[Senate Hearing 106-367]
[From the U.S. Government Publishing Office]
S. Hrg. 106-367
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES 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. 2684/S. 1596
AN ACT MAKING APPROPRIATIONS FOR THE DEPARTMENTS OF VETERANS AFFAIRS
AND HOUSING AND URBAN DEVELOPMENT, AND FOR SUNDRY INDEPENDENT AGENCIES,
BOARDS, COMMISSIONS, CORPORATIONS, AND OFFICES FOR THE FISCAL YEAR
ENDING SEPTEMBER 30, 2000, AND FOR OTHER PURPOSES
__________
Corporation for National and Community Service
Department of Housing and Urban Development
Department of the Treasury
Department of Veterans Affairs
Environmental Protection Agency
Executive Office of the President
Federal Emergency Management Agency
National Aeronautics and Space Administration
National Science Foundation
Nondepartmental witnesses
__________
Printed for the use of the Committee on Appropriations
Available via the World Wide Web: http://www.access.gpo.gov/congress/
senate
______
U.S. GOVERNMENT PRINTING OFFICE
54-239 CC WASHINGTON : 2000
_______________________________________________________________________
For sale by the U.S. Government Printing Office
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ISBN 0-16-060224-6
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 DORGAN, North Dakota
LARRY CRAIG, Idaho DIANE 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 VA, HUD, and Independent Agencies
CHRISTOPHER S. BOND, Missouri, Chairman
CONRAD BURNS, Montana BARBARA A. MIKULSKI, Maryland
RICHARD C. SHELBY, Alabama PATRICK J. LEAHY, Vermont
LARRY CRAIG, Idaho FRANK R. LAUTENBERG, New Jersey
KAY BAILEY HUTCHISON, Texas TOM HARKIN, Iowa
JON KYL, Arizona ROBERT C. BYRD, West Virginia
(ex officio)
Professional Staff
Jon Kamarck
Carolyn E. Apostolou
Cheh Kim
Paul Carliner (Minority)
Administrative Support
Joseph Norrell
Liz Blevins (Minority)
C O N T E N T S
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Thursday, March 4, 1999
Page
Federal Emergency Management Agency.............................. 1
Thursday, March 11, 1999
Corporation for National and Community Service................... 77
Department of the Treasury: Community Development Financial
Institutions Fund.............................................. 181
Thursday, March 18, 1999
National Aeronautics and Space Administration.................... 197
Tuesday, March 23, 1999
Executive Office of the President: Office of Science and
Technology Policy.............................................. 307
National Science Foundation...................................... 307
Thursday, April 15, 1999
Department of Veterans Affairs................................... 375
Thursday, April 22, 1999
Department of Housing and Urban Development...................... 475
Thursday, April 29, 1999
Environmental Protection Agency.................................. 609
Executive Office of the President: Council on Environmental
Quality and Office of Environmental Quality.................... 839
Material Submitted by Agencies Not Appearing For Formal Hearings
Independent Agencies:
Department of Health and Human Services...................... 865
American Battle Monuments Commission......................... 870
Chemical Safety and Hazard Investigation Board............... 873
Consumer Product Safety Commission........................... 880
Court of Appeals for Veterans Claims......................... 883
Department of Defense--Civil: Cemeterial Expenses, Army...... 886
Federal Deposit Insurance Corporation: Office of the
Inspector General.......................................... 894
National Credit Union Administration......................... 895
Neighborhood Reinvestment Corporation........................ 897
Selective Service System..................................... 902
Community Development Financial Institutions................. 905
Nondepartmental witnesses:
Department of Veterans Affairs............................... 907
Department of Housing and Urban Development.................. 934
Environmental Protection Agency.............................. 964
Federal Emergency Management Agency.......................... 1039
National Aeronautics and Space Administration................ 1054
National Science Foundation.................................. 1060
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
THURSDAY, MARCH 4, 1999
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:33 a.m., in room SD-192, Dirksen
Senate Office Building, Christopher S. Bond (chairman)
presiding.
Present: Senators Bond, Stevens, and Mikulski.
FEDERAL EMERGENCY MANAGEMENT AGENCY
STATEMENT OF JAMES L. WITT, DIRECTOR
ACCOMPANIED BY:
MIKE WALKER, DEPUTY DIRECTOR
GARY JOHNSON, CHIEF FINANCIAL OFFICER
CARRYE BROWN, ADMINISTRATOR, U.S. FIRE ADMINISTRATION
OPENING STATEMENT OF SENATOR CHRISTOPHER S. BOND
Senator Bond. Good morning. The subcommittee will come to
order. Today we begin the deliberation of the fiscal year 2000
budget for the VA, HUD, and Independent Agencies Subcommittee.
This morning we will hear testimony on the Federal Emergency
Management Agency's request. We welcome Director James Lee
Witt; FEMA's new Deputy Director and former Acting Secretary of
the Army, Mike Walker; and Gary Johnson, FEMA's Chief Financial
Officer.
The good news this morning is that we have not had many
large-scale disaster events this year. Unlike last year when
FEMA personnel were spread across the country responding to El
Nino-related weather events, this year has been relatively
quiet. Disaster cost projections to date fall below the 5-year
historical average and we do not anticipate the need for a
supplemental for the disaster relief fund, reversing a long-
term trend. As of the end of January, FEMA had $2.3 billion in
unobligated disaster relief funds.
The bad news is that once again we face a very tough battle
in the Appropriations Committee. The budget caps put in place
by the 1997 Balanced Budget Act are extremely tight. Spending
available for discretionary programs overall is $30 billion
below the current year level. Unfortunately, the President's
budget busted those caps by about $18 billion by assuming
offsets from tobacco revenues, Superfund taxes, and other
gimmicks which frankly have little or no chance of flying
whatsoever. This makes our job harder because it raises
expectations that we simply will not be able to fulfill.
Within the VA-HUD Subcommittee, we have identified several
areas of shortfall in the President's request. The largest such
shortfall is within the VA medical care appropriation request
which would be frozen at current levels, despite the fact that
VA has identified many new requirements, such as treating
patients with hepatitis C. VA estimates are that this problem
alone will cost at least $500 million next year. Once again we
will be forced to make some very difficult trade-offs in order
to accommodate the dire needs.
I congratulate you, Director Witt, at your success in the
internal budget process at OMB. It is always nice to see who is
a winner in that internal battle, and your star must be at the
peak. While the VA-HUD Subcommittee portfolio would decline
$1.7 billion overall under the President's budget request, OMB
has smiled upon you and FEMA's budget would increase $84
million, or 10 percent over the current year, for a total of
$923 million. Do not count on that coming through the full
process necessarily.
FEMA proposes several new programs, such as a new $12
million repetitive loss initiative aimed at eliminating those
properties with significant repeat claims posing the biggest
drain on the flood insurance fund, and a new flood map
modernization fund to update and digitize FEMA flood maps.
These programs, accompanied by some new requirements on
policyholders currently under consideration, would help put the
flood insurance program on a more sound footing. And I agree
that is an urgent need. Nevertheless, I have grave reservations
about a FEMA proposal for a mortgage fee to finance those
requirements.
There are also significant program enhancements proposed in
the budget, such as the $25 million increase for the emergency
food and shelter program, the $13 million increase to augment
various activities at the U.S. Fire Administration, the $13
million increase for anti-terrorism activities, which my
ranking member and I have supported very strongly in the past,
and additional funding for State preparedness activities. I
also recognize and express my appreciation that FEMA's budget
includes full funding of $5.9 million for the dam safety
program, an increase of $2 million over the current level.
Let me be quite clear. These are all critical activities
which we support. However, the constraints imposed by the
budget caps will make these demands quite difficult to fund
fully. We will have many questions on each of these funding
proposals as we seek to ascertain the priorities.
In addition to FEMA's request for $923 million in
discretionary appropriations, FEMA proposes $2.48 billion in
off-budget disaster relief contingency funds. It is, frankly,
very disappointing to me that once again the administration has
chosen not to budget for these anticipated requirements under
the budget caps. We know we will have disasters next year, and
we know that the funding requirement will be several billion
dollars. That is no mystery. We should budget for those
requirements up front.
Among the items not approved by OMB in FEMA's original
budget proposal was a new mitigation grant program for
universities which totaled $175 million in your proposal. OMB
approved instead a $1 million study of such a program. I have
already heard from a very important constituent in Missouri,
Washington University in St. Louis, about their support for
such an initiative. While clearly it is in the Nation's
interest to protect our significant investment in university
research, it would be tremendously difficult for us to find the
funds for such a massive new spending program.
There are many other areas we have a particular interest in
this morning. At the top of the list is the Y2K computer
problem that my ranking member will be addressing. It is my
understanding that the National Association of Counties
completed a survey in December which found that roughly half of
the 500 counties which participated in the survey do not have a
county-wide plan for addressing Y2K conversion issues. Almost
two-thirds had not yet completed the assessment phase of their
Y2K work. That is not encouraging, and that shows a potential
problem.
FEMA's role, relative to Y2K, is consequence management,
and the agency received over $7 million through OMB from the
Y2K contingency funds. We look forward to hearing what FEMA is
doing to prepare for and minimize Y2K-related emergencies,
particularly in the emergency services sector.
We also look forward to hearing what FEMA is doing to
improve the level of preparedness at the State and local level
for acts of terrorism. FEMA is one of many agencies involved in
this effort, perhaps too many. Unfortunately, my concern is
there does not appear to be a strategic approach to this
critical issue and that the roles of FEMA, DOD, and the
Department of Justice remain confusing.
We do not have a good handle on what remains to be done to
ensure the readiness not just of the major metropolitan areas,
but the country at large. In testimony before the House
Government Reform and Oversight Committee last year, GAO raised
many concerns about the Nation's domestic preparedness program
for terrorism and it is urgent these issues be addressed.
We also remain concerned about the disaster relief program.
You and I have talked over the years about escalating costs of
disaster relief and the need to tighten up this program. Since
1989 we have spent $25 billion on FEMA disaster relief and
there remains more than $2.6 billion in anticipated costs
associated with open disasters.
Mr. Witt, I commend you for a number of the initiatives you
have implemented to improve the program, such as reengineering
the public assistance program and the concerted effort to close
out old disasters, which has returned hundreds of millions of
dollars to the Disaster Relief Fund. This effort, spearheaded
by Mr. Johnson, is in large part our reason for not needing to
provide additional supplemental appropriations for FEMA in
fiscal year 1999, and we acknowledge your good work in this
area.
We also recognize that you have proposed criteria for
declaring disasters. I appreciate your effort here,
particularly in the face of strong resistance in various
quarters. Unfortunately, I am concerned that the criteria are
no more stringent than the factors currently used to consider
whether a disaster should be declared and do not take into
consideration a State's economic health or the ability to raise
public revenues to cover the cost of a disaster.
Much remains to be done to eliminate the loopholes and
streamline the program, both through the regulatory process and
through legislation. We understand you plan to go forward with
a requirement that public facilities be insured at least to 80
percent of their replacement value. I would urge you to move
expeditiously with that rulemaking which should result in
savings to the Disaster Relief Fund.
You may recall that in last year's Senate committee report,
we asked for a report, now due within a few weeks, of FEMA's
effort to propose through regulation administrative changes to
reduce disaster relief costs. We hope we can see that report
shortly.
With respect to the Stafford Act legislation, FEMA just
yesterday submitted another legislative proposal to OMB which
includes several important proposals such as authority to
reduce the Federal share of public assistance for projects
which have incurred multiple losses. And I appreciate your
diligence in again proposing legislative improvements.
However, the package does not contain many of the proposals
that were in the July 1997 set of proposed amendments and we
need to understand why. Also, we urge you to work aggressively
with the committees of jurisdiction to move legislation that
would tighten up the Stafford Act, further streamline the
program, and reduce disaster relief expenditures.
With respect to mitigation activities, there are a number
of concerns we have and some questions, concerns about the way
the 404 hazard mitigation grant program is working, whether
adequate cost-benefit procedures are being utilized, and
whether these dollars are being put to the best uses. We have
asked GAO to provide testimony for the record today, which I
have reviewed and which will be inserted in the record
following my opening statement, without objection, and ask that
FEMA consider and respond to the issues raised by GAO.
Last year we expressed concern about the need for improved
interagency coordination on disaster preparedness, response,
recovery, and mitigation activities. We continue to have strong
concerns in this area. It is my understanding that despite
language in the appropriations bill for the past several years
requiring the close involvement of FEMA and other agencies in
the distribution of emergency HUD CDBG monies for unmet needs,
HUD has refused to follow the law's requirements. I am
mystified as to how the initial round of funds from the fiscal
year 1998 supplemental were distributed.
This afternoon the full committee will mark up an emergency
supplemental bill, and while there will not be any funds for
FEMA disaster relief, I have asked to transfer to a new account
at FEMA from HUD's emergency CDBG funds unobligated balances
totaling over $313 million. That is in direct response to our
concerns with how HUD has handled these funds. Given your track
record, Mr. Witt, it is my expectation that FEMA will move out
with funds in an expeditious manner after careful consideration
of needs, priorities, and appropriate mitigation strategies. We
expect FEMA to follow closely the detailed legislative
requirements we will include for allocation of the funds and to
keep us apprised on a regular basis.
While I am very much concerned about expanding FEMA's roles
and responsibilities, particularly without an explicit
authorization, there is significant demand to address so-called
unmet needs following recent disaster events. I strongly
believe that, along with Stafford Act proposals currently on
the table, the authorizers should look at this issue. Early
this week I sent a letter to the chairman of the EPW Committee
and the subcommittee chairman, Senators Chafee and Inhofe,
asking them to consider this issue along with other cost-saving
and streamlining reforms.
In report language last year, we asked FEMA to convene an
interagency group to assess areas of duplication and overlap,
propose the streamlining of activities, and define clearly
areas of responsibility among agencies. This report is due
within a few weeks, and we look forward to getting a preview of
that effort.
Other areas of interest include FEMA's plan to implement
the recent Blue Ribbon Panel recommendations to improve the
U.S. Fire Administration and FEMA's efforts to consolidate
further the non-disaster grants that go to States and whether
there is adequate accountability in exchange for the increased
flexibility provided to States.
It is now a pleasure to turn to my ranking member, Senator
Mikulski, for any statement she may have.
emergency supplemental
Senator Mikulski. Thank you, Mr. Chairman. Before I give my
opening statement, I note that the chairman of the full
Appropriations Committee is here. I would be happy to yield to
him because I know he has other duties, if he wishes to give a
statement.
I also would like to thank the chairman of the
Appropriations Committee as we move into the supplemental as we
met our supplemental emergency needs. This year the VA-HUD
Subcommittee was not raided. As you know, we have often been
viewed as the ATM machine for emergency supplementals. This
year that dangerous trend I think from a fiscal standpoint has
reversed. I really thank you for doing that.
If you wish to make a statement, recognizing your other
obligations, I would be happy to yield to you.
STATEMENT OF SENATOR TED STEVENS
Senator Stevens. Well, you are very kind. I thank you,
Senator Mikulski. As a matter of fact, we have three
subcommittees meeting at the same time, and I have got another
hearing of my own. So, I do appreciate the opportunity to be
here to greet James Lee Witt and his colleagues.
First, let me thank you for the prompt action on setting up
the task force for our western Alaska fish disaster. I have
heard from many of the Eskimo families out there. They would
not have survived the winter had you not moved as expeditiously
as you did.
We have one issue in Alaska that I wanted to call your
attention to. The Corps of Engineers built the Moose Creek Dam
upstream from North Pole, Alaska. It is not quite the North
Pole, but it is pretty far north. It has resulted in downstream
flooding of about 50 homes, and it has been rezoned now so
there will be no new homes. What is needed is some modification
of these homes to prevent the additional flooding. I would like
to see if you would work with us on that.
disaster insurance
But that leads me into another thing, Mr. Witt. I was
fortunate enough to ride with a friend on his boat through the
inland waterway, and as we went down from Virginia on down to
the Carolinas and Georgia, through that wonderful country, we
just saw repeated areas which had been hit by either floods or
hurricanes.
The interesting thing about that for someone who is not
from the area is the vision of the fickleness of these
disasters. Portions were destroyed and others not touched. It
is just like some of the fires up our way, as the swath of fire
comes through and destroys areas and others are left untouched.
I really admire this new initiative of yours, talking about
the flood plain. I would hope that perhaps we could expand that
to cover areas where we have had multiple disasters. I am
thinking we should ask the people in the authorizing committee
on HUD to see whether we should have Federal insurance for
homes that are in areas that have been repeatedly subject to
fire or flood or hurricane, and if we do, whether or not we
should not require some specific types of protections.
I noted along the inland waterway how many of the newer
homes have been lifted up, some as high as 10, 12, 14 feet.
Well, that just means those homes that were not hit last time
are going to get it for sure the next time because they do not
have that protection.
It just seems to me we ought to further your initiative on
preventive medicine in this area of disasters where we are
spending so much of the taxpayers' money repeatedly in the same
areas. I think this committee would be very much inclined to
work with you and to work with the authorizing committees to
give you even more authority. But somehow or other, between
your agency and HUD, we ought to move out. As the chairman
said, we have not had too many of these disasters this year.
Maybe this is the year to move out and try to spend some money
to prevent future disasters of the type that we have faced in
the last few years.
That is particularly so in the flooded areas. One fellow
told me his place had been hit by floods three times, and he
just rebuilt it at taxpayers' expense really in effect. So, I
think we have to find a way to deal with this on a preventive
basis.
I really congratulate you for taking the initiative on
that. What I would like to do is just broaden the horizon a
little bit and take it beyond just the flood plain. I would be
happy to talk to you about that another time.
Thank you very much for your courtesy.
Senator Bond. Thank you, Mr. Chairman. I had mentioned to
Mr. Witt there were media articles on repeated disasters
striking particularly along the Outer Banks. If they are
secondary homes, I have a real question why we as taxpayers
need to continue to rebuild them when they are built in areas
which are subject to hurricanes, flooding, and other natural
disasters. We worked in the flood insurance reform to get
people out and make them take certain protective steps and have
actuarially sound insurance. Frankly, you have put your finger
on another very serious problem.
Senator Stevens. Well, I spent part of my time in
California, and I remember fires when I was a boy in the Santa
Monica Canyon and slides and those homes were all rebuilt. I
guess they have been rebuilt 8 or 10 times since then. I really
think we have to have greater protection for the taxpayers.
Most of those are, in fact, recreation homes that we are
talking about, second homes. But there has to be some way to be
fair about it and at the same time start preventing future
losses to the taxpayers.
Thank you very much.
y2k hearing
Senator Mikulski. Before the chairman goes, if I just might
say Senator Bond and I will be talking about Y2K and counter-
terrorism here. One of the things we were discussing is perhaps
the need for a joint hearing between Defense, VA-HUD with FEMA,
HHS, and CJS, and we would like to discuss this with you.
Senator Stevens. You are talking about the full committee.
Senator Mikulski. Let us do the full committee.
Senator Stevens. Anytime you say.
Senator Mikulski. Because we have got a lot of money going
out there and some wisely focused and some, quite frankly, like
the Keystone Cops.
Senator Stevens. I will be happy to do that anytime and be
sure we get the other chairmen and ranking members from those
subcommittees involved.
Senator Mikulski. Well, Senator Gregg has been deeply
involved.
Senator Stevens. Good. We will plan it. Thank you very
much.
Senator Bond. Senator Mikulski.
STATEMENT OF SENATOR BARBARA MIKULSKI
Senator Mikulski. Thank you very much, Mr. Chairman.
Once again, I am happy to join with you at really our first
hearing of VA-HUD for fiscal year 2000. It is hard to believe
that we are actually going to do a fiscal year for the new
century and the new millennium. So, this really has to be I
think a well-focused appropriations that looks not only at the
immediate needs of our constituencies, but also the long-range
needs of the Nation, which is why it is so important we do
this.
In a post-impeachment environment, everybody is talking
about the new-found comity and bipartisanship, and we have been
doing that for a long time together, and I look forward to our
continued relationship to move the bill. Though you and I would
disagree with President Clinton's agenda and President
Clinton's budgetary arithmetic, I do think we do agree on so
many things in this bill, and I believe even now with the
issues that you have raised in your opening statement, I find
myself so much in alignment with the questions that you have
raised. So, I look forward to working with you.
Mr. Witt, I want to thank you and the entire FEMA staff for
their continued dedicated response to the various disasters
within our Nation. FEMA has been absolutely upgraded, and I
think we all know that if a Governor calls or disaster hits,
that FEMA will be a 911, ready to be able to respond.
We really admire that and want to continue both the funding
sources as well as the culture of FEMA that you have
established, but we now also want to institutionalize this so
it is not based on one person's response or one person's
directive. We believe in this appropriation, we have a great
opportunity.
disaster prevention
First, let me comment on the disaster aspects. I come from
a background, as you know, of social work, of community
organization, organizing people for self-help. I have a great
passion for the field of public health, and what they say in
public health is the best action is always prevention. In the
field of public health, they do an audit of what people are
most likely to have happen, what diseases will most attack
children or the elderly, and they develop an immunization
strategy. And this is what I am looking for in the pre-disaster
mitigation effort, which is essentially almost like using the
tools of epidemiology, where are the problems, what is the
concrete, specific data, and then where do we need to immunize
ourselves so we are not hit by a tragedy.
So, therefore, in looking at the pre-disaster mitigation,
we do not want to create a big program. We do not want it to be
pork barrel. We do not want a new kind of local entitlement
program where we are either FEMA's CDBG or FEMA revenue sharing
by proxy. I think we are clear on that.
What we are looking forward to do is how we can, in an
organized, systematic way, identify those communities that are
most at risk in terms of loss of life and loss of property to
be able to deal with that.
I understand from a preliminary look at data there are
76,000 buildings that have repetitive losses, more than two
loss claims in 10 years and they have cost the Federal
Government $2.8 billion.
We look forward to hearing your action plan based on that
prevention model that does not create again a whole new fiscal
black hole where suddenly--and Senator Bond will know this --
there will be what we will call Project Impact creep so that
something 100 miles away from a flood plain suddenly somebody
at a local level is trying to put into it. So, we look forward
to that.
We also look forward to the issue that will not get a lot
of attention but the necessary mapping of flood plains because
that again is an important tool to do the prevention strategy.
We know our colleague in State, Justice, Commerce is going to
be looking at the same issue for NOAA and coastal plains, but
you would have rivers and other aspects. So, we look forward to
supporting you on that.
Also in terms of the emergency shelter grants, we want to
again work with you because we know that the emergency shelter
grants, particularly working through faith-based groups like
Catholic Charities or nonprofits, that we have really gotten
out and met compelling human need.
In the appropriations markup this afternoon, I support
Senator Bond's effort to see that you have the emergency CDBG.
It is going to raise a lot of hackles, but we have got to be
able to respond. I do not want a Maine in Maryland.
y2k and counter-terrorism efforts
This takes me then to the new issues. First, I am very
concerned about the issue of Y2K and also about the issue
around counter-terrorism. I will elaborate on those in my
questions, but I think we have got to be right and clear on our
response on Y2K as a building block to be ready for counter-
terrorism response. I understand from my State-Justice hearing
that Justice is responsible for crisis management. You are
responsible for consequence management, but the consequence
management could be the same. Therefore, we will be looking
forward to hearing this.
We want to compliment Senators Bennett and Dodd for their
work on the Y2K, but now that we have done the analysis, I do
not want to see States being in paralysis over Y2K. Sometimes
we analyze, then we get paralyzed, and I do not want that. So,
I am going to be asking you questions on Y2K because, quite
frankly, I am very concerned about power outages, the failure
of people to have access to money, food, medicine, and then
panic occurring resulting in civil unrest.
The other is I am concerned about pre-panic because the
talk shows could take over and hype it. We are already seeing
the concern about food, bottled water. Some people are buying
gold. Our colleague, Senator Frist, talked about an elderly
citizen who got so jazzed by a radio show, he took $30,000 out
so that he could have it at home in the anticipation of New
Years Eve only to be robbed. When I talk about our prevention
strategy, part of it is preventing a breakdown of services to
people, not only your services, but the basic services. But we
also need to have our strategies so that we do not have panic
and pre-panic.
Then that, of course, will take us to the terrorism
response. We will get into questions.
report on the national fire academy
Then I want to just comment quickly about the Fire Academy.
I read that report. First of all, I would like to compliment
you on your leadership in commissioning that report. That Fire
Academy is located in Maryland. It was really Senator Mathias,
my predecessor, who was an appropriator, who helped do that.
Now, I want that Fire Academy to be a world class Fire
Academy that meets not only the needs of our Nation, but they
want to come from around the world to learn best practices for
really being able to respond. And those fire fighters are first
responders.
When I read that report that you had to have a report to
tell them how to talk with each other, it bothered me. And then
the fact that they had no relationship to the fire fighting
community really escalated my concern. And last, but not at all
least, they had no consciousness or awareness about these new
threats to the security and stability of our country. I found
it deeply and profoundly troubling. I would like to pursue that
with you and hear your action plan so that we can get it right.
So, that is kind of my framework of kind of how to proceed
with you. Thank you again for your hard work. Obviously, you
have got a plan here that wants to be a step ahead of the
problem, whether it is helping the first responders be ready to
respond or preventing the loss of life and property.
Mr. Chairman, I am ready to go to questions, and thank you
very much.
Senator Bond. Thank you very much, Senator Mikulski. I
thank you for your kind words about our being in agreement on
so many issues. I assure you it is because I have learned many
of these issues and the questions from you. That is why I
appreciate so much your service and leadership on this
committee.
Well, Mr. Witt, you have now got a pretty good idea of our
concerns. Maybe it is appropriate we turn to you and hear what
you have to say. So, thank you for joining us.
statement of james l. witt
Mr. Witt. Thank you and good morning, Mr. Chairman, and
good morning, Senator Mikulski.
I really do appreciate the opportunity to be here today at
this subcommittee hearing to present our budget proposal for
fiscal year 2000. I really, truly want to thank your staff for
the work that they have done with us and the support that they
and you have given us. It truly has made a difference for us.
We are proud of our work. We are proud of the FEMA
employees and what they have done, and they continue to work
very hard and are very dedicated.
My statement this morning is going to be very brief so that
we can get to the questions.
We have made improvements not only in the delivery of
disaster services, but improvements in the management and
accountability of FEMA's programs. This has made a huge
difference for us and the States and local emergency
management. I am particularly pleased to note that our
Inspector General has completed the review of FEMA's financial
statements, and has rendered an unqualified opinion on all of
our financial statements, which we are very proud of. Much of
the credit goes to Gary Johnson and his staff for what they
have done. I thank them for that and they have done a great job
and have worked very hard on these statements.
Gary Johnson is here with me today, as you stated, Mr.
Chairman, and our Deputy, Mike Walker, my partner in FEMA.
Also, I want you to meet the Fire Chief from Farmington Hills,
Michigan, Rich Marinucci, who will be working with us for the
next several months. Rich, do you want to raise your hand? He
is going to be working with us on the implementation plan based
on the Blue Ribbon Panel report. Rich is very well respected
across all fire services, and we are honored to have him
helping us with this. He will be working with Carrye Brown, the
U.S. Fire Administrator, and myself to have the very best fire
service programs that we can have.
Mr. Chairman, this budget is not a ``disaster budget,'' we
hope. Instead it focuses on prevention for the future. As we go
into the year 2000 and the 21st century, I think that is
important to stress smarter government and more community
responsibility. I think this budget is the blueprint for the
future, including the effective and efficient use of new
technologies. The three fundamental principles driving this
budget are that prevention works, that we can work even smarter
and more efficiently, and that the communities need to be
empowered to take personal responsibility. Instead of just
responding to disasters we can do more in the area of
prevention, and that is what we want to do.
prepared statement
So, Mr. Chairman, we will be happy to answer your
questions.
[The statement follows:]
Prepared Statement of James L. Witt
Good Morning Mr. Chairman, Good Morning Senator Mikulski. I
appreciate the opportunity to appear before the Subcommittee today to
present our budget proposal for fiscal year 2000.
I want to thank the Members of the Subcommittee for their support
of FEMA's programs and for all the time that the Members and staff have
provided in reviewing our programs.
We are very proud of our work at FEMA--not only in our successful
delivery of disaster services but also in the improved management and
accountability that we have brought to FEMA's programs. I am
particularly pleased to note that our Inspector General has just
completed his review of FEMA's Financial Statements and rendered an
unqualified opinion.
Much of the credit for putting our financial house in order goes to
Gary Johnson, my Chief Financial Officer, who is with me today. I'm
also pleased to be accompanied by the rest of my senior staff from
FEMA.
One member of my staff who this Subcommittee hasn't met before is
my new Deputy, Mike Walker. You may know Mike from his work as a Deputy
Secretary of the Army and prior to that for his work in the Senate on
Appropriations. We are very pleased to have Mike as a part of our team.
Also joining us for the next several months is Chief Rich Marinucci
from Farmington Hills, Michigan. Rich will be working with Carrye
Brown, Administrator of the U.S. Fire Administration, to implement some
of the changes recommended by our Blue Ribbon Panel.
This is a strong and dedicated group and I am happy to have them
working with me. It is a team that, with the support of the
Administration and the Congress, has made America and Americans much
safer. So much of what we have done in changing the face of emergency
management could not have been accomplished without the help of
Congress. In our visit today, I would like to share with the members of
this subcommittee examples of how Congress has enabled FEMA to improve
our programs and the manner in which we serve the public. I will also
highlight ways in which we are asking for continued support from
Congress to do more. I will be talking about just how far we have come,
where I believe we need to be going, and how I propose that we get
there.
What I am placing before you today is not a disaster budget, but a
prevention budget. The keys to saving lives and reducing the cost of
disasters are prevention, smart government and community
responsibility. We have to be willing to go after long-term savings
that result in safer communities for years to come.
I would not only like to demonstrate some of the successes that we
have realized, but more importantly I would like to discuss our
blueprint for the future. This blueprint, like all good building plans,
has been shaped by the lessons we have learned and will be implemented
using the most effective and efficient techniques and technologies
available to us. The three pillars upon which we are building are the
lessons that: prevention works; that we can work even smarter and more
efficiently; and that communities need to be empowered to take personal
responsibility.
The fiscal year 2000 budget is built upon those three pillars. I
would like to highlight some examples of how we have laid the
foundation for these three principles already and I'd like to discuss
how together with your help and this fiscal year 2000 budget, we will
take FEMA and emergency management in this country to the next level.
Instead of responding to disasters, we must prevent them instead of
waiting to react, we must prepare NOW for the next flood, hurricane,
fire or earthquake. We are shifting to proactive prevention.
In this budget we are asking that the Administration and Congress
invest new resources in our mission to buyout repetitive flood loss
properties--as a matter of prevention; to invest in mapping
modernization--that will help FEMA, the States, and local communities
work smarter and more efficiently; and once again to invest in pre-
disaster mitigation--which is an investment in prevention that supports
personal responsibility empowered at the community level. These are
investments that will save hundreds of lives and billions of dollars
worth of property and personal belongings, as well as help us to
further reduce disaster costs.
FEMA's progress during this Administration has been built on the
pillar of prevention. I'd like to share with you a few examples
demonstrating that prevention works. Alabama experienced severe
flooding in March 1990 when 6,000 people lost their homes and Statewide
damage estimates totaled more than $100 million. In June 1994, Alabama
was hit by Tropical Storm Alberto and again devastating floods left a
trail of flooding destruction along the Pea and Choctawhatchee Rivers.
Small towns along these waterways like Elba and Geneva were hit
particularly hard.
Following the 1994 floods, Geneva officials began an aggressive
campaign to convince homeowners in the most flood prone area of their
community to relocate outside of the floodplain area. The community
applied for and received funding from FEMA to acquire 54 homes.
At this time last year a heavy storm from the Gulf of Mexico moved
inland across the United States. Torrential rains swept through the
region and caused serious flooding in several Alabama counties. Of the
54 homes identified for purchase through the FEMA grant, 30 had
actually been acquired by March 1998. FEMA's benefit-cost analysis
determined that for an upfront investment of $672,000 to acquire the
properties, over $1.4 million in damages and losses were avoided,
that's $2 saved for each $1 invested--that is the hallmark of
mitigation.
All of the acquired structures lay deep in the floodplain, and
would have been flooded had they remained in the flood-risk zone. If
these buildings had been merely replaced after the 1994 flood, many
would have been severely damaged or destroyed in 1998.
The program that funded this property acquisition was our Hazard
Mitigation Grant Program. This is a program that delivers the bulk of
mitigation assistance to communities following disasters so that they
may better survive the next storm. We may not have had the resources to
do this without the Volkmer Amendment of 1994 that increased the
resources available for this purpose. Unfortunately, funding for this
program is generated following a Presidentially disaster declaration--
after something bad has already happened to a community.
I want to expand a program that we already have to address the
problem of properties suffering repetitive flood losses. For fiscal
year 2000, we are requesting that an additional $12 million be
appropriated to the Flood Mitigation Fund which Congress established
through the Flood Insurance Reform Act of 1994 to accelerate the
process of removing repetitive loss homes from our flood insurance
rolls. This appropriation would give us a total of $32 million to make
a real impact on this recurring problem. Mike Armstrong, our Associate
Director for Mitigation, and Jo Ann Howard, our Insurance
Administrator, are working hard to make this happen.
As many of you know, the National Flood Insurance Program (NFIP)
collects fees and policy premiums from homeowners with properties in
floodplains and some homeowners with properties outside flood plains
who want flood insurance protection. Each year the insurance fund pays
out more than $700 million to policyholders who have suffered losses
due to flooding. Of this $700 million paid out annually, $200 million
of the payouts are to policyholders who have already suffered at least
one other loss during the past 10 years. By targeting the repetitive
loss properties first, we can save the insurance fund these unnecessary
annual losses and, more importantly, we can move the individuals who
are suffering the most out of harm's way.
Up to $20 million collected in fees from policyholders in 2000 will
be used to buy out or elevate properties or take other sound mitigation
measures, in every State in the nation. In fiscal year 1999, I asked
that we concentrate as much of the $20 million as possible to buy out
or elevate properties that have suffered multiple losses. We plan to
continue to target the $20 million to repetitive loss properties in
fiscal year 2000. But, this $20 million is not enough to really get at
the heart of the problem.
We estimate that there are over 35,000 properties with more than
one loss. Of this amount, about 8,000 have suffered four or more losses
over the past ten years or at least two losses that totaled more than
the value of the entire house. To start making a significant impact on
the repetitive loss properties, we are requesting an appropriation to
use in concert with the $20 million generated from the flood fund.
To eliminate the 8,000 properties with four or more losses or two
losses totaling more than the value of the house, it would cost nearly
$300 million. Our fiscal year 2000 budget request includes $12 million
that would allow us to get at the 270 worst properties. Buying out the
270 properties would save over $2.6 million in the first year and a
projected savings exceeding $27 million over the next 15 years. That's
a $12 million investment resulting in a $27 million savings!
In order to further protect against flood risks, we need to
continue to ensure that our nation's dams are safe. The National
Inventory of Dams classifies nearly one-third of the nation's 75,000
dams as either ``High Hazard'' or ``Significant Hazard.'' This
classification does not mean that nearly one-third of the dams are
likely to give way in the near future. It does mean, however, that a
problem with any one of these dams will result in loss of life or at
the very least, cause a significant economic impact on the surrounding
community. To help guard against problems at our nation's dams, our
fiscal year 2000 request fully funds the dam safety program to the
authorized level.
Finally, in the area of prevention, our budget also includes a $1
million request for a pilot program designed to help make our colleges
and universities more disaster resistant. With so many billions worth
of Federal funding going to higher education institutions for research,
it is very important that we help these schools mitigate against future
disasters in order to protect the Federal government's investment.
The second pillar of our blueprint for the future supports our
effort to get people out of harm's way by implementing methods to work
smarter and more efficiently. One important way of doing this is
through better flood maps.
We are proposing this year an aggressive map modernization effort--
bringing our flood maps up to date and digitizing them so they will be
both more accurate and easily available to communities. We are asking
for a $5 million appropriation in start up funds until we can generate
a steady stream of funding for the program.
That steady stream of funding, and our proposal to put a $15 fee on
all mortgage transactions to produce that funding, are issues I suspect
we might discuss a little bit today. I welcome that discussion because
these maps are important to ensure that the future growth and
development in our country is done based on the best information
available.
As many of you know, FEMA's flood maps are used for several
different purposes. Some of the main users are mortgage lenders who use
them when a house is purchased to determine whether or not the property
is within a flood plain. If a property is likely to be flooded sometime
in the future, the lenders require the homebuyers to purchase flood
insurance. In addition to lenders, flood plain managers, States,
communities, surveyors and insurance companies use the maps for
different purposes.
Currently, we spend about $50 million annually from the flood
insurance fund to pay to update the flood maps. Unfortunately, at this
funding level, we have fallen behind in producing new maps. Most of the
$50 million is actually spent amending the old maps rather than
creating entirely new maps. Nearly our entire map inventory is on paper
or plastic panels. We would like to be able to digitize our maps so
that they are easier to update and transport. The Technical Mapping
Advisory Panel, a group of map experts from government and the private
sector, recently endorsed our map modernization plan in its annual
report.
Figuring out how to pay for updated maps and who should pay for
them are difficult questions. To update all of our maps, we estimate
that it will cost nearly $900 million and take more than seven years to
complete. The $50 million currently spent on updating maps comes from
insurance premiums and fees collected from homeowners who purchase
flood insurance. This does not seem fair for the policyholders as many
people and businesses benefit from up-to-date maps, while only flood
insurance policy holders are paying for them.
Because last year's subcommittee report asked us to identify a
creative way to find funding for updating maps, we came up with the
idea of assessing a $15 fee on every federally backed mortgage
transaction. Proceeds from the fee will go into a Map Modernization
fund that will allow us to start updating and modernizing our map
inventory. By charging the fee on mortgage transactions, we will not be
putting an additional burden on the flood insurance policy holders.
Also, and I want to emphasize this very strongly, I want these maps
to become the community's maps, not just FEMA's maps. I have been
working closely with our Associate Director for Mitigation, Mike
Armstrong, to get funding out to communities to do this mapping
themselves. It is time that communities contribute resources to produce
better maps instead of spending money to fight the maps at the end of
the process.
Although the $15 fee will have some opposition, nearly everyone
agrees that we need to update the maps. We look forward to working with
you to identify the best solution.
Aside from my desire for us to have better maps, the Agency has
already made great strides in the area of working smarter and more
efficiently. These efforts have already been demonstrated through
several efforts to streamline the delivery of disaster assistance and
by incorporating better business practices.
Our program for assisting communities whose public infrastructure
has been damaged during a disaster has been streamlined as a result of
the recent business process re-engineering effort. Working with our
customers in State and local emergency management we have simplified
the method for getting aid to communities for the repair of their
public roads, bridges, and other critical infrastructure so that they
can begin to recover soon after a disaster strikes. Again, we
appreciate the support of the Appropriations Committees and support of
the Stafford Act authorizing committees.
The final step in the grant delivery process would be further
streamlined if FEMA were permitted by law to settle with applicants on
the basis of estimates, as is accepted industry practice. This would
speed closeout of disasters, improve project management and
significantly economize the use of Federal and State resources. We will
be pursuing this change in legislation this year.
For the first time ever, in 1999 we published an administrative
rule in the Federal Register that identifies criteria that must be
considered when evaluating whether an incident should be declared a
disaster. The criteria is tied to the CPI so that it adjusts annually.
By implementing this rule, we are helping ensure that disaster
declarations are consistently applied in every State.
When I testified before this Subcommittee last year, I told you
that we were going to emphasize closing out the books on older
disasters as quickly as possible. By the end of fiscal year 1998, the
Territorial Closeout Teams that were established under the leadership
of our CFO, Gary Johnson, have reduced the number of open disasters by
44 percent and reduced remaining costs by $1.7 billion. Our close-out
efforts resulted in recoveries of $675 million in fiscal year 1998--
funds that help us avoid having to replenish the Fund as quickly as we
would have.
In addition to new close-out procedures that will help recover
disaster funds, we are attempting to simplify the manner in which funds
are delivered to our State partners. When I was a State Emergency
Manager, FEMA used to send funds to me under about thirteen different
accounts. Each account had a different matching level and specific
reporting requirements. It was an administrative nightmare. During my
first five years at FEMA, we have been able to reduce the number of
funding streams to seven. This year's budget request includes a
proposal to consolidate the seven remaining funding streams that go to
state and local emergency managers into a single funding stream.
From my experience in emergency management at the State level, I
know that this consolidation will help reduce administrative red tape
for states and for FEMA. It is going to allow States to take more
responsibility for putting resources against the risks that they assess
to be the greatest threats.
When I first came to FEMA in 1993, the agency's financial house was
in disarray. OMB had designated our financial system as high risk, and
the agency was in no position to produce the financial statements
required by the Chief Financial Officers Act. In fact, the agency had
never reconciled over $20 billion spent in the Disaster Relief Fund. We
immediately set out to install an integrated financial system that
would aid in reconciling the agency's books. We then established an
intensive, three year effort to improve our financial reporting so that
we could prepare, and audit financial statements for all the agency's
activities. I am pleased to report to you today that we have met that
schedule. For the first time, FEMA has prepared comprehensive financial
statements for all of its programs, including the Disaster Relief Fund.
And I am very proud to report that the Inspector General has rendered
an unqualified opinion on those statements. Achieving this goal is not
only important for our reporting to OMB and Congress, but it is
critical for enabling the program managers to make sound decisions--
based on solid financial data.
The final pillar of our blueprint for the next century is that
communities need to be involved in promoting personal responsibility.
This can best be illustrated by Project Impact.
Three years ago I came here asking for your help in starting pre-
disaster mitigation--the work we could do with communities before
disaster strikes. Today, we have 118 communities across all 50 states
participating in Project Impact. This would not have been possible
without the support of our Appropriation Committees.
Many Members who were on this Subcommittee before have heard me say
that Project Impact is not a traditional government program. Instead of
the Federal Government giving large amounts of money to local
communities, the small amount of money and technical assistance given
to communities is used to leverage additional community and private
sector involvement and support in many different forms. When community
members take steps to mitigate the impacts of future disasters at the
grass roots level, great success stories come about.
I am especially pleased to report that the initial grants that the
Federal Government has given to the 118 Project Impact communities
resulted in the leveraging of nearly 700 corporate partners which have
contributed volunteers, in-kind donations and funding to help their
communities mitigate the impacts of future disasters.
In addition to corporate partners, Project Impact communities rely
upon individuals who live in the community to get involved. I wish all
of you could have joined us at the Summit we had in December that
brought Project Impact participants together from places like
Tillamook, Oregon, Deerfield Beach, Florida, West Virginia and
California. All of these people had shown leadership in their
communities in addressing the risks they face.
All of the Project Impact participants know that we can prevent
disaster damage if we act now. After Hurricane Georges, a lot of people
have asked me why that storm did not devastate the U.S. Virgin Islands
and the Gulf States the way other storms have in the past. The answer
is mitigation. The Virgin Islands adopted tougher codes and built back
stronger and smarter. This last hurricane showed the wisdom of that
work. That is exactly what Project Impact wants to do.
One of my favorite examples of local citizens taking ownership of
the pre-disaster mitigation process occurred in Tucker County, West
Virginia. Tucker County was a community that had flooded repeatedly
over the years. Each time the town flooded, the residents had to work
together to piece their lives back together.
After this pattern of disaster/recovery/disaster occurred several
times, a local resident, Mrs. Katie Little, decided she was going to
try to do something to make the situation better. Mrs. Little and a
group of her friends started selling pies and cakes in order to raise
enough money to build the Concerned Citizens Coalition to help minimize
the flooding in her community of Tucker County, West Virginia. From
their bake sales they raised over $50,000 which was used to leverage $2
million from the State of West Virginia. This money, along with support
from other Project Impact business partners in the community, allowed
Tucker County, West Virginia to make their community more resistant to
future flooding disasters by clearing debris and stabilizing eroding
riverbanks.
We are hearing stories like these in community after community as
Project Impact continues to expand. Fully funded at the $30 million
level, we will be able to expand the program to at least 50 more
communities.
The last few budget items that I would like to highlight,
incorporate elements of all three pillars prevention, smarter
government, and community based responsibility.
FEMA's fiscal year 2000 budget requests almost $31 million to
support counter-terrorism initiatives. This includes training for fire
departments and State and local emergency managers who are likely to be
the first responders in the event of a terrorist incident. These are
the people we work with every day and they are going to be called upon
in these situations.
Although several agencies are involved in the government's anti-
terrorism efforts, the agencies involved are coordinating closely
together to ensure that our efforts are effective and efficient.
Attorney General Janet Reno and I have visited personally about the
responsibilities of our respective agencies on several occasions. This
coordination is going to help our State and local partners to access
the Federal resources that can help them respond in their communities.
In fiscal year 1998, I commissioned a Blue Ribbon Panel of
representatives from our nations fire service community to review the
programs and facilities of the United States Fire Administration
(USFA). The Panel provided me with a report that outlined
recommendations for improving the operations of the USFA.
FEMA's fiscal year 2000 budget request includes an increase of
about $12 million to pay for some of the recommendations in the initial
report. If approved, the funding would improve the USFA's data
collection system so that the national fire problem can be better
defined and addressed. The funding would allow the USFA to better focus
its public education materials and firefighter training courses to meet
the needs of the fire community, local citizens and all professions
involved in fire prevention. Each of these activities give local fire
departments better tools to respond to a local incident, whether it is
a fire, a flood, or an EMS call.
To implement the recommendations, we are pleased to have Chief Rich
Marinucci of the Farmington Hills Michigan Fire Department and past
president of the International Association of Fire Chiefs. He
graciously accepted this challenge. Rich will be reviewing the
recommendations made, meeting with members of the Panel and other
constituents and working with our staff at the Fire Administration to
improve operations.
I also want to call your attention to a major funding increase for
the Emergency Food and Shelter Program. We at FEMA are very fortunate
to have been a part of this program for fifteen years. This program is
a great way to work with local communities, especially the non-profit
community that does the essential work with the working poor and
elderly and the people in the roughest circumstances.
The increase of $25 million brings the program up to $125 million.
Our partners in this program the Salvation Army, Catholic Charities
USA, the American Red Cross, the National Council of Churches, the
Council of Jewish Federations and the United Way of America--have
joined with us to be careful stewards of these funds. And it is really
important to remember that the millions of extra meals and nights of
shelter that come from this program are all delivered with an
administrative expense share of just under 3 percent. That is a really
good deal, not only for the federal government but also for the people
who desperately need these services.
Finally, I want to touch on the work we have been doing in relation
to the Y2K problem. By the end of this month we will have hosted a
meeting in each of our 10 regional office cities bringing in State and
local officials to give them information, but mostly to listen and to
hear where they think their needs are and to suggest what they should
be looking at.
Many of my staff with me today, including Mike Walker, Lacy Suiter
and Kay Goss have been on the road with representatives of other
Federal agencies, as well as with John Koskinen's task force, to take a
reading on where the State and local emergency officials are and to
arrange a plan for maintaining this channel of communication over the
next nine months.
We are taking this problem very seriously but we are also serious
about striking the right balance in approaching a complicated issue. We
will continue to keep this Committee informed on our work in this area.
The ability to implement this blueprint for the next century and to
continue this bold experiment of creating the finest emergency
management system in the world we need to retain and attract good
quality people.
The fiscal year 2000 budget requests an increase of over $14
million for salaries and expenses. Protecting our employees at FEMA is
very important to me because I know what I've asked of the staff at
FEMA and I know how they have responded. ``People helping people'' is
not just a phrase but the way my staff approaches every day at work.
They work smart and they work hard. I am very proud of them.
Just moments ago, I described several ways in which the FEMA staff
has worked to make the agency run more efficiently. The most remarkable
thing to me is how they are able to accomplish so many improvements in
the way day-to-day business is conducted while also being asked to
absorb so many new responsibilities.
For example, during the past two fiscal years, FEMA has received
additional funding for anti-terrorism initiatives. However, each time
funds were appropriated for anti-terrorism programs, corresponding S&E
funding was not provided. Instead, staff had to absorb the anti-
terrorism initiatives while also continuing to perform the agency's
other functions at a high level. Similarly, although Project Impact
funding was provided, we had to detail staff from other places in the
agency to support the initiative.
Finally, increased S&E funds will allow us to actually implement
the reforms we want to see in the U.S. Fire Administration. The S&E
increase will support more positions at the Fire Academy in Emmittsburg
and will help USFA to discharge its increased responsibilities due to
the threat of terrorism.
I know how often the request for more S&E funds comes before you. I
know how often I have asked!
But I have asked because I have a tired and stretched work force
that is always asked to do more; from frequent disasters around the
country to new initiatives--whether it's a church arson program, pre-
disaster mitigation or helping States and communities face the
consequences of terrorism. I am especially grateful to the
Administration for recognizing this and supporting this request for
increased S&E funding for FEMA.
I want to conclude by telling you that this budget is important to
me and to FEMA, and it is especially important to the future of our
communities across the nation.
I have been privileged to work for the President, to be his
representative in bringing some hope and help to towns and cities and
counties and states that have been hit by disasters. But I have gone
back to the same places too many times over the last six years. I have
seen the same problems that could have been prevented with an ``ounce
of prevention.''
The last few years of terrible weather events--floods and
hurricanes and El Nino and other natural events like the Northridge
earthquake--are telling us that we have to take action to reduce their
impact in the future.
It seems that sifting through debris and looking for resources to
rebuild are the constant parts of our current approach to disaster
response and recovery. Unfortunately, that approach is short-changing
ourselves, our families, our businesses, our communities, and the
future for our children.
We can and should be proud of how much we have accomplished in our
work after disasters, but we really need to look forward. As I
mentioned earlier, this is a budget that takes emergency management to
this next level of proactive prevention. Through mitigation, improved
mapping and additional training opportunities, FEMA will help prepare
states, local communities and citizens to save lives, cut property and
business losses, protect our environment, and make our communities
safer and stronger for our children and their children. I hope you can
provide us the support we need to look to that promising future.
Together, FEMA and Congress are creating and will continue to create a
true legacy of natural disaster protection.
Thank you for the opportunity to appear before this Subcommittee
and I am happy to answer any questions you may have.
[General Accounting Office, March 4, 1999]
Disaster Assistance--Information on the Cost-Effectiveness of Hazard
Mitigatio Projects
(By Stanley J. Czerwinski)
Mr. Chairman and Members of the Subcommittee: This statement for
the record provides our preliminary views on how the Federal Emergency
Management Agency (FEMA) ensures the cost-effectiveness of projects
funded under the Hazard Mitigation Grant Program. We are conducting
this work at the request of this Subcommittee and the Chairman of the
Subcommittee on Oversight, Investigations, and Emergency Management,
House Committee on Transportation and Infrastructure.
For a number of years, the Congress has been concerned about the
increasing costs of federal disaster assistance. One of FEMA's primary
approaches for reducing these costs is to promote mitigation measures
that will reduce future damage within communities--potentially
decreasing future federal disaster expenditures. However, there are
concerns that FEMA's mitigation funding is not targeted to cost-
effective measures, as mandated by the Robert T. Stafford Disaster
Relief and Emergency Assistance Act. Our statement is based on previous
and ongoing work and provides (1) an overview of the increases in
disaster assistance costs and FEMA's mitigation programs and (2) our
preliminary views on the approaches FEMA uses to ensure that funding
under the Hazard Mitigation Grant Program is targeted to cost-effective
mitigation measures.
In summary:
--Federal disaster assistance costs billions of dollars annually. For
disasters that occurred between 1989 and 1993, average annual
obligations in FEMA's disaster relief fund totaled $1.6
billion, in 1998 dollars, while average annual obligations over
the past 5 years (1994 through 1998) have increased to $2.5
billion annually in 1998 dollars (even with the exclusion of
one of FEMA's costliest disasters--California's Northridge
earthquake). The growth in disaster assistance costs in the
1990s has been attributed to a number of factors, including a
sequence of unusually large and costly disasters; an increase
in the number of presidential disaster declarations; and a
gradual expansion in eligibility for assistance. To reduce
these costs, FEMA is using, among other things, hazard
mitigation efforts. These efforts promote community involvement
in mitigation measures by providing grants and training to
state and local governments. FEMA's efforts include providing
federal flood insurance, converting flood-prone properties to
open space, mitigating damage to public facilities, reducing
earthquake risks, and helping mitigate the loss of life and
damage from fires.
--Our ongoing review of FEMA's efforts to ensure the cost-effective
use of federal dollars for hazard mitigation has focused on the
Hazard Mitigation Grant Program--one of FEMA's primary sources
of funding for implementing hazard mitigation measures within
communities. FEMA uses benefit-cost analysis \1\--an approach
recommended by the Office of Management and Budget--as its
primary approach for ensuring that mitigation measures within
the Hazard Mitigation Grant Program are cost-effective.
However, FEMA also excludes certain types of Hazard Mitigation
Grant Program projects from benefit-cost analysis--including
projects that fund the removal of certain structures from
floodways, research for new building codes, and planning
efforts. FEMA officials stress a need for flexibility in
assessing these projects, citing the difficulties of
quantifying the benefits of some projects and the time needed
to gather data to conduct a benefit-cost analysis. However,
these exemptions limit the agency's ability to demonstrate that
the funded mitigation measures are cost- effective.
Additionally, according to our review of selected benefit-cost
analyses in two FEMA regions, officials conducting these
analyses were generally knowledgeable and had been trained in
how to conduct the analyses. However, they did not always use
the best available information in analyzing projects designed
to mitigate future damage from flooding events. For example,
the officials did not always use flood damage information
available from past insurance claims.
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\1\ Benefit-cost analysis is used to determine how the anticipated
dollar savings gained through implementing a project compare with its
cost. In order to be considered cost-effective, a project must return
more money over its life than it cost.
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background
Following a disaster, at the request of a state governor, the
President may issue a major disaster declaration for the affected
areas, thus triggering a range of assistance from federal agencies. The
costs of this disaster assistance have grown notably between the late
1970s and 1990s. Between 1979 and 1988, FEMA's obligations in its
disaster relief fund exceeded $500 million only in 1 year. In
comparison, since 1989, the obligations in the fund have exceeded $1
billion every year except for 1991. The increase in costs is also seen
in the number of large, costly disasters. Prior to 1989, only Hurricane
Agnes cost the fund in excess of $500 million, while 10 disasters have
cost over $500 million since 1989. While FEMA has implemented a number
of approaches to reduce the costs of disaster assistance--such as
consolidating multiple disaster response and recovery functions at
individual disaster sites to reduce administrative costs--the agency
has made disaster mitigation a primary goal in its efforts to reduce
the long-term costs of disasters.
FEMA's September 1997 strategic plan, entitled ``Partnership for a
Safer Future,'' states that the agency is concentrating its activities
on reducing disaster costs through mitigation because ``no other
approach is as effective over the long term.'' Mitigation activities
are undertaken to reduce the losses from disasters or prevent such
losses from occurring. The agency's hazard mitigation efforts include
grants and training for state and local governments; funding for
mitigating damage to public facilities; the purchase and conversion of
flood-prone properties to open space; federal flood insurance; the
development of land-use plans and zoning ordinances to discourage
building in hazardous areas; and programs targeted at reducing the loss
of life and property from earthquakes and fires.
However, as we noted in previous testimony,\2\ quantifying the
effects of mitigation efforts can be difficult. Specifically,
determining the extent to which cost-effective mitigation projects will
result in federal dollar savings is uncertain because the savings
depend on the actual incidence of future disasters and the extent to
which the federal government would bear the resulting losses.
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\2\ Disaster Assistance: Information on Federal Disaster Mitigation
Efforts (GAO/T-RCED-98-67, Jan. 28, 1998).
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The Stafford Act requires that hazard mitigation measures under the
Hazard Mitigation Grant Program be cost-effective and that they
substantially reduce the risk of future damage, hardship, loss, or
suffering. According to Office of Management and Budget (OMB)
guidelines, contained in OMB Circular A-94, the use of benefit-cost
analysis is the recommended approach for determining cost-
effectiveness. FEMA's guidance for determining the cost-effectiveness
of hazard mitigation projects \3\ states that ``a key criterion for
mitigation projects to be eligible for funding is that they must be
cost-effective'' and that ``benefit-cost analysis is used for all cost-
effectiveness determinations.''
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\3\ How to Determine cost-Effectiveness of hazard Mitigation
Projects, A New Process for Expediting Application Reviews, Interim
Edition, Dec. 1996.
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Benefit-cost analysis is used to assess whether the expected costs
of investing in a hazard mitigation project are justified because the
project will help avoid damages expected from future disasters (the
benefits). FEMA generally conducts the benefit-cost analysis for the
projects that states submit for approval.\4\ By conducting a benefit-
cost analysis, the analyst determines a benefit-cost ratio--the ratio
of the expected benefits divided by the expected costs. If the expected
benefits are greater than the expected costs, the ratio is greater than
1.0 and the project is considered cost-effective. If the expected
benefits are less than the expected costs, the ratio is less than 1.0
and the project is considered not cost-effective. FEMA's guidance
describes four main elements of a benefit-cost analysis:
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\4\ Three states (Florida, North Dakota, and Ohio) typically
conduct the benefit-cost analysis for projects from their communities
and submit a sheet summarizing the analysis for FEMA's review. These
states have been given additional responsibilities as participants in a
pilot program called the ``managing state concept.''
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--an estimate of damages and losses before mitigation,
--an estimate of damages and losses after mitigation,
--an estimate of the frequency and severity of the hazard causing the
damages (such as the risk of flooding), and
--economic factors used in the analysis (a project's expected life
span, for example).
After all of these elements are considered, along with a project's
expected costs, a project's cost-effectiveness can be determined.
However, other factors outside of the benefit-cost analysis can also
influence whether a project is accepted for funding, such as the
project's potential impact on environmental conditions.
growth in federal disaster assistance costs
Federal disaster assistance costs have increased in the 1990s for
several reasons, including several unusually large and costly
disasters, increasing population and development in hazard-prone areas,
increases in the federal share of disaster assistance costs in larger
disasters, an upward trend in the annual number of presidential
disaster declarations, and an increase in the types of facilities
eligible for disaster assistance. Total obligations from FEMA's
Disaster Relief Fund for the 10-year period prior to 1989 were $4
billion; since 1989, they have totaled $25 billion.\5\
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\5\ Since these figures are expressed in nominal dollars, they do
not reflect the effects of inflation over the time periods cited.
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Factors Underlying Increasing Costs
The large disaster assistance costs in the 1990s have been
attributed to a number of factors. Since 1989, the United States has
experienced a series of unusually large and costly disasters, including
Hurricane Hugo, Hurricane Andrew, the 1993 Midwest floods, and the
Northridge earthquake. Hurricane Georges was added to this list in
1998--FEMA is projecting that it might be the agency's second costliest
disaster ever. The close occurrence of such costly disasters in the
United States is unprecedented. Furthermore, increases in population
and development, especially in hazard-prone areas, increase the
potential losses associated with these disasters. For example, FEMA
expects that by 2010 the number of people living in the most hurricane-
prone counties (36 million in 1995) will double.
For several of these large disasters, the federal government has
increased its share of the disaster relief costs to provide additional
assistance to the states. For example, while the federal share of
funding is at least 75 percent for assistance to repair or replace
disaster-damaged public and nonprofit facilities, the President used
his authority to raise the federal share to 90 percent for the
Northridge earthquake and to 100 percent for Hurricane Andrew.
There has also been an upward trend in the annual number of
presidential disaster declarations. From fiscal years 1989 through
1993, the average number of major disaster declarations was 38 per
year, while from fiscal years 1994 through 1998, the average number
increased to 49.
Additionally, over the years, the Congress has generally increased
eligibility by expanding the categories of assistance and/or specified
persons or organizations eligible to receive assistance. For example, a
1988 law expanded the categories of private nonprofit organizations
that are eligible for FEMA's public assistance program.
According to a report by the Senate Bipartison Task Force on
Funding Disaster Relief,\6\ federal budgeting procedures for disaster
assistance may also have influenced the amounts appropriated for
disaster assistance. This is because disaster relief appropriations
have often been designated as ``emergency'' spending, thus excluding
them from the strict budget disciplines that apply to other spending.
Some views in the report suggested that the assistance provided is more
generous than would be the case if it had to compete with other
spending priorities.
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\6\ Federal Disaster Assistance, Document No. 104-4, U.S. Senate
(Washington, D.C.: U.S. Government Printing Office, 1995).
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fema's hazard mitigation efforts
To reduce disaster assistance costs, one of FEMA's primary
approaches has been to emphasize hazard mitigation through various
incentives. Mitigation consists of taking measures to prevent future
losses or to reduce the losses that might otherwise occur from
disasters. For example, floodplain management and building standards
required by the National Flood Insurance Program might reduce future
costs from flooding. FEMA estimates that the building standards that
apply to floodplain structures annually prevent more than $500 million
in flood losses.
A Number of Programs Provide for Hazard Mitigation Assistance
FEMA funds or otherwise promotes hazard mitigation through a number
of programs. As part of its National Flood Insurance Program, FEMA
attempts to reduce future flood losses by providing federally backed
flood insurance to communities that adopt and enforce floodplain
management ordinances that help mitigate the effects of flooding upon
new or existing construction. This program also funds a flood
mitigation assistance program through the National Flood Mitigation
Fund. In 1998, FEMA distributed over $14 million to states and
communities to plan and implement measures to reduce future flood
damage in homes and other properties that had experienced repeated
losses from flooding. Eligible projects under this program include
elevating structures, flood-proofing properties, and buying out and
converting flood-prone properties to open spaces.
FEMA also provides grants to states to prevent or reduce the risks
of earthquakes by using mitigation measures such as the seismic
retrofitting of buildings. The agency also conducts training, public
education, and research programs in subjects related to fire protection
technologies. The agency's efforts support the nation's fire service
and emergency medical service communities through such services as the
national fire incident reporting system, which collects and analyzes
data in order to help mitigate the loss of life and damage from fires.
In 1997, FEMA began Project Impact--an initiative based on the
premise that consistently building safer and stronger buildings,
strengthening existing infrastructures, enforcing building codes, and
making proper preparations prior to a disaster would save lives, reduce
property damage, and accelerate economic recovery. The initiative
intended to build ``disaster-resistant communities'' through public-
private partnerships, and it included a national awareness campaign,
the designation of pilot communities showcasing the benefits of
disaster mitigation, and an outreach effort to community and business
leaders. Project Impact received an appropriation of $25 million in the
fiscal year 1999 budget.
Under section 406 of the Stafford Act, communities recovering from
disasters can use federal funds to mitigate future damage to public
facilities that have been damaged. For example, as a damaged building
is rebuilt, seismic retrofitting is added to help reduce damages from
future earthquakes. Mitigation measures funded under the section 404
program--the Hazard Mitigation Grant Program--differ from the 406
program in that they can be targeted to either damaged or undamaged
facilities. For example, putting storm shutters on the windows of
structures is expected to help mitigate wind and rain damage from
future hurricanes. Our statement focuses on the measures funded under
the Hazard Mitigation Grant Program.
Hazard Mitigation Grant Program
Under the Hazard Mitigation Grant Program, up to 15 percent of the
total funds spent on a disaster may be spent specifically on hazard
mitigation measures. Subject to certain dollar limits, the act
generally allows the funding of up to 75 percent of the cost of hazard
mitigation measures within communities that have been affected by a
disaster \7\ (the states or local governments pay the remaining portion
of the costs). In fiscal year 1998, FEMA approved and obligated over
$415 million in Hazard Mitigation Grant Program grants. These grants
can be used to protect either public or private property, including the
acquisition and relocation of structures from hazard-prone areas. The
Stafford Act establishes that the federal contribution is based on
measures that ``the President has determined are cost-effective and
which substantially reduce the risk of future damage, hardship, loss,
or suffering in any area affected by a major disaster.'' The program
funds a range of projects, including purchasing properties in flood-
prone areas, adding shutters to windows to prevent future damage from
hurricane winds and rains, or rebuilding culverts in drainage ditches
to prevent future flooding damage.
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\7\ In an October 10, 1997 regulation, FEMA announced that for
disasters declared after April 6, 1997, eligibility for program funding
would be statewide rather than limited to the communities affected by
the disaster. FEMA was attempting to give the states enhanced
flexibility in using the funding for priority projects across the
states and to expedite closing out the funding from older disasters.
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Historically, hazard mitigation has been considered primarily a
responsibility of local and state governments as well as private
citizens, since these entities often control the decisions affecting
hazard mitigation. For example, building code enforcement and land-use
planning are generally under local jurisdictions. As a result, FEMA
works with state and local governments to instill a community-based
approach to implementing disaster mitigation efforts. Section 409 of
the Stafford Act plays a role in developing this approach because it
helps to establish the requirement for a comprehensive state hazard
mitigation plan that includes an evaluation of a state's vulnerability
to natural hazards. Additionally, as a condition of receiving a Hazard
Mitigation Grant Program grant, the state must prepare an
administrative plan that establishes its procedures and priorities for
identifying and selecting mitigation projects. FEMA, however, has final
approval authority for funding these projects. FEMA guidance states
that an ``ideal'' plan would include a statewide mitigation strategy
and identify potential hazard mitigation projects that are consistent
with the plan.
We talked with FEMA staff responsible for approving these plans and
reviewed plans from several states. In general, we found that state
administrative plans exhibited a broad range of approaches for
identifying and selecting mitigation projects. Additionally, a 1996
study \8\ found that many of the 39 state plans reviewed were ``merely
intended to qualify the state for post-disaster mitigation grants under
section 404 of the Act.'' FEMA officials generally agreed with this
conclusion. However, several officials noted that the agency has
recently initiated changes to improve the states' planning efforts.
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\8\ Edward J. Kaiser and R. Matthew Goebel, Analysis of Content and
Quality of State Hazard Mitigation Plans Under Section 409 of the
Stafford Act, June 1996.
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fema does not always use benefit-cost analysis to determine cost-
effectiveness and at times does not use best available data
Our preliminary review found that FEMA's guidance recommends the
use of benefit-cost analysis as the primary approach for determining a
project's cost-effectiveness. However, the agency excludes certain
categories of Hazard Mitigation Grant Program projects from this
analysis. These categories include projects that fund the removal of
certain structures from floodways, tornado-related measures, research
for new building codes, and planning efforts. While FEMA has explained
the rationales for these exemptions, certain factors, such as the lack
of an analytical basis for an exemption on the acquisition of certain
floodplain properties, are limiting the agency's ability to demonstrate
that these mitigation measures are in fact cost-effective.
Certain Types of Projects Exempted From Benefit-Cost Analysis
The Stafford Act requires that Hazard Mitigation Grant Program
projects be cost-effective. FEMA's guidance establishes that benefit-
cost analysis is the preferred method for making this determination.
However, since September 1996, FEMA has exempted the following four
categories of Hazard Mitigation Grant Program projects from the use of
benefit-cost analysis:
--projects involving the purchases of substantially damaged
structures in 100-year floodplains;
--up to 5 percent of the Hazard Mitigation Grant Program funding for
a variety of hazard mitigation measures, such as disaster
warning systems or the application of new, unproven mitigation
techniques;
--hazard mitigation planning projects for older disasters; and
--an additional 5 percent of the Hazard Mitigation Grant Program
funding for tornado-related projects.
FEMA's general rationale for the exemptions varies, although the
agency's policy guidance establishes that two of the exemptions were
made because some mitigation projects were often difficult to evaluate
against ``traditional quantitative program cost-effectiveness and
eligibility criteria.'' FEMA officials have explained that the benefits
of some projects are difficult to quantify against known project costs
and that the time involved in gathering the data on some mitigation
projects can be excessive. For example, it is difficult to determine
the benefits of establishing an educational program that uses fliers to
inform the public about the risks of living in a floodplain because it
is hard to predict the resulting changes in public behavior that might
result from the fliers. However, without any measurement and subsequent
comparison of a project's expected benefits with its expected costs, it
is unclear what criteria the agency is using to determine cost-
effectiveness.
Exemption of Projects Involving the Purchase of Substantially Damaged
Structures
Through policy guidance established in September 1996, FEMA
exempted projects that involved purchasing structures located in
floodways and floodplains--if the cost of restoring the damaged
structures equaled or exceeded 50 percent of the structures' market
value and the structures were located in a 100-year floodplain. This
particular exemption has come under criticism by FEMA's Inspector
General. In a March 1998 report,\9\ the Inspector General questioned
the exemption's lack of analytical data supporting the contention that
acquisition projects involving substantially damaged properties in the
100-year floodplain were cost-effective. While FEMA officials have
begun to retroactively analyze some of the acquisition projects
exempted under this policy, the agency is currently unable to provide
the analytical data that would support exempting all substantially
damaged structures in a 100-year floodplain. FEMA officials explained
that they need to conduct a detailed and rigorous analysis of
acquisition projects to support the policy. Without this analytical
basis, it is difficult for FEMA to demonstrate that the exempted
acquisition projects it is funding are cost-effective.
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\9\ Improvements Are Needed in the Hazard Mitigation Buyout
Program, FEMA OIG, Inspection Report I-01-98, March 1998.
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Exemption of Up to 5 Percent of the Hazard Mitigation Grant Program
Funding for Various Projects
In September 1996, FEMA established another policy that exempted
projects from benefit-cost analysis. Known as the ``5 percent Hazard
Mitigation Grant Program initiatives,'' this policy allowed the states
to use up to 5 percent of their Hazard Mitigation Grant Program project
funding for a variety of hazard mitigation measures. According to
FEMA's policy memo for this exemption, the evaluation of funding for
certain mitigation measures, such as hazard warning systems or research
for new building codes, required a large amount of time at the state
and federal levels, although it was generally recognized that such
measures reduced the potential losses from a future disaster. The
policy was intended to provide the states with discretion in deciding
which mitigation measures they wanted funded, as well as the
responsibility for providing the rationale for the cost-effectiveness
of the projects selected. FEMA officials explained that the intent of
the policy was to spur creativity and avoid the time and expense
involved with conducting a benefit-cost analysis.
To be eligible, a project type had to be identified in the state's
hazard mitigation plan and reduce or prevent future property damage,
injury, or the loss of life. Instead of conducting a benefit-cost
analysis, the states were instructed to include a narrative that
identified the mitigation benefits and the reasonable expectation that
future property damage, injury, or the loss of life would be reduced or
prevented. In fact, FEMA's guidance instructs project applicants to use
5-percent funding if the project was ``previously denied because of
difficulty in measuring cost-effectiveness.'' While FEMA's guidance
instructs the states to identify a project's benefits, it does not
specifically suggest any comparison of the benefits with the project's
costs or competing alternative projects. Without any measurement and
subsequent comparison of a project's expected benefits with its
expected costs, the criteria the agency is using to determine cost-
effectiveness are unclear. Additionally, by using such a broad
determination of a project's cost-effectiveness, it appears that almost
any project could be determined as cost-effective.
Exemption of Hazard Mitigation Planning Projects for Older Disasters
About 1 year later, in October 1997, FEMA announced its third
policy decision, when it exempted hazard mitigation planning projects
associated with older disasters from benefit-cost analysis. FEMA
decided that in the interest of expediting the closeout of disasters
that occurred on or before June 10, 1993, the agency would make
remaining program funds from these disasters available for hazard
mitigation planning purposes.\10\ States were invited to submit Hazard
Mitigation Grant Program applications for funding that would help them
develop multi-hazard mitigation plans. The policy memo stated that
``funds provided for planning purposes shall be considered a cost-
effective measure.''
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\10\ When the Hazard Mitigation Grant Program was established, it
provided federal matching grants on a cost-share basis of up to 50
percent of a project. Thus, FEMA refers to these mitigation projects as
``50/50 planning'' projects. With the 1993 amendments to the Stafford
Act, the federal cost share was changed from up to 50 percent to up to
75 percent.
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Exemption of Up To 5 Percent of the Hazard Mitigation Grant Program
Funding for Tornado-Related Projects
In August 1998, FEMA announced the fourth policy exempting certain
projects from benefit-cost analysis. FEMA extended its 5-percent set-
aside funding by another 5 percent to fund tornado-related projects.
The agency noted an increase in tornado activity that it associated
with the 1997-98 El Nino weather pattern and suggested that the need
for additional funding for warning systems could not be accommodated
through existing programs. In essence, the agency increased the 5-
percent set-aside policy to a 10-percent set-aside policy, although the
additional 5 percent of Hazard Mitigation Grant Program funding was
limited to states that had received a presidential disaster declaration
for tornadoes. In addition to including a narrative that identified the
project's mitigation benefits and the expectation that future damage or
loss of life or injury would be reduced or prevented, the states were
required to develop a comprehensive plan for warning their citizens,
including a public education component. The policy applied to all
disasters with unobligated funds that were declared before fiscal year
1998, as well as all fiscal year 1998 and future declarations in which
tornadoes or high winds played a role. The policy remains in effect
until FEMA adopts proposed regulatory changes stating that warning
systems will only be funded from the original 5-percent set-aside. FEMA
officials expect that the regulatory changes will be made final in mid-
March 1999.
Estimating the Number and Dollar Figure of Hazard Mitigation Grant
Program Grants Exempted From Benefit-Cost Analysis
We are working with FEMA to quantify the number and dollar amount
of all of the Hazard Mitigation Grant Program measures exempted from
benefit-cost analysis. However, for a number of reasons, FEMA is unable
to readily provide us with this information for all of the exempted
projects. For example, it is hindered in providing this information
because there is no data field in the Hazard Mitigation Grant Program
database that would allow the agency to specifically identify the
projects that fall under the exemption for acquiring property that has
been substantially damaged. Additionally, agency officials have
expressed reservations about the accuracy of the data. For these
reasons, our preliminary numbers are limited to the 55 hazard
mitigation project files we examined for four states (Arkansas,
Florida, Louisiana, and Texas) in FEMA regions 4 and 6.
These 55 projects represented approximately $20 million in hazard
mitigation grant funding, with Florida accounting for 36 projects, or
$17.2 million of the amounts reviewed, while the other states accounted
for the remaining 19 projects, or approximately $2.8 million in
funding. Of the 55, 14 (25 percent), or over $8 million (42 percent) of
the funding, were exempted from benefit-cost analysis. One-half of the
exempted projects were property acquisitions, while the remaining
exempted projects included funding for emergency satellite
communications, all-weather radios, emergency alert systems, and a
public awareness campaign. The 41 remaining projects subjected to
benefit-cost analysis included wind retrofits (shutter projects),
drainage improvements, seismic retrofits of buildings, and the
installation of gas shut-off valves in structures.
Some Benefit-Cost Analyses Conducted on Acquisition Projects Do Not Use
the Best Available Data
In the four states we reviewed, the officials conducting the
benefit-cost analysis were generally knowledgeable about the process
and had received training on how to use FEMA's computerized modules.
However, we also found that the officials did not always use the best
available data for estimating the benefits of projects involving the
acquisition of property located in floodplains. These data help
determine the extent of the expected benefits attributed to a project
and significantly influence the accuracy and final outcome of the
benefit-cost analysis.
For example, in determining flood hazard data--which establishes
the probability and severity of a flood event--FEMA's guidance suggests
using the flood insurance rate maps available through the National
Flood Insurance Program.\11\ These maps establish the number of times a
flood is expected to occur in a given area (the frequency of future
flooding) and the level of the flooding (its severity). The quality of
this information can significantly influence the benefit-cost analysis'
outcome because overestimating the frequency or severity of a flood can
inflate the estimated benefits attributed to an acquisition project. We
found little evidence that information from flood rate maps was used in
the benefit-cost analyses we reviewed. Therefore, we are in the process
of reviewing several of the analyses to determine how the use of
information from the flood rate maps would have affected the analyses'
outcomes.
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\11\ The flood hazard data needed is actually found in flood
insurance reports which accompany the flood insurance rate maps.
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We also found that the officials conducting the benefit-cost
analysis may not always use the best available data on damage claims
from past flooding. The quality of this information has a significant
influence on the outcome of the benefit-cost analysis because
overestimating the extent of the damage from a previous flood event can
inflate the estimated benefits attributed to an acquisition project.
FEMA officials told us that information on flood claims available from
the National Flood Insurance Program was not always used, suggesting
that they simply used information supplied by project applicants. We
also found that the officials conducting the analysis do not always
validate the damage claims information submitted by the applicants. As
a result, the benefit-cost analysis may rely on testimonial evidence
from the applicant--the individual most likely to benefit from the
acquisition project. We are now working with FEMA to determine if the
agency can easily provide damage claims information from the National
Flood Insurance Program to the officials conducting the benefit-cost
analysis.
We provided a draft of this statement to FEMA to verify its factual
content and modified the statement where appropriate. Our review was
initiated in December 1998, and it is continuing in accordance with
generally accepted government audit standards.
related gao products
Disaster Assistance: Information on Federal Costs and Approaches
for Reducing Them (GAO/T-RCED-98-139, Mar. 26, 1998).
Disaster Assistance: Information on Federal Disaster Mitigation
Efforts (GAO/T-RCED-98-67, Jan. 28, 1998).
Disaster Assistance: Information on Expenditures and Proposals to
Improve Effectiveness and Reduce Future Costs (GAO/T-RCED-95-140, Mar.
16, 1995).
GAO Work on Disaster Assistance (GAO/RCED-94-293R, Aug. 31, 1994).
budget priorities
Senator Bond. All right. Well, thank you, Mr. Witt.
FEMA has requested $83 million in increased expenditures, a
10-percent increase. An increase has also been requested for
additional staff, the emergency food and shelter program, a new
repetitive loss initiative, fire program enhancements, and the
list goes on.
Given the fact that the budgetary caps will likely prevent
us from funding all these increases, would you give me your
highest priorities: one, two, three? What areas are the most
needy in terms of increases?
Mr. Witt. Well, of course, the Y2K effort is so important
and also the anti-terrorism program is very important.
Senator Bond. You picked that up I think from our
discussion. [Laughter.]
Mr. Witt. They are priorities for us too, Mr. Chairman.
The Pre-disaster Mitigation Fund, and the flood map
modernization fund are absolutely critical. We are requesting
increases for the Fire Prevention and Training activity, and
the Emergency Food and Shelter program which does so much good,
and the National Flood Mitigation fund. And the Salaries and
Expenses are a priority, and I think the budget reflects that.
Senator Bond. Well, I appreciate that listing, but would
you give us for the record your one, two, three priorities,
recognizing, of course, that by the time this new fiscal year
begins, we will be in the middle of the Y2K problem and the
advance planning stage will be over. I would like to have them
listed in terms of the additions. What's one, what's two,
what's three?
Mr. Witt. Salaries and Expenses are number one. There is no
doubt about that. The Pre-disaster Mitigation Fund and the
National Flood Mitigation Fund have to be considered as well.
Of course, you said three, but the fire prevention and training
is absolutely one of the top priorities too. So, those are the
four that reflect my priorities.
disaster 5-year historical average
Senator Bond. May I ask why FEMA is once again requesting
$2.5 billion off budget? Is it not true that the 5-year
historical average, which used to be $1.6 billion, now even
excluding Northridge it is $2.6 billion. Is that not a pretty
good estimate even though we do not know the specific
disasters?
Mr. Witt. We have found that the average is running pretty
close to that. Of course, it depends on the events of a
particular year. We wished that we did not have them, but you
are absolutely correct. This year could be a very active year--
we hope not--in hurricanes and flooding.
Senator Bond. The weather man I listen to on television
this morning said with La Nina, it is going to be a super
hurricane season. It should not be a surprise if we have some
disasters.
Mr. Witt. True. Dr. Gray's projections, I believe, include
19 named storms this year.
unmet disaster needs
Senator Bond. You know in the past several years, as I
mentioned earlier, we have appropriated hundreds of millions of
dollars to HUD for so-called unmet needs, and even though there
is no authorized HUD program, we tried to address the need for
standards with appropriation language, ensuring that HUD works
with FEMA in allocating the funds.
Could you tell me how HUD has consulted with FEMA in
allocating the fiscal year 1998 supplemental needs and whether
this consultation has been effective and whether it allowed the
prioritization of needs for the most effective allocation? How
would you have done it differently if you had been in complete
charge of that?
Mr. Witt. Those funds are very, very important in that
unmet need area, and I think you have seen this many, many
times, particularly when we have done the long-term recovery
reports showing those unmet needs.
What we have tried to do is to work with the States and
local communities to gather the accurate information in unmet
needs in each disaster, then forward that information to HUD so
they can use it to make their decisions on how to meet those
unmet needs, based on the priorities that we felt needed to be
addressed first.
Senator Bond. Did HUD actually follow your recommendations?
Were the HUD expenditures expenditures recommended by FEMA? You
and I know the answer to that, do we not? [Laughter.]
You can submit for the record any analysis showing where
HUD actually funded needs that FEMA identified.
Mr. Witt. Thank you, Mr. Chairman.
Senator Bond. I am from Missouri, and you better show me
because I have a high degree of skepticism on that one.
Let me turn now to the ranking member for some questions,
and we will go back and forth as long as we can enjoy it.
mortgage transaction fee
Senator Mikulski. Thank you very much, Mr. Chairman.
Before I get into really the meat of Project Impact and Y2K
and all of those things, I want to raise an issue that I think
could get prickly as we move along, and that is on page 5 of
your written testimony, you talk about a $15 fee on all
mortgage transactions to produce the funding for the maps.
Well, I woke up on Sunday morning to read the Baltimore
Sun, and the headline in the real estate section said this: A
new tax on homeowners in FEMA's budget. I tell you the cream in
my coffee curdled when I read that--[Laughter--] because I knew
every real estate agent was reading it, et cetera.
Now, Mr. Witt, I think we do have to find a way to fund
this. The chairman and I have not had a chance to talk about
this, but I would just like to put a bright light around it to
talk about the $15 mortgage transaction.
Did you want to say something?
Mr. Witt. Senator Mikulski, when we made a proposal to OMB
on how we could fund the map modernization program----
Senator Mikulski. Well, I think you need to go back to
OMB----
Mr. Witt. I agree, we should look at all options.
Senator Mikulski [continuing]. And say that you have to
come up with other solutions.
Mr. Witt. I think the point of it is--and the chairman and
I talked about this in our meeting--that we need to show the
significance and the importance of this mapping program, and we
have to address this problem. The chairman advised me and
several others advised me that this proposal probably will not
fly, and I understand that. But we have to address this
problem, and this is a starting point to talk about how we can
do that.
Senator Mikulski. Well, there are those who do view it as a
tax, and I do not think you want this thing to go to the
Finance Committee or the Ways and Means Committee.
Mr. Witt. We do not want a tax.
flood mapping
Senator Mikulski. But I would like to just give a comment
here. I do not want to spend all my time on the maps. We put
money into NASA for both Mission to Planet Earth and something
called LANDSAT. My question later on will be, but not now--I am
going to get to some other things--is what is it that NASA can
tell you and could they help you do the maps in a way that
would lower cost, et cetera? They have pictures that go back
years and years and years of this planet. We are funding
Mission to Planet Earth. They love to show me those lovely
little satellite pictures that are red, green and blue, and if
it is blue, it is this, and if it is green, it is that, and so
on. And I love looking at it, but I wonder if it could be
transferable in that way.
Mr. Witt. Yes, ma'am. Dan Golden and I have talked several
times. My staff has met with the NASA staff. We are working on
signing an MOU with NASA now to use the satellite technology as
much as possible to update maps.
Senator Mikulski. Well, I think that is good, and when we
meet with Dr. Goldin, we can actually thank him for his
cooperation. We do not say that is the only step to your
mapping.
Mr. Witt. Oh, no, but it is one way.
Senator Mikulski. Yes, because essentially with LANDSAT, we
have got so many pictures over so many years that have been
catalogued in such a confusing way that we now have a data
mortuary. I would like to see if we could not pull it out and
maybe find their DNA and get it back into business. [Laughter.]
consequence management
Now, let us go to Y2K. Mr. Director, could you tell us,
number one, what is consequence management? Do you have
responsibility for consequence management, and what are your
plans in terms of consequence management? Because Tip O'Neill
once said all politics is local, but all response and
preparedness and prevention is also local. Could you share
where you are?
Mr. Witt. Sure. Consequence management is the
responsibility to plan, train and equip State and local
governments to deal with public health and safety in response
to incidents. What we are doing now for Y2K is another portion
of consequence management. As you said earlier, the Y2K
initiative and the anti-terrorism program do have a connection
to our all-hazard planning.
The 10 regional meetings that we have scheduled working
with the other Federal agencies and our counterparts in the
regions--we have had four of these meetings with the State
directors of emergency management, with State fire marshals,
and several other local officials--have gone extremely well,
and have provided us a world of information.
Mike Walker, our Deputy Director, has had the lead on the
Y2K and has been to every single one of these meetings and will
be at the other six meetings and the follow-up meetings that we
are planning to have with each of the States and local
governments. So, Mike, do you want to expand on it just a
little bit?
Senator Mikulski. Mr. Walker, first of all, welcome. We
have known you in other roles.
Mr. Walker. Thank you.
state preparedness for y2k
Senator Mikulski. But my question to you, sir, is are we
ready in the 50 States, and is FEMA helping the 50 States get
ready or is it very uneven?
Mr. Walker. Well, FEMA is working very closely with all 50
States on Y2K, as we do on all hazards. As we have these 10
regional meetings around the country, not only are all 50 State
emergency managers coming, but a number of local emergency
managers are coming also.
Quite frankly, I want to take this opportunity to also
commend the work of the Senate special committee. They did an
excellent job. They have indicated an assessment of the Y2K
issue that we agree with--Y2K will not pose major disruptions,
awareness is growing and progress is being made. We do have
concerns which we share in the small business sector and in
many small towns and small counties. The biggest difficulty
that we have is drilling the message down to the smallest
community where awareness is only now beginning. James Lee has
made it very clear that that is going to be our highest
priority to work with the States to foster awareness and the
need to fix any problems before the end of the year.
Senator Mikulski. Every State has a Governor and
essentially the Governor is the commander-in-chief of that
State. Have you asked every State to have a Y2K designee?
Mr. Walker. Yes, and they do. Every State has a Y2K
coordinator who is separate from the emergency manager.
Senator Mikulski. Have you furnished to the States
essentially a Y2K readiness checklist? Because again rural
States have different needs, et cetera.
Mr. Walker. Oh, absolutely, we have. We provided a guide to
State and local emergency managers and we are in the process of
putting together some other materials which will be available
right down to the very smallest unit of government.
It is a complex problem. There are 200,000 water districts
in this country and 87,000 units of local government, and it is
hard to get the message out. Congress can be of great benefit
too through your newsletters and in putting the word out to
local folks.
Senator Mikulski. But is not the point of accountability a
Governor who would then assemble the local jurisdictions and so
on?
Mr. Walker. That is correct.
Senator Mikulski. Do you anticipate a breakdown in services
and the need to be concerned about any civil disturbances?
Mr. Walker. No. Based on current assessments, the sky is
not falling. We are telling people in our regional meetings
there is no need to hoard. There is no need to take money out
of banks. There is no need to head for the hills.
This is much more than a technology problem. It is a
leadership issue. It is a matter of taking responsibility, and
there is still time to do that in these communities.
Senator Mikulski. Well, I think when we say there is
nothing to worry about, then I think that there is a sense of
complacency. Later on next week I will be asking these same
questions of my own Governor Glendening when he comes to
present this.
Now, let me tell you why I am so hot on Y2K. Because it is
an anticipated event and can be planned for in an organized,
systematic way. This then says if we do not have it together
for Y2K, we certainly do not have it together for counter-
terrorism.
Senator Bond. Senator, may I just interject just two quick
Y2K questions?
Senator Mikulski. Why do you not go right ahead?
Senator Bond. No. I will come back to that.
Senator Mikulski. I think we are on the same wavelength.
Senator Bond. Will FEMA have all of its own mission-
critical systems corrected and tested by March 1 of this year?
Mr. Walker. March 31.
Mr. Witt. March 31, yes.
disaster relief for y2k
Senator Bond. What will be the Federal policy with respect
to disaster declarations stemming from any possible Y2K related
emergencies? In what circumstances would disaster relief be
granted if there is some kind of failure as a result of the Y2K
problem?
Mr. Witt. That was the very same question I asked Mr.
Suiter, the Associate Director for Response and Recovery. They
drafted a one-page guidance on what it would take to trigger a
Federal declaration which we shared with your staff, and we
will be continuing to finalize that to make clear that we have
it down to a very, very tight compliance in order to make a
declaration like that.
Senator Bond. I think it is clear--and we have had staff
discussions--if somebody says, oh, well, we have got a disaster
because our computers came up 00 and they thought it was 1900,
that is not a disaster. That is not an unforeseen disaster.
Mr. Witt. No, it is not.
Senator Bond. I think the message ought to get out that if
somebody says, oh, my gosh, my computers do not work, that is
not grounds for bringing in the Federal resources. We do not
plan to pay for failure to plan for a completely predictable
and understandable contingency that everybody ought to know is
going to arise.
Mr. Witt. I think that is important too, Mr. Chairman,
because I think Mike Walker and Lacy Suiter have shared the
information directly with the participants in the regional
meetings, that if you have a problem with your computer system,
we are not going to give disaster declarations to fix computer
problems because we do not want communities waiting to get
their computers fixed or systems fixed under a Federal
declaration.
Senator Bond. Your warnings about flood insurance in the
media have been very good. You might consider even making Y2K
warnings.
Let me return to Senator Mikulski to go back and take on
the next questions.
informing the public about y2k
Senator Mikulski. Just a couple of other points again about
Y2K. I gather we could go all morning just on that. But I must
really impress upon you, sir, and ask you to impress upon the
interagency groups and also your locals that you are working
with, people are starting to get scared, but there is also
public information being given out.
In my last utility bill from the Baltimore Gas and Electric
Company, they said they anticipate that they will be ready to
deliver electrical services in Maryland, and that presumes
everything else is working. They then did say if you are
concerned, have at your home what you would have for an ice
storm. As you recall, a couple years ago we had very severe ice
storms and parts of our States had ice storms even in recent
weeks. Our cousins in Virginia went almost a whole week in
certain parts of it. So, they gave you guiding principles and a
checklist of what to do. It was just like any utility
communication. It was a bit boring, but it was very factual and
you had that. But it was also reassuring because if you were
hearing this ozone type stuff on the talk show, you knew what
to do.
The second is I got a mailing from the Washington
Cathedral, and it was not about a prayer breakfast or a women's
religious weekend. It was about them convening a regional
workshop on the nonprofit response to Y2K and if you were a
citizen, what you needed to do to get ready for it. People are
getting ready on their own, which I thought was great
Washington Cathedral was going to do that, but that is the
Cathedral.
So, we cannot be processing ourselves to death here. We
have to get out the public information, make sure that we have
our infrastructure lined up with our Governors, and really have
this. Otherwise, this is going to get away. And it is really
going to get away from you. So, we have a wonderfully
responsible private sector, the utilities; the nonprofit
sector, like the Washington Cathedral. And then we have the
talk shows that the aliens are going to land or in every dam in
America the locks will fail and so on. So, we have doomsday,
Armageddon, and I do not want the American people to be caught
because we were processing and having regional meetings and the
coordinators felt very good and felt everything was under
control because the infrastructure might work, but there might
be panic whether the infrastructure works or not. It is the
pre-panic that we need to start to manage now. I am not saying
the panic is here, but it will be here unless there is some
type of organized effort about that.
the national fire academy
Then we can go to terrorism, if I could. Actually I am
going to have the chairman ask his questions on terrorism and I
will come back because anything we respond to goes to our first
responders. Our first responders are the fire fighters,
volunteer and professional, and I happen to believe the
volunteers train very hard to be professional. And then we have
the emergency technicians that are usually part of fire
fighting units as well as then moving into ER rooms and so on.
This thing with the Fire Academy really bothered me. It
bothered me tremendously about the report. I would like to
compliment you on your leadership in terms of pulling that out.
Could you tell us what your intentions are to make the Fire
Academy fit for duty? We welcome your new personnel.
Mr. Chairman, I just want to show you. They have to revisit
their mission statements. The Fire Academy needs to be an
active partner and proactive in disaster relief and terrorism.
There is this whole other question which is that the Fire
Academy is not involved with the professional organizations
around the country. This is not good news. This is not good
news.
So, do you want to tell us how you will address these
management and other defects?
Mr. Witt. Senator Mikulski, the concerns that are reflected
in the report are shared by Administrator Brown, the fire
services, and myself. That is why I asked the national fire
associations to appoint a person to convene a panel to look at
what we are doing in fire services on a national level, look at
our programs, look at our delivery of the programs, look at how
we are managing these programs, look at what we needed to
change to make sure that we have the best fire service
possible, the best trained fire fighters in America, the newest
technologies, the latest research; everything that is going to
save lives and protect property. That is what we asked them to
do. And they came up with a very good report.
Now it is our responsibility to take that report and those
comments, and implement a plan over the next 2 years to put in
place, as you said earlier, the very best academy that we can
have for this Nation. And that is what we want to do. I think
we can do that. That is what Rich is going to be working on,
and I am very excited about this. The fire services are excited
about it. As we go through this, we will be happy to report to
you what we are doing and how we are doing it.
In August we will be meeting with all the national fire
associations, and I have suggested we have the meeting at
Emmitsburg at the Fire Academy where we will have opportunity
to interact with Administrator Brown and the fire staff up
there. Hopefully, Rich will have an implementation plan to
share with them and go through it at that time.
Senator Mikulski. In the executive summary, it says the
Fire Academy's fire program must be first and foremost
adequately funded. We cannot fund something that is
hemorrhaging the way this is.
Second, beyond money, however, lies the crisis of faith and
confidence which money will not fix, which goes to the
leadership issues.
Now, a 2-year program, meaning a step-by-step program from
a fiscal standpoint, is very good, but Mr. Witt, is there a
sense of urgency not only within headquarters, but out at the
Fire Academy about really moving on some of the leadership and
communication issues that are not about money but it is about
getting your act together and getting it pretty quick?
Mr. Witt. Absolutely.
urgency for addressing fire academy issues
Senator Mikulski. In other words, I want a response to the
report as quick as the fire fighters in Baltimore respond to a
911 call.
Mr. Witt. What we will try to do for you is to share with
you a report that we are working on now that says what we can
do right now without funds to make a difference.
Senator Mikulski. Is there a sense of urgency?
Mr. Witt. I think so. There is an urgency that we need to
start now to be ready to go into the 21st century.
Senator Mikulski. Do you have a sense of urgency?
Mr. Witt. Yes, I do.
Senator Mikulski. Does the leadership at the Fire Academy
have a sense of urgency?
Mr. Witt. Yes, they do.
Senator Mikulski. And this is not about spring hazing. Were
they as mortified by this as they should be?
Mr. Witt. They were very concerned and they are very
encouraged by this because it really focuses on what we need to
do for the future. So, I think they are very excited about the
possibility that we truly can be the best up there. So, they
are very encouraged by this.
But there is a sense of urgency that we need to be better
and we can do better and we are going to do better.
Senator Mikulski. Let me turn it back to you, Mr. Chairman.
allocation of anti-terrorism funds
Senator Bond. Thank you, Senator Mikulski.
On the general theme of anti-terrorism, you are requesting
$30.8 million for anti-terrorism, which is an increase of $13
million. $8 million would go to States. Much of the rest would
go to FEMA personnel in regions and headquarters.
Can you give me an idea how you would allocate the funds
and why the increase is needed?
Mr. Witt. Sure. Gary, do you want to----
Mr. Johnson. Mr. Chairman, are you interested in allocating
the salary and expense dollars or all of the dollars in that
program?
Senator Bond. What are you going to do with the money? What
mission is going to be accomplished if we give you $30.8
million? I do not need to know who is being hired to do what,
but what is going to be the outcome? What do we get for it?
You can follow up in detail for the record, but I just want
to know what is $30.8 million going to get us?
Mr. Walker. The primary thing, Mr. Chairman, is $21 million
of that goes right into the hands of the States and then the
State fire people. So, $21 million, as opposed to $12 million
last year, is going out there for planning and exercises on the
State level.
Mr. Witt. And I think it is important to note that in last
year's budget, FEMA had a small role and less responsibility in
comparison to what we have now and how the program has been set
up with the Department of Justice and Janet Reno. I think now
the program is more targeted than it was last year. I think
setting up the office in Justice gives a one-stop shop that
people can call. They did not know who to call before. They did
not know where to go. We had too many players in it without a
true focus. By working very closely with John Hamre at DOD and
Janet Reno, we do have a focus on it now. We do have a good
plan now, and I think it is going to truly make a difference.
interagency coordination on terrorism
Senator Bond. You anticipated my next question because the
GAO report of April 23, 1998 said the United States is spending
billions of dollars annually to combat terrorism without
assurance that Federal funds are focused on the right programs
or in the right amounts. Then in October, GAO said there had
been inadequate coordination and focus for training, equipment,
and response, and the GAO says, ``Some local officials viewed
the growing number of WMD consequence management training
programs, including the domestic preparedness program, the
Department of Justice, FEMA, EMI courses, National Fire Academy
courses, the National Guard's National Interagency Counter-Drug
Institute course as evidence of a fragmented and possibly
wasteful Federal approach towards combatting terrorism.''
I know you say there has been a coordination office set up
in DOJ. What is actually happening? How are we getting a handle
on these? Because we are going to be dealing with this at the
full committee appropriations level, as Senator Stevens has
said.
Mr. Witt. I met and talked about this with Janet Reno, John
Hamre, and Mike Walker, when Mike was at DOD. I was concerned
because I did not think we were getting down to the grassroots,
first-responder level and truly getting these people trained
and truly getting them the types of equipment they would need
to detect a chemical/biological agent if there was an event. I
expressed my concerns. I was very vocal about this.
State and local emergency management and the fire services
are going to be on that front line. They have got to be able to
respond immediately. They will not have 12 or 15 hours to
respond.
I was not bashful about this. I said ``we do not need to
reinvent the wheel.'' We have got the wheel. We need to put a
tight ring around that wheel. Janet Reno agreed with me, and
that is what we have been trying to do and I think we have. She
has worked closely with us to make this happen.
While I feel better about it, I am not as comfortable as I
would like to be. I think by working the training process with
the States and the fire services at the State and local level,
I will gain a higher comfort level. We are targeting cities
with populations of 100,000 or above.
coordination with state and local governments on terrorism
Senator Bond. Well, I tell you, pardon my skepticism, but
creating another office is not necessarily reassuring to me
that we have solved the problem.
Have you got people out of each other's hair? Have you got
agencies that are trying to reinvent the wheel that have not
been in the wheel business before? Because it is obvious to me
that FEMA works with local communities. The National Guard is
in every community already. You will have to show me a lot to
convince me that between what FEMA does and the National Guard
does, there is not a heck of a lot of room where we need to
have more Federal employees, no matter how brilliant and how
informed they are, trying to work with local communities. Have
you gotten the other people out of the field where you and,
say, the National Guard have primary expertise?
Mr. Witt. I think the coordination with State and local
governments is much better than it was, would you agree, Mike?
Mr. Walker. Director Witt has made it clear, Mr. Chairman,
that if the Congress--and the Congress has not yet approved the
NDPO, the National Domestic Preparedness Office, in the
Department of Justice--if the Congress does approve the office,
from FEMA's standpoint as part of the partnership, we will
insist that the focus be on State and local government and
first responders. That is going to be what we do in our daily
work with the NDPO.
Senator Bond. Well, I think that is important. Frankly,
there is legislation that we passed that sends the Department
of Defense out to 120 cities. I suppose I voted for it. I do
not recall it. [Laughter.]
But when you look at it, you think, does that make a lot of
sense?
Mr. Walker. Mr. Chairman, I managed that program when I was
at DOD. So far, 30,000 first responders have been trained.
There are 5 million first responders in this country. We have
only begun to scratch the surface. That is why it is important
that we look at how to deal with the rest of the Nation and
keep that focus on the State and local level responders who are
going to be there on the front line.
Senator Bond. Is the DOD the right agency to be training,
or should FEMA be using its existing relationships, the other
emergency responders, the National Guard? In the first couple
of years as Governor, I spent more time with the National Guard
than I did with my family because I was viewed as the master of
disaster because we had everything from projected prison riots
to floods to tornadoes, and when it comes to responding, the
Guard is the one that is going to be there, along with the
emergency personnel and local law enforcement officials.
Mr. Walker. You are exactly right. DOD did not ask for the
mission. We tried to give it away as soon as we got it. The law
required DOD to have it for 3 years. It is a domestic mission.
It is not an international mission. This is the last year for
DOD and it will transfer to the new NDPO in the next fiscal
year.
Senator Bond. Thank you.
Senator Mikulski.
training for first responders
Senator Mikulski. In our hearing at the State, Justice,
Commerce--and Senator Gregg has held four hearings on
terrorism--he was very complimentary of the coordination and of
the cooperation of Director Freeh of the FBI and our Attorney
General. They have good coordination with our Secretary of
State and other national technical means agencies for gathering
information.
But I share the same concerns that Senator Bond has, that
we now are building up a lot of money and we have a lot of
coordinators of the coordinators. I am not talking about the
interagency group where very senior and dedicated people are
trying to work through this, but as we move down those
coordinators of the coordinators, even between the White House
and here, it is who is Mr. Turf and who is Mr. Big Guy. We
cannot fool around like this.
The other thing is I think that there is a lack of clarity
between what is DOD and the role of the Guard or, yes, yes, the
military and. And then the second is our coordination with HHS
and the Centers for Disease Control. I will not go through all
of this because it does go to, I think, a full hearing with my
colleagues on the other subcommittees that have probed into
this. But Senator Frist, even on the authorizing Committee of
Health, Education, and Labor is going to hold a hearing on
bioterrorism. Everybody is holding a hearing.
Now, why are we holding hearings? Because I think deep down
inside of the U.S. Senate we do not know what the plan is and
we do not know if everybody has got their act together. So, we
are all trying to take bites of this to make sure that on our
watch we have fulfilled our responsibility. But I think if we
have concern, then there is a reason to be concerned.
Now, I do not want to give countenance so somebody says,
oh, they do not have their act together, be ready to go. I
believe the infrastructure we have in place and brave people
will. But I really do think we really do need a presentation of
this and a real sense of clarity because I have yellow flashing
lights about the others.
In Maryland, they are using Baltimore as a test site. DOD
is in there with their 120 cities. But quite frankly,
Washington, DC, is a very high risk area, and guess what
counties will be first hit? Montgomery and Prince Georges with
both the panic or whatever the nature of, say, a chemical or
whatever it could be. Now, they have got training grants from
the Department of Justice, but you see, somebody says, oh,
well, it is Baltimore. It is a big city. Well, yes, it is.
Well, it is my hometown. I want us to be like prime time.
As I said, I will be discussing this with Governor
Glendening. The Maryland plan does have a medical strike force.
In other words, there are elements here that give me
consolation, but I am really concerned.
This takes me to one other thing about being concerned. You
are all training the first responders, and yet I have a report
here from the Fire Academy that says it is out to lunch on
training first responders. Who is training the first
responders? Is it the Fire Academy?
Mr. Witt. The Fire Academy is doing a lot of anti-terrorism
training, but also the State fire training academies are as
well and the State offices of emergency services are too.
role of fire academy in anti-terrorism training
Senator Mikulski. Who is training the State fire training
academies?
Mr. Witt. They are coming to Emmitsburg and taking
training.
Senator Mikulski. But, sir, in your own Blue Ribbon report
it said that Emmitsburg did not have any sense of being
proactive or even reactive on training terrorism.
Mr. Witt. Yes.
Senator Mikulski. I am going by the report.
Mr. Witt. I understand that. The academy has worked very
closely with DOD and Justice in developing those training
programs that they are using now as well.
Senator Mikulski. Why would the report say they do not know
how to do it?
Mr. Witt. I do not know why that report said that, but they
are. They have done a lot of work in developing those training
programs. There needs to be more of the in-depth training at
the academy, there is no doubt.
Senator Mikulski. I am just going to this, and this is why
I have a worry about the whole thing. Recommendation number 21:
The U.S. Fire Academy needs to be an active partner and have a
proactive role in the national disaster and terrorism response.
Then you tell me they are training them and then there is this
recommendation. So, can you see why I do not get it?
Mr. Witt. Sure, I do.
Senator Mikulski. So, how can I get it?
Mr. Witt. Carrye, would you like to----
Ms. Brown. I would like to respond.
Senator Mikulski. Would you identify yourself and use the
microphone?
Senator Bond. Would you come up to the microphone and
identify yourself for the record please?
Ms. Brown. I am Fire Administrator Carrye Brown, and part
of my responsibility, along with Dr. Onieal and the rest of my
senior staff, is the National Fire Academy, as well as our
other fire related, technology based programs.
But before this whole issue came up, we had a stakeholders
meeting to look at the role of the Fire Academy in anti-
terrorism. That was way back in 1996. So, before this became a
hot issue on Capitol Hill, we had experts from Israel, from
Ireland. We had our top level experts here in the United
States. And they set out a plan for the National Fire Academy
to develop curricula based on anti-terrorism issues. And we
started with very little money, seed money, because as you
know, we have been level-funded over the last 4 years, to
develop the curricula that DOJ has taken and sent out around
the country. So, we were ahead of this.
So, in other words, I respectfully disagree with that
conclusion that was reached in the Blue Ribbon Panel report. My
outstanding staff at both sides of the house, both the Academy
and our technology based side of the house, got ahead of the
issue, and we were ready to develop the curricula for anti-
terrorism before we got additional seed anti-terrorism money.
Senator Mikulski. Madam Administrator, as you know, this is
not about hazing you or finger-pointing.
Ms. Brown. I know.
Senator Mikulski. I am going by the reports. That is what
we have.
Now, my question to you, presuming the curriculum has been
developed, is the curriculum being implemented?
Ms. Brown. It is being implemented. In fact, we have helped
to train about 34,000 trainers. We have leveraged that by
giving curriculum to DOJ, and they have utilized it as well and
helped to print materials and send it out to others. What we
did was train the trainers so that they, in turn, could go back
to the States and train others.
We have used, too, something that Director Witt said, our
existing training systems. We did not try to replicate anything
that was already out there. We have the State training systems
and they are excellent in all 50 States. So, that is how we did
a great deal of it, but we also trained more than 34,000 on
campus.
Senator Mikulski. Thank you.
Ms. Brown. You are welcome.
Mr. Walker. Senator Mikulski, if I could add, when I was at
the Department of Defense, I unfortunately found myself in
Oklahoma City after the Murrah Federal Building bombing, and
when I talked to the local fire department there, I found out
that just the year or so before the incident that they had been
at Emmitsburg for training, and they credited that training for
how well they responded. The fire department of Oklahoma City
under enormous pressure, and in a difficult situation, did a
magnificent job. I was not at FEMA then, but they said that the
training they received at Emmitsburg helped them do that.
Senator Mikulski. Well, I appreciate that, but you can
understand our questions based on the material which then goes
to the full hearing. Based on the response of the
Administrator, I think we need a response to the Blue Ribbon
commission about, number one, where it is agreed upon and the
highest priorities and then to be able to move.
Rather than go into all the questions on terrorism, I think
we need to go to the full committee, Mr. Chairman. I have taken
a lot of time here.
cost savings in the disaster program
Senator Bond. Well, I think it is very important. I am
getting ready to, I think, submit most of the remainder of my
questions for the record.
But I want to discuss some of the things that we have
mentioned before about getting a handle on the disaster relief
program. I have congratulated you on the things you have done
to improve the program like the disaster close-out teams. There
is still much to do, such as defining the circumstances that
allow State insurance commissioners to declare the insurance is
or is not reasonable.
What actions do you plan for publishing the final rule
requiring 80 percent coverage of replacement value? What about
the State insurance commissioners? What additional actions do
you see to reduce costs in the disaster relief program? And
what are the cost savings that you have achieved as a result of
actions you have taken to date?
Mr. Witt. Mr. Chairman, in every single State where we have
done the mitigation it has been shown, even in repeated floods
and other disasters, that prevention has saved money. For
example, Hurricane Georges went through the Virgin Islands,
however, there was very minimal damage because of the
mitigation work that we had done following Hurricane Marilyn.
Then when Georges hit Puerto Rico, it showed very clearly that
Puerto Rico had not done as much mitigation or prevention.
The insurance component is important. We hope in April to
be ready to come forward with a published rule after working
with the States and the insurance commissioners and the Public
Risk Managers Association. We have a meeting coming up with
those State insurance commissioners.
[Clerk's note.--In subsequent conversations regarding the
public buildings insurance rule, FEMA officials indicated that
that publication of a draft rule is now scheduled for June due
to a desire for additional meetings with stakeholders.]
I feel pretty strongly that we will be able to come forward
with that rule. It is a difficult issue to deal with, but we
are tackling this and I think it should be addressed.
Reengineering the public assistance program is one
improvement that is now being implemented that is going to
allow us to save administrative costs and save disaster costs
because we are going to be able to respond and close out
disasters much faster. The close-out teams that you referred to
and that you all helped us put in place--and we appreciate
that--are going to be able to consolidate from the three teams
down to two teams by the end of this year because they have
accomplished so much.
Senator Bond. You have made that much progress in closing
out.
Mr. Witt. Yes, sir. That in itself has really made a huge
difference.
I think each thing that we are doing, even the flood
mapping modernization plan, will help save disaster costs. Even
if we can start addressing the repetitive flood losses, that
will not only save funds in the Flood Insurance Program, but it
is going to save disaster dollars. Even though claims are paid
from the flood insurance program, there is still a need for the
temporary housing program as part of the disaster response. So,
all of those things will help save us money in the disaster
program.
Senator Bond. Did you say when the 80 percent replacement
value would be published? Is that the one in April?
Mr. Witt. We are hoping to publish in April.
disaster criteria
Senator Bond. The disaster criteria. FEMA proposed the rule
describing the factors and we need these criteria to be
established and on the record. The Stafford Act says that
Federal assistance is to be provided following an event which
overwhelms State and local capability to respond, but it has
not been formally defined.
I am concerned the proposed rule does not go far enough.
For example, the $1 per capita threshold has been in use for
the past several years. No adjustment for inflation. It does
not reflect a State's economic health or ability to raise
public revenues. Why not?
Mr. Witt. Well, I think it is a step in the right direction
to work with the States in coming to a single disaster
declaration criteria with an annual adjustment on the $1 per
capita based on CPI and also putting in a minimum of $1
million. $1 per capita for even the State of Arkansas, which is
2\1/2\ million people or almost 3 million, would require at
least a $3 million disaster in order to qualify. For
California, over a $30 million disaster would have to happen
before we could even look at declaring a Federal disaster.
And by adjusting the per capita threshold each year, plus
the cost share adjustments that we are making moves us in the
right direction and with the support of the States. I think it
is a good step.
Senator Bond. Do you think there will be fewer disaster
declarations as a result of that? Will it cut down on the
number?
Mr. Witt. Very possibly, yes, sir.
Senator Bond. How does FEMA determine the amount of
insurance coverage that should have been in force as required
by law and regulation at the time of disaster? I do not believe
that you currently have such information, and how will you get
it before issuing a final rule?
Mr. Witt. We are working on that now, and we will be happy
to provide it to you, Mr. Chairman, as soon as we get it
compiled.
stafford act amendments
Senator Bond. Very briefly, on the proposed Stafford Act
legislation, I gather that has been reported out of OMB now. I
am advised by staff I was incorrect.
Mr. Witt. Yes.
Senator Bond. Can you give us a preview just of the key
items, how much money they would save, and why you dropped out
some of the red hot and ready items in the July 1997 package,
such as the requirements that private nonprofits first seek SBA
loans?
Mr. Witt. Basically what we are trying to do with the
insurance on public buildings covers the private nonprofits, as
well as public structures, which I think will help make a
difference.
The amendments that we are going forward with hopefully
will be incorporated into those introduced by the House and
Senate as well. I do not have the legislation with me.
Senator Bond. What kind of cost savings do you expect?
Mr. Witt. I do not have the total, Senator.
Senator Bond. Well, let me give you a little heads up. Last
year, to be quite honest about it, we moved forward with some
things that would spend some more money in hazard mitigation
and do some things that were very good. When I asked my
colleagues who were supporting the legislation where the
savings were, they said, well, we are spending more money. And
I said, as you and I would say in Arkansas and Missouri, that
dog will not hunt.
For me to remove my objection to any reforms in this area,
I want to see savings, and I will be happy and join with you in
supporting a bill that makes demonstrable savings. Just
spending more money is not going to get it. So, we look forward
to working together. I know we have got a lot of people who are
interested in it, but my bottom line is how much savings are
you going to show us.
Mr. Witt. It is ours as well, Mr. Chairman. I think with
your support and the committee's support that we have come a
long way. It is not saying that we do not have further to go.
Senator Bond. Yes.
Mr. Witt. But we are working very hard on it.
Senator Bond. I am just telling you what I am looking for.
Senator Mikulski, I turn to you for the wrap-up and the
exit question or questions, as described by some of our friends
in the talk show business.
professional emergency managers
Senator Mikulski. Thank you, Mr. Chairman. Just a comment
and then a question.
In 1988 when I became the chair of the subcommittee, the
Cold War was drawing to a close. I wanted to bring down the
fire wall between our response to the American people and a
civil defense function because it had been so eaten up. Now it
is so ironic that the two are melding because we are now
threatened by weapons of mass destruction, perhaps nuclear, but
more likely other types of disruption and security threat.
That takes me to not putting walls back, but I think one of
the things that I strive with in working with you, sir, was I
believe that emergency management is a profession. It is a
profession like being in the military. It is like being a
physician and so on.
One of the concerns that I had in looking at States was
some had professional administrators like you in Arkansas and
others were, quite frankly, patronage driven. There was always
Louie who had helped in the campaign. Let us give him
something. Now we are not going to go back to putting up a
wall, but I never wanted to see local administrators patronage
driven and really to honor the whole concept that this is a
profession.
Could you tell us, as my concluding question, because it is
part of the institutionalization of our reforms, what you want
to do to professionalize this and, therefore, it can be
acknowledged both in service and in benefits, et cetera?
Mr. Witt. Senator Mikulski and Mr. Chairman, since 1993 we
have worked with State and local emergency responders to become
more professional in what we do, and to be able to respond to
do a better job. We have assessed their capabilities and have
identified the weaknesses. We have tried to address those, but
now is the time to move forward for the future. We have sat
down with NEMA.
Senator Mikulski. Can you say what NEMA is?
Mr. Witt. NEMA is the National Emergency Management
Association.
I can say that NEMA and the local emergency management
associations are far better now than they were 6 years ago.
Senator Mikulski. Absolutely.
Mr. Witt. And they have worked very hard. I am very proud
of them, but we need to go a step further. We need to
professionalize emergency management similar to fire services.
The National Emergency Management Association's executive
board, the State directors, and I sat down. We talked about
what we needed to do in the future. We agreed that we need
national standards for emergency management at the State and
local level.
We are working now to implement national standards for
State and local emergency managers based on the National Fire
Protection Association standard 1600. So, I think it is going
in the right direction. We are working with them now and have
already drafted standards to implement. This will help to
professionalize this area.
We have worked with universities. We have several
universities that now are offering college credit courses in
the emergency management profession leading to a college
degree. So, I think we are almost there, but we have one more
component to be addressed.
Senator Mikulski. Well, we look forward to the advice of
the professional association because they gave us a lot of
guidance, as did the national organizations of fire fighters
during our reform process. So, we look forward to this. We want
to have professionals. We do not want to have bureaucracies. We
like the idea of training at a collegiate level. We also think
these are tremendous opportunities through a community college
level, particularly as people are retraining and recycling
themselves.
Mr. Witt. I agree.
Senator Mikulski. Thank you very much. I look forward to
working with you on a prevention budget.
Mr. Witt. Thank you.
Additional committee questions
Senator Bond. Thank you very much, Senator Mikulski. Thank
you, Director Witt. We do have a number of questions we have
asked you about, and we will be submitting more for the record.
We appreciate working with you and look forward to meeting the
challenge ahead of us.
Mr. Witt. Thank you, Mr. Chairman.
[The following questions were not asked at the hearing, but
were submitted to the Agency for response subsequent to the
hearing:]
Questions Submitted by Senator Bond
priorities
Question. FEMA has requested $83 million in increased expenditures
over fiscal year 1999, a 10 percent increase. Increases have been
requested for additional staff, the emergency food and shelter program,
a new repetitive loss initiative, fire program enhancements, and the
list goes on. Given that the budgetary caps likely will prevent us from
funding all of these increases, please provide a specific ranking of
priorities.
Answer. The increases requested in 2000 related to salaries and
expenses reflect my first priority. It is absolutely necessary that
FEMA have an adequate and well trained workforce, capable of delivering
all of our programs in the most efficient and effective manner
possible. The establishment of the Pre-Disaster Mitigation Fund and the
request targeting repetitive loss structures under the Flood Mitigation
Fund are both investments in the future of this nation that will save
money and help prevent our citizens from becoming disaster victims.
Therefore, I would place them among our top budget priorities. Finally,
the enhancement for Fire Prevention and Training will allow FEMA to
address many of the recommendations made by the Blue Ribbon panel,
which was convened to review our fire programs.
hud ``unmet needs'' funds
Question. FEMA asked each State with a declared disaster last year
to submit a list of its unmet needs in an effort to work with HUD to
allocate emergency CDBG funds. The list totals $2.3 billion. How would
you characterize the lists sent in to FEMA--are they ``wish lists'' for
the everything the State wants that may be connected to a disaster, or
have they been analyzed and prioritized, and have cost-benefit studies
been conducted? If FEMA were provided with funding for ``unmet needs''
how will FEMA's process differ from how HUD allocated funds.
Answer. It is our experience that most States do prioritize the
unmet needs lists that they forward to FEMA. Often the lists are the
product of the State's own unmet needs task force or hazard mitigation
team that reviews requests from residents and local communities and
distributes available State and Federal assistance. Because the unmet
needs lists include early proposals, it is unlikely that the State has
conducted benefit-cost analyses on them. Generally, detailed analyses
such as these are done for the top priority projects once the State is
certain how much funding is available.
If FEMA had the responsibility for allocating unmet needs funding,
our actions would build upon the processes used in supplying data to
HUD. Our first priority would be to work closely with our customers at
the State level to devise an equitable distribution. We would actively
seek the input of State emergency management and community development
agency officials regarding how to prioritize the needs reported. FEMA
has well established relationships with its State partners and has a
high degree of trust in their ability to identify key disaster needs.
disaster criteria
Question. In January FEMA proposed a rule describing the factors it
considers when evaluating a governor's request for a major disaster
declaration. Criteria are needed to depoliticize the declaration
process, and to clarify what constitutes a federal disaster. Under the
Stafford Act, federal assistance is to be provided following an event
which overwhelms state and local capability to respond. But this has
never been formally defined prior to this rulemaking.
I'm concerned the proposed rule does not go far enough. For
example, the $1 per capita threshold has been in use for the past
several years, with no adjustment for inflation, and does not reflect a
state's economic health or ability to raise public revenues. Why?
There are problems in other areas, such as how FEMA will determine
insurance coverage that ``should have been in force as required by law
and regulation at the time of the disaster.'' FEMA currently does not
have such information. How will FEMA determine insurance coverage that
should have been in place? Will FEMA consider these and other concerns
before issuing a final rule?
Answer. The National Emergency Management Association and the
National Governor's Association have strongly objected to
implementation of any criteria in regulation that would limit the
flexibility of the President or the governors in meeting disaster
needs. The evaluation factors that FEMA proposes would ensure that
requests for disaster assistance are evaluated fairly and consistently
while preserving Presidential discretion, and allow consideration of
the unique circumstances of each request.
In preparing the proposed rule, FEMA held extensive discussions
with its State partners and local government organizations to determine
the best means of identifying State capability, and ensuring that
proposed declaration criteria encourage insurance and hazard
mitigation. We found that there was no agreement on a simple and
equitable method to measure State capability. In the interest of
clarity, simplicity and practicality, we chose to continue the use of a
per capita indicator as a means of gauging the relative means of a
State's ability to handle a disaster--but would adjust this indicator
annually based on the Consumer Price Index. Even this simple shift in
approach met with resistance--a number of large population States
objected to the use of the $1 per capita indicator, while some small
population states objected to the minimum $1 million threshold proposed
under the Public Assistance Program.
With respect to insurance, FEMA proposes to consider the amount of
insurance that should have been in force at the time of the disaster.
Under the Stafford Act we already have an insurance provision that
requires the applicant to obtain and maintain insurance for public
buildings unless the Insurance Commissioner determines that the
insurance is not reasonably available. FEMA requires flood insurance on
all buildings in identified flood hazard areas as a condition of
receiving disaster assistance. Under Section 406 of the Stafford Act,
FEMA actually reduces the disaster assistance by the amount of flood
insurance that could have been purchased, if the damaged facility is
located in a special flood hazard area that has been identified for
more than one year. FEMA tracks insurance purchase requirements and
could determine, for any given disaster, which applicants were required
to purchase insurance. Under a separate initiative FEMA is now in the
process of preparing a proposed rule that would strengthen and clarify
these insurance purchase requirements.
Question. FEMA recently submitted to the Congress legislation
amending the Stafford Act.
What are the key items in that legislative proposal that deal
specifically with improving the disaster relief program?
Answer. Pre-Disaster Mitigation.--Our legislative proposal creates
a new Section 203 in the Stafford Act that authorizes the Director to
establish a program for States, local governments, and other entities
for carrying out pre-disaster mitigation activities that exhibit long-
term, cost-effective benefits and substantially reduce the risk of
future damage from major disasters. This provision would give an
explicit statutory authorization and mandate for FEMA's pre-disaster
mitigation program.
Hazard Mitigation Contributions.--We ask that the Congress amend
section 404(a) of the Stafford Act by changing maximum post-disaster
hazard mitigation contributions from 15 percent to 20 percent of
aggregate amount of grants, applicable to all major disasters declared
after the date of enactment of the new legislation. This provision
would provide increased funding and emphasis on programs to reduce
future damages from natural disasters when the window of opportunity,
usually following a disaster event, is open.
Insurance.--Our proposal would authorize the President to require
by regulation that States, communities or other applicants protect
property through adequate mitigation measures if the State's insurance
commissioner certifies that insurance is not reasonably available.
Under current law an applicant need not take any further action to
insure or mitigate the property against future damage if the State
insurance commissioner certifies that insurance is not reasonably
available. When insurance is unavailable, risks are frequently quite
high. This provision would authorize the President to require further
action to reduce future potential damage to the affected property.
Management Costs.--The legislation would define management costs
and direct the President to establish management cost reimbursement
rates, subject to periodic review for grantees and subgrantees
receiving assistance under the Stafford Act. The purpose of this
provision is to simplify payment of management costs to States and
local governments, and to reduce the potential for duplication of
payments for administrative and other indirect costs under the current
system.
Repair, Restoration, or Replacement of Public Facilities.--We also
proposed to amend and reorganize Section 406, which provides authority
to the President to make contributions to a State, local government, or
person for the repair, restoration, or replacement of public facilities
or private nonprofit facilities. The legislation would amend Section
206 to authorize reduction in the current minimum Federal share of
disaster assistance for facilities that had previously received
significant disaster assistance on multiple occasions. This provision
would have particular applicability to facilities, such as roads, for
which insurance is not generally available.
The amendment would principally support FEMA's reengineering of the
Public Assistance Program by allowing FEMA to provide assistance based
on estimates of repair costs. The President could determine actual cost
to be eligible for assistance notwithstanding the prior estimate where
the actual cost is above 120 percent or below 80 percent of the
estimated cost.
Consolidation of Housing and Individual and Family Grant (IFG)
Programs.--We further propose to combine the Housing and Individual and
Family Grant (IFG) Programs. As amended, this section would establish
the type of assistance available for housing, repairs, and
construction, and would cap total assistance per individual or
household under the combined program at $25,000 per major disaster. In
general, applicants would apply insurance proceeds or apply for an SBA
disaster loan before applying for assistance under this provision. It
would authorize the President to assist some individuals by repairing
their homes or allowing them to rent alternate housing accommodations
without applying for an SBA loan, and by providing financial assistance
for medical, dental, funeral, personal property, and transportation
expenses.
Consolidating the two programs would result in improved services
for victims of disasters. By working with only one program instead of
two, eligible victims would receive faster processing and face fewer
administrative burdens during their time of crisis.
Question. How much money would be saved annually in the disaster
relief fund if this legislation were enacted?
Answer. CBO estimated the Stafford Act amendments in H.R. 707 would
result in a $2 billion increase in outlays between 1999 and 2004. Of
this estimate, CBO projects that ``most of the estimated increase in
outlays--$1.3 billion of the five-year total--would result from
provisions that would accelerate spending from FEMA's disaster relief
fund, but would not change total spending over the long term.''
Additionally, it is important to note that CBO's estimates do not
take into account the savings to be achieved through pre-disaster and
post disaster mitigation efforts. It has been estimated that for every
$1 spent on mitigation, $2 are saved.
We have not yet completed our analysis of annual savings in the
Disaster Relief Fund from this legislation. We are working to refine
the projected savings. When completed, we will forward this information
to the Subcommittee.
Question. Why does the legislation not include all of the proposals
submitted in the July, 1997 package of amendments, such as the
requirement that private nonprofits first seek SBA loans? Does FEMA
continue to support the July 1997 proposal, or has the agency reversed
its position on any of these items?
Answer. We decided early in the drafting stage to propose a
streamlined version containing those features that we considered
essential to mitigate damages and reduce the costs of disaster
assistance. We eliminated certain provisions such as the requirement
that private nonprofits first seek SBA loans because these provisions
had failed to find significant sponsorship or other support in the last
Congress. We were concerned that the opposition generated by these
provisions might unnecessarily delay, if not prevent, passage of these
amendments. We continue to support our July, 1997 proposal and have not
reversed our position on any of the items in that proposal. We have
merely modified our proposal for the pragmatic reasons stated above.
y2k issues
Question. According to a November FEMA survey of state emergency
management agencies, states are generally not aware of the status of
emergency preparedness and progress towards compliance at the local
level. According to the FEMA survey, ``the issue cited most often as a
problem was the limited to total lack of specific Y2K funding and
availability of technical resources and staffing necessary to assess,
test, and validate systems and fixes.'' The survey also found that most
states have no plans to assist or provide funding for local authorities
to resolve Y2K issues.
What are the resource requirements for ensuring the emergency
services sector is prepared?
Answer. FEMA does not have a role in repairing the billions of
bytes of publicly and privately held computer code infected by the Y2K
computer problem. However, FEMA can respond to the physical
consequences of Y2K disruptions if they constitute a threat to lives,
property, public health and safety pursuant to a Presidential
``Emergency Declaration.'' More importantly, with respect to the Y2K
phenomenon, FEMA has embarked on an extensive ``outreach'' initiative
that has direct and indirect benefits to State and local emergency
management and emergency service agencies. The FEMA Y2K effort includes
the development of contingency and consequence management planning
guidance, training for State and local emergency managers, exercise
support, consumer preparedness materials, senior leadership seminars,
regional workshops, Emergency Education Network broadcasts, and a
clearinghouse to exchange information and best practices.
Question. Will any funds be made available from the remaining
emergency funds, and if so, when?
Answer. FEMA is finalizing budget requests for the remainder of
fiscal year (FY) 1999 and 2000 to complete ongoing Y2K contingency
planning activities and to have in place the operational capability at
the Federal and State levels to monitor and, if necessary, respond to
emergencies during the year 2000 rollover period. The budget requests
will be submitted to the Office of Management and Budget before the end
of May.
Question. Is there adequate time remaining to identify and resolve
Y2K problems at the local level?
Answer. Given the wide disparity of readiness in emergency services
systems at the county and municipal level, FEMA is increasing its
outreach activities to these local organizations. Through our regional
offices, FEMA is working with State and local emergency management and
constituent organizations, as well as others, to broaden and accelerate
Y2K emergency preparedness at the local level. Even though every system
will not necessarily be fixed before January 1, 2000, it is not too
late to begin fixes and develop contingency and consequence management
planning.
anti-terrorism
Question. FEMA is requesting $30.8 million for anti-terrorism
activities, an increase of $13 million over the current year. GAO has
raised concerns in reports and testimony in the last year about the
federal government's counterterrorism efforts. GAO cited the need to
develop risk assessments to target resources effectively and set
priorities. (See GAO/T-NSIAD-98-164). How has this concern been
addressed? Please discuss how other concerns and recommendations cited
in this report have been addressed, as they relate to FEMA's role in
counterterrorism. Can you give us your assessment of the level of
readiness at the state and local level for a possible terrorist attack?
The Missouri National Guard has one of the 10 full Rapid Assessment and
Initial Detection (RAID) teams. How does the National Guard tie into
the planning, training, and exercise activities for possible terrorism
attacks?
Answer. Regarding risk assessments, Section 1404 of Public Law 105-
261 provides that
``The Attorney General, in consultation with the Director of
the Federal Bureau of Investigation and representatives of
appropriate Federal, State, and local agencies, shall develop
and test methodologies for assessing the threat and risk of
terrorist employment of weapons of mass destruction against
cities and other local areas. The results of the tests may be
used to determine the training and equipment requirements under
the program developed under section 1402 [the Nunn-Lugar-
Domenici Domestic Preparedness Program]. The methodologies
required by this subsection shall be developed using cities or
local areas selected by the Attorney General, acting in
consultation with the Director of the Federal Bureau of
Investigation and appropriate representatives of Federal,
State, and local agencies.''
The other concerns cited in GAO's testimony are the need to improve
coordination, develop overall priorities and strategy, and measure
results. FEMA is supporting the Attorney General's National Domestic
Preparedness Office (NDPO). In accordance with Presidential Decision
Directive 62, FEMA also participates in the National Security Council's
Weapons of Mass Destruction Preparedness, Consequence Management, and
Protection Group (WMDP) and certain subgroups. Through the NDPO, FEMA
expects to work with other departments and agencies to develop an
interagency strategy that builds on the Attorney General's Five-Year
Counterterrorism and Technology Crime Plan and includes performance
measures. At the same time, FEMA will continue working to refine and
enhance the Capability Assessment for Readiness (CAR).
Readiness at the State and local levels varies from one
jurisdiction to another, and it varies in terms of particular
components of readiness: plans, training, equipment, exercises and
evaluation. In the pilot State CAR report, States indicated that plans
and equipment for weapons of mass destruction terrorism were areas in
need of improvement. FEMA's request calls for additional funding for
State and local planning; the Department of Justice is providing
additional funding for State and local equipment.
As a State asset, the National Guard ties into terrorism
preparedness activities as a State's Governor sees fit. Certainly the
National Guard is a resource not to be overlooked. It provides valuable
support in all kinds of disasters--for example, in the areas of
transportation and security. On a national level, the National Guard
Bureau is completing a study mandated by Congress last year to
determine how it can support terrorism preparedness within the existing
framework of Federal, State, and local department and agency
authorities and responsibilities. First responders have stressed that
expansion of National Guard activities in terrorism preparedness should
complement--rather than duplicate--existing systems for emergency
preparedness and response, and that attention to National Guard
resource requests not detract from resource needs of local responders.
FEMA recognizes this as a legitimate concern, and the draft National
Guard study indicates awareness of this concern. FEMA training courses
are available to the National Guard; more than one-third of the
curriculum for RAID teams consists of National Fire Academy courses.
flood map modernization initiative
Question. In his fiscal year 2000 budget, President Clinton
requested authority to assess a $15 transaction fee on all new
mortgages and refinancings. Revenue from this transaction fee, totaling
nearly $312 million over 5 years, will be used to update and improve
the floodplain mapping system developed by FEMA. Among other things,
these floodplain maps help FEMA determine which properties are eligible
to participate in the National Flood Insurance Program. These
floodplain maps have been found to be inaccurate around the edges. Why
has FEMA allowed these maps to deteriorate to such a point where in
some cases the maps indicate that properties are within a floodplain
when in fact they are outside of the floodplain, and vice versa? FEMA
has identified a $900 million requirement to update and modernize its
flood maps. Why do we have such a large backlog of outdated maps in
this program? Why are new funds needed to improve these maps, instead
of a reallocation of FEMA's current funding to update the system?
This proposed $15 transaction fee will apply to all new mortgage
originations and refinancings, regardless of whether the property is in
a floodplain or not. What is FEMA's rationale to impose a tax on home
ownership on properties that are not in the floodplain? How will such
homeowners benefit from improved floodplain maps?
Can you explain the rationale for this fee and describe how you
have consulted with the mortgage banking industry? If the fee is not
enacted, what other ideas do you have to address this very large
requirement? What are the ramifications of not addressing this need?
FEMA's proposal would generate about $58 million next year for
flood mapping activities. Under your proposal, how many years would it
take to completely address the need to update and modernize the maps?
Why is there such a large backlog, and why are new funds needed?
Answer. The deterioration in the map inventory results from
resource levels that have been inadequate to keep the map inventory up-
to-date. The maps require updating as a result of man-made or natural
changes and/or because newer data and/or improved study methods have
become available. Also, many maps show flood-prone areas that were
analyzed using only approximate methods of analysis which are not
adequate for sound floodplain management. At present, FEMA is
authorized to spend for mapping only the money generated by the Federal
Policy Fee and through the sale of map products and services. FEMA
could reconsider some of its current activities, and reduce services
provided to rechannel additional funding to map modernization efforts.
However, even with authority to do so, reallocating some of FEMA's
current funding for map modernization would result in significant cuts
in other service areas.
Question. What is FEMA's rationale for assessing a fee on
properties that are not in the floodplain? How will homeowners of such
property benefit from improved floodplain maps?
Answer. There is already a mortgage transaction fee that applies to
all properties, whether or not they are located in the floodplain. Each
mortgage transaction requires a flood map determination by the lender.
Currently, a fee of about $25 is charged to the borrower for this
determination. The fee goes to the lender and/or the contractor
employed by the lender to provide the determination based on FEMA's
maps; despite this, the NFIP gets no portion of this revenue. It is
expected that the cost of the flood map determination reviews will
decrease as a result of map modernization because digital flood maps
will decrease the business costs of performing the reviews.
Consequently, the overall increase in the cost of a mortgage from the
proposed flood map mortgage transaction fee should be less than $15.
A mortgage transaction fee is equitable because it is tied to real
property. Each of the approximately 11 million mortgages transacted
each year and every building permit issued by a community requires the
use of the maps. The maps are used during the mortgage transaction
process by lenders, flood map determination firms, property owners,
insurance companies and agents, and real estate professionals. All
homeowners will benefit from improved floodplain maps because new homes
will be elevated above the flood elevation or built to avoid the
hazards altogether. More accurate flood maps will also mean that there
will be fewer instances where Letters of Map Amendment, which require
property surveys at the expense of the property owner, are required to
remove properties that are inadvertently shown in flood hazard areas.
Question. Has FEMA consulted with the mortgage banking industry?
Answer. The mortgage banking industry, through its representation
on the Council, supports map modernization. We have had some
interaction with the industry regarding the fee and will continue to
work with the banking industry.
Question. If the fee is not enacted, what other ideas does FEMA
have to address this requirement?
Answer. FEMA has considered the following funding options for map
modernization:
Increase Federal Policy Fee.--One option is to increase the $30
Federal Policy Fee. High fees required to recover the whole cost would
be a disincentive to new policyholders and would leave the burden of
flood mapping primarily on policyholders. However, the use of fees to
cover some of the long-term maintenance costs may be appropriate.
Increase Fees on Sales of Map Products and Data.--Prices for
products and data sets could be increased to cover some of the costs of
the mapping program. Currently, the prices cover only the direct cost
of map printing and distribution. Some increase in price appears to
have justification and might be acceptable to customers. However, even
a large price increase would only result in minimal additional revenue,
and would be unpredictable as a principal source of funding for this
initiative. Also, significantly increasing prices for map products,
such as digital files, would likely result in few customers purchasing
them from FEMA at the higher price and then duplicating and selling the
information to multiple other users at a lower price to recoup their
costs.
Increase Flood Insurance Rates.--Another option would increase the
cost of flood insurance to cover the incremental cost of map
modernization. However, this option leaves the burden of paying for
flood maps on only a small portion of the beneficiaries (approximately
4 million policyholders), and any increase will discourage the purchase
of new policies.
Annual Discretionary Appropriations.--Annual appropriations could
be requested each year to cover the map modernization costs from 2000
through 2006. Long-term maintenance costs in 2007 and beyond would be
covered by fee increases.
Long-Term Borrowing from NFIF.--The up-front costs of the program
could be financed by borrowing from the NFIF. The debt would be repaid
with interest through reduced losses and fees paid by program
participants. However, fees of some type would be needed to pay back
the debt plus interest.
Non-Federal Cost Sharing.--State and local governments could
provide some portion of the costs based upon the value of floodplain
mapping to other State and local government activities. It would be
difficult to obtain significant funding from the relatively few States
and communities with adequate resources. Further, it would be a
significant challenge to coordinate the funding levels appropriate for
each entity. In addition, the States would view this as an unfunded
mandate. This option would provide only a portion of the required
funds.
Question. What are the ramifications of not addressing this need?
Answer. Many of the proposed new mapping products and processes
will gradually be implemented even if full funding for map
modernization is not made available. However, the effect of these new
products and processes will take longer to be realized, meaning it will
take much longer than the planned 7-year period to upgrade the 100,000-
map panel inventory for nearly 19,000 communities.
The failure to conduct the needed flood data updates and convert
the mapping inventory to a digital format would severely limit the
potential of a modernized mapping program to dramatically reduce the
loss of property. We project that the map modernization will result in
approximately $26 billion less property damage to new residential and
non-residential structures over a 50-year period than will result under
the current rate of remapping. If implementation of the plan is delayed
one year, we estimate that the long-term benefits to be achieved will
be reduced by approximately $1.5 billion; a significant portion of
these lost benefits will likely result in increased Disaster Relief
funding. Each year of delay in implementing the plan will add
approximately $19 million to the total cost for the plan.
Question. Under the proposal, how many years would it take to
address completely the need to update and modernize the maps?
Answer. As planned, map modernization will take 7 years. However,
the proposed mortgage transaction fee represents only approximately
one-half of what is needed for map modernization. Thus, with the
proposed fee but no other increased funding, map modernization will
take 14 to 16 years.
repetitive loss proposal
Question. FEMA proposes $12 million to buyout, relocate, or elevate
properties that have had multiple claims to the Flood Insurance Fund,
in thousands of cases exceeding the home's value. While this may be a
prudent policy, it should be accompanied by administrative reforms to
this program which seek more accountability on the part of
policyholders.
Can you describe what plans you have to make administrative changes
to the program, and the specific time frame, and whether you believe
that the repetitive loss program should go forward only with such
administrative changes?
Answer. FEMA, along with Members of Congress, is concerned about
the cost to the taxpayers for natural disasters. We are especially
concerned about the individuals who suffer repetitive losses in these
disasters. To address theses concerns, FEMA is interested in
implementing improvements to the National Flood Insurance Program
(NFIP) to protect residents of communities, not penalize them.
FEMA is in the process now of looking at the NFIP's statutory and
regulatory authority to facilitate a repetitive loss initiative using a
common-sense approach, which will help homeowners and business owners
reduce their flood risks, and reduce the costs to taxpayers, while
improving the stability of the NFIP by eliminating reoccurring losses.
FEMA looks forward to working closely with the Congress in considering
the proposals for this initiative.
FEMA will be targeting those properties that have suffered 4 or
more losses and those that have 2 or more losses where cumulative
payments exceed the property value. FEMA will provide a list of the
target properties to each State. We will work with State and local
governments to develop grant applications that address the flood
problems facing those high-risk structures. Grants will be provided
through States to communities for elevation, acquisition, or relocation
projects.
FEMA intends to administer the program in partnership with the
State through the Flood Mitigation Assistance (FMA) program, using a
75/25 cost-share. In this way, FEMA will build upon the experience
gained in working with communities in previous mitigation projects.
Hazard Mitigation Grant Program (HMGP) funds for flood disasters may
also be used to mitigate repetitive loss properties. The $12 million
appropriation will be exclusively targeted at high repetitive loss
properties. Most of the high repetitive loss properties are older
structures, built prior to the implementation of the NFIP, and their
insurance rates are lower than actuarial rates would be. FEMA is
working to enable individuals to protect themselves by providing
alternatives through voluntary buy-outs and elevation or floodproofing
of their homes.
If an insured property owner refuses FEMA's offer to take action to
make the structure less flood prone, FEMA believes it is reasonable
public policy to then only provide insurance at a full-risk premium.
The Agency is preparing to be able to carry out this policy in fiscal
year 2000.
FEMA believes that this administrative change should be part of the
overall repetitive loss strategy. However, since the vast majority of
property owners targeted in these first mitigation efforts are expected
to want to take mitigation action, the repetitive loss program should
go forward with or without such an initial change.
Question. How many projects would FEMA be able to target with these
funds? How much money is needed to address all of the high-risk,
repetitive loss properties?
Answer. FEMA has estimated that the average cost to mitigate a
structure (combining and averaging costs for acquisition and elevation)
is $57,500. At a cost share of 75/25, the Federal share would be
$43,125 per structure. This would allow us to mitigate approximately
270 of the highest risk repetitive loss structures.
FEMA estimates that mitigating these structures would result in an
annual reduction of insurance payments of $9,600 per structure, for an
overall annual savings of $2.6 million per year for the $12 million
initial investment. This one time appropriation would pay for itself
within about seven years, by significantly reducing insurance claims on
high repetitive loss properties.
An estimated $360 million would be required to mitigate losses to
the 8,300 buildings that FEMA has targeted in addition to current
programs.
Question. What requirements will there be for participants in the
program?
Answer. FEMA believes that those who choose to locate in hazardous
areas should bear the risk involved with that decision. Most repetitive
loss property owners are paying flood insurance premiums at less than
full-risk rates as is allowed for Pre-FIRM properties. Thus, our
strategy would be to renew the flood insurance only at full-risk
premiums if a property owner declines an offer of mitigation
assistance. In addition, the statutory authorities that limit disaster
assistance where flood insurance has not been maintained should be
fully utilized.
Question. Will funds be used solely for repetitive loss properties
which are insured under the NFIP, or will the additional 41,000 non-
insured properties which are repeatedly flooded also be targeted?
Answer. The $12 million appropriation will be primarily targeted at
insured high repetitive loss properties. The properties that at one
time were insured repetitive loss properties, but that are no longer
insured, have dropped insurance for a variety of reasons, not the least
of which may be that mitigation actions have already resolved the
problems. FEMA believes that the requested funds should be primarily
targeted at currently insured problem properties as a priority.
Those properties that are still at risk, but not insured, remain
eligible for assistance through other mitigation programs including the
Stafford Act Hazard Mitigation Grant Program (HMGP).
Question. FEMA estimates that $200 million is lost, on average each
year, in the NFIP owing to repetitive loss properties. What is the
average annual cost estimate in the disaster relief fund associated
with repetitive loss properties (both insured and uninsured)?
Answer. At this time, we do not know what the disaster relief costs
are associated with repetitive loss properties. Insurance claims
payments (and not disaster assistance or SBA loans) cover the costs
related to insured repetitive loss properties. There are costs to the
Disaster Relief Fund associated with response services and recovery
assistance, however, they are difficult to isolate.
Some of the disaster-related considerations are as follows:
--Rental assistance may be required to temporarily house occupants of
some buildings while they are being repaired. The average
rental assistance provided by FEMA is under $3,000.
--There may be some costs associated with unmet needs, paid for by
FEMA and SBA grants, particularly for those who did not
purchase insurance coverage for the value of their home
contents.
--Costs for Public Assistance to repair the infrastructure that
services buildings in repetitively flooded areas are incurred.
--Emergency response services are required for frequently impacted
properties.
--Also, in the aftermath of an event, specialized recovery services
produce added expenses (including possible additional costs
associated with increased demand on building departments for
permitting; cleanup of environmental contaminants and household
wastes; etc.).
It should be noted, however, that many of the repetitive losses do
not occur during declared disasters. For these losses, no disaster
assistance would be provided, however they continue to produce added
costs for local communities and property owners.
Question. Is FEMA targeting repetitive loss properties within
existing mitigation programs and initiatives? Please explain.
Answer. Existing mitigation programs and initiatives are inter-
related with the Agency's repetitive loss strategy. For example:
--In September 1998, FEMA issued a policy memorandum challenging
States to address repetitive loss buildings by focusing HMGP
funding to activities that serve to mitigate damages to these
structures.
--In fiscal year 1999, the Flood Mitigation Assistance program
guidance requires States to evaluate projects in order of
priority depending on how well they address repetitive loss.
The first priority is reducing the number of NFIP-insured
structures with 4 or more losses; the second is to reduce the
number of insured structures with 2 or more losses where
cumulative payments have exceeded the property value; the third
priority is to reduce the number of insured structures that
have sustained substantial damage; and the fourth is to pursue
other FMA eligible activities.
--Project Impact communities are also focusing their attention on the
issue of repetitive loss, and many have implemented programs to
reduce their flood risk.
project impact
Question. FEMA claims that the federal investment in the initial 7
pilot Project Impact communities has leveraged $24 million in non-
federal resources. Please provide a specific, detailed analysis of how
you arrived at this figure.
Answer. FEMA solicited information from each of the pilot
communities in order to determine what non-FEMA funds were leveraged
against the initial FEMA investment. This information included total
contributions received by each pilot community, to include ``in-kind''
contributions, and what benefits were received from the leveraged
contributions. The communities were also asked to submit information on
how the leveraged funds were utilized.
Examples of some of the pilot community contribution highlights
received are provided, as follows:
The City of Oakland, CA, has received in-kind contributions from
over 50 corporations, utilities, private non-profit partners and local
and State government partners.
The City of Pascagoula, MS, has committed more than $200,000 in
fiscal year 1999 for drainage improvements, to include a $96,000
citywide project to clean and reshape drainage channels to improve
flows.
Lowes, State Farm, and Wal-Mart donated over 100 smoke detectors
that were installed in the homes of elderly and low income families by
ROTC cadets and Boy Scouts during ``Spring Break'' in 1998.
Allegany County, MD, is matching funds with the Natural Resources
Conservation Service to restore stream channels.
The State of Maryland is funding implementation of new Allegany
County building codes.
The New Hanover County, NC, School Board passed a bond issue of
$2,753,000 to accomplish retrofitting of individual school buildings
pursuant to a mitigation engineering study.
The City of Seattle leveraged numerous non-Federal partners
including: Seafirst and Washington Mutual Banks which reduced charges
and profits and marketed loan packages for mitigation; Puget Sound
Energy which provided technical assistance products to contractors and
homeowners; and, the University of Washington which provided technical
assistance products to contractors and homeowners.
The State of North Carolina selected New Hanover/Wilmington as a
``pilot community'' in the State's Local Hazard Mitigation Planning
Initiative and provided $73,000 to assist the development of a multi-
hazard mitigation plan.
Solutia, Inc. is donating ``Keep Safe'' windows valued at an
estimated $25,000 for a school in New Hanover County, NC. It is also
donating storm resistant windows for the Deerfield Beach, FL, Chamber
of Commerce, valued at $25,000.
Fannie Mae and FEMA have established a partnership to offer special
loans for residential homeowners that will be dedicated solely to
protecting America's homes from hurricanes, floods, earthquakes and
other natural disasters. The loan program will fund construction
projects such as replacing roofing with fire-resistant materials,
waterproofing the exterior walls of a home, and reinforcing the
foundation of a home.
The State of Florida designated Deerfield Beach/Broward County as a
Florida Showcase Community. This is an initiative for the development
of disaster resistant, sustainable communities, similar to and
supportive of Project Impact. At least $240,000 has been pledged by the
State.
A more detailed report is being prepared pursuant to a request of
our Inspector General.
Question. What are the lessons learned to date in this program?
Have program deficiencies been identified and corrected?
Answer. The single biggest lesson we learned is that for a
community to become disaster resistant it must include as broad a
community base as possible, and find ways to keep it a dynamic issue
for its citizens. However, to help facilitate a community-based
initiative, there has been a cultural shift for the FEMA organization.
Our staff have had to rethink the Federal role relative to an
initiative that is not a traditional grant program. We need to continue
to expand our skill base to cover new challenges such as community
facilitation, encouraging peer mentoring between communities, and
motivating all sectors of society to accept responsibility for becoming
disaster resistant. We need to refine the administrative mechanisms for
coordinating Federal participation with locally driven decisions which
may include non-traditional applications like revolving funds for
retrofitting structures. And we need to do even more to integrate our
efforts with other community-based initiatives at the Federal and state
level, which would complement Project Impact. We are addressing all of
these areas, but they are issues which require institutional change and
additional staff resources.
Question. What are the outyear plans for this program? How many
Project Impact communities should there be in each state?
Answer. FEMA plans to leverage Federal resources in already-named
communities, encourage more established communities to mentor newer
ones, and help improve State capability to promote disaster resistant
communities.
Also, FEMA will work to incorporate risk reduction into the purview
of many disciplines. For instance, urban planners do not typically
factor natural hazards risk reduction strategies into community
development. School boards do not call for curriculum on becoming
disaster resistant as part of environmental studies programs. Civic
organizations do not think of mitigation activities as community
service. The economic development community does not factor overcoming
vulnerability to natural disaster as part of their growth strategies.
We see considerable effort in partnerships and education activities as
a vital component to maintaining momentum and expanding participation.
Rather than a fixed number, the amount of Project Impact
communities in each State will be driven by risks, local initiative,
and the need for Federal support for pre-disaster mitigation.
Question. How will you assess the effectiveness in the long-term of
the Project Impact grants?
Answer. FEMA has found that mitigation is most effective when
designed and implemented at the local level. Unfortunately, in the past
the greatest incentive for a community to implement mitigation has
typically been after a disaster. Therefore, the Project Impact
initiative was designed not only to help communities address current
natural hazard risks but to encourage the community to incorporate
natural hazard loss reduction as a continuing part of the community
culture so that it becomes a sustainable activity. To assess the
effectiveness of this strategy, FEMA is implementing an evaluation
process that will establish a baseline on the number of structures and
infrastructure at risk as well as the current level of mitigation
activity in the community at the time it begins the Project Impact
process. For five years the community's progress will then be evaluated
annually to determine the reduction in the number of structures and the
extent to which infrastructure is at risk, increases in mitigation
education and training activities in communities, and activities to
foster proactive business and/or government actions. The data collected
will be used to formulate changes as well as to demonstrate the success
of strategy implementation.
Question. How does Project Impact relate to the Institute for
Business and Home Safety's Showcase Community Program? Why doesn't FEMA
adopt the IBHS's eligibility criteria and program structure that guides
the Showcase Community Program?
Answer. We have worked with the Institute for Business and Home
Safety both at the community level and at the National level. IBHS is
involved directly in some of the Project Impact communities. Director
Witt has held several meetings with IBHS staff to explore areas of
cooperation. At the last meeting he requested IBHS solicit support from
the insurance industry to provide policy incentives for those persons
mitigating their structures and to solicit financial support for public
education measures.
With respect to the eligibility criteria, we are happy to report
that IBHS has adopted many of the Project Impact principles and
features within their Showcase community program.
Question. Do projects funded under the Project Impact initiative
undergo any type of analysis to determine if they are cost-effective?
If so, please describe the approach. If not, how does the agency know
that this funding is targeted to the projects that provide the greatest
amount of future cost savings?
Answer. The Project Impact grant is intended not only to address
immediate community mitigation needs but also as a means for leveraging
funding and resources from other partners, and an incentive for
becoming proactive about emergency management. Therefore, community
Project Impact leaders have been given some discretion on how the funds
will be used. Specifically, this discretion allows the grant to be used
for training, education, and initiative administration activities, as
well as mitigation actions which lend themselves to cost-benefit
analysis. When successfully implemented, all of these activities can
increase capability and the general public's knowledge of mitigation. A
well-informed community can lead to important zoning and/or bond issues
that provide tremendous loss reduction benefits.
Nonetheless, evaluation methods have been developed. For more
traditional projects such as structural retrofits and buy-outs a cost-
effective analysis will be done. In addition, Project Impact
communities will be evaluated each year for the number of these types
of projects implemented through their Project Impact effort. For the
more non-traditional projects as described above, data pertaining to
these elements will be collected annually to evaluate the effectiveness
of these options in the overall Project Impact effort.
hazard mitigation grant program
Question.. Under the HMGP program, 15 percent of the total disaster
relief assistance spent on a disaster is made available for a state's
mitigation programs. GAO has found that about 20--25 percent of HMGP
grants that it looked at are not subject to benefit-cost analysis, so
we cannot be confident that funds are going to those projects which
will provide the most protection against future disaster losses. Can
you explain the rationale for exempting such a large percentage of
projects for benefit-cost analysis?
Answer. The 20-25 percent figure mentioned in the question came
from recent Congressional testimony submitted by GAO. The report gives
a correct explanation of FEMA policy in this area, although the sample
taken is not necessarily representative of the entire HMGP process.
Benefit-cost analysis, while useful in many situations, cannot
always be applied easily to many projects. The nature and types of
hazards, the fact that the return on investment will not be entirely
realized until the next disaster, and the necessity of avoiding
piecemeal approaches in applying mitigation approaches all justify
variance from a singular usage of benefit-cost analysis.
Question. GAO mentions in its testimony that FEMA exempted four
categories of mitigation projects within the Hazard Mitigation Grant
Program from benefit-cost analysis. How does the Agency determine cost-
effectiveness without using benefit-cost analysis? Is any qualitative
effort made to compare project costs with benefits?
Answer. The four categories mentioned in the GAO report refer to
the following: (1) tornado warning systems; (2) mitigation planning;
(3) FEMA's ``5 percent'' initiative; and (4) substantially damaged
structures in a regulatory floodway or floodplain. To address the
Stafford Act cost effectiveness requirement, projects in the first
three categories must be supported by narrative analysis included with
an HMGP application. The fourth category of projects is expected to
yield a high level of benefits because the criteria for such projects
ensure they protect structures at extremely high risk. A more detailed
discussion of each category is provided:
Tornado Warning Systems.--Rigorous economic analysis of warning
systems is problematic for two reasons. First, it is notoriously
difficult to determine the probability of tornadoes--even the best
estimates have considerable statistical uncertainty. Second, it is also
hard to predict whether people will take action when they are warned,
and how effective their actions will be in preventing injuries or
damage.
Given that warning systems reach large geographic areas and give
large numbers of people the time and opportunity to protect themselves,
a reasonable argument is made that these are among the most cost-
effective measures FEMA funds. The Agency requires warning systems to
be part of an overall risk reduction plan, thereby enhancing their
effectiveness. Risk reduction plans must have public education
components, designated shelters, and strategies for encouraging the
construction of safe rooms in new buildings.
Mitigation Planning.--Planning is relatively inexpensive, and has
broad, long-term positive results. It is somewhat analogous to building
codes, in that if mitigation planning influences the way people behave,
e.g., how buildings are constructed or where people go in a tornado,
there is a general improvement in life and property safety. Here again,
benefits are very difficult to quantify. Yet the best use of mitigation
funds in other areas is compromised without effective planning. Local
governments are particularly effective in applying these dollars in a
way which maximizes the effectiveness of the 404 grant. When the
relatively low costs of such projects are balanced against this, it is
valid to conclude that the intent of cost effectiveness requirements is
met.
The ``5 percent Initiative''.--The ``5 percent Initiative'' relates
to a FEMA policy providing States with discretionary use of up to 5
percent of the HMGP funds available after disasters. The underlying
premise for this policy is that since State and local authorities are
in the best position to understand local mitigation needs, some leeway
in project selection is desirable. Projects typically funded under this
exemption include warning systems, planning, public education and
mitigation technologies still under development. Very often, the issue
of cost effectiveness prevents such projects from being seriously
considered because analysis is problematic.
Substantially Damaged Structures in a Regulatory Floodway or
Floodplain.--FEMA requires that participating communities in the
National Flood Insurance Program enforce a substantial damage
provision. This provision requires individual owners to elevate or
relocate structures substantially damaged (more than 50 percent of pre-
event value) during disaster events. This has proven to be the most
cost-effective way of minimizing or eliminating flood damage. FEMA's
policy regarding the acquisition of substantially damaged structures is
based on 30 years of experience in the National Flood Insurance Program
that mitigating structures meeting the two criteria proves cost
effective. In fact, the Agency is undertaking a management audit of the
policy and expects to have results within two months, which we will
share with GAO and the committee.
Question. Based on GAO's testimony, FEMA is limited in its ability
to demonstrate that funding under its Hazard Mitigation Grant Program
is targeted to cost-effective projects because the agency categorically
excludes certain types of projects from benefit-cost analysis,
including certain property acquisitions. The committee's fiscal year
1999 report (Senate Report 105-216) directed FEMA to ensure that all
property acquisition projects it funded met stringent benefit-cost
requirements. During fiscal year 1998, FEMA obligated $415 million
under HMGP and a sizable amount might have been obligated without going
through a benefit cost analysis. First, how much of the $415 million
was obligated for property acquisitions? Second, how much of the $415
million was obligated for relocating properties? Third, how much of the
$415 million was obligated for elevating properties? Fourth, how much
of the $415 million was obligated for ``50/50 planning'' projects and
for what planning purposes were funds obligated?
Answer. FEMA made significant progress in obligating HMGP funds in
fiscal year 1998. Of the $415 million obligated in fiscal year 1998,
acquisition projects accounted for nearly $81 million, relocations
accounted for $3.2 million, elevations accounted for nearly $11.5
million, and ``50/50 planning'' projects accounted for approximately
$1.6 million. The planning projects were for local flood mitigation,
watershed management, and local multi-hazard mitigation plans, and
State mitigation plan updates. The ``50/50 planning'' projects were
part of a limited opportunity for States to utilize funding from
disasters prior to June 1993 that had a 50/50 cost-share towards
planning efforts.
Question. GAO has also raised concerns with respect to the states
hazard mitigation plans, required by Section 409 of the Stafford Act.
GAO found that state administrative plans often lack specific
information such as the identification of individual mitigation
projects. Are you concerned that this requirement is treated as a
``boilerplate'' exercise? Shouldn't 409 plans be a serious guidepost
for an effective, prioritized allocation of HMGP dollars?
Answer. In the last year, FEMA has targeted the issue of effective
State mitigation (409) planning as a top priority, creating a new
Planning Branch in the FEMA organization and developing new guidance
for States. As a result of this effort, State 409 plans are becoming
increasingly sophisticated as they realize the value of developing a
framework featuring strategies for selecting post-disaster mitigation
projects and initiatives in the pre-disaster timeframe. FEMA's
Mitigation Directorate has produced guidance documents, courses, and
workshops that provide strategies and tools to assist States in
establishing mitigation policies and priorities that make 409 planning
an ongoing activity, rather than waiting until after a disaster
declaration.
With improved 409 planning, the post-disaster identification and
prioritization of specific mitigation projects will take place more
rapidly. This also results in projects that have been more carefully
and thoughtfully selected and designed. While there is clearly room for
States to improve their planning activities, the best State 409 plans
are bringing about an effective, prioritized allocation of HMGP
dollars.
Question. FEMA has made disaster mitigation a primary goal in its
efforts to reduce the long-term costs of disasters. In previous
testimony to this committee, FEMA noted that, ``every dollar we spend
in the area of pre-disaster mitigation can save $2 in future taxpayer
dollars'', and that savings were ``well documented''. Would you provide
this committee with copies of studies or other evidence or analysis
that supports this statement?
Answer. This figure, originally cited in 1995 to describe the
benefits FEMA expected to accrue from the flood prone property buyouts
after the 1993 Midwest floods, was an average of the expected savings
FEMA estimated for projects approved under the Hazard Mitigation Grant
Program (HMGP). A study conducted by Iowa's Emergency Management
Division demonstrated significant benefits associated with mitigation
measures taken after the 1993 floods in Iowa. Specifically, the study
reported, ``55 projects have been funded for a total investment of
$47,372,324.94. The long term benefit of this investment in avoided
future damages is anticipated to be $101,440,205.42 (page 2 of The
Benefit of Hazard Mitigation Projects in Iowa).''
Since all HMGP projects must be cost-effective, an analysis of the
expected savings versus the cost of a potential project is completed
for all projects approved. Generally, this analysis estimates the
expected savings in the form of reduced damages over the life of the
project, given the frequency and severity of the hazard at that
location. FEMA has greatly improved its capability to conduct such
reviews in the last few years through the development of benefit-cost
analysis software and training.
FEMA recently updated that analysis to include more recent project
approvals. This analysis shows an overall ratio of 2.54. This simply
means that the expected savings from a $1 HMGP investment are $2.54
over the life of an ``average'' mitigation project. This reflects a
sampling of 1,334 HMGP projects approved between February 1990 and
September 1998. We still recommend use of the more conservative
estimate of 2 to 1, however, to characterize the expected savings.
We are finalizing the report that reflects this analysis, and will
make it available as soon as it is completed.
Question. In response to this committee's previous request for
quantifying the extent to which mitigation reduces future disaster
relief costs, you responded that you planned to ``initiate a study of
the cost effectiveness of a broad spectrum of mitigation measures (such
as the implementation of new building codes and acquisition/relocation
projects) before the end of fiscal year 1998''. What is the status of
that study and what other evaluations are ongoing or planned to
determine the cost savings achieved through disaster mitigation
efforts, such as the Hazard Mitigation Grant Program and Project
Impact?
Answer. FEMA has undertaken several studies and actions designed to
capture or demonstrate the cost-effectiveness of mitigation measures.
They include the following:
NAS Study of the Costs of Disasters: FEMA funded a multi-year
effort with the National Academy of Sciences (NAS) to categorize the
direct and indirect costs of natural disasters in order to provide a
better accounting of the losses that could be avoided through
mitigation actions. This study is nearly complete, and should be
available soon.
FEMA has completed two volumes on the ``Costs and Benefits of
Natural Hazards Mitigation,'' which outline the benefits of a wide
variety of mitigation measures in different geographic regions, and
under different circumstances. A third volume is currently under
development as well, and should be available this summer.
The Mitigation Directorate recently completed a study of mitigation
efforts in four communities in Alabama and Georgia, and two other
studies are underway. The Alabama/Georgia study shows the economic
results of mitigation projects in the communities, using rigorous
economic and engineering analysis. In all four communities, the results
were positive--the projects generated more long-term economic benefits
than they cost initially. While this does not represent a nationally
representative sample, it does provide strong evidence of the cost-
effectiveness of mitigation measures in reducing flood risks.
We continue our efforts to examine the Hazard Mitigation Grant
Program (HMGP) project database to learn the extent to which mitigation
projects produce savings. As noted in the answer above, this has
demonstrated a benefit cost ratio of 2.54 to 1.
We are conducting an in-depth review of how the substantial damage
cost-effectiveness policy is applied. The former study is intended to
be a general look at the economic benefits of funding a variety of
mitigation projects nationwide. The study is about half-complete, but
the initial results are very positive. The substantial damage policy
study is discussed in the question below.
Question. In responding to questions for the fiscal year 1999 VA/
HUD Appropriations hearing before the House (p. 103), FEMA cited an
example of elimination of flood risk for high-risk properties.
According to the example, FEMA conducted a survey that identified about
560 homes along Minnesota's Red River that, ``had significant or
substantial damage (the damage was categorized as greater than 40
percent).'' FEMA funded 555 of them for acquisition under HMGP at a
total FEMA cost of about $17.2 million. What were the benefit-cost
results for these properties? Answer. The purpose of the survey
mentioned above was to identify properties at high risk for future
flooding that might be good candidates for the State's property
acquisition program. Under FEMA policy, a detailed benefit-cost
analysis was not conducted on these properties because they were
substantially damaged. Currently, we are completing a study of 370 of
these properties to verify the benefit-cost ratios for acquiring them.
Question. (13g): FEMA is in the process of conducting studies to
establish a valid basis for property acquisitions--possibly the most
costly of the four exemptions discussed in GAO's testimony. A year has
passed and millions of dollars have been obligated since concerns were
raised about the lack of analytical data supporting the decision for
this exemption. When will that evidence be provided, and why has the
exemption continued for the last year, without having the proof that
these projects are indeed cost-effective measures? How are you assuring
that these projects are cost effective?
Answer. FEMA has started the study, which is expected to take
another two months to complete. The study, which is designed to test
the presumption that structures meeting the criteria will be cost-
effective, has the following elements:
--It will initially focus on six communities in three States.
--Hundreds of structures acquired in the six communities will be
subjected to rigorous benefit-cost analysis.
--The study will be carefully controlled so that results will be
useful in estimating benefits nationwide for sites similar to
those in the study
FEMA believes this policy is sound because it targets structures at
the highest risk and that would be required to be elevated or relocated
under NFIP standards. Each structure included must meet specific
criteria that indicate it is at high risk and would be cost effective
to purchase.
It is very significant and important to note that acquisition of
substantially damaged structures not only removes a building from a
hazardous area, but it reduces the expenses associated with disaster
relief efforts. Such projects also provide an environmental and social
dividend in communities through the creation of open space and
unobstructed floodplain areas.
fire program improvements
Question. FEMA is requesting $45 million for fire prevention and
training, an increase of $13 million over current spending levels. This
is largely in response to a recent Blue Ribbon Panel Review of the fire
program. The panel identified significant problems in terms of
leadership, resource management, and communication. Does FEMA plan to
implement each of the panel's recommendations? Please provide a
description of FEMA's plans for each recommendation. Will the funding
FEMA has requested be sufficient to meet the panel's recommendations?
What are the highest priorities?
Answer. The development of USFA's fiscal year 2000 budget request
began in fiscal year 1998, prior to the establishment of the Blue
Ribbon Panel. The Blue Ribbon Panel was established to review the USFA
programs and provide recommendations on improvement, and rendered its
report on October 1, 1998, after submission of the initial fiscal year
2000 budget request.
In response to the 34 recommendations made in the Blue Ribbon Panel
Report, several changes have already been made. Many of the requested
budget enhancements for the USFA for fiscal year 2000 are similar to
recommendations made by the Blue Ribbon Panel. Although the budget
request does not address every increase the Panel recommended, the
following requested increases reflect several of USFA's main program
areas (the numbers in parentheses represent the corresponding
recommendation number from the Blue Ribbon Panel report):
--Data Collection.--$1,881,668,and 2 positions to expand and increase
fire incident reporting through NFIRS, focusing on data
accuracy and timeliness (recommendation 7);
--Public Education and Awareness.--$1,631,666 and 2 positions to
expand and increase outreach efforts with special emphasis on
community hazard assessment and mitigation strategies in
support of Project Impact and groups at greatest risk from fire
(#11 and 12);
--Research and Development.--$1,631,666 and 2 positions to conduct
research that addresses the Nation's fire problem to support a
basis for training and public education efforts (#8, 9 and 10);
--Training.--$4,204,000 and 5 positions to expand and increase
delivery of all training programs at all levels and increase
development of training materials and curriculum (#14 and 15);
--$1,272,000 and 3 positions to update course materials and provide
additional deliveries in Counter-Terrorism (#21); and,
--$3,859,000 for capital improvements and to renovate and expand a
building to house the simulation lab and the Integrated
Emergency Management Course classrooms. The capital
improvements include such things as roof replacement, road
repair, equipment and furniture replacement, space utilization
renovations on the NETC campus in support of student and user
needs. The increase also will support funding for travel
(training related, pilot deliveries, site visits, committee
meetings, etc.), employee training and other staff expenses
such as a portion of the utility expense and supplies.
FEMA has already made several other changes to implement the
report's recommendations. While some of these changes have been quickly
implemented, others are in the process of being implemented. These
include (the numbers in parentheses represent the corresponding
recommendation number from the Blue Ribbon Panel report):
--Chief Marinucci, who has over 21 years of fire protection service,
8 years of which were gained as an elected official of the
International Association of Fire chiefs, and most recently as
President of the International Association of Fire Chiefs, has
been appointed as a senior advisor to the Agency. He will
develop a plan to be implemented by FEMA to provide the
appropriate leadership, management structure, program and
training activities, and funding and staff resources to put
USFA on a more pro-active course to address the new and
challenging issues facing the fire protection community in the
21st Century.
Chief Marinucci will be involved in a USFA and NFA management
review, the development of a plan for the future of USFA's
major programs, and USFA funding and resource management plans
and plans to assure closer integration of fire issues into
FEMA's ongoing strategic planning process. (recommendations 1,
3, 4 and 5)
--Increasing the U.S. Fire Administrator's advocacy role, such as
participation in Presidentially declared disasters (#32);
--Recommissioning America Burning (#34);
--Calling an annual meeting with the fire service organizations; the
first of which is to occur on August 2nd and 3rd in Emmitsburg,
Maryland (#29); and,
--Signing a Memorandum of Understanding on Project Impact with the
major fire service leaders.
consolidated grants proposal
Question. FEMA proposes $142 million for a new consolidated
emergency management grant program for states. This represents an
increase of about $12 million over current spending for such
activities, $8 million of which is devoted to anti-terrorism
activities. The consolidation is intended to streamline administrative
procedures and provide greater flexibility to states in the use of
these funds. It would allow states to target funds to their highest
priority areas based on where the greatest risks are. FEMA has already
consolidated several state grant programs, and several years ago
launched a performance partnership grant. What's new here? How does
this relate to the performance partnership concept? What is the status
of performance partnerships?
Performance partnerships are intended to provide flexibility to the
states, in exchange for increased accountability. Has FEMA developed
performance measures for the states that clearly demonstrate
accountability?
Please describe how FEMA has integrated risk information into the
Performance Partnership process and how FEMA has assisted state and
local governments in conducting hazard identification and risk
assessment?
An internal task force recently was formed to determine how this
new program will work. Why is FEMA creating this Task Force only now--
wasn't this recommended in a 1994 OIG audit report? When will the task
force make recommendations?
Answer. The Emergency Management Performance Grants (EMPG) will
replace the current cooperative agreement (CA) mechanism through which
our non-disaster funds to State emergency management agencies are
provided. In 2000, FEMA will continue the existing Performance
Partnership Agreements (PPAs). The EMPG, when fully implemented in
2001, will be a performance partnership grant based on State readiness
and capabilities. It will continue to provide greater flexibility to
States and allow them to target funds (with the exception of Terrorism)
to their highest priority areas. Under the PPA/CA, States have had
limited flexibility with the funds they received because each funding
source retained unique requirements. Also, the past structure of FEMA's
budget for these funds precluded flexibility because of the need to
retain inherent reporting requirements.
The PPA approach has been successful; it has produced a new way of
conducting business between FEMA and our State partners. It marked the
end of paternalism in the FEMA/State relationships. While it did not
result in an overnight partnership of mutually agreed upon priorities
and strategies for achieving objectives, it has moved the relationships
a long way toward that goal. Under the PPA/CA, States could combine
hazard-specific programs in order to develop multi-hazard strategies.
Because some mitigation techniques can result in increased risk of
other hazards, hazard mitigation has benefited significantly from these
multi-hazard strategies.
Under the EMPG, this concept is developed further to allow States
to combine funds, strategically plan, and measure performance. (Funds
provided through the EMPG that are derived from Terrorism must be spent
on terrorism-related activities.) As we implement the EMPG, we expect
there will be far more recognition and accommodation of the unique
approaches States are taking to strategic planning. Enhanced
accountability will result as State organizations are allowed the
flexibility to incorporate their own approaches and criteria into
performance agreements. FEMA will hold the States accountable for
meeting performance goals set jointly.
The increased flexibility provided to the States through the EMPG
is intended to enhance the professionalism of State and local emergency
managers and build a decentralized capability for State and local
preparedness and response. States will be evaluated annually, and FEMA
will develop remedial or corrective actions to address critical
weaknesses. In exchange for flexibility, FEMA will require
accountability from the State and will achieve this by:
Partnering with the States:
--The task force is working with State representatives to develop
program goals and objectives that will serve as the basis for
program guidance to ensure the EMPG best meets the needs of
FEMA and the States.
Negotiating with the States:
--As part of our partnership with the States, each EMPG will be
individually negotiated to determine funding priorities and
performance measures.
--State-developed workplans will have to achieve FEMA, as well as
State, objectives.
--Workplans will have to describe goals and objectives, results and
benefits expected, and quantifiable projections of the program
and accomplishments to be achieved and the performance measures
to be used.
Requiring quarterly reporting:
--FEMA will require quarterly financial and performance progress
reports.
--Technical assistance and monitoring will be provided throughout the
year to ensure success of the EMPG.
--States will be required to submit final financial and performance
reports that link back to the workplans and performance
measures that were negotiated.
A 1994 OIG audit report was issued on FEMA's Comprehensive
Cooperative Agreements (CCAs), the predecessor to the PPA. Among the
recommendations in that report were:
--Assess hazards and risks;
--Develop integrated emergency management objectives and performance
standards;
--Increase States' flexibility by consolidating emergency management
programs;
--Move from a hazard-specific to a functional program structure; and
--Assess States' capabilities to respond to disasters by conducting
and evaluating exercises and monitoring actual disaster
response.
A task force was formed to implement changes to the CCA for 1995.
Subsequently, in 1996, the CCA was eliminated and replaced with the
PPA/CA. Many of the OIG's recommendations were incorporated into the
PPA/CA process, including consolidation of certain programs;
decentralization of non-disaster programs to Regions; and devolvement
of day-to-day grant management to States. FEMA Regions have spent a
substantial amount of time working with States to develop performance
measures, which are incorporated into the PPAs. FEMA has also been
developing systems for risk assessment and capability assessment.
A recently issued follow-up to the initial OIG report (I-01-99,
March 23, 1999) supports our efforts to further consolidate PPA/CA
funding streams and recommends the Chief Financial Officer continue to
explore such consolidation. In addition, the report recommends that
FEMA, in coordination with States, develop performance measures that
work towards the Federal goal of improving State emergency management
programs and that clearly demonstrate accountability by showing how
FEMA funding has improved the States' emergency management capability.
We believe the EMPG process will do this.
The EMPG Task Force will continue the process begun four years ago.
The Task Force is working with State representatives to work through
the issues related to implementing the consolidated grant, such as
formulating guidance and developing baselines for performance
measurement and methodologies for assessing overall State capability
and mitigation needs. Recommendations for a framework to address
accountability issues should be completed by early Summer.
national flood insurance program
Question. The National Flood Insurance Program's outstanding
borrowing has decreased from $917 million in June of 1997 to $722
million in December 1998. What is driving the decrease in the program's
borrowing and do you expect this trend to continue? What is your plan
for repaying the current borrowing?
Answer. Since levels of flooding are the critical determinant in
repaying the current borrowing, it is not possible to determine with
certainty when the repayment will be complete. Through simulation
modeling, FEMA has made some estimates of the probability of repaying
current borrowing over the next five year period. Based on premium
income alone, FEMA has a 16 to 27 percent probability of completely
repaying the amount borrowed from the Treasury at some point within the
next five fiscal years.
FEMA has submitted a report to Congress that outlines various
alternative strategies for repaying the borrowing. It includes a direct
appropriation as one possible option that Congress might consider.
Based on premium income and an appropriation or forgiveness of $400
million out of the current $800 million in outstanding debt, FEMA has a
41 to 50 percent probability of complete repayment at some point within
the next five fiscal years.
funding for puerto rico
Question. According to a recent news article in the San Juan Star
(2/19/99), FEMA will be awarding Puerto Rico $190 million to build
homes. Is this true? Under what authority is FEMA awarding funds for
the building of homes? Please explain what the ``New Safe Home
Program'' is.
Answer. We understand the Government of Puerto Rico is in the
process of developing a grant application for approximately $190
million in federal funding under FEMA's Hazard Mitigation Grant Program
(HMGP). This project has not yet been formally submitted to FEMA. FEMA
will be assisting Puerto Rico over the next several months to develop a
grant project suitable for funding under the HMGP.
Based on our understanding, the ``New Safe Home'' program that
Puerto Rico plans to propose is intended to provide funding to ensure
that residents whose homes were destroyed during Hurricane Georges are
re-housed in safe, disaster-resistant housing. The proposal is likely
to request HMGP funding to go toward the mitigation elements of this
larger re-development project. ``New Safe Home'' houses will be located
outside of flood hazard areas and will be designed to withstand both
wind and seismic loads. They will also be built in full compliance with
the 1997 UBC building code recently adopted by the Government of Puerto
Rico.
______
Questions Submitted by Senator Burns
Question. We know that FEMA has been using the National Imaging and
Mapping Agency (NIMA) to provide data from national systems for
emergency response and assessment. In your newly proposed effort to do
detailed mapping of flood risk areas, have you investigated using any
mapping tools developed by NIMA or the National Reconnaissance Office
to assist in converting your data to a useful mapping format?
Answer. FEMA closely cooperates with NIMA. The laser terrain
standard that has been drafted and is currently going through final
review was coordinated with NIMA. Data developed under this performance
based standard will meet the draft Digital Terrain Elevation Data
(DTED) standard used by NIMA, and will be easily converted from Digital
Elevation Model (DEM) format to DTED format using standard Geographic
Information System (GIS) programs and tools. We are also keeping NIMA
informed of our technology applications and are assured by our NIMA
partners that they are keeping us abreast of their technology
improvements.
state and local assistance (sla) funds
Question. This program was designed to be a 50/50 match between the
federal government and the states. There have been serious shortfalls
in SLA funding and this problem only seems to be getting worse. What is
your proposal in order to keep your promise and provide adequate
funding, at the 50 percent level, for local emergency management
agencies? Montana is doing what it can to fund the shortfall, but we're
having a tough time.
Answer. State and Local Assistance (SLA) has been one of several
programs delivered under the auspices of FEMA's Performance Partnership
Agreements (PPAs) that provide financial assistance to State and local
governments. SLA has been provided in the past both with 100 percent
Federal funding, and with a 50 percent Federal/50 percent State cost
share. In accordance with Congressional direction in the Conference
Report on the 1996 appropriation and the House Report on the 1997
appropriation, FEMA notified States that 1999 would be the last year
100 percent Federal funds would be provided through the SLA program.
In 2000, funds previously provided to State emergency management
agencies under the PPA/CA will be provided through an Emergency
Management Performance Grant (EMPG). Rather than receiving several
separate annual funding allocations as is presently the case under the
PPA/CA, each State will receive one aggregated allocation under the
EMPG. The annual allocation will be derived from the programs
contributing dollars to the grant. A composite cost share for the grant
will be calculated based on the cost share policies of the programs
contributing funding as well. The total EMPG request of $142 million
assumes funds equal to the 1999 SLA-50 and SLA-100 levels ($105
million). Moreover, an additional $10 million is requested for the EMPG
that is attributed to the former SLA funding stream.
Question. What are your specific plans for improvements for
Bioterrorism/Biowarfare precautions and response? Is additional funding
needed in this area?
Answer. FEMA is working with the Federal Response Plan (FRP)
agencies to develop Time Phased Force Packages for different weapons of
mass destruction (WMD) scenarios, one of which is the use of a
biological agent. Time Phased Force Packages identify what resources
are needed for a given scenario and in what order and timeframe they
need to be deployed for maximum effectiveness.
FEMA does not offer courses specific to bioterrorism. Some
terrorism-related courses developed by FEMA's National Fire Academy and
Emergency Management Institute (EMI) do include information on
biological agents and associated precautions. As these courses are
revised and new ones are developed, FEMA will include where appropriate
information on new technologies and techniques--for example, in the
area of chemical and biological agent detection. This also holds true
for the first responder Job Aid for terrorism response that FEMA's
National Fire Academy plans to issue this year. Training provided by
the EMI addresses various terrorism preparedness and general emergency
management issues applicable to all types of disasters including
bioterrorism. If the U.S. were unfortunate enough to suffer a
bioterrorism event, it could result in a public health emergency of
major proportions. Standard EMI emergency planning courses, for
example, would be very pertinent in helping local officials know how to
plan for such an event.
FEMA stands by its request for fiscal year 2000. Before identifying
any gaps that FEMA can and should fill in this area in the outyears,
FEMA will consider work being done by the U.S. Army Soldier and
Biological Chemical Command in its Biological Warfare Improved Response
Process (in which FEMA participates), by the Department of Health and
Human Services in its initiatives for chemical and biological terrorism
preparedness, and by the Department of Justice in its conduct of a
congressionally mandated needs assessment.
______
Questions Submitted by Senator Stevens
Question. Thank you for convening the interagency task force to
address the fish disaster in Western Alaska. It led to the relief
package that is helping Eskimos and others survive the winter.
The Corps of Engineers built the Moose Creek dam upstream from
North Pole, Alaska. It resulted in downstream flooding of about 50
homes. The Fairbanks North Star Borough is rezoning the area to
prohibit new construction, but the remaining homeowners are literally
down the creek without a paddle. The local government believes
modification of some of the homes will prevent future flooding, and is
seeking funding to begin the work. Would you be willing to take a look
at this issue and let me know if there are any programs at FEMA that
could help us correct this problem, so we can prevent future flooding?
Answer. FEMA will be pleased to look into how Mitigation programs,
particularly the Hazard Mitigation Grant and Flood Mitigation
Assistance Programs, may be used to help address this flooding problem.
In addition, we will work with the State of Alaska and the local
government to see if there are other sources of available funding to
help resolve this problem.
As you know, FEMA has been actively involved in dealing with this
problem for many years. The Chena Lakes Flood Control Project consists
of the Moose Creek Dam and floodway on the Chena River, a levee system
along the Tanana River, and an interior drainage network between the
Chena and Tanana Rivers. The project was built to protect people and
property in and around Fairbanks from the flooding of the Chena and
Tanana Rivers. The purpose of the Flood Control Project is to restrict
flows on the Chena River through Fairbanks to 12,000 cubic feet per
second. This is accomplished by closing the gates at the Chena River
and impounding floodwaters behind the embankment that was constructed
between the Chena and Tanana Rivers. When the impounded water exceeds
the elevation of the floodway sill at the Tanana River, water flows
over the sill into the Tanana River. During extended periods of
impoundment behind the embankment, water enters the porous medium below
the embankment and flows through the ground, thereby increasing the
ground-water elevation downslope of the embankment. The elevated
ground-water level sometimes causes flooding in basements and crawl
spaces and has disrupted well and septic tanks.
Since 1992, investigations have been underway to find a feasible
solution to mitigate the groundwater flooding problem resulting from
impounding water behind the embankment for extended periods. All major
structural solutions investigated have been found to be cost-
prohibitive. The suggested solution proposed in a February, 1997, FEMA
Report entitled, ``Evaluation of Ground-Water Flooding Problems and
Mitigation Alternatives for the North Pole Area of Alaska,'' is a
combination of the following non-structural and site specific
mitigation measures:
--Implementation of land-use regulations such as were recently
adopted by the Fairbanks North Star Borough, to restrict
building and construction practices that increase the flood
problem;
--Extension of flood insurance for ground-water flooding to all
residents in the affected area;
--Development of a Geographic Information System (GIS) to determine
structures at risk and to assist community officials in future
land-use planning; and
--Implementation of site-specific mitigation measures. Site specific
mitigation measures to affected structures could include
floodproofing; relocation to higher ground; demolition and
replacement; and creating open space (such as parkland.)
Question. The University of Alaska has informed me of a proposal in
your fiscal year 2000 budget request called Disaster Resistant
Universities, and the need for a federal matching fund to protect the
nation's research investment. Can you describe this program, and your
idea for a federal fund for universities?
Answer. By proposing a Disaster Resistant Universities initiative,
FEMA is responding to the concerns expressed by several university
Presidents that their institutions are at risk of serious damage from
natural disasters. We believe this initiative will protect the nation's
investment in university research and education, preserve the economic
engine of communities when they most desperately need it--after
disasters--and reduce future Federal disaster assistance costs.
We will take the core ideas of Project Impact--public/private
partnerships, local control, and investments focused on ``the bottom
line''--and apply them to universities. In forming the program, we are
also creating a partnership among the White House Office of Science and
Technology Policy, Federal research agencies and the Department of
Education. Their involvement, as well as the input of the Congress, is
critical to ensuring that the investments we protect reflect the
nation's research and education priorities.
Currently, FEMA is investing in two initial efforts that are
critical to making this project a reality. The first is a study by
several professors at the University of California, Berkeley on the
economic connections among universities, their surrounding region,
State and nation, and how disasters at universities affect these areas.
Secondly, a team of university leaders from various States, including
Alaska, Missouri, West Virginia, Florida, and New York, will contribute
to the development of methods that all universities can use to
successfully assess and lessen their risks using a combination of
public and private resources. The work of these university leaders over
the next six months will result in a precisely defined Disaster
Resistant Universities program.
The idea for a federal matching fund to do the mitigation work on
campuses was first proposed by universities last year. We believe that
the appropriation of such funds will achieve long-term savings,
particularly at universities, where the human and economic costs of
disaster recovery are very high as compared to the costs of pre-
disaster mitigation. Because the purpose of this fund is to protect the
large Federal investment in research and education, the cost of this
research investment protection fund could be tied to the amount the
federal government spends annually on research at universities. A
figure that has been discussed--$75 million--represents only one half
of one percent of this yearly investment. Federal resources alone
cannot solve the problem, but should be used to leverage the support of
other university stakeholders. Thus I have made it clear that
universities would have to match any grant from this fund with State or
private money. This should not be difficult; Project Impact has shown
us that Federal resources in this area will generate mitigation
investments well beyond ``match'' requirements.
There are several criteria envisioned for participation in the DRU
program. A university would be eligible if they conduct substantial
Federal research, if their students receive large amounts of financial
aid, and if the campus lies in an area likely to see a natural
disaster. Additionally, universities receiving funds would have to
demonstrate a commitment to mitigation in partnership with the private
sector, have conducted risk analyses, and have completed disaster
response plans. The specific criteria for awards from this fund will be
determined in consultation with the Congress and Federal research
agencies in order to ensure that Federal technical and financial
support is distributed broadly, in terms of geography, need, and type
of institution.
While the Federal and State governments and private sector have the
greatest stake in preserving their investments in higher education, the
creation of a Disaster Resistant Universities program is ultimately the
responsibility of the universities at risk of natural disasters. To
make this program a success, leaders of these institutions will have to
assess the hazards facing their campuses, work with their neighbors to
mitigate those hazards, inform the Congress of the value of such a
program, and, most importantly, forge public-private partnerships with
corporations and community groups.
Question. There are many sectors of society that are worthy
recipients of federal funds for this purpose. Why should we protect
universities over elementary schools, hospitals, or city halls?
Answer. There are many institutions, including those you mentioned,
in need of assistance. In fact, in 118 communities throughout the
country, FEMA's Project Impact is helping schools, hospitals, and city
halls, as well as homes, farms and churches, become disaster resistant.
This proposal responds specifically to the universities' request
for Federal leadership because of their critical role in society, the
taxpayer's tremendous investment in them, and the high cost of
repairing campus facilities after a disaster. Universities are
important not only because they educate our future leaders, but also
because their research leads to innovations and industries which drive
our economy and enhance our quality of life. Additionally, universities
are frequently the largest employer and most significant cultural and
recreational resource in their regions.
There is substantial Federal commitment to universities; this year
it will be over $65 billion for research and financial aid. If we look
at just three universities for which natural disasters are a
significant concern, the University of Alaska, West Virginia
University, and Washington University in St. Louis, we see that last
year the Federal research and financial aid investments totaled over
$330 million. When natural disasters hit universities, they are very
costly to rebuild. For example, in the last five years, FEMA has spent
hundreds of millions of dollars at Cal State Northridge, Colorado State
University, University of North Dakota and Syracuse University, among
others. In proposing this initiative, we hope to reduce these human and
economic costs at institutions that are critical to the communities
that surround them.
______
Questions Submitted by Senator Mikulski
anti-terrorism initiatives/weapons of mass destruction
Question. How effective is the government's inter-agency effort
working in planning to prevent and respond to terrorist attacks? What
is your assessment of the working relationship between the agencies? Is
there a ``one stop shop'' that state and local governments can go to
for answers regarding preparedness training and resources for Weapons
of Mass Destruction attack?
Answer. FEMA is the lead agency for Federal consequence management
response. The interagency Federal response planning community has
established a strong, productive, and lasting working relationship. The
community has worked diligently to ensure the appropriate consequence
management response plans and related guidance documents are published.
For example, the Terrorism Incident Annex to the Federal Response Plan
(FRP), numerous special events plans like the Operational Supplement to
the FRP for the North Atlantic Treaty Organization's 50th Anniversary
Summit, and the Time Phased Force Packages (under development) are
documents that have been worked through the FRP community. FRP-related
working groups such as the Catastrophic Disaster Response Group, the
Emergency Support Functions Leaders Group, and the ad hoc Interagency
Steering Group for the development of the Time Phased Force Packages,
as well as the Contingency Planning and Exercises Subgroup established
under authority of Presidential Decision Directive 62, all have been
directly involved in development and coordination of these documents.
Similar levels of cooperation have existed among departments and
agencies involved in terrorism preparedness programs. In the
Interagency Work Group on Domestic and International Counterterrorism
Exercises, the Contingency Planning and Exercises Subgroup, and the
Multi-Agency Task Force on Nunn-Lugar-Domenici Exercises, FEMA and the
other consequence management agencies work together with the Federal
Bureau of Investigation and the U.S. Army Soldiers and Biological
Chemical Command (SBCCOM) to design, plan, conduct, and evaluate a wide
variety of emergency response exercises. FEMA also has actively
supported training efforts of the Departments of Defense and Justice.
The National Domestic Preparedness Office, proposed by the Attorney
General, is poised to become a ``one stop shop'' for State and local
governments to obtain information on preparedness programs and
resources relating to terrorism involving weapons of mass destruction.
Question. What is the status of FEMA's work in training local
communities? How many cities/localities have received training? Who is
being trained--first responders, local trainers? What type of training
has been provided?
Answer. FEMA has worked closely with the Departments of Defense and
Justice in their training efforts. In addition, FEMA offers a limited
program of its own terrorism-related training such as the Emergency
Management Institute's (EMI) Integrated Emergency Management Course
(IEMC): Consequences of Terrorism, Emergency Response to a Terrorist or
Criminal Event, and Senior Officials' Workshop on Terrorism and the
National Fire Academy's Emergency Response to Terrorism curriculum.
To date over 32,000 fire and emergency response personnel--trainers
and end users--have received the National Fire Academy's (NFA)
Emergency Response to Terrorism training through FEMA and State
channels; the same material has been offered through the Department of
Justice's training program. Additional NFA Emergency Response to
Terrorism courses in incident management and in tactical considerations
for company officers, emergency medical services personnel, and
hazardous materials responders are being made available this year.
The IEMC: Consequences of Terrorism course has been delivered 16
times since it was created in 1997: five times for specific communities
and 11 times for audiences comprised of emergency officials from a
cross section of communities. The training audiences for EMI's
terrorism-related training includes a broad range of emergency
responder and other public officials who have emergency management
responsibilities. The Senior Officials' Workshop on Terrorism, for
example, which EMI developed in conjunction with the Department of
Defense and an interagency team, is specifically intended to train
mayors and their cabinets regarding special considerations for planning
to deal with terrorist events involving weapons of mass destruction.
FEMA terrorism-related courses are primarily classroom-based
training, although the culminating event of the IEMC: Consequences of
Terrorism course is a major tabletop exercise, and the other courses
include exercises and some hands-on activities. FEMA has a distance
learning capability through its satellite-based Emergency Education
Network (EENET), and makes some of its terrorism-related course
materials available on the internet.
Question. What type of follow-up does FEMA do with localities after
they have been trained? Is any work done to ensure that the plan is one
that is operational and not just a paper plan stuck in an office
cabinet?
Answer. FEMA's National Fire Academy is in the process of obtaining
long-term feedback from students (and their supervisors) who have taken
the Emergency Response to Terrorism: Incident Management course. The
National Fire Academy also receives feedback on its courses through its
Training Resource and Data Exchange (TRADE) network.
FEMA is requesting additional funding in fiscal year 2000 for its
exercise-based courses. Courses such as the Integrated Emergency
Management Course (IEMC) with a terrorism scenario allow key officials
from a community to come together, simulate response using the
community's plans, and identify gaps in their plans and procedures.
FEMA is working with the Department of Justice to make this course
available at its Ft. McClellan facility. Communities that participate
in FEMA's IEMC are required to submit a report after one year
indicating how they have applied the lessons they learned as a result
of their participation in this training event.
FEMA is providing funding to States for State and local terrorism
consequence management planning and for exercises to test those plans.
Exercises allow emergency responders at all levels of government, as
well as the private and volunteer sectors, to test policies, plans, and
procedures. In recent years, FEMA, other Federal departments and
agencies, and State and local governments have participated in a wide
variety of terrorism-related exercises including ILL WIND, ELLIPSE
ALPHA/GAUGED STRENGTH, KEYSTONE 2-98, ROCK `N' ROLL, and WESTWIND 99.
Question. What is your assessment of local governments' and first
responders' preparedness to respond to terrorist attacks? What was the
latest assessment of local and state capabilities to respond to a
terrorist attack? What types of criteria were used to measure
preparedness?
Answer. The level of preparedness varies across the country, and
its varies among the aspects of preparedness (planning, training,
equipment, exercises/evaluation). Certain local jurisdictions'
terrorism preparedness has benefited from increased Federal attention
such as that provided by the Department of Defense's Nunn-Lugar-
Domenici Domestic Preparedness Program, the Department of Justice's
training and equipment initiatives, the Department of Health and Human
Services' Metropolitan Medical Response System initiative, and the
interagency and intergovernmental planning involved in preparing for
certain special events. Others are able to apply lessons learned from
other technological hazard programs, such as FEMA's Chemical Stockpile
Emergency Preparedness Program (CSEPP) and the Radiological Emergency
Preparedness (REP) program. However, if the pilot State Capability
Assessment for Readiness (CAR) report can be used as an indicator of
local capability, planning and equipment for weapons of mass
destruction terrorism are areas in need of improvement. After-action
reports from some of the tabletop exercises conducted under the Nunn-
Lugar-Domenici Domestic Preparedness Program provide support for this
conclusion.
FEMA's latest capability assessment was the pilot State CAR report
of December 1997. The CAR asked States to assess:
--Equipment for nuclear, biological, and chemical (NBC) terrorism
(e.g., development of HAZMAT teams with sufficient equipment to
respond to an NBC incident, availability of pharmaceuticals);
--NBC terrorism plans (e.g., coordination with Federal agencies,
coordination with private sector hospitals);
--NBC terrorism training (e.g., training HAZMAT and EMS responders to
recognize NBC incidents and respond safely).
FEMA is revising the CAR instrument to provide more detailed
information.
Question. What is your assessment of the ``unmet needs'' at the
local level in terms of preparedness? What is FEMA's role in helping
localities and states meet those unmet needs?
Answer. Since the level of preparedness varies around the country,
so do ``unmet needs.'' Assessments indicate that, in general, planning
and equipment are two areas in need of improvement. In addition, FEMA
is working with States to ensure that local jurisdictions not included
in Defense and Justice initiatives are able to obtain terrorism-related
training.
While the Department of Justice is providing substantial funding
for equipment, FEMA's role under Presidential Decision Directive 39 is
to ensure that State--and by extension, local--plans and capabilities
for terrorism consequence management are adequate and tested. To that
end, FEMA is providing funds to the States for State and local planning
and exercises. As noted above, FEMA is also working with States--State
fire training centers and State (emergency management) training
officers--and providing grants to ensure that terrorism-related
training is available to emergency managers and responders in the
``balance of the nation.''
Question. Are there any knowledge or equipment gaps for responding
to terrorist attacks at the state and local level that haven't been
filled? If so, which agencies are working to fill them? What is FEMA's
role?
Answer. There are an estimated 1.3 million paid and volunteer fire
service members in the United States. To date, over 32,000 individuals
have taken the National Fire Academy's Emergency Response to Terrorism
training through FEMA and State channels, and approximately 15,000
individuals have received Nunn-Lugar-Domenici Domestic Preparedness
Program training. Even allowing for other training efforts, this leaves
a substantial gap. FEMA is supporting the training efforts of the
Departments of Defense and Justice, in addition to FEMA's own training
efforts. FEMA's focus in training is to make training available to
States and local jurisdictions not addressed by the Defense and Justice
initiatives. Further, FEMA is working with the Attorney General's
National Domestic Preparedness Office to improve dissemination of
information.
According to the State Capability Assessment for Readiness (CAR)
report, planning and equipment for response to weapons of mass
destruction (WMD) terrorism are areas in need of improvement. FEMA is
providing funds to States for State and local planning (and for
exercises to test those plans), while the Department of Justice is
providing funding for responder equipment. FEMA has contributed to the
National Domestic Preparedness Office's development of a Standardized
Equipment List.
Question. How effective is the training that FEMA is providing if
localities and states don't have the equipment they need?
Answer. Response to a suspected incident of nuclear, biological, or
chemical terrorist incident may require specialized equipment. Proper
and skilled use of equipment does require hands-on training with that
equipment.
Much of the training FEMA provides is designed for officials at the
policy and executive levels, and for planners. Corresponding equipment
requirements for these individuals are minimal. Yet training for these
individuals may be effective if it helps senior officials and emergency
planners understand the potential scope and consequences of a terrorist
incident involving weapons of mass destruction (WMD) and identify gaps
in plans and procedures. Thorough emergency planning that includes the
risk of terrorism is prudent practice. This planning does not require
specialized equipment, although the actual response may.
Even for responders, training may be effective if it teaches a
first responder to recognize when he or she does not have the means to
deal with an incident safely, or when exotic equipment and ``victim''
decontamination are unnecessary or even counterproductive.
Question. How far will the budget requested by FEMA for fiscal year
2000 allow FEMA to go in providing training to the 157 largest cities
and localities?
Answer. None of the request is intended for training the 157
largest cities and localities. Programs at the Departments of Defense
and Justice provide for training of these localities. FEMA will provide
assistance to States for training; by working with and through States,
FEMA intends to help training reach the ``balance of the nation''--
communities not otherwise served by the Defense and Justice training
programs.
Question. What is being done to capitalize on the unique
capabilities of agencies such as the CDC to assist with response
planning and preparedness training? How involved is CDC with FEMA's
training to states and localities to ensure that local public health
officials can identify biological and chemical agents? Is attention
being given to the need to prepare for agents (microbes and bacteria)
that may be developing immunity to the current standard ways of
treating them?
Under the Federal Response Plan structure, the Department of Health
and Human Services (HHS) is the primary agency for Emergency Support
Function (ESF) 8, Health and Medical. Within HHS, the Office of
Emergency Preparedness is the ``executive agent'' for discharging HHS'
responsibilities as primary agency under ESF 8 and coordinates
extensively with other organizations of the U.S. Public Health Service,
including CDC. FEMA relies on this coordination within ESF 8 to ensure
that CDC contributions are incorporated in Federal response planning.
Terrorism-related training at the Emergency Management Institute
has been developed in an interagency environment and in conjunction
with various Federal departments and agencies. HHS, of which CDC is a
component, has been a key player in such training development, as have
the Environmental Protection Agency, the Department of Energy, the
Department of Justice, and the Department of Defense.
Under Public Law 105-277, CDC was appropriated sums for a variety
of initiatives to, among other things, enhance technical capabilities
to identify certain biological agents, better identify potential
biological and chemical terrorism agents, develop rapid toxic
screening, strengthen State and local epidemiological and surveillance
capacity, provide for regional laboratories for detecting and measuring
biological and chemical agents, and establish a pharmaceutical and
vaccine stockpile for civilian populations.
Question. What public and media relations efforts will be
implemented in the event of an incident to mitigate widespread panic?
Answer. Widespread panic in any incident will only be mitigated if
the public has confidence in the government's response. The effort must
reflect that government, at all levels, is working together to quickly
respond to the incident. To achieve this, the revised Terrorism Annex
to the Federal Response Plan outlines the establishment of a Joint
Information Center (JIC) that will ensure a coordinated flow of
information to the news media and public.
The JIC will: Include Public Information Officers from all key
agencies and departments; Provide media relations counsel for
operational leadership; Organize and conduct news briefings as often as
needed; Maintain list of pre-designated subject matter expert
spokespersons; Gather information from all levels of government;
Develop critical updates and fact sheets; Distribute information via
not only print and electronic news media but also Internet web sites,
e-mail, and the Emergency Alert System (EAS).
It is also important for first responders to communicate as quickly
and accurately as possible with the public. In some incidents, this
will begin prior to the arrival of Federal assets and the establishment
of the JIC. The Rapid Response Information System (RRIS) and special
toll-free hotlines make critical information quickly available to first
responders.
Emergency public information aspects of WMD incidents continue to
be tested in field and tabletop exercises. Exercises provide an
important opportunity to build critical interagency cooperation and
ensure first responders understand their emergency public information
role.
united states fire administration (emittsburg, maryland)
Question. How do you think we arrived at the problems outlined in
the Blue Ribbon Panel Review?
Answer. The USFA was required to implement level funding budgets
since 1994, which limited USFA's ability to accomplish all goals as
quickly as possible.
FEMA submitted an enhanced fiscal year 2000 budget that is directly
linked to our Government Performance and Results Act (GPRA) goals and
objectives. Our enhanced fiscal year 2000 budget will provide for our
efforts to more aggressively and effectively launch an organized and
coordinated attack on the unacceptable incidents of fire and fire
related deaths, injuries and property damage. The USFA budget for
fiscal year 2000 was submitted as part of the President's budget at
about the same time the Blue Ribbon Panel was commissioned to conduct
their study. It is not a mere coincidence that the USFA budget request
for fiscal year 2000, which began in fiscal year 1998, and the Blue
Ribbon Panel Report rendered on October 1, 1998, both address the need
for additional staff and funding resources.
In addition, we experienced a complete change in individuals in the
three most senior management positions that resulted in certain
management difficulties which we are working to address.
Question. What expectations do you have for the work to be done by
the new Senior Advisor tasked to address improving the Fire
Administration? Are there certain criteria in place that will be used
to judge whether his work has been effective?
Answer. As Senior Advisor, Chief Marinucci has been asked to
develop a leadership and business plan for improving USFA's operations
and implementing the Blue Ribbon Panel report. The plan must provide
the appropriate leadership, management, and program structure to put
USFA on a more pro-active course to address the new and challenging
issues facing the fire protection community in the 21st Century.
Question. Are you committed to implementing the recommendations
made in the Blue Ribbon panel report?
Answer. Yes. By implementing many of the recommendations in the
report and requesting funds in the fiscal year 2000 budget which would
allow implementation of many more (see the answer to question 14 above
for information about specific recommendations), FEMA has quickly
demonstrated a commitment to the spirit and purpose of the Blue Ribbon
panel.
Question. Do you plan to implement the recommendation to increase
the role of the USFA in FEMA? If so, how?
Answer. Yes. FEMA agrees strongly that the U.S. Fire Administration
must be a key player within FEMA and plan to continue to involve the
USFA as a partner with other Agency organizations. A most recent
example was the signing of a Memorandum of Understanding with over
twenty fire organizations to work with us on Project Impact activities.
Implementation of the recommendations that result from Chief
Marinucci's management review and the successful implementation of
USFA's performance standards will certainly go a long way toward
strengthening and enhancing the USFA's role within FEMA.
Question. Do you support the recommendation to expand the
residential capacity of the National Fire Academy by 110 rooms for
students? Do you support a capital construction project on site? If you
do support a capital construction project on site, how do you plan to
find the resources?
Answer. The issue of the additional 110 rooms, plus all supporting
facilities, for NFA resident program students has been addressed in two
recent reports to Congress. There are a limited number of classrooms
and limited funds for student stipend reimbursements and contract
instructor services. There are considerations that are more restrictive
to NFA than the lack of dormitory space. The U.S. Fire Administration
does not have the necessary resources to support this multi-faceted
construction project on site at this point in time. FEMA would need
additional resources to accomplish such a project.
Question. Do you plan to change the reporting relationships among
the USFA leadership that the panel found to be problematic? If so, how?
Answer. We have created a new position at the USFA, Chief Operating
Officer (COO), to oversee the day to day operations of the Fire
Administration. As a Senior Executive Service career appointment, the
COO will serve as the primary advisor to FEMA's Director and the USFA
Administrator on overall operations and management of the USFA.
The COO will report directly to the Director of FEMA, thus freeing
the U.S. Fire Administrator to become a full time advocate for the fire
services as recommended by the Blue Ribbon Panel report.
Question. What are your plans to implement the recommendations to
improve the research and development efforts by making effective use of
the capabilities in the National Institute of Standards and Technology
(NIST), Consumer Product Safety Commission and other public and private
sector organizations?
Answer. USFA initiated a new public effort to involve stakeholders
from across the Nation that have indicated interest in USFA's research
plans. NIST, CPSC, and other public and private partners participated
in the initial meeting.
Senior managers of NIST and USFA have discussed fire research and a
basic agreement has been reached to continue national level meetings
such as that described above. These open meetings will be hosted
jointly by USFA and NIST. The outcome of these meetings will be a
National Fire Research Agenda that will identify research needs across
numerous areas of interest.
In the original legislation establishing USFA, Congress noted that
USFA is in a unique position as the point of contact for individuals in
the fire safety community to voice opinion about the needs of the fire
safety community and fire safety of the American citizen. USFA
continues to serve in this capacity. As the Federal fire focus, USFA
utilizes NIST as one of its primary sources for conducting research
sponsored by USFA. USFA believes that with the modest enhancement
proposed in its fiscal year 2000 budget request, its fire research
program will be revitalized. Much of this revitalization will be
directed through the research facilities of NIST, CPSC and other public
and private sector organizations.
Question. Do you plan to implement the recommendation to develop
relationships with minority owned corporations to co-develop fire
prevention campaigns designed specifically for at-risk groups? If so,
how?
Answer. USFA has worked with and plans to continue to work with
minority firms to develop public fire safety educational materials
directed toward at-risk target audiences.
Groups with which cooperative efforts have addressed the at-risk
populations include:
--International Association of Black Professional Fire Fighters
--Women in the Fire Service
--Telemundo Hispanic Television Stations
--Homung Community Representatives
--Congress of National Black Churches.
In addition, USFA has worked with other groups addressing at risk
audiences:
--American Red Cross
--National Volunteer Fire Council
--Safe Kids
--Sesame Street
--Coalition for a Safer America: Advertising Council, American
Association of School Administrators, American Trauma Society,
Avrett Free & Ginsburg, Congressional Fire Services Institute,
Fleishman--Hillard, General Federation of Women's Clubs,
International Association of Black Professional Fire Fighters,
International Association of Fire Chiefs, International
Association of Fire Fighters, National Association of
Elementary School Principals, National Consumers League, The
National Parent Teacher Association, Consumer Product Safety
Commission
USFA considers these partnerships as a means to address at-risk
groups. When considering such partnerships, evaluation is made with
regard to the knowledge and abilities of the potential partner within
the proposed activity. When potential partners are identified or when
partnerships are proposed, USFA seeks to maximize its limited funds
through joint funding of the proposed project between all partners.
USFA considers and evaluates all proposals to address fire related at-
risk groups.
institutionalizing reforms
Question. What steps have you taken to institutionalize the steps
necessary to focus the agency on readiness, response and recovery?
What steps has FEMA taken to institutionalize this focus for states
and localities--to ensure they are ``fit for duty?''
How often does FEMA do an assessment of local preparedness to
respond to natural disasters?
What steps is FEMA taking to respond to the unmet needs states and
localities have in being ``fit for duty?''
Answer. The current State Capability Assessment for Readiness (CAR)
process institutionalizes the emergency management assessment at the
State level. It also serves as a model for development of local
emergency management assessment instruments and processes. The CAR
process was jointly developed in fiscal year 1996 by FEMA working in
partnership with the National Emergency Management Association (NEMA),
an organization of State emergency managers. The CAR assessment
process, which determines ``fitness for duty'' is structured around
thirteen (13) functional areas. These 13 functional areas are: Laws and
Authorities; Hazard Identification and Risk Assessment; Hazard
Management; Resource Management; Planning; Direction, Control and
Coordination; Communications and Warning; Operations and Procedures;
Logistics and Facilities; Training; Exercises; Public Education and
Information; and Finance and Administration.
All 56 States, Territories and Insular Areas completed a CAR
assessment during fiscal year 1997. A Report to the United States
Senate Committee on Appropriations was developed and submitted to the
President and Congress in December 1997, based on the results of the
assessment process. The States were very supportive of the CAR
assessment process. They used the results to identify deficiencies in
programs and activities, and modify strategic plans and budgets in
order to address their needs and the needs of their localities. The
results were also used in FEMA's Preparedness Partnerships and
Agreement/Cooperative Agreement process.
Following issuance of the report, FEMA conducted Customer Feedback
Workshops in early 1998 throughout the nation with State and regional
counterparts in attendance. These workshops were designed to determine
if the CAR was beneficial to States and to identify needed enhancements
to improve the process and assessment instrument for the next scheduled
assessment in the year 2000.
NEMA has requested the involvement of FEMA in the development of a
local template assessment instrument and process similar to the current
CAR. States will have the option to modify/customize the template for
use in their localities. Some States, for example Michigan, North
Carolina, and Florida have already begun using the CAR to assess the
local governments' emergency management preparedness capabilities. The
number of States conducting local assessments is expected to increase
dramatically over the next review cycle with the issuance of the local
template.
Finally, the CAR assessment instrument and process will incorporate
the emergency management standards that are currently being developed
under the auspices of the National Fire Protection Association (NFPA).
The CAR is also being designed to serve as the assessment process
supporting this standards and accreditation process.
Question. What is the status of the Stafford Act reforms that are
designed to reduce disaster relief costs?
Answer. FEMA is now in the process of preparing a report to
Congress that outlines the following actions that we are taking to
reduce disaster relief costs:
The Office of Financial Management has been working to reduce
disaster costs in three areas: (1) closing out old disasters; (2)
implementing better monitoring of disaster expenditures; and, (3)
standardizing Agency policy on reimbursing State management costs.
The Response and Recovery Directorate is proposing to reduce
disaster costs through a number of initiatives: (1) publishing
evaluation factors for major disasters that would adjust the financial
indicator annually for inflation; (2) raising the $64 threshold now
used to recommend cost-share adjustments up to current dollars and
adjusting that indicator annually for inflation; (3) realizing
administrative savings through the new Public Assistance process; and,
(4) clarifying and strengthening the insurance purchase requirements
under the Public Assistance Program.
Question. In response to questions for last years hearing record,
the agency noted that it had developed a series of 26 Essential
Elements of Information (EEIs) that is planned to use to judge the
severity, magnitude, impact and procedures for conducting a Preliminary
Damage Assessment. What is the status of FEMA's work in reviewing the
EEIs with other Federal departments and agencies that support FEMA
under the Emergency Response Plan?
Answer. FEMA established an interagency work group to review and
validate the existing Essential Elements of Information. Based upon
this review, 25 EEIs were retained and minor changes noted. The revised
EEIs will be published in the updated Federal Response Plan. In
addition, the work group is developing baseline Information Collection
Plans for several disaster scenarios. The baseline plan for a major
hurricane is complete and work has been initiated on an earthquake
information collection plan.
Question. What criteria has FEMA institutionalized to determine:
what role FEMA will play in responding to a disaster; the extent of
FEMA's involvement; what FEMA will pay for; and, whether FEMA will
focus on rehabilitation, restoration or re-engineering?
Answer. In the past six years FEMA has undertaken a number of
initiatives to institutionalize improvements in disaster response.
Following are a few of the most significant accomplishments:
Strengthening and improving the Federal Response Plan so that the
Federal government has a single well-recognized and effective means of
responding to disasters and emergencies under the Stafford Act.
Creating a national Urban Search and Rescue capability that
consists of 27 teams throughout the nation, and that can be activated
immediately in response to disasters anywhere in the United States.
Improving our regulations, policies and guidance that clarify
FEMA's role, the role of other Federal agencies, and the roles of State
and local governments in responding to a disaster. This has been
particularly effective in the Public Assistance Program, where a
``Policy Compendium'' clearly outlines what FEMA considers eligible
costs. This guidance is available both in booklet form and under FEMA's
web site on the internet.
Developing and implementing a ``New Public Assistance'' program in
concert with our State and local partners that simplifies and
streamlines delivery of the program, and that keeps the end customer--
the applicant--uppermost in our minds.
Improving our centralized teleregistration and processing
capability so that we can provide assistance to individuals through a
toll-free number that is activated immediately upon the declaration of
a disaster. This centralized capability can provide assistance within
just a matter of days, and includes a helpline to answer applicant
questions and needs throughout the process.
project impact/pre-disaster mitigation
Question. What has been accomplished with Project Impact funds?
Answer. Project Impact funds have enabled community-based
mitigation to become a reality in an exciting way--it has reached
people nation-wide. With Project Impact funds, we have been able to add
Federal leadership, support and investment in a national momentum
toward creating disaster-resistant communities. Previous grant programs
reached selected audiences for targeted purposes. Project Impact
motivates communities to change the way they deal with disasters. It
encourages communities to use the seed money provided as a tool to
leverage additional funding from public and private partners. As a
result of Project Impact, interest in and awareness of the need for
pre-disaster mitigation has sparked an interest in communities which
has resulted in 118 communities to date and over 600 community business
partners.
Question. How many localities have received Project Impact grants?
Answer. As of March 31, 1999, eighty-seven (87) localities have
received Project Impact grant funding. Fifty-seven (57) fiscal year
1997 and fiscal year 1998 localities/communities received Project
Impact grants totaling approximately $24,500,000 and thirty (30) fiscal
year 1999 localities/communities received approximately $8,400,000.
The communities will be able to draw down on these obligated
dollars as their projects come to fruition. In addition, all of the
Project Impact communities are utilizing ``in-kind'' and cash
contributions of non-Federal partners before and after drawing on
Federal funds.
Question. How much of the funding has actually been disbursed to
the localities?
Answer. As localities/communities gear up for Project Impact (pre-
disaster mitigation), they are initially using the leveraging of funds
from businesses and other federal partners to accomplish many of their
current projects.
Approximately $32,900,000 was available for spending by the
localities/communities on or before March 31, 1999, it is up to the
locality/community to request the dollars needed for continuing
operations. The funding mechanism is set-up so that communities can
draw-down funds as needed (similar to writing a check on a bank
account).
Our theory of providing seed money seems to be working. Thus far,
communities are using leveraged dollars to accomplish their goals and
projects.
Question. How much in non-Federal resources have been leveraged?
Answer. The 7 pilot communities have leveraged $5,757,000 in FEMA
invested grants into estimated partner contributions of $26,000,000.
This works out to a 452 percent return of the original investment. Of
the 26 fiscal year 1998 communities which have signed Memorandums of
Agreement (MOAs), 18 communities have reported leveraging $9,000,000 in
FEMA invested grants into estimated partner contributions of
$24,340,000. This works out to a 270 percent return of the original
investment.
Question. How has FEMA measured the leveraging?
Answer. FEMA solicited leveraging information from each of the
communities with signed MOAs, to determine what non-FEMA funds were
leveraged against the initial FEMA investment. This information
included total contributions received by each community, to include
``in-kind'' contributions, and benefits received from the leveraged
contributions.
Question. What does FEMA do to ensure that local governments and
businesses are involved and fulfill their commitments? Does FEMA have
an outreach effort it conducts to get non-Project Impact local
governments and businesses involved with pre-disaster mitigation
efforts?
Answer. Community partnerships are vital to developing and
implementing the initiative. Project Impact emphasizes community
partnerships that include leaders from businesses, volunteer
organizations, educational entities, and government. The local
government is asked by FEMA to take the lead in convening and presiding
over planning meetings. FEMA encourages the local government to include
the Chamber of Commerce as well as specific business representatives.
FEMA also provides the names of other businesses that have participated
elsewhere in the State or Region.
One of the criteria suggested to the States for their selection of
a Project Impact community is to look toward those with good public-
private partnership activities in place. This is necessary because
Project Impact is self-directed by the community. It takes broad
participation of community stakeholders to create consensus on actions
that they need to take to make the community more disaster resistant.
To date, Project Impact communities have partnered with over 600 public
and private organizations.
Question. What is FEMA doing to streamline and speed up the
environmental and historic preservation impact reviews done by FEMA at
the regional level?
Answer. A variety of steps have been taken to improve and speed
National Environmental Policy Act (NEPA) compliance reviews. Over the
past several years FEMA has:
--hired Environmental Officers for each Region to speed
determinations;
--offered a newly developed NEPA course in all 10 FEMA regions, and
included State staff to better familiarize them with
requirements of relevant statutes and improve their skills in
conducting such reviews. This has greatly increased capability
to process projects at the Federal and State levels;
--published an expanded list of NEPA categorical exclusions. Use of
these new exclusions has significantly reduced the time
required for environmental review for approximately 50 percent
of the projects submitted by States for HMGP funding; and
--introduced the new ``Managing State'' concept for the management of
Hazard Mitigation Grant Program funds, which includes
additional education activities for State staff so that they
can identify and assemble most of the environmental and
historic review documentation necessary to fund a project.
Question. What is FEMA doing to study the cost-effectiveness of
Project Impact? Is an analysis being done to study the reduced disaster
cost incurred in Project Impact communities after they have completed
mitigation projects?
Answer. FEMA will be studying the cost-effectiveness of Project
Impact by: (1) applying cost-benefit analysis to structural projects;
(2) annual data collection and evaluation of effectiveness of training,
education, planning and administrative activities which do not lend
themselves to traditional cost-benefit analyses; and (3) before and
after comparisons of conditions and expenditures in the pre- and post-
disaster environments in Project Impact communities.
In the past the greatest incentive for a community to implement
mitigation has typically been after a disaster. In order to change this
trend and increase mitigation activity as a proactive rather than
reactive solution, the Project Impact initiative was designed not only
to help communities address current mitigation project needs but to
encourage the community to incorporate natural hazard loss reduction as
a continuing part of the community culture and activity. Therefore, the
Project Impact grant is intended not only as a means to address
immediate community mitigation needs but also as a way of leveraging
funding and resources from other partners, and an incentive for
becoming proactive about emergency management. As a result, community
Project Impact leaders have been given some discretion on how the funds
will be used. Specifically, this discretion allows the grant to be used
for training, education, and initiative-related administration
activities that do not readily lend themselves to a traditional cost-
benefit analysis. However, when successfully implemented these
activities can increase capability and the general public's knowledge
of mitigation. A well-informed community can lead to important zoning
and/or bond issues that provide tremendous loss reduction benefits.
To assess the effectiveness of this strategy, FEMA is also
implementing an evaluation process that will establish a baseline on
the number of structures and infrastructure at risk as well as the
current level of mitigation activity in the community at the time it
begins the Project Impact process. Then each year for the next five
years the community's progress will be evaluated to determine the
reduction in the number of structures and the extent to which
infrastructure is at risk, increases in mitigation education and
training activities in communities, and activities to foster proactive
business and/or government actions. The data collected will be used to
make necessary policy changes as well as to demonstrate the success of
strategy implementation.
emergency food and shelter program
Question. What is your assessment of the EFSP program's
effectiveness of meeting compelling human needs? What criteria are used
to determine the effectiveness of the program?
Answer. FEMA's assessment of the effectiveness of the program is
based on the number of meals and nights of shelter provided each year.
These numbers equate to millions of people who were hungry or having to
sleep on the streets, being fed and sheltered indoors. It has also
helped hundreds of thousands of the working poor with rent, mortgage
and utility payments to prevent evictions, which could lead to
homelessness. Providing individuals and families, young and old, with
these basic necessities of life substantiates the effectiveness of the
program.
Periodically, surveys of EFS Local Boards and funded agencies are
conducted to get their insights on the program's effectiveness. Data
from the most recent survey is being compiled. Preliminary information
indicates that while the EFS Program has been effective in helping to
meet the food and shelter needs of many, the need is still there.
Agencies report an increase in the number of working families seeking
mass shelter, food and other emergency assistance.
Question. What standards/criteria are used to determine local
needs?
Answer. The standards/criteria used to determine what the local
needs are is made at the local level by a Local Board. Each
jurisdiction, (city/county) that is eligible to receive EFSP funding
must constitute a Local Board. The Local Board, whose members consist
of a homeless or previously homeless person and representatives from
charitable, voluntary and local government organizations from within
the community. The Local Board decides how the EFSP funds will be
divided to meet the unmet needs and what community organizations can
best provide the services to meet those needs.
Question. How involved are local governments in determining which
local agencies will receive local EFSP funding?
Answer. Each Local Board is required to have a representative from
the local government. The local government representatives, in
partnership with the other board members, determine which agencies to
fund. The purpose of the Local Board is to ensure coordination of
government and community resources that already exist. The EFSP funds
are used to supplement and expand all ongoing services.
Question. Has FEMA done an assessment of unmet local needs in terms
of providing the types of services eligible for EFSP funding?
Answer. Yes. The EFSP program does periodic assessments/surveys of
Local Boards and funded agencies to determine what the local needs are,
the effectiveness of the EFS Program funds in meeting those needs, and
what the unmet needs are. Information is being compiled on the most
recent survey that was conducted during November 1998. Preliminary
results indicate that the most significant unmet need is in the area of
rent, mortgage and/or utility assistance due to an increase in the
number of working families seeking assistance.
This has resulted in an increase in the number of families seeking
overnight accommodations in mass shelters.
Question. Do EFSP funds leverage any local or private funds?
Answer. Yes. Numerous resources are leveraged at the local level in
the EFS Program. Indeed, there are many in-kind resources leveraged in
addition to facilities, utilities, staffing provided by the agencies,
such as administrative costs, private donations from foundations,
philanthropic organizations and other private donations. Some
communities also leverage other funding to provide additional resources
for expenditures not funded through this program. They include medical
assistance, security deposits, and more than one month's rent, mortgage
or utility payments. Many local grocers and restaurants also donate
food and supplies, while hotels and motels donate overnight
accommodations free or at a greatly reduced cost.
Question. Does FEMA work with other agencies that provide funding
for similar services to coordinate delivery efforts at the local level?
Answer. Yes, it is imperative that the EFSP coordinate with other
agencies since the program is supplemental in nature. The EFSP program
supplements the ongoing efforts of agencies to provide shelter, food
and supportive services. The coordination with other federal, state and
local agencies are a must in order to ensure the efficiency and
effectiveness of the assistance to be provided. For instance, the US
Department of Agriculture provides canned goods and other staples of
food to food banks and pantries, while funds from the EFSP are used to
purchase fresh vegetables. The EFSP program provides one month's rental
payment and local funds are used to pay the security deposit.
y2k issues
Question. Have you given any thought to the potential for problems
associated with Y2K (such as civil unrest or utilities malfunctioning)?
Answer. Based on the President's Council for Year 2000 Conversion
First Quarterly Summary of Assessment Information, it is anticipated
that there will be no major catastrophic impacts on public safety or
health, or on key economic and infrastructure functions in the U.S.
during the transition from 1999 to the year 2000. However, there may be
numerous localized impacts of limited duration occurring simultaneously
across the country. The Y2K conversion presents the emergency
management community with a unique challenge. It is primarily a
technological problem with well-known solutions. Based on current
assessments, Y2K need not result in major disruptions. The all-hazards
practices and techniques emergency managers routinely use for other
disasters and emergencies should well serve our nation in planning for
the potential consequences of Y2K conversion.
The Federal Response Plan (FRP) will serve as the foundation for
coordinating any Federal response to the consequences of Y2K
disruptions. The FRP describes the structure by which the Federal
Government mobilizes emergency resources and delivers disaster
assistance. It is a proven framework for responding to hurricanes,
floods, earthquakes, and other disasters and emergencies that overwhelm
State and local governments.
With respect to civil unrest, each State has primary responsibility
for law enforcement, using State and local resources, including the
National Guard. As such, the FRP makes no provision for direct Federal
support of law enforcement functions in a disaster or emergency. In the
event that State and local police forces are unable to adequately
respond to a civil disturbance or other serious law enforcement
emergency, a Governor may request Federal military assistance through
the Attorney General. Procedures for coordinating such law enforcement
responses are set forth in the Department of Defense Civil Disturbance
Plan (Garden Plot).
With respect to utilities malfunctioning, the Department of Energy
believes that the electric grid is robust and stable and that any
electric service problems that may occur will be localized and quickly
addressed. In addition, it is expected that interruptions of the
telecommunications infrastructure (major interchange carriers and
primary local exchange carriers) will be minimal to nominal. In other
utility areas, large and medium systems are expected to be compliant;
smaller systems may be more problematic.
Question. Does FEMA have a readiness, response and recovery plan to
deal with any of the potential chaos that may occur in relation to Y2K?
Is FEMA working with other Federal agencies, state and local
governments to develop these types of plans?
Answer. Readiness.--FEMA has published, as part of its State and
local outreach activities, guidance entitled ``Contingency and
Consequence Management Planning for Year 2000 Conversion: A Guide for
State and Local Emergency Managers.'' This Guide is meant to assist
States and local emergency management organizations in preparing Y2K
contingency and consequence management plans. It provides information
for identifying potential problems, conducting risk assessments,
keeping the emergency management organization operations, informing and
assisting the public, and developing and implementing Y2K consequence
management plans. It is being as widely disseminated as possible to the
emergency management community in hard copy and electronic format and
has been posted on FEMA's website. Emergency Operations Plans,
supplemented by the material suggested in this Guide, should form an
effective basis for Y2K contingency planning and consequence management
for States and local governments. Training to supplement the Guide will
be available for State and local emergency managers.
Response and Recovery.--FEMA is developing a special Y2K
Operational Supplement to the Federal Response Plan as a prudent
planning measure. The supplement will augment the current planning
approach in the Federal Response Plan and address any unique
circumstances associated with the unprecedented nature of the Y2K
phenomenon. It will assess the Y2K risk and possible impacts; set forth
planning assumptions; describe Federal monitoring operations and early
warning systems; establish an expanded information and reporting
function to ensure expeditious collection, analysis, and dissemination
of situation assessments; and identify any additional resource
requirements.
modernizing fema's flood hazard mapping program
Question. How long will it take FEMA to update its maps without any
additional resources provided for the effort?
Answer. Without additional resources, the existing backlog of
outdated maps will never be eliminated. It is estimated that 19 percent
of the current inventory already has outdated flood data, and
approximately 4 percent of the 100,000-map panel inventory deteriorates
each year. Because of finite funding, FEMA is able to update only 2 to
3 percent of the inventory a year.
Additionally, the majority of the inventory is in a manual format.
The modernization plan calls for a 5-year catch-up period during which
6 percent of the panels will be updated to reflect current flood data
each year. Approximately 16 percent of the panels with adequate flood
data but needing map maintenance and conversion to a digital format
will be updated each year for 5 years. After the backlog of outdated
maps is eliminated and the inventory is converted to digital format,
adequate funding (about twice present levels) must be provided to avoid
accumulating another backlog.
Question. How much does it cost the government to go with outdated
maps?
Answer. It is estimated that the potential flood damages avoided
over a 50-year period as a result of FEMA's map modernization plan will
be approximately $26 billion more than would result at the current rate
of mapping. If new floodplain mapping was stopped altogether, we
project there would be an estimated $45 billion more in damage than
would occur under the modernization plan. A significant portion of
reduced losses will result in decreased Disaster Relief Funding.
Question. Who pays for the maps now and who benefits from the maps?
Answer. The NFIP mapping program is presently funded from two
sources:
Federal Policy Fee.--A Federal Policy Fee of $30 is charged to each
of the approximately 4 million flood insurance policies sold. This
funding source accounts for 90 percent of the funding for the mapping
program. The Federal Policy Fee also pays for other activities,
including floodplain management and flood mitigation assistance, as
well as administrative expenses for the program; and,
Fee Charge System.--Fees are charged for reviewing and processing
map revision requests, and for printing and distributing the maps and
engineering back-up data. The Fee Charge System accounts for
approximately 10 percent of the funding for the mapping program.
Although only a minority of taxpayers currently pay for the flood
mapping program, all taxpayers benefit. The general public benefits
through reduced disaster relief costs and reduced loss of life and
property when floods occur. With the accurate identification of
existing flood hazards, new construction can be designed to avoid the
floodplain altogether or, at the least, minimize the potential flood
loss by implementing the minimum Federal floodplain management
requirements. This benefits all homeowners, business owners, the
insurance industry, and other groups. Additionally, existing residences
and businesses situated in the floodplain can be retrofitted or their
contents relocated to minimize flood losses.
Question. What is the status of FEMA's discussions with the housing
industry and advocacy groups regarding the proposed mortgage
transaction fee?
Answer. The Coalition on Permitting Efficiency attended the recent
(March 1-2, 1999) meeting of the Technical Mapping Advisory Council-a
congressionally mandated advisory group representing various map user
constituencies. This meeting provided FEMA with the opportunity to
consult the Coalition, which represents 24 different associations and
industries, including the National Association of Realtors, the
National Association of Homebuilders, and the National League of
Cities. In addition, FEMA has recently had conversations with the
National Flood Determination Association.
Question. What is the status of FEMA's Request for Proposals for
new companies to update maps (TEC Contracts)?
Answer. Solicitation EMW-1999-RP-0022, ``Engineering Review and
Revision of Flood Insurance Maps'' was printed in the February 23, 1999
issue of the Commerce Business Daily (CBD) and was posted in CBDnet on
February 19, 1999. All information required by this solicitation was
due to the Contracting Officer no later than 4:00 p.m. local time in
Room 350, FEMA, 500 C Street, SW, Washington, D.C. 20472, on March 31,
1999. FEMA is currently reviewing the qualifications of the offerers
and anticipates announcing a selection by September 1, 1999.
Question. What criteria will be used to evaluate companies applying
for the TEC contracts?
Answer. Selection will be in conformance with the provisions of
Public Law 92-582 and based on the following criteria and evaluation
points, in descending order of importance (Total points = 180):
(1) Specialized, nationwide experience of firm and key personnel in
hydrology, hydraulics, flood risk assessment and floodplain mapping for
riverine environs (Max. pts. 25).
(2) Demonstrated experience using Geographic Information Systems,
with emphasis on spatial data production, analysis, and creation of
soft and hard copy flood hazard and related products that are in
accordance with relevant (i.e. FGDC, FEMA) standards: (a) Experience
and/or innovation in the area of automated hydrology, hydraulics and
floodplain delineation (0-5pts.). (b) Experience in and/or capability
to produce digital and print-on-demand map products complete with
metadata (0-5pts.). (c) Experience in effectively communicating and
supporting local governments and private citizens in issues related to
spatial data information and technologies used in hazard identification
and risk assessment (0-5pts.). (d) Experience in successfully
evaluating spatial data (base cartography, imagery, etc.) from a
variety of sources for quality, completeness and accuracy and
integrating them into a systematic process (system) to accomplish tasks
related to this rating factor (0-5 pts.). (Max. pts. 20).
(3) Demonstrated capacity to accomplish the work in the required
time and ability to direct, manage, and control the entire project.
(Max. pts. 20).
(4) Past performance on contracts of comparable size with
government agencies and private industry in terms of: (a) cost control
(0-5pts.), (b) quality of work (0-5 pts.), (c) compliance with
performance schedules (0-5 pts.). Submittals must include references'
names, affiliations, and phone numbers (Max. pts. 15).
(5) Experience of firm and key personnel in the coordination of,
public relations/outreach involving, and facilitation of, technical
issues with local officials, private citizens, Federal and State
entities, and private industry (Max. pts. 15).
(6) Experience of firm and key personnel demonstrating the
capability to maintain adequate product quality control of contracts of
comparable size (Max. pts. 10).
(7) Specialized experience of firm and key personnel in flood risk
assessment and floodplain mapping of coastal environs, including
analysis and mapping of coastal and Great Lakes erosion zones (Max.
pts. 10).
(8) Demonstrated ability to deliver timely and effective guidance
and technical assistance to both public and private sectors involved in
various stages of maintenance and production of flood hazard mapping
(Max. pts. 10).
(9) Demonstrated ability to provide state-of-the-art technical
guidance and advice to transform existing methodologies and processes,
and to keep pace with future technological advancements (Max. pts. 10).
(10) Experience and knowledge in the development and maintenance of
Internet sites, including the distribution of spatial and text data via
File Transfer Protocol (FTP) and the World Wide Web (Max. pts. 10).
(11) Demonstrated experience in developing and applying new
hydrologic, hydraulic, and general engineering approaches to unique or
specialized flood risk situations (Max. pts. 10).
(12) Experience and/or capability in current remote sensing
technologies (i.e. LIDAR, IFSAR, GPS) used to develop high-resolution
digital elevation models (Max. pts. 5).
(13) Experience of firm and key personnel in manual cartographic
production (Max. pts. 5).
(14) Demonstrated capability in the identification and assessment
of hazards and risks associated with erosion, hurricanes, alluvial
fans, earthquakes, tsunamis, wind, and unsafe dams (Max. pts. 5).
(15) Experience of firm as a technical review contractor for Local,
State, and Federal or other Architect-Engineering firms (Max. pts. 5).
(16) Experience and capability to design, build, maintain, and
operate library reporting and storage systems for both manually and
digitally produced spatial text data, and the experience and capability
to retrieve the data from these systems in both hard copy and
electronic format (Max. pts. 5).
Question. Does the Director believe that new and innovative
approaches and technologies are needed in the current map modernization
process?
Answer. The Director supports the new and innovative approaches and
technologies that are a part of the modernization plan. We have already
begun implementing a number of these new approaches. For instance, we
have re-engineered the flood study process to include more up-front
coordination with the community, state, and other Federal agencies.
This up-front coordination will involve working with the community to
identify all flood hazard data it has available, to learn of any flood-
related concerns and flooding problems, and to identify areas of
anticipated development. In addition, FEMA will adopt a more aggressive
public outreach strategy to better inform the public of the risks of
flood hazards and explain why the maps change and why they are
important.
Another example of an innovative approach that we are currently
implementing is the Cooperating Technical Communities (CTCs) program,
which increases community involvement. Specifically, the mapping
modernization plan will proactively pursue strong Federal-state-
regional-local partnerships through a variety of cooperative programs.
In recent years, many states, communities, and other local entities, at
their own expense, have invested considerable resources in identifying
and updating flood hazard information. The intent of the CTC program is
to facilitate and capitalize on these state and local efforts and
coordinate them with FEMA's flood mapping efforts rather than having
them simply occur on an ad-hoc basis. This will result in strengthened
mapping and floodplain management programs and, thus, should reduce
flood losses and disaster assistance.
Another new approach supported by the Director involves
partnerships between FEMA and other Federal agencies. For instance,
FEMA is establishing a partnership with USGS for assistance in
developing and maintaining base maps. FEMA is also working with other
Federal agencies that develop mapping, elevation data, and flood
studies. For instance, FEMA is establishing a partnership with NGS for
assistance in establishing and disseminating geodetic data. FEMA is
also establishing a partnership with the U.S. Fish and Wildlife Service
for improved mapping of Coastal Barrier Resources System areas. In
addition, FEMA's new digital map products will be compatible with
Federal Geographic Data Committee standards and will support
implementation of the National Clearinghouse for Spatial Data and the
National Spatial Data Infrastructure. Finally, FEMA will work with
NASA, the USACE, and the NRCS to use state-of-the-art data collection
and hazard identification methodologies.
Finally, the Director believes technological advances will make a
significant contribution to the flood mapping program. Currently, we
are evaluating LIDAR (Light Detection and Ranging) and IFSAR
(Interferometric Synthetic Aperture Radar) to determine the costs and
accuracy of these remote-sensing technologies. They hold the potential
for cost effectively performing flood modeling and mapping.
We are also exploring the use of automated GIS-based hydrologic and
hydraulic models integrated with digital watershed models and digital
elevation models, which may or may not be built from LIDAR/IFSAR and
Global Positioning System elevation data. GIS-based hydrologic and
hydraulic analyses create ``living'' models that are easy to revise as
conditions change. They are also a powerful tool for communities to
quickly evaluate the impacts of various watershed and floodplain
developments.
Digital maps will allow us to distribute the maps via CD-ROM and on
the Internet. They will also enable print-on-demand technologies.
______
Questions Submitted by Senator Lautenberg
Question. I understand from churches, charities, and local
governments that, because their resources are limited, they are having
to turn people away who are hungry and homeless. As you know, much of
the funding for these programs comes directly from the federal
Emergency Food and Shelter Program (EFSP). How do you respond to this?
Answer. Many churches, charities and local governments (including
the groups mentioned above) which have had to turn people away are
recipients of this supplemental program. The Emergency Food and Shelter
(EFS) National Board Program provides supplemental funding to over
10,000 nonprofit and local government agencies who provide emergency
financial and food assistance to people in need. The preliminary
results of a recent survey of EFS funded agencies indicates an increase
in the number of working families, elderly and unaccompanied children
that are requesting food, rent and/or utility assistance. This increase
has resulted in the depletion of EFS program funds much earlier than in
past years. As a result, individuals and families are receiving reduced
assistance and in some cases, turned away due to lack of resources.
Agencies are encouraged to coordinate their resources and refer clients
to other organizations that have resources. It is also hoped that the
request for additional funding for the EFS Program will help to
decrease the number of people turned away for food or shelter.
Question. The Administration has included an additional $25 million
for EFSP in its fiscal year 2000 budget. Do you have a sense of what
this money could purchase at the local level? Is this in your opinion,
a good investment?
Answer. The increase of $25 million in the EFS Program budget will
enable agencies to provide approximately 6,653,968 additional meals,
964,309 additional nights of shelter, and pay 89,427 additional rents
and utility bills to assist with keeping people sheltered in their
homes.
Whenever we can help the most vulnerable citizens in our country,
in my opinion, it is a good investment. The saving of lives and helping
people to gain a sense of well-being by providing the basic necessities
in life is a good and sound investment. While the EFS program has been
successful in its goal of providing supplemental emergency funding
expeditiously and efficiently to local agencies, the need for emergency
food and shelter is still evident.
Question. Approximately what percentage of the administering
agencies under EFSP are religiously affiliated?
Answer. During the past two fiscal years, approximately 30 percent
of the funded agencies classified themselves as religiously affiliated.
These organizations included, but are not limited to Catholic
Charities, Churches and Ministerial organizations, Jewish Federations,
The Salvation Army, and St. Vincent de Paul Societies.
Question. I understand that of all the programs that you
administer, the EFSP is one of the best. Is this correct?
Answer. While I am proud of the hard and caring work that all FEMA
employees provide to people during some of the most difficult times in
their lives, the EFS program does stand out as one of FEMA's exemplary
programs. This can be attributed to the partnerships that have been
forged at both the national and local levels with charitable and
voluntary organizations, homeless and hunger advocates and local
governments in the administration of the program.
Question. Can you describe who you are helping with the EFSP
program?
Answer. The EFS program helps families and individuals, both
working and unemployed, who are hungry, homeless or who may be facing
homelessness. This includes the elderly, children, veterans, Native
Americans, the disabled, and persons with mental illness.
Question. What are the administrative costs of the EFSP program? I
understand it is less than 4 percent. Is this correct?
Answer. While the authorization for the EFS program allows for a 5
percent administrative allowance, only 3.5 percent has been
appropriated since the McKinney act authorization in 1985. This amount
is divided among the organizations responsible for the implementation
of the program at the national, state, local, and agency levels. Each
recipient of these administrative allowances are judicious in their use
of the funds, with many choosing to put their allowance back into the
program to be used for direct services. Over the past several years,
less than 3 percent has been used for administrative costs.
______
Question Submitted by Senator Byrd
Question. West Virginia University has indicated an interest in the
Disaster Resistant Universities initiative in the fiscal year 2000
budget request for the Federal Emergency Management Agency. West
Virginia University facilities, both directly and indirectly, through
its extension programs throughout the state, have been impacted in the
past by natural disasters. How do you believe that the Disaster
Resistant Universities program can help West Virginia University and
the people of West Virginia. Please elaborate for the record.
Answer. As you know, West Virginia University (WVU) contributes
greatly to the lives of West Virginians. Because of the vital role its'
regional campuses, extension offices, agricultural, aquacultural, and
health science facilities play in all 55 counties of West Virginia, WVU
represents the best in American land grant universities. A fully
functioning WVU is critical to the economy, education, and quality of
life for the entire State.
Unfortunately, WVU has not always been fully functioning at the
times West Virginia has needed it most--after a disaster--because the
university is vulnerable to the same natural events, including floods,
snow and wind, that afflict the rest of the state. In the past five
years alone, WVU county extension offices were forced to close for a
total of ten weeks due to natural disasters. While these closures occur
at times of greatest need, they can also adversely affect WVU's
research activities that contribute to West Virginia industries, such
as coal mining, agriculture, and chemical production, among others.
The Disaster Resistant Universities initiative proposed in FEMA's
fiscal year 2000 budget request could help WVU protect itself, and the
dozens of communities surrounding its facilities and dependent upon it,
against natural disasters. This program will make available to WVU the
expertise of universities around the country that have experienced
disasters or have exhaustively planned for them. The DRU program will
also enable WVU and other research universities to work with Federal
research agencies to protect the taxpayer's substantial investment in
research in these institutions.
Additionally, by encouraging universities to work with FEMA, state
governments, local communities and the private sector (using the
Project Impact model), this program will give universities like WVU the
tools to better serve the people of their state immediately following a
disaster. WVU will better plan its emergency response, and be better
able to provide healthcare, engineering advice, and other services to
West Virginians.
The actual mitigation work at West Virginia's campuses and
extension facilities could be funded through a national matching fund
that has been proposed by universities. It has been demonstrated that
the appropriation of such funds will achieve long-term savings,
particularly at universities, where the human and economic costs of
disaster recovery are very high as compared to the costs of pre-
disaster mitigation. While this program would use Federal money due to
the national interest in protecting research and education, it is
important to note that Federal resources alone cannot solve the
problem, but should be used to leverage the support of other university
stakeholders.
The Disaster Resistant Universities initiative requested in FEMA's
budget will enable university leaders to form public-private
partnerships to assess and reduce the vulnerability of WVU and the
state as a whole. Should a fund be established, it would provide
resources to universities on a matching basis to mitigate their
potential disaster losses. By protecting one of West Virginia's most
vital resources, its primary public university, this program will
prevent the next major flood, snow storm, or tornado from becoming a
disaster.
subcommittee recess
Senator Bond. The hearing is recessed. Thank you.
[Whereupon, at 11:04 a.m., Tuesday, March 4, the
subcommittee was recessed, to reconvene subject to the call of
the Chair.]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
THURSDAY, MARCH 11, 1999
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:35 a.m., in room SD-138, Dirksen
Senate Office Building, Hon. Christopher S. Bond (chairman)
presiding.
Present: Senators Bond, Kyl, and Mikulski.
CORPORATION FOR NATIONAL AND COMMUNITY SERVICE
STATEMENT OF HON. HARRIS WOFFORD, CHIEF EXECUTIVE
OFFICER
ACCOMPANIED BY:
WENDY ZENKER, CHIEF OPERATING OFFICER
HON. LUISE S. JORDAN, INSPECTOR GENERAL
KAREN MOLNAR, KPMG AUDITOR
STATEMENT OF SENATOR CHRISTOPHER S. BOND
Senator Bond. Good morning. The Subcommittee on VA, HUD and
Independent Agencies will come to order. This is the
subcommittee's second hearing on the fiscal year 2000 budget.
This morning our subcommittee will hear testimony on the
President's fiscal year 2000 budget request for the Corporation
for National and Community Service and the Department of
Treasury's Community Development Financial Institutions or CDFI
Fund.
We will first hear from the Corporation's chief executive
officer, Senator Harris Wofford, who will be followed by the
Honorable Luise Jordan, the Corporation's Inspector General.
The subcommittee will then hear from Ms. Ellen Lazar, director
of the CDFI Fund.
The Appropriations Committee and the VA Subcommittee will
face another year of very difficult budget decisions as I have
indicated previously. Under the budget caps imposed under the
1997 Balanced Budget Act, the Federal Government will have $29
billion less to spend for discretionary activities in fiscal
year 2000 than what was available last fiscal year.
Unfortunately the President's budget busted these caps by
about $18 billion by assuming offsets from tobacco revenues,
Superfund taxes and other gimmicks which simply will not fly.
This makes our job quite a bit harder because it raises
expectations that we simply will not be able to accommodate
reasonably within the VA/HUD subcommittee because of shortfalls
in the President's request.
The largest such shortfall is within the VA medical care
appropriation request, which would be frozen at current levels.
For example, the administration request for VA does not account
for the new costs of treating patients with Hepatitis C. The VA
estimates this problem alone will cost at least $500 million
next year.
Further, the subcommittee will be faced with the annual
need to fund Section 8 housing assistance contract renewals
which aid low-income families including the elderly and
disabled. Once again we will be forced to make some difficult
trade-offs in order to accommodate such dire needs.
Moreover, despite the overall decrease in the VA/HUD
account under the President's budget, the President has
requested a significant spending increase for the Corporation.
Specifically, $545.5 million has been requested, an increase of
$110 million over the fiscal year 99 appropriation.
Within the President's budget request the Corporation would
expand the AmeriCorps Service of 53,000 to 69,000 by the year
2000, reaching a goal of 100,000 in fiscal year 2002. In
addition, the President is proposing to expand AmeriCorps to
high school students, expand service-learning programs for
school-age youth and increase opportunities for seniors to
serve.
The Corporation certainly has a number of admirable,
important goals such as improving child literacy. That is an
area where I am a strong advocate. Nevertheless, there are many
significant issues concerning the implementation of the
program.
First, it will be extremely difficult to fund an increase
in spending for this agency when this subcommittee will be
faced with funding demands for priorities such as veterans'
medical care and the renewal of HUD Section 8 housing
assistance contracts.
Second, providing an increase in funds to an agency that
has been fraught with significant management problems is very
troubling. I have repeatedly expressed concerns about the
Corporation's management. Yet it continues to be a problem
every year.
I had hoped to hear the OIG's audit of the Corporation's
financial statements at this hearing. KPMG, under contract to
the OIG, has been conducting an extensive, costly and time-
consuming audit of the Corporation's fiscal year 1998 financial
statement. Unfortunately, the completion of the audit has been
delayed, primarily due to the flaws in the Corporation's
balances related to grants. I am very disappointed that the
Corporation's books cannot yet be audited. This has been a
priority concern of the subcommittee since the inception of the
Corporation.
We added a significant amount of money--I believe it was $3
million--last year to gain a handle on these problems. It
remains a priority. We do know, however, that KPMG's work will
reveal material weaknesses in at least eight areas of the
Corporation's financial operations. Actually that is two more
than the number of material weaknesses that was reported last
year. Many of these problems are the same as those that have
been reported on since the first audits of the Corporation were
conducted.
I also am concerned about a recent audit finding of surplus
funds in the National Service Trust account. Based on an
extensive analysis of actual usage of education awards, the
Corporation had $357 million in trust investment to fund the
education award liabilities, which is estimated to be $161
million, which means that there may be $196 million in
projected surplus funds in the trust account.
Frankly, this raises questions about the Corporation's
bookkeeping and ability to forecast accurately its true funding
needs. I would like to hear more about this surplus from the
auditors of the Corporation and I would like the Corporation
and the auditors to explain why such a large surplus exists and
whether these surplus funds represent excess amounts of what is
actually needed to meet all the Corporation's education award
liability.
In addition to ensuring auditable or clean books, the
Corporation must also correct its management problems. Having
auditable financial statements is just one of the first steps
of management reform. I believe that the problems I have just
cited prove that point.
Last year we agreed to provide additional funds to help the
Corporation achieve better financial management. We had hoped
and continue to hope that these funds will, indeed, be put to
the best use in addressing the Corporation's management
problems. Unfortunately, the Corporation has already fallen
behind the time frame directed under last year's
appropriations.
Because of these shortfalls, I must say I am disappointed
with the Corporation's progress to the commitment to that
mandate. Nevertheless, I expect the Corporation to comply with
all the legislative mandates and to do so in a timely manner.
The Corporation's slogan is getting things done. I credit
the Corporation for assembling a positive action plan to
address its management and administrative problems. However, it
is just a plan and many of its corrective actions have not been
implemented.
In fact, some of its planned time frames have already
slipped and it will likely be another 6 to 9 months before any
real results will be achieved in the plan. Therefore, it will
be a while until the Corporation is able to demonstrate if it
has adequately addressed its problems. I am still waiting to
see if the Corporation can, quote, get things done, close
quotes.
I cannot emphasize enough that we have to be able to tell
our colleagues in the Senate and the American taxpayers that we
know how the money is being spent and it is being spent in
compliance with the applicable laws and regulations.
Until the Corporation has demonstrated the ability
effectively and efficiently to manage its existing resources
and programs, it will be very difficult for me to support any
expansion of funding for the Corporation.
Now it is my pleasure to turn to my ranking member, Senator
Mikulski for her statements and comments.
STATEMENT OF SENATOR BARBARA MIKULSKI
Senator Mikulski. Thank you very much, Mr. Chairman. And I
want to welcome the National Service CEO, Senator Harris
Wofford, and the IG, Luise Jordan, for our first panel, as well
as the chief operating officer.
As you know, I was one of the prime movers of this program
because I think volunteer programs highlight what is best about
America. Volunteerism is the backbone of your communities, from
preserving the safety net for seniors to helping get behind our
kids and our teachers. The whole idea behind national service
was to link our values with our public policy. And when the
legislation was passed, we knew it was going to be in many ways
breaking new ground, using at the same time existing values.
Now the legislation is up for reauthorization, and not only
for our annual appropriation, but the legislation is up for
reauthorization. And I believe just like we have to show fiscal
accountability, Mr. Chairman, we have to say what did this
program do and was it worth it?
So what I want to focus on in my questions was to go back
to the original intent of national service and then ask about
very specific questions now on the impact of the program. The
whole idea of National Service was to link our values with
public policy. It was also to say ``Yes'' to the young people
who were saying ``No'' to drugs and alcohol and other evils in
our society.
And we also wanted to provide an opportunity structure, by
providing a way for many of them to reduce their biggest debt
or their first mortgage, their student loan or to accrue money
to be able to go on to higher education. But this program was
founded on the concept that for every right, there is a
responsibility. For every opportunity, there is an obligation
and, therefore, to be involved in the community.
The other was to make sure that both the volunteers
became--be rekindled with the concept of habits of the heart,
but also to spark other volunteer efforts in the community. The
point is that National Service was not designed to be a social
welfare program, nor a giveaway program, but to really recruit
people to serve in their communities and be able to have a
voucher--this is the National Service part--to go onto their
communities.
Now, I never really liked the way this program was
launched. I knew that it was rocky in terms of its
administrative structures because it was new, because it had to
take on some of the old ACTION programs, and essentially it was
launched in many ways like a rock concert. It was a lot of show
biz, a lot of fanfare, a lot of volunteers were just parachuted
into communities. And I am not so sure that the core concept of
good, solid training before they go to the community, real
projects focused on five areas like public safety and education
and so on for them to do or closely adhere to. This is not
about the volunteers. It was about this.
Often when this program has been in trouble what we heard
were anecdotes, and we would have pep rallies and wonderful
young people showing up with baseball caps who wanted to give
me T-shirts. We are not in a post-T-shirt environment.
And what we need to know is really what has gone on,
because I think it has been difficult to separate out the
fiscal accounting problems and then the show biz. Somewhere in
the middle is hard, solid information about how many volunteers
have we recruited, how many have stayed in the program, what
have they done once they left the program, did they use the
program to further their higher education? Have they formed
alumni associations like what the Peace Corps has done, where
they continue--the Peace Corps is a state of mind as well as a
service that had been given, where they go on and continue to
serve in their community for a lifetime. That is what I want to
know about, is the volunteers.
The next thing I want to know about is what happened in
communities. Sure, you can run in and tutor. But did it have
the same adhesive quality as me reading Dr. Suess to a 4-year-
old? That is a nice photo op for me, but I do not know if it is
a learning opportunity for a child. And it is great if we
tutor, but the question is at the end of the day, backing up
hard working teachers or have we advanced education, have we
advanced public safety, have we recruited and been able to
deliver immunization and have our volunteers, because of what
they do, generated more volunteers in local communities?
So those are the kinds of results. Because if I do not have
fiscal accountability and real results, it is going to be very
hard to both get the program funded at the level the President
wants and also to be able to do the reauthorization.
With the end of this century and looking forward to the
millennium, I hope this could be one of the programs that
really take the values of the old century into the next
century, but at the same time use the excellent knowledge that
we have about maximizing volunteer resources, sound fiscal
accountability, so that--so that we really do have an
opportunity structure.
I look forward to hearing this testimony and want to thank
the administration of the National Service for their
cooperation with this committee. But I think this is kind of a
crucial year for National Service. We are either going to go on
or we are going to sputter out. The two significant issues that
will determine about whether we go on and have a momentum that
I hope the program has, is sound fiscal accountability and a
clear direction of where we have been. And a direction of where
we are going with the idealistic young people who sign up, that
we do not let them down, we do not let communities down and we
do not let taxpayers down.
In many instances I look forward to the quantitative and
other data that will help me continue to be the strong advocate
that I am for this program. Thank you.
[The statement follows:]
Prepared Statement of Senator Barbara A. Mikulski
Good morning Mr. Chairman and thank you. I want to welcome National
Service CEO Harris Wofford and Inspector General Luise Jordan for our
first panel. I am proud to be called the godmother of National Service.
I think volunteer programs highlight what is best about America.
Volunteerism is the backbone of our communities, from preserving the
safety net for seniors to keeping our communities clean and getting our
kids ready to learn.
And I also want to welcome CDFI Director and Maryland native Ellen
Lazar for our second panel.
national service/overview
The whole idea behind the National Service program was to link our
values with our public policy. We wanted to say yes to the young people
who say no to drugs and alcohol and many of the other ills in society.
We wanted to provide them with an opportunity structure by
providing a way to reduce what for many people is a first mortgage--
their student debt. The specter of high student debt prevents many
young people from pursuing a college education.
Second, we wanted to link responsibility to the opportunity,
essentially to reinforce the old civic virtues that needed to be
rekindled. The program is designed to give members an experience that
is meaningful for them and the communities where they work.
The point is that National Service was not designed to be a means
tested program. It was meant to provide a broad base of young people
from a variety of social classes and backgrounds an opportunity to
serve their country through sweat equity work in their communities.
financial management
Since its inception the organization has been plagued with issues
that have caused me concern, and I know a great deal of concern for
other Members. The issues have centered around sound financial
management, and ensuring accountability that directed everyone to focus
on accomplishing the mission which I stated earlier.
Mr. Chairman, this is a serious concern of mine. Management issues
revolving around the financial accountability and the audibility of
records have persisted even through changes in personnel. I understand
that progress has been made, and I commend the work of Chief Operating
Officer Wendy Zinker, but there is still some serious work to be done.
This morning, I know you will direct many questions to the
corporation regarding financial management and accountability. I will
be interested to hear the responses.
mission focus
This morning I want to focus on mission. I want to know what
exactly we have gotten for our money. I want to know if we have gotten
the ``equity'' part of the sweat equity that was intended.
Stories about the changed lives of members and their new
perspectives on life are important. But this morning, I want to talk
specific, quantifiable facts.
I want to discuss how effective the Corporation has been at:
--recruiting members--how many have completed their service, how many
have used their education awards; generating additional
volunteers in communities
--how many have been generated and what have they done in their
communities;
--producing tangible benefits in local communities--how is the
Corporation measuring for results and impact what members have
done.
Again, Mr. Chairman, I am proud to be considered the godmother of
National Service. For years I have championed the importance of helping
promote the habits of the heart.
Many of us were energized by the Presidents Summit on Service two
years ago in Philadelphia that focused on promoting volunteerism. And I
believe that the Corporation has a critical role to play in this
effort. But we can't be content with feel good stories about kids in
tee shirts.
We must stand sentry to ensure that Corporation members are reading
to young children and helping increase literacy, planting trees and
cleaning gullies--helping the environment, organizing local volunteer
groups and spreading the habits of the heart.
This will be my focus this morning. The Corporation's ability to
generate bi-partisan support will depend largely on the extent to which
it can demonstrate meaningful tangible results in local communities.
cdfi
CDFI has a as its mission providing an opportunity structure that
helps those who practice self help.
In a perfect world, we may not need a CDFI. But we don't live in a
perfect world. We live in a world with distressed communities that are
under served by the mainline private financial institutions.
In many of these communities there are willing people who want to
improve their lot in life, but they lack the capital or expertise
needed.
This is where CDFI helps to fill the void. I look forward to
hearing from Ms. Lazar this morning on the progress CDFI has made in
addressing management concerns raised over the last several years.
But as with the Corporation, I want to stay mission focused. I want
to ensure that CDFI doesn't just move money out of the door, but helps
move people up and out of poverty and despair. There needs to be a
system in place to evaluate grant recipients' progress in meeting their
goals.
There also needs to be a system to measure how effective CDFI is in
helping grant recipients improve their communities and empower local
residents.
Mr. Chairman, I look forward to the dialogue with you and this
morning's witnesses.
Senator Bond. Thank you very much, Senator Mikulski, for
that very strong statement, and I certainly endorse the
comments you made.
Senator Wofford, it is always a pleasure to welcome you.
You have submitted a 29-page statement. I assure you we will
make it a part of the record and I assure you that we are
better off reading it than having it read to us.
So we would like to give you up to 10 minutes to make a
summary of your report and comment perhaps, if you wish, on any
of the points that Senator Mikulski and I have written.
Thank you, Senator.
statement of harris wofford
Mr. Wofford. I will certainly not go beyond 10 minutes, Mr.
Chairman.
Thank you for letting Wendy Zenker, our chief operating
officer, accompany me here. And thank you, Mr. Chairman and
Senator Mikulski, for giving that quite appropriate double-
barrel challenge to us, and we want to meet that challenge to
the best of our ability today in response to your questions.
Many of the points are in that 28-page testimony. First, it
responds to a number of your concerns, Mr. Chairman, and
second, it contains some hard data that will be of interest to
Senator Mikulski.
Now, Mr. Chairman, this morning I am presenting the
administration's budget request and, to the extent we have time
this morning, I want to discuss the success of National Service
and report to you on our efforts to improve financial
management. But I am going to focus my oral testimony on the
financial management issues.
My written statement contains extensive information about
the accomplishments of National Service and I welcome
questions. And I particularly intend, Senator Mikulski, to take
your precise questions, and present a report to you that is in
the very categories that you have just put to us.
And I think you will be pleased with some of the
evaluations we are reporting on this morning.
financial statements
Mr. Chairman, our top priority continues to be--has to be--
achieving a clean opinion on the audit of a full set of
financial statements and going on to remove the material
weaknesses. We have made real progress.
As the chart indicates, we have gone from financial
statements not auditable in 1994 to 1996, to a qualified
opinion on our fiscal year 1997 balance-sheet-only audit, to
the current full-scope audit of our fiscal year 1998 financial
statements. Those three steps represent a lot of work,
dedication and progress.
----------------------------------------------------------------
Auditability
Fiscal Year 1994-96
--Financial statements not auditable
Fiscal Year 1997
--Qualified opinion on Statement of Financial Position
--No audit of Statement of Operations or cash flow
--Two qualifications, six material weaknesses identified
Fiscal Year 1998
--Audit of full set of statements for fiscal year 1998 near
completion
--Results not yet available
--Implementing Action Plan to correct weaknesses
----------------------------------------------------------------
We, too, Mr. Chairman, had hoped that along with our
Inspector General Luise Jordan we could report on the results
of the fiscal year 1998 audit today. However, the Inspector
General and her auditors from KPMG are holding open that audit
while we provide additional documentation they need.
That audit is ongoing. And the Inspector General and I will
report to you the results of the audit in the very near future.
But even if we obtain a clean opinion, which, of course, is our
aim, we know that we will still have financial management
material weaknesses.
Last fall Congress provided additional resources to speed
our progress in correcting those weaknesses. We submitted a
detailed action plan to do so that builds on the previous plans
and steps that we had taken and accomplished much in.
The plan calls for action in nine areas. It includes 177
specific tasks with deadlines. To date we have completed 69 of
them. Let me be clear: though progress has been made, it is not
enough to satisfy you, Senator Mikulski, or me. Much remains to
be done.
Let me tell you what we are doing in three key areas shown
on this chart, areas that affect many of the material
weaknesses, and are key to the solutions.
[GRAPHIC] [TIFF OMITTED] T05MA11.000
progress on financial management
Since last fall all of our mission critical systems, except
for financial management, have been made year 2000 compliant.
And most of our hardware is now compliant. We are confident we
will be prepared for the year 2000. Many of the problems stem
from the weaknesses in our core accounting system that we took
over.
We have selected a new financial management system known as
Momentum, and implementation is under way. The system will be
fully operational this year.
To ensure the accuracy of the data in the National Service
Trust we are, right now, installing imaging technology, and we
are pilot-testing a Web-based reporting system, a breakthrough
system in this field. By next year, they will both be fully
operational.
In our next report, due the middle of April, you will
continue to see progress on these and on other items in the
Action Plan. And we will be able to report to you the results
of the audit.
independent evaluations
As we grapple with these critical questions of financial
management, Mr. Chairman, let us not lose sight of the success
and impact of National Service. Today we are releasing an
independent study, reflected on the chart, that demonstrates
how AmeriCorps is strengthening local organizations and
communities and having a positive impact on the lives of
AmeriCorps members--now totalling in 4 years, more than
100,000.
----------------------------------------------------------------
Summary of Recent National Evaluation of AmeriCorps
Eighty-two percent of community representatives report AmeriCorps'
impact as ``good'' or ``outstanding.''
AmeriCorps improves the quality and quantity of local
organizations' community services.
More than 75 percent of members have gained significant life
skills.
AmeriCorps instills ethic of service in members.
Source: Aguirre International, 1999.
----------------------------------------------------------------
I hope members of this committee will read the summary of
this report which we are providing for the committee and we'll
be happy to sit down with your staff, and with you, to talk
further in depth on what those results mean. It was conducted
by Aguirre International. Mr. Aguirre was President Ford's
Commissioner of Education and we consider this a very landmark
and important study.
As this other chart shows, recent studies have also
documented that service learning programs benefit communities
while instilling a sense of civic responsibility and raising
the academic performance of participating students.
----------------------------------------------------------------
Recent National Evaluations of Learn and Serve America
Students participating in service-learning programs report gains in
following areas: Civic attitudes; Volunteering; School engagement;
Academic performance.
Projects rate students' service as outstanding.
Source: Brandeis University and Abt Associates, 1998.
----------------------------------------------------------------
Mr. Chairman, you can see that our work around the country
is going well. And we will look forward to showing you in more
detail how well it is going. In many cases we have a state-by-
state analysis including the extraordinarily successful--many
programs in the State of Maryland and programs in Missouri.
There are many places where the state commissions, appointed by
governors, have had their own evaluations. And we have
materials from governors estimating the impacts, such as
Governor Voinovich's last letter to me outlining the impact of
National Service programs that he thought was tremendous in
Ohio. And the outline of the impact that Governor Locke and
Governor Racicot of Washington and Montana sent to all new
governors telling them of the tremendous contribution of the
three programs of National Service and the commissions in their
states.
I think it is this success that people around the country
see on the ground that is the reason for the growing bipartisan
support--not only in Congress but especially in the states,
cities, schools and neighborhoods where ordinary Americans are
making an extraordinary difference every day.
prepared statement
So I look forward to working with you to extend the reach
of National Service and to complete the task of making the
Corporation the kind of high-performing organization we all
want it to be. Thank you.
[The statement follows:]
Prepared Statement of Harris Wofford
Mr. Chairman, Senator Mikulski, and members of the Subcommittee, I
appreciate this opportunity to review the achievements of national
service over the last year, report on the status of our efforts to
issue financial statements and improve financial management, discuss
our fiscal year 2000 budget request, and respond to your questions. I
very much appreciate the Committee's past support, including the $10
million in additional fiscal year 1999 appropriations for AmeriCorps
grants, as well as the additional funds to speed our progress on
essential improvements in our financial management systems.
The Corporation has made good progress on many fronts. Last
October, the 100,000th AmeriCorps member was sworn in. The service of
AmeriCorps members in more than a thousand local, state and national
non-profit programs is helping solve community problems all across the
country. Service-learning activities of more than a million college,
high school and elementary school students, assisted by our Learn and
Serve program, is demonstrating how well-organized community service
can help the community while instilling the ethic of service and pride
of citizenship in participating students. In short, through AmeriCorps
and Learn and Serve America, the Corporation is carrying out the three
prime purposes set by Congress in the National and Community Service
Trust Act of 1993 (42 U.S.C. Sec. 12501):
(1) meet the unmet human, educational, environmental, and public
safety needs of the United States, without displacing existing workers;
(2) renew the ethic of civic responsibility and the spirit of
community throughout the United States; and
(3) expand educational opportunity by rewarding individuals who
participate in national service with an increased ability to pursue
higher education or job training.
Before providing more details of the accomplishments of these
programs, let me start with a brief summary of our budget request and a
discussion of our work to improve financial management.
i. budget request summary
The total fiscal year 2000 budget request for national service
programs authorized under the National and Community Service Trust Act
is $545.5 million, an increase of $110 million over the fiscal year
1999 appropriated level of $435.5 million. This is a large increase for
a relatively small agency, but the needs that AmeriCorps members are
helping communities meet--particularly the needs of children and
youth--are very large. The added value of this service by AmeriCorps
members (generally full-time) in leveraging large numbers of unpaid
part-time community volunteers and in strengthening the work of non-
profit, educational and faith-based organizations is a powerful new
resource for the renewal of America's civic sector.
The new funds will provide for approximately 60,000 AmeriCorps
members through grant programs and the education award program, as well
as approximately 1,100 AmeriCorps members through the National Civilian
Community Corps (NCCC) program. As part of the AmeriCorps budget, our
budget request also includes a new program to engage 5,000 high school
students in intensive, full-time service during the summer.
Participants in the AmeriCorps*VISTA program, funded through the
Subcommittee on Labor, HHS, Education and Related Agencies, will bring
the total to approximately 69,000 AmeriCorps members, with a goal of
100,000 members per year starting in 2002.
The new funds for the Learn and Serve America program will help
schools, colleges and universities, and community organizations
strengthen and expand service-learning activities. If the 60 million
students in America are seen as--and see themselves as--resources and
potential leaders, they can be a powerful source of service for
communities. Tapping this potential is a double investment--in the
education of the next generation as citizens of character and
competence, and in meeting the country's unmet needs.
I also want to emphasize the important contributions of the Points
of Light Foundation and how much the Corporation values its partnership
with the Foundation and with its network of hundreds of Volunteer
Centers. An increasing number of AmeriCorps members and
AmeriCorps*VISTA members--already more than a hundred--are working
directly with, and under the leadership of, these centers for volunteer
service. We are requesting $5.5 million for the Points of Light
Foundation in fiscal year 2000.
Jointly, the Corporation and the Points of Light Foundation were
the original sponsors and organizers of the Presidents' Summit for
America's Future in Philadelphia convened in 1997 by President Clinton
and President Bush. We work together as key partners in the post-Summit
campaign led by General Colin Powell's America's Promise--the Alliance
for Youth. This close and continuing collaboration between the
Foundation created by President Bush as a center for volunteering and
the Corporation proposed by President Clinton as the vehicle for
national service is a demonstration of how what George Romney called
``the twin engines'' of full-time stipended national service and part-
time unpaid community volunteering can and should pull together to help
communities solve serious social problems.
We are seeking $33 million for program administration, including
funds for State Commissions--an increase of $4.5 million over the
fiscal year 1999 level. This increase will provide the administrative
support necessary to keep up with the growing work-load of the
Corporation and is discussed in greater detail later in the testimony.
In addition, we are requesting $5.5 million for program evaluation, and
a separate appropriation of $3 million from this Subcommittee for the
Office of the Inspector General.
the audit and the action plan
The Corporation shares the view of the Subcommittee that prompt
action on auditability and other financial and management weaknesses is
urgently needed. These issues are our top internal priority. With the
help of the Committee and the Inspector General, we have focused
substantial resources and activity on achieving solid and lasting
solutions.
The Corporation has made steady progress over the past year toward
its goal of improving fiscal oversight and of obtaining an unqualified
opinion on its financial statements. As the Subcommittee knows, until
last year, the Corporation was unable to produce financial statements
that the Inspector General could audit. But, in July 1998, the
Inspector General issued an Auditability Assessment that indicated that
the Corporation had made progress and that, although late, we could
proceed with an audit effort for fiscal year 1997. In October 1998, the
Inspector General issued a qualified opinion on the Corporation's
fiscal year 1997 Statement of Financial Position. There were two
qualifications--grant accrual and net position--and six material
weaknesses.
Now, for fiscal year 1998, the Corporation is preparing a full set
of statements, and these statements are being subjected to independent
audit by the Inspector General. The Corporation, the Inspector General
and the auditors are still at work on the audit. We are collecting and
providing information to the auditors, and the auditors are reviewing
and assessing that data. At this time, we are uncertain of the
auditor's opinion, but we are working closely with the Inspector
General and her audit staff to complete the financial statement audit.
We know that there are material weaknesses--weaknesses identified
in the fiscal year 1997 balance sheet audit and two new weaknesses that
will be identified in this audit resulting from the broader scope of
the fiscal year 1998 audit. Based on the fiscal year 1997 audit, and
with funds made available by this Committee, we are implementing a
comprehensive Action Plan to correct these weaknesses and improve
Corporation management. We are working to correct a number of these
weaknesses this year; others will take longer. But you can and will see
progress every month as we work to achieve the goals set forth in this
Plan.
We submitted the Action Plan to your Subcommittee on December 21,
1998. It included 168 tasks. In a February 17, 1999, letter from
Chairman Bond and Chairman Walsh of the House VA/HUD Subcommittee, you
asked that we revise the plan to include procurement management and to
provide more information on the expenditure of funds associated with
the plan. In our first progress report on February 19, 1999, (which I
would like to submit for the record) we did those two things. The Plan
now includes 177 tasks, of which 69 have been completed. You also asked
for more information on specific performance measures. We have included
such information in our Government Performance and Results Act
Performance Plan and will be happy to discuss additional measures with
your offices.
Your letter of February 17 indicates that, with these changes, you
have no substantive disagreements with the contents of the Action Plan.
In fact, we believe the Plan offers us a clear path toward resolving
outstanding financial management issues once and for all. Although
these changes cannot happen overnight, there is a firm commitment on
the part of the Corporation to advancing solutions as quickly as we
possibly can.
The Action Plan includes 9 goals and a number of objectives within
each goal: (1) General Control Environment; (2) National Service Trust;
(3) Financial Operations; (4) Grants Management; (5) Financial Systems;
(6) Financial Reporting; (7) Information Technology--Year 2000; (8)
Information Technology; and (9) Procurement Management. Summary
information on these goals and objectives follows:
General Control Environment.--We are working to establish a strong
and effective control environment, including a commitment to
excellence, organizational structure, and assignment of authority and
responsibility. Included in this goal is the financial statement audit
process. On other important fronts we have done good work towards
issuing a comprehensive set of policies and procedures; we are working
on an assessment of management controls by selected Corporation
managers as part of a pilot program for fiscal year 1998; we are
filling key positions; we are developing a comprehensive training plan;
and we are including financial performance measures in the
Corporation's Government Performance and Results Act Performance Plan.
National Service Trust.--We are determined to ensure the integrity
of the National Service Trust, accurately recording member information
and education award liability, and efficiently processing transactions
related to enrollment and award processing.
In the past year, we and our prime grantees, the State Commissions,
have undertaken two major technological initiatives specifically
designed to strengthen the Trust. First, as I reported last year, we
have introduced imaging technology designed to improve the quality and
dependability of information in the Trust.
We are using imaging technology to electronically capture our
records and ensure that we have complete and readily accessible
information for every member enrolled in the National Service Trust. By
the middle of April, a contractor will complete the process of scanning
all of the paper documentation from our files on every current member
of the National Service Trust, and we will then begin the process of
checking the input data with our program records to capture any missing
pieces of data. Additionally, in April, the National Service Trust will
begin using imaging technology to scan forms into the system as the
forms are received.
Second, we are in the midst of testing a breakthrough innovation--a
world wide web-based reporting system (WBRS), that will enable the
National Service Trust to receive member data-- enrollment forms,
change of status forms, and end-of-term forms--electronically. WBRS
currently is being used to input enrollment data on a trial basis in
Maine and California. If the tests are successful, State Commissions
will be using this technology for enrollment forms by the end of this
year. In partnership with the Corporation, the State Commissions
developed WBRS. The Corporation contracted with Ernst and Young in
October 1998 to do a security review of the data transfer. When
appropriate development, testing and training are completed, we will
phase in the use of the technology for change of status and end-of-term
forms and extend the system to our national direct grantees.
There are three related goals: Financial Operations, Financial
Systems and Financial Reporting.
Financial Operations.--We are making progress in the area of
financial operations. We promulgated our debt collection regulations
and are working to finalize our agreement to have the Department of the
Treasury service our delinquent financial transactions. Other efforts
are underway to clean up financial data in preparation for the
conversion to the Momentum accounting system.
Financial Systems.--We are in the midst of implementing a new
financial management system--Momentum--that will modernize our record-
keeping and allow us to input and recover data in an easier and more
timely fashion than our previous system. The Corporation selected the
Momentum package last November and entered into a cross-servicing
agreement with the Department of the Interior's National Business
Center to support the implementation process. Momentum is a commercial
off-the-shelf software system compliant with the Federal Government's
Joint Financial Management Improvement Program system requirements, and
it is Year 2000 compliant. Momentum implementation includes data
conversion, setting up system interfaces, testing and staff training.
We have an aggressive schedule to complete this process and make the
Momentum system fully operational this year.
Financial Reporting.--Our goal is to produce accurate and timely
financial information, issue timely reports and financial statements,
obtain an unqualified opinion on our financial statements and reduce--
and as soon as possible eliminate--the number of reported material
weaknesses. I have already described our progress in this area.
Grants Management.--We have undertaken important efforts to improve
grants administration and the procedures for AmeriCorps service hour
reporting. In January we held a conference for all State Commission and
National Direct Executive Directors to reinforce the importance of the
procedures and reporting requirements associated with their grants.
Executive Directors have been contacting us with detailed follow-up
questions, and we have already sent out a formal response to questions
elicited at the conference and intend to continue to follow-up with the
grantees. Also, as a further step in devolution to the governor-
appointed state commissions, we have eliminated any Washington office
programmatic review of the formula program proposals submitted by well-
functioning State Commissions. With OMB approval this past year, we are
testing simplified grant approaches, including fixed amount grants.
Information Technology--Year 2000 and beyond.--Making sure that all
systems are Year 2000 compliant is a goal that cuts across all aspects
of the Corporation. Through the additional funding included in the
fiscal year 1999 Treasury, Postal Service Appropriations bill, the
Corporation received $800,000 to assist in our compliance and
verification work.
Our mission-critical systems, except for the financial management
system and its related interfaces, are Year 2000 compliant today. We
will be performing independent verification and validation in the
coming months. Our headquarters and service center network and personal
computer workstations are compliant; we are still working on our field
office and NCCC workstations, but anticipate no difficulty. The new
Chief Information Officer whom we will designate soon will do much of
our long-range planning in the information technology area. Some
aspects of our long-range plan will include improving our technology
for communication with state offices, designing a single, integrated
grants system, selecting a procurement module to add to the Momentum
system, and providing better data for decision-making.
Procurement Management.--We added this goal to our Action Plan in
February in response to work conducted by the Inspector General. We are
revising procurement policies and are working to resolve specific
contract issues. We are also developing training sessions for our
procurement office and Corporation staff.
The Corporation is committed to improving its management and has
made substantial progress in this direction. More remains to be done,
and the Subcommittee will continue to see progress in carrying out our
Action Plan. We will continue to report regularly to you and the other
appropriate committees in Congress.
government performance and results act
The Corporation continues its full compliance with the requirements
of the Government Performance and Results Act. Building on the
experience of the first year under GPRA, we have prepared an expanded
annual Performance Plan for fiscal year 2000. This plan provides in a
more accessible format our revised performance goals for fiscal year
1999 and the goals for fiscal year 2000. We have organized our
performance goals into two broad categories: annual performance
indicators, and focused (usually one-time-only) program evaluation
studies.
Annual Performance Indicators are measures based on information
collected regularly (usually yearly) from grantees and subgrantees of
the Corporation and from program participants. Primarily these
indicators measure aspects of program performance that are in the
direct control of the Corporation. These data are useful for oversight
and management of the programs. Many of these measures focus on what
programs do with federal funds--such as implementing projects;
selecting, training and enrolling Members; and awarding subgrants. In
addition, annual indicators can include customer satisfaction,
community impacts, and program accomplishments.
Focused (Usually One-time-only) Program Evaluation Studies
represent a significant area of investment by the Corporation. Unlike
annual performance indicators, many outcome evaluation studies are not
likely to occur every year because they are more expensive and time
consuming to carry out. Program outcome studies, however less frequent
than indicator data, will provide useful information on what national
service programs achieve for the American people.
Our 2000 Performance Plan contains information on programs and
administrative activities that will interest anyone wanting to learn
more about the Corporation and national service. For each program, the
fiscal year 2000 Performance Plan presents:
--A concise description of the program with information on program
design, numbers of participants, types of service, and levels
of funding.
--Special initiatives underway and planned for the coming years.
--Performance indicators and goals for fiscal year 1999 and fiscal
year 2000.
--Key findings from completed program evaluations.
--Pending and planned program evaluation topics.
This year we have added a section that highlights the three budget
activities supporting the Corporation's programs: Innovation,
Evaluation, and Program Administration. ``Innovation'' describes our
plans to expand and strengthen training and technical assistance for
all streams of service. Under ``Evaluation'' is found the Corporation's
evaluation plan for 1999 and beyond. And ``Program Administration''
summarizes the efforts underway to improve financial management. This
new section includes five new performance indicators that focus on our
most critical administrative issues: auditability, data accuracy in the
Trust, grants management, financial management systems, and the Year
2000 status of computer systems.
Finally, the new format of the fiscal year 2000 Performance Plan
represents the first step in linking the budget proposal with the
Performance Plan. Next year, we plan to submit one, fully-integrated,
budget and performance plan.
program administration
The Corporation is requesting $33 million for Program
Administration in fiscal year 2000--an increase of $4.5 million over
the fiscal year 1999 appropriation. Program administration supports the
Federal share of the costs of activities of the State Commissions,
which implement and monitor national service programs at the local
level, as well as the activities of the program, policy, and management
staff in the Corporation's headquarters.
Last year, the Congress provided an increase of $1.5 million in
Program Administration funding to address urgent program administration
requirements related to financial management, grants management and
systems implementation. Congress also called on the Corporation to
shift $1.5 million out of lower priority efforts to address urgent
program administration needs. These additional funds have improved the
quality and the timeliness of the Corporation's responses to these
outstanding problems. Now, in order for the Corporation to move forward
on financial and management issues in the most expeditious manner
possible, more funds are needed.
The workload of the Corporation has grown enormously since 1994.
The annual number of AmeriCorps members has increased from 25,000 in
fiscal year 1995 to approximately 50,000 in fiscal year 1999 to a
proposed 69,000 in fiscal year 2000. The cumulative number of
enrollments in the National Service Trust has grown from those initial
25,000 to over 100,000 and will grow to over 140,000 with funds already
appropriated. The Corporation needs additional resources to respond to
this greatly increased workload.
The requested increase in funding will support the following
urgently needed activities, many of which are described in further
detail in the section of the testimony dealing with the audit and
Action Plan: achieving an unqualified opinion on our financial
statements and reducing the number of material weaknesses;
significantly increasing funds devoted to systems development;
strengthening the National Service Trust; increasing the support for
State Commissions; and replacing aging computer hardware.
americorps and service-learning evaluations and accomplishments--the
impact of service
In the last year, we have received the results of three major
evaluations of Corporation programs. The following is a brief summary
of each evaluation. The results show that national service has a
dramatic impact both on the communities and individuals served and the
service participants themselves.
Impact Evaluation of AmeriCorps State/National Direct
Today we are releasing one of those studies--an independent
evaluation of the impact of AmeriCorps State/National programs
performed by Aguirre International. This study collected survey data
from all ongoing programs and specifically examined 60 randomly-
selected programs over a three year period. The study looked at what
AmeriCorps members accomplished, the impact of those accomplishments on
service recipients, the impact on the life skills and civic attitudes
of members, and the impact of AmeriCorps on grantee institutions and
the communities in which the programs were located.
Among the key findings of the study
AmeriCorps programs strengthened local organizations and
communities served:
--The majority of institutions that received AmeriCorps grants
reported that association with AmeriCorps improved their
organization's quality and/or quantity of services and
increased their overall professionalism.
--82 percent of community representatives interviewed reported that
AmeriCorps' impact upon their community had been ``very good''
or ``outstanding.''
AmeriCorps provided significant member benefits:
--More than 75 percent of AmeriCorps members reported substantial
gains in life skills during their program year. These changes
occurred in members of all ethnic, racial, economic and
educational backgrounds.
--AmeriCorps members' life skills gains were significantly greater
than the gains reported by a matched comparison group of
nonmembers. Members whose skills were the lowest upon entering
the program gained the most.
--AmeriCorps members' levels of civic engagement were positively
affected by AmeriCorps service.
We are pleased that this major new study demonstrates that
AmeriCorps is accomplishing precisely what it was designed to do--it is
getting things done in our communities and producing significant
benefits for those who serve.
learn and serve america k-12
Between 1995 and 1998 Brandeis University and Abt Associates
conducted an evaluation of 17 high quality service-learning programs at
middle schools and high schools across the country. The evaluation
followed a group of participating and comparison group students over
two years. The evaluation found:
Service-Learning programs provide significant benefits to their
communities:
The service provided by the students was highly rated by the
community agencies where students provided assistance; 99 percent of
the agencies rated their experience as ``good'' or ``excellent.''
On average, participants in the programs in the study produced
service valued at nearly four times the program cost during the 1995-
1996 program year.
The service-learning programs in the study were strongly supported
by administrators and teachers, and a large majority of programs appear
likely to continue to operate after the end of their grants.
Service-learning programs had a positive impact on students:
Students rated their program experience highly with more than 95
percent of the students reporting that they were satisfied with their
community service experience.
At the end of one program year, student participants compared to
non-participants showed significant positive impacts. The students:
were more appreciative of cultural diversity, service leadership and
civic involvement; were more likely to be involved in some form of
volunteer service; provided more than twice as many hours of service;
were more likely to show small, positive impacts on school engagement
and on math and science grades and core grade point averages.
The Superintendent of Schools in Gresham, South Carolina states
that Corporation grants have funded ``service-learning programs that
reinforce academic skills taught in the classroom and meet community
needs'' and have had ``a significant impact on our school system and
the community. It has ``reconnected our youth to the community and has
actively engaged our young people in the learning process.'' An example
of such results in the Gresham High School is in the appendix.
learn and serve america higher education
Between 1995 and 1998 the Rand Corporation conducted an intensive
evaluation of the Learn and Serve Higher Education Program's
implementation, achievements and impacts on sponsor institutions,
community agencies and participating students. The study found:
Participating students made valuable contributions to the
organizations--non-profit agencies, schools, and others--in which they
served.
Community organizations' staff assigned high marks to the student
volunteers. Respondents assigned the highest ratings to students'
enthusiasm, ability to work with staff and clients, and interpersonal
skills. Staff reported that they were able to improve the quality of
services and provide more services as a result of the student
volunteers.
Students in service-learning courses, compared to students in
similar courses without a service component, reported larger gains in
civic participation (involvement in community service) and life skills
(interpersonal skills and understanding of diversity).
literacy and education activities
Since fiscal year 1994, education programs, including especially
literacy activities for elementary students, have been a high priority
for national service. Governor-appointed state commissions on national
and community service have focused national service resources on needs
in education. In addition, AmeriCorps*National and Education Award
programs, as well as service-learning programs at the K-12 and higher
education levels, have focused service on the education needs of young
people.
For fiscal year 1998, this Subcommittee appropriated an additional
$25 million to the Corporation to conduct activities designed to ensure
that every school child can read well and independently by the end of
the third grade. These additional funds were granted to 30 separate
organizations selected by states, including statewide literacy
initiatives in Florida, Louisiana, Maryland, Maine, Massachusetts,
Mississippi, New Jersey, Ohio, Oklahoma, Washington, and West Virginia.
In total, an additional 1,700 full-time equivalent AmeriCorps members
are engaged this year as organizers, leaders, and participants in these
local literacy programs, including summer and after-school programs.
Research results show that national service can produce strong
positive outcomes in early childhood literacy. Literacy programs
supported by the Corporation under the AmeriCorps*State and National
category reported the following results for the 1996-97 program year:
In all programs, 5,700 members at 305 sites supported the tutoring
of youth in grades 1-12. Sixty-seven percent of youth tutored in grades
1-12 (of 128,000 measured) showed improvement during the program year.
In all programs, 4,700 members supported academic mentoring at 258
sites. Seventy-six percent (of 53,000 mentored students measured)
showed improvement during the program year.
In all programs, over 2,000 members taught in grades 1-12. Sixty-
nine percent (of 70,000 students measured) showed improvement during
the program year.
In addition to the very positive, self-reported achievements by
projects, independent evaluations of specific literacy programs are
documenting positive outcomes. Professor George Farkas of the
University of Texas documented gains for a Reading One-to-One program
of 0.4 to 0.7 grade equivalents above what students would have attained
without tutoring, a significant improvement. The program uses college
students, AmeriCorps members, and community residents to tutor more
than 6,000 students in more than 70 schools across ten school districts
in Texas.
Other recent reports contain an equally positive message. In the
District of Columbia, low-achieving children who were tutored by
Federal Work-Study students and other volunteers in a program managed
by AmeriCorps*VISTA members had reading scores at the national average
at the end of the first year of the program. In New Haven, Connecticut,
the Leadership, Education, Athletics in Partnership program helped
produce independently documented increases in children's reading test
scores. In this program children read an average of 24 books during the
summer.
In addition to AmeriCorps, the Corporation's service-learning
programs, also under the jurisdiction of this Subcommittee, have
contributed to the America Reads Challenge. The Corporation works in
coordination with the Department of Education. Over 1,000 colleges and
universities have pledged to use a portion of their Federal Work-Study
funds to enable college students to tutor children and work in family
literacy programs. In addition, the Corporation's grants to state
education agencies support service-learning programs in schools and
communities across the country. The dominant service activity reported
by service-learning grantees at the middle and high school level is
education, including mentoring, tutoring, and classroom assistance.
These programs have double benefits; since teaching is often the best
way to learn, middle and high school students who tutor younger
students often increase their own skills, not only in English but in
math, science, and the use of computers.
americorps
AmeriCorps*State and National Program Update
Last October, the 100,000th AmeriCorps member was sworn in, and
members are continuing to get things done in their communities all
across the country. Together, AmeriCorps members, most age 18 to 25,
are showing their idealism and devoting a year or more to help
strengthen communities by tackling the nation's most serious problems.
Since the inception of the program, over 100,000 AmeriCorps members
have:
--Served nearly 33 million people in more that 4,000 communities.
--Taught, tutored or mentored over 2.6 million children.
--Served over 560,000 at-risk youth through after-school programs.
--Built or rehabilitated over 25,000 homes.
--Given food, clothing or other necessities to homeless individuals
in over 2.4 million instances.
--Planted 52.5 million trees.
--Recruited, trained or supervised over 1.6 million volunteers.
In an appendix to this statement, we are providing examples of
AmeriCorps members getting things done in our communities.
Fiscal Year 1999 Budget Update
Last year Congress appropriated an additional $10 million for
AmeriCorps grants. As a further example of our commitment to devolving
authority, all of that funding was directed to state initiatives. Of
that $10 million, $3 million was added to the formula grants to state
commissions. The other $7 million was directed towards a Governor's
Service Initiative, which will fund new statewide initiatives that tie
into a governor's priorities and could benefit by a service component.
Fiscal Year 2000 Budget Request for AmeriCorps
The budget request for fiscal year 2000 for AmeriCorps will provide
for approximately 60,000 AmeriCorps members through grant programs and
the education award program, as well as approximately 1,100 AmeriCorps
members through the National Civilian Community Corps (NCCC) program.
Participants in the AmeriCorps*VISTA program, funded through the
Subcommittee on Labor, HHS, Education and Related Agencies, will bring
the total to approximately 69,000 AmeriCorps members, with a goal of
100,000 members per year starting in 2002.
That total includes a new program to engage 5,000 high school
students in intensive, full-time service during the summer. This new
initiative will allow high school students already involved in
community service to serve full-time in the summer and, if they wish,
part-time during the school year and receive reduced stipends and
education awards for their service during the summer.
AmeriCorps*NCCC
The National Civilian Community Corps (NCCC) is a distinctive part
of the AmeriCorps network of programs; it is a residential program, and
it is the only element of AmeriCorps that is administered directly by
the Corporation for National Service. NCCC members are housed in
dormitory-style residences primarily at closed or downsized military
bases at Charleston, SC; San Diego, CA; Denver, CO; Perry Point, MD;
and Washington, DC. Members serve on teams in the local community and
are deployed on ``spikes'' in communities in every state to meet the
critical needs of urban and rural communities, including disaster
relief, education, environment, public safety, and other human needs.
Although now a part of AmeriCorps, the NCCC was first proposed in
1992 in separate legislation, S. 2373, sponsored by Senators Boren,
Warner, and Specter. Their bill sought to create a civilian community
corps modeled on the Depression-era Civilian Conservation Corps (CCC)
while simultaneously responding to the need to reuse closed military
bases. The CCC section of the bill was offered and unanimously approved
as an amendment to the fiscal year 1993 Defense Authorization Act.
Among the key sponsors of this bipartisan amendment were Senators
Boren, Dole, Warner, Mikulski, McCain, Kennedy, Seymour, and Nunn. In a
floor statement during debate on the amendment, Senator Dole said ``As
I thought about this program, it was easy to see that many of today's
youth could benefit from a modernized version of the CCC * * *. Far too
many of our youth--both in urban and rural areas--are at risk--to
drugs, to crime, to gangs, to teen pregnancy. It is these youths who
could benefit from the new CCC Program.'' The following year, the
National and Community Service Act of 1993 placed the administration of
the NCCC in the hands of the newly-created Corporation for National
Service.
The NCCC is one of the most successful and effective components of
AmeriCorps. For example, in fiscal year 1998, members performed about
550 service projects in local communities in all 50 states.
Accomplishments included renovating 346 houses, building 91 new homes,
and tutoring 18,000 children, among many others. Here are several of
the distinctive features of the NCCC that account for its extraordinary
success:
NCCC members are highly trained and organized. They are
particularly effective at mobilizing and supervising other volunteers.
Habitat for Humanity and the Boys and Girls Clubs rely heavily on NCCC
members to supervise and thereby enhance the effectiveness of their
part-time volunteers. NCCC members are specially trained to respond
rapidly in times of natural disaster, and they work in close
partnership with the Federal Emergency Management Agency (FEMA) and the
Red Cross to respond to almost every major natural disaster, including
fires, tornadoes, floods, and even the Oklahoma City bombing.
True to its roots, NCCC adheres in part to a military model--
members wear uniforms, work in teams, participate in a physical fitness
regimen, and serve in a highly structured and tightly disciplined
environment.
Members work long hours doing hard work--and the results are
visible in communities across the nation. This has made the NCCC one of
the most popular AmeriCorps programs. In 1998, more than 3,000
applicants applied for approximately 850 positions.
Funding for the NCCC was originally set in 1994 at $30 million
(including $20 million in an earmarked Department of Defense
appropriation). The 1995 appropriation was reduced in a rescission from
$26 million to $18 million, and funding has been held at that level
ever since. As a consequence, the NCCC has reduced the number of
members, delayed filling personnel vacancies, reduced the number of
``spikes,'' and otherwise done everything possible to make ends meet.
However, it is now clear that fewer communities are being served, and
program quality is at risk of slipping.
The budget request for NCCC, a $3 million increase over the fiscal
year 1999 level. The requested increase will finance the continuation
of activities at five campuses and the enrollment of 1,141 Corps
members, a 29 percent increase from fiscal year 1999 member population.
The increase will also address reductions of essential personnel,
operations, and administrative/logistics that were incurred in fiscal
year 1998 when the fifth campus was established.
In addition the increased participation level financed by the
request would serve to decrease the per member cost of the program. The
NCCC's per member costs are artificially inflated currently at almost
$26,000 per member (including the education award) because NCCC has had
to limit and even cut the number of members in recent years. Recently,
the Corporation reached a bipartisan agreement with Senator Grassley to
reduce the Corporation's average budgeted cost per AmeriCorps member by
$1,000 per year to reach $15,000 per member next year. If Congress
approves the NCCC's fiscal year 2000 budget request, the number of
members will increase, reducing the per member cost to about $23,100
and allowing the Corporation to achieve the goal of an average
AmeriCorps member cost of $15,000.
We urge Congress to adopt the President's budget request to
increase funding for the NCCC to $21 million in fiscal year 2000--the
first increase in four years.
AmeriCorps National Direct
The National and Community Service Act dictates that two-thirds of
AmeriCorps funding flows to State Commissions and the remaining one-
third supports national non-profit organizations through AmeriCorps
National Direct grants. Each year since 1996, the appropriations law
has imposed a cap of $40 million on these AmeriCorps National Direct
grants.
When established in 1996, the cap on AmeriCorps National Direct
funding sought to address Congressional concerns stemming from grant
allocations to other federal agencies. As part of a bipartisan
agreement with Senator Grassley, the Corporation later agreed to
eliminate all grants to federal agencies.
Currently, AmeriCorps makes national direct grants to 39 national
non-profits, including Habitat for Humanity, the American Red Cross,
YouthBuild USA, Los Angeles Veterans Initiative, City Year, Youth
Volunteer Corps of America, and the National Association of Community
Health Centers. These non-profit organizations are widely supported in
the Congress and in our communities. The Corporation ensures that these
programs are funded in a completely non-partisan and non-ideological
manner.
National non-profits have special qualifications to engage in
national service activities at the local level, including:
--years of expertise in supporting service: many of these
organizations were funded from 1990 to 1993 by Commission on
National and Community Service appointed by President Bush;
--well-developed program concepts and service delivery models;
--experience in program management and community collaboration;
--readily accessible training for staff and members; and
--strong ability to reach under-served areas and expand programs to
states with smaller populations.
The National Direct grant program minimizes the administrative
burden necessary to deliver national service. For nationwide
organizations like Habitat for Humanity or the American Red Cross, it
is more efficient to apply one time to the Corporation and then to
allocate resources to local chapters, rather than to apply multiple
times through individual State Commissions.
AmeriCorps National Direct programs also cost less than other
AmeriCorps programs, because national non-profit organizations:
--Provide significant matching funds. The 1998 programmatic match is
57 percent, which is significantly higher than the requirements
of the statute and the match provided by AmeriCorps state
projects; and
--Attract major private support. Partners include corporations such
as IBM, Sony, Dow Chemical, the Timberland Corporation, Nike,
United Parcel Service, and the Disney Corporation that
otherwise might not engage in national service.
The cap on National Direct prevents AmeriCorps from supporting some
of its most effective grantees:
--The Corporation's ability to meet increasing demands for service
addressing local community needs has been curtailed, as
community-based affiliates of national non-profit organizations
translate reduced grant support into a reduced number of
AmeriCorps members and receive no funds for program
development;
--The quality of service efforts is increasingly challenged due to
limited training funds; and
--Since new grants require funding reductions to existing programs,
which endangers the continued viability of these efforts, it is
impossible for the Corporation to fund more than a handful of
prospective new National Direct grantees in any given year.
For these reasons, we strongly believe that the overall quality and
effectiveness of AmeriCorps programs will increase if the
appropriations cap is lifted, and we are enabled to carry out the
original intent of the 1993 Act that one-third funds are awarded in the
form of National Direct Grants. We ask the Subcommittee to give this
request careful consideration.
important initiatives and special programs
AmeriCorps' Call to Service
Last month, AmeriCorps launched the Call to Service--a year-long
effort to encourage young Americans to serve their community and
country through AmeriCorps. Asking young people, ``Are you up to the
challenge?'' the Call to Service, which is AmeriCorps' biggest
recruitment drive to date, seeks to enroll more than 50,000 AmeriCorps
members over the next year.
The Call to Service was kicked off on February 10th at the
University of Maryland with participation from President Clinton,
Maryland Gov. Glendening and Lt. Gov. Kathleen Kennedy Townsend,
University of Maryland President Mote, AmeriCorps members and others.
It will continue throughout the spring and summer with a number of
campus-based events, community-wide service events, summer of service
kick-offs, and the events marking AmeriCorps' five-year anniversary in
September.
AmeriCorps Promise Fellows
As noted earlier, along with the Points of Light Foundation, the
Corporation was a co-convenor of the Presidents' Summit for America's
Future in Philadelphia two years ago. We continue to work closely with
General Powell and America's Promise, the organization designed to
follow-up on the five goals established at the Summit. As a special
initiative in conjunction with General Powell and America's Promise,
the Corporation created the AmeriCorps Promise Fellow initiative, which
is designed to identify and support talented individuals who will
assist with state and local efforts to provide all young people with
the five fundamental resources identified at the Presidents' Summit:
--Caring adults in their lives, as parents, mentors, tutors, coaches;
--Safe places with structured activities in which to learn and grow;
--A healthy start and a healthy future;
--An effective education that equips them with marketable skills, and
--An opportunity to give back to communities through their own
service.
Five hundred new AmeriCorps members will serve this year as
AmeriCorps Promise Fellows to help communities meet the needs of young
people.
AmeriCorps Promise Fellows will be community organizers and
facilitators drawn from many walks of life, including academia,
business, the military, and the service field. They will bring their
diverse and considerable experience to the hundreds of national, state,
and local nonprofit organizations that are sponsoring them. Among the
projects that AmeriCorps Promise Fellows will support are:
--Recruiting and coordinating volunteers to run after-school
programs;
--Implementing curricula coordinating service and education in
elementary schools;
--Coordinating communities' Summit follow-up activities, and
--Building private sector support for projects supporting children
and youth.
The more than 500 AmeriCorps Promise Fellows will serve in almost
every state, two American Indian tribes, and one U.S. territory, as
well as with 17 national organizations that deliver community services
on a local basis.
In an appendix, we have also provided several examples of the
manner in which States intend to deploy Promise Fellows to solve
problems in local communities. I am also attaching to this testimony
General Powell's statement on the AmeriCorps Promise Fellows published
on America's Promise web site--www.americaspromise.org.
americorps education awards program
The Education Awards Program is a central element in the
Corporation's plans to expand the number of AmeriCorps members. Because
we will add more members to the Education Award Program this year, we
anticipate even further reductions in the cost per AmeriCorps member to
the Corporation and more opportunities for traditional nonprofit
organizations to take advantage of the opportunity to utilize
AmeriCorps members.
Across the country, faith-based organizations tackle some of our
greatest challenges--and AmeriCorps members are playing an increasingly
significant role in helping them solve community problems. Of the
40,000 AmeriCorps positions this year, nearly 6,000 are in faith-based
organizations. Since 1994, more than 13,000 AmeriCorps members have
served with faith-based groups. A significant number of these positions
are in the Education Awards program.
Since its inception as a bipartisan initiative agreed to with
Senator Grassley, the AmeriCorps Education Awards Program has greatly
expanded opportunities for young people to serve as AmeriCorps members,
brought new communities and new sponsors as partners in AmeriCorps, and
produced new non-federal resources to support service programs. Now
beginning its third year, the Education Awards program encourages
organizations to apply to State Commissions or to the Corporation and
demonstrate their capacity to recruit, train, supervise and generally
support AmeriCorps members with little Corporation assistance beyond
the education award. The members who successfully serve in such
programs are eligible to receive an AmeriCorps educational award, but
they do not receive a living allowance, health care or child care from
the Corporation, and the sponsoring organizations receive only minimal
administrative assistance. At the Presidents' Summit on America's
Future in Philadelphia, President Clinton challenged faith-based
organizations, non-profits, and colleges and universities to support
this initiative.
We have approved and launched more than 140 Education Awards
programs, including about 80 organizations that had not previously
hosted AmeriCorps members. The rest are existing AmeriCorps grantees
that were able to add new components as a result of this new
opportunity. Once fully operational, the programs approved thus far
will support more than 20,000 new AmeriCorps members. In general,
sponsors are national, state, and local organizations and agencies, and
programs range in size from 1,000 or more to fewer than 20 members,
carrying out service to respond to all types of community problems.
Sponsors include:
--The Boys and Girls Clubs of America, which will place 1,000
AmeriCorps members in Clubs across the country to serve younger
Club members and engage those younger boys and girls themselves
in service to their communities;
--Two national faith-based organizations: the National Council of
Churches and the Catholic Network for Volunteer Service, which
together have placed over 6,000 AmeriCorps members in non-
religious community service activity;
--The L.A. Veterans' Initiative, which is placing more than 200
members across the country to assist in homeless veterans'
returns to independent and productive living; and
--A number of colleges and universities that are placing college
students in intensive community service settings.
the martin luther king jr. day of service
In 1994, Congress passed the King Holiday and Service Act of 1994
to transform the federal holiday honoring Dr. King into a day of
service that reflects his life and teaching, bringing people together
around the common focus of service. At that time, Congress charged the
Corporation for National Service to work in partnership with the
National King Holiday Commission (now replaced by the King Center for
Nonviolent Social Change, Inc.) and play a leading role in making the
holiday a day ``on'' for service, not just a day off from work or
school. Service was at the heart of Martin Luther King Jr.'s philosophy
and action. Dr. King said, ``Everybody can be great because anyone can
serve,'' and urged Americans to take action to improve our communities
and the lives of fellow citizens. Our other national partners include:
the United Way of America; the Points of Light Foundation and its
Volunteer Center network; First Book, which donated over a million
books to literacy efforts; and Do Something, a youth service
organization that provides a special service-learning curriculum to
school aged youth.
This year on the King holiday tens of thousands of volunteers in
thousands of projects across the country joined together to tutor
children, build homes, clean parks, paint classrooms, deliver meals,
and provide other service to improve their communities in all fifty
states, the District of Columbia, Puerto Rico, and the Virgin Islands.
The projects varied widely in scale and in focus. In Philadelphia,
12,000 volunteers fanned out across the city to renovate schools, clean
neighborhoods, and read to children. In Jackson, Mississippi over a
dozen youth groups served together on cross-faith, cross-racial teams
to renovate low income housing and restore afterschool play spaces. In
Zuni, New Mexico, volunteers from the Indian Reservation and from the
Senior Corps and AmeriCorps collaborated with the local fire department
to create a wood bank for low-income residents to heat their homes
through the winter. In all these efforts we have called on all the
Corporation's streams of service--AmeriCorps, Learn and Serve America
and the Senior Corps--to play an active part in the observance.
In the fourth year of the Martin Luther King Jr. Day of Service, we
are gaining momentum toward our goal--fulfilling the legislative
responsibility to promote service in honor of Dr. King.
In an appendix, we have provided examples of Martin Luther King Jr.
Day of Service activities.
learn and serve america
fiscal year 2000 budget request
The Learn and Serve America fiscal year 2000 appropriation request
reflects an increase of $7,000,000 over the fiscal year 1999 budget.
These additional funds are requested to expand the reach and impact of
service-learning programs for school-age and college youth and meet the
local demand for service-learning implementation and training. Learn
and Serve America's funding has remained constant since fiscal year
1996. In the intervening years, service-learning has gained stature and
importance in education at the elementary, secondary and post-secondary
levels because of its positive impact on youth in academic achievement,
school engagement, civic responsibility, understanding of racial
diversity, and in the contribution service-learning makes to
communities.
The goal of the Learn and Serve America programs is to make service
an integral part of the education and life experiences of all young
people, thereby building a lifelong ethic of responsibility and
service. All Learn and Serve America programs--K-12 school- and
community-based and higher education--integrate community service with
academic curriculum or with out-of-school time and extracurricular
learning opportunities.
In fiscal year 2000, Learn and Serve America's new and existing
resources and capabilities at the local, state and national levels will
be mobilized to: support the increasing demand for service-learning
implementation and training; support the expansion of out-of-school
time programs; better support higher education institutions' efforts to
create permanent service-learning programs; and increase the ability of
colleges and universities to utilize Federal Work-Study students in
community service, including America Reads literacy programs.
In an appendix, we have provided examples of local service-learning
programs at the K-12 and higher education levels.
special service-learning initiatives and programs
National Service-Learning Leader Schools Program
Sponsored by the Corporation for National Service, the National
Service-Learning Leader Schools Program is a new presidential
initiative that will recognize high schools from across the nation for
high quality service learning. In its pilot year, 1998-1999, the
program will recognize up to 100 high schools for their exemplary
integration of student service into the curriculum and the life of the
school. The first National Service-Learning Leader Schools will be
announced in June 1999, and at that time, the schools will begin a two-
year award period in which they will provide support and training to
other schools interested in developing or expanding service-learning
programs.
The President's Student Service Scholarships
The President's Student Service Scholarships program is now in its
third year and has awarded scholarships to over 4,000 young people, but
many more students are eligible and deserving. Each high school in the
country may select one junior or senior to receive a $1,000 scholarship
for outstanding service to the community. Through the National Service
Trust, the Corporation for National Service provides $500, which is
matched with $500 from local scholarship sponsors. Scholarship
recipients must have served at least 100 hours within a 12-month
period. In addition to the scholarships, many other students will
receive recognition through the President's Student Service Award
program, which honors youth ages 5 to 25 who perform at least 100 hours
of service to the community in a 12-month period; they receive a gold
pin, as well as a presidential certificate, and a letter from the
President.
The scholarship program is succeeding. Matching scholarships have
been provided by the high schools themselves as well as by a host of
community foundations, local businesses, and religious and civic
organizations including Kiwanis Clubs, Lions Clubs, the Miss America
Organization, Elks Lodges, Moose Lodges, and Dollars for Scholars.
In addition, states and regional partners are supporting the
President's Service Scholarships. For example, in Minnesota the state
legislature has made funds available to meet the match for each
scholarship awarded in the state; in Houston, Texas local corporate and
foundation sponsors provide the match for the scholarship in 50
schools. Local nonprofits such as hospitals, senior centers, YMCAs or
YWCAs, or United Ways may benefit from or coordinate student service;
they provide the match for the scholarship in many communities.
We are working to expand our partnerships to encourage the
additional matching resources required to expand the program. Boys and
Girls Clubs, for example, have agreed to match up to 2,000 scholarships
to young people in their local sites.
Our fiscal year 2000 budget proposal includes $10 million for the
President's Student Service Scholarship to support scholarships for
20,000 high school juniors and seniors.
Points of Light Foundation
Under Title III of the National and Community Service Act, the
Corporation for National Service is authorized to provide funds for the
Points of Light Foundation, which was created under President Bush to
encourage every American and every American institution to help solve
the nation's most critical problems by volunteering in community
service. The Foundation also disseminates information on promising
community service approaches and builds the capacity of institutions
and individual leaders to support volunteer service. The Corporation
enthusiastically urges the Committee to appropriate $5.5 million for
the Points of Light Foundation in fiscal year 2000, the same amount
appropriated last year. The Corporation and the Points of Light
Foundation continue to work closely together in pursuit of our common
objectives.
conclusion
In conclusion, the success of AmeriCorps and Learn and Serve
America warrant the additional support requested in the budget. Thank
you.
______
Appendix One--Examples of National Service Programs
americorps*state and national
The following is a sampling of AmeriCorps members' accomplishments
around the country:
In St. Louis, Missouri, AmeriCorps members serve with the St. Louis
Partners Safety Service Corps. The team has assisted the U.S. Forest
Service in fire suppression on over 1,600 acres in Missouri. The Corps
has also received recognition from President Clinton for their work
around the country, which includes clearing fallen trees from roads and
power lines in the wake of ice storms in Maine and New Hampshire,
providing relief and assistance to residents of Michigan following
severe storms that included gale force winds and responding to an
interagency call for assistance in fighting major forest and grass
fires in Florida.
In Montgomery County, Maryland, AmeriCorps members participate in
Community Assisted Policing (CAP) with the Montgomery County Police,
who credit AmeriCorps members with adding to their arrest rates. With
AmeriCorps members tracking down the location of criminals, police were
able to arrest 33 percent of those with outstanding warrants. In
addition, with AmeriCorps members completing administrative duties,
police were able to devote additional time in December to the Driving
While Intoxicated (DWI) Holiday Task force, which resulted in 201
arrests of drunk drivers, many of whom were underage.
In Birmingham, Mobile and Montgomery, Alabama, AmeriCorps members
serve in 13 schools through the Alliance for Catholic Education (ACE).
During their two-year commitment, ACE AmeriCorps members participate in
intensive teacher-training and service-learning courses during the
summers and teach full-time. Over the past four years, ACE AmeriCorps
members in schools across the South have taught nearly 5,000
underprivileged school children, and 100 percent of participating
principals have rated the program highly.
ACE AmeriCorps members make an impact with their students that goes
far beyond the classes they teach. At St. Jude's High School in
Montgomery, ACE AmeriCorps members have started a popular drama program
and directed students in several service-learning projects. In
Birmingham, an ACE AmeriCorps member directs a service project that she
integrates with classroom work. Students volunteer at a homeless
shelter/soup kitchen and then are assigned to write and reflect about
their experiences.
In Des Moines, Iowa, AmeriCorps members serve at the Iowa Coalition
Against Domestic Violence. Operating since 1985, the Iowa Coalition
Against Domestic Violence offers assistance to battered women and
children living in 99 rural communities throughout Iowa. AmeriCorps
members enable the Coalition to maintain field offices in underserved
areas, offering services in crisis intervention, counseling, protective
orders, shelter, and medical services. Last year, members assisted
close to 3,500 women and 4,000 children through 29 domestic violence
agencies/projects across the state. Additionally, members provided 260
education programs to the public, including classes on date rape and
conflict resolution to hundreds of elementary, junior high and high
school students. Overall, the AmeriCorps program in the last four years
has made it possible for members to assist 20,000 victims of domestic
violence.
Throughout West Virginia, AmeriCorps members serve with Energy
Express. Initially serving two sites in 1994, Energy Express now
includes 68 sites where AmeriCorps members provide summer learning
experiences and nutrition to children living in low-income and rural
communities across West Virginia. Of the more than 3,000 elementary age
children enrolled in the 1998 summer program, 70 percent of those
tested maintained or improved their reading achievement scores and
benefited from a nutritious breakfast and lunch served daily over the
six-week program.
In Flagstaff, Arizona, AmeriCorps members serve in the Coconino
County Rural Environmental Corps. AmeriCorps members focus on three
areas of the environment in Northern Arizona: fire prevention,
hazardous fuel reduction, and natural resource management. Members
performed home fire safety inspections for 370 residents, thinned eight
acres of land near the Flagstaff Arboretum, participated in annual
revegetation projects, and developed a youth service component to
assist with U.S. Forest Service trail maintenance. In response to a
firewood shortage in Native American communities in Northern Arizona,
thinned wood was dried and delivered for use during cold winter months.
In Houston, Texas, 135 AmeriCorps members serve children in
disadvantaged neighborhoods throughout Houston, reaching a school
population of nearly 6,000 through SERVE HOUSTON. The wide array of
services provided by AmeriCorps members include learning enrichment
activities, one-on-one tutoring, student wellness education,
development of parent resource centers, and ongoing service-learning
opportunities. Through their comprehensive activities, and in close
collaboration with individual school staff, SERVE HOUSTON members
expand these schools' overall capacity to provide academic and extra-
curricular activities, and get things done for these kids. AmeriCorps
members work with a wide variety of community partners including the
YMCA of Greater Houston, Volunteer Houston, Interfaith Ministries,
Junior Achievement, the Scouts of America, and the Children's Museum of
Houston.
In New Jersey, AmeriCorps Members serve through the New Jersey
Department of Education in ten New Jersey schools. Members provide safe
havens for children by extending the school day where they tutor
children and run after school programs. Members also provide in-class
academic support and mentoring activities aimed at improving math,
science, and literacy skills. The program aims to improve the school
success of 80 percent of 600 students served in 5 districts--Camden,
Paterson, Pleasantville, Roselle, and Trenton.
In Montana, 40 full-time and 80 part-time AmeriCorps members serve
through the Montana Conservation Corps. The AmeriCorps members serve
throughout the state on crews of 6 under the leadership of a crew
supervisor, and they work to address critical needs in maintaining
Montana's natural resources. AmeriCorps members are constructing and
maintaining 250 miles of trail and 36 parks, restoring and enhancing
degraded watersheds, helping improve water quality, correcting site
erosion, and preventing further degradation and restoring habitat.
AmeriCorps members are constructing homes for ten low-income families,
and rehabilitating housing for 80 low-income senior citizens and ten
community agency facilities. Through its CorpsLink program, the
AmeriCorps members are mentoring 450 adjudicated youth that they have
engaged in 210 service projects.
In Idaho, 17 full-time and 19 part-time Idaho Trio AmeriCorps
members are improving the academic performance of 2,309 Head Start, K-
12 and college students in various sites throughout the state. The
majority of these students face challenges including physical
disabilities, disruptive home life, and poor English skills. Teachers
benefit from AmeriCorps members providing in-class support by giving
one-on-one and small group assistance to many students.
americorps promise fellows
The following are some examples of how states intend to utilize the
new Promise Fellows:
In Arizona, ten AmeriCorps Promise Fellows will be serving in urban
and rural communities across the state to build upon and enhance the
existing network of service organizations. Three AmeriCorps Promise
Fellows will be based at the Arizona Governor's Community Policy Office
where they will concentrate on identifying existing service
organizations that are already providing the five fundamental resources
for children and youth in Arizona. Those programs will serve as models
that can be replicated and teamed with other service organizations.
Seven AmeriCorps Promise fellows will be placed in rural and under-
served communities. For example, an AmeriCorps Promise Fellow serving
in Graham and Greeley counties will, among other things, develop a
youth council, bringing high school students in the area together to
share ideas, give voice to community concerns, and themselves serve the
community.
In Florida, eleven AmeriCorps Promise Fellows will be engaged in a
variety of diverse activities to help fulfill the goals set for
children and youth at the Presidents' Summit in Philadelphia and the
Florida Promise Summit, including:
--Identifying safe places for children in Pinellas County through the
Youthmapping for Safe Places;
--Starting a literacy project that will distribute books to programs
across the state;
--Organizing a mentor recruitment drive to involve more people in
becoming positive role models; and
--Creating and managing a Youth Opportunities Directory to provide
valuable resources to every child.
In Oklahoma, thirteen AmeriCorps Promise Fellows will serve to
develop, expand and coordinate initiatives aimed at answering the
America's Promise Challenge, including:
--Designing a database of volunteers for the American Red Cross;
--Expanding the volunteer base for the Oklahoma City Boys and Girls
Clubs;
--Developing an afterschool program at the Texas County YMCA in
Guymon, OK to provide safe places and more mentors to youth in
the area; and
--Creating a volunteer center for the United Way of Ponca City, OK.
martin luther king jr. day of service
The following are examples of Martin Luther King Jr. Day service
projects: In Athens, Alabama, the city of Athens provided a day of
continuous service and education for adults, teens, and children about
how to resolve racial conflicts. Community leaders provided educational
training on nonviolent solutions and then the attendees participated in
serving lunch to area senior citizens and the needy.
In Baltimore, Maryland, students, faculty, staff and alumnae of the
College of Notre Dame of Maryland along with community volunteers
staffed the Caroline Center, a job training/education program for women
living in poverty. Their efforts allowed the Center to open on the
holiday and to provide a safe, supervised environment when the schools
were closed. Volunteers worked with children at the center to create
picture books about racial harmony and cultural diversity. The women of
the Center participated in seminars about self and community
development and were also given a presentation on the role of women in
the Civil Rights Movement.
In Helena, Montana, staff and volunteers from the United Way read
books to over 150 youth for the holiday. The books focused on the
accomplishments of Martin Luther King and the contributions of African-
American and Native American cultures. Following the reading, children
and adults served in local community service projects in the Helena
area.
In Passaic, New Jersey, staff of the Anderson Lee Vocational and
Technical School and NAACP youth volunteers helped to renovate three
classrooms in need of repair. The volunteers added plumbing fixtures,
installed new flooring, and repainted faded walls.
In Austin, Texas, on the Saturday before the holiday, residents of
Austin fanned out over the city to over 40 sites to participate in
community service projects. Over 1,500 people helped to build houses
with Habitat for Humanity; planted trees; cleaned-up trash in
neighborhoods; visited nursing homes; and participated in clothes
drives.
In Morgantown, West Virginia, volunteers renovated a playground to
ensure compliance with state regulations. They refinished existing
playground equipment, replaced rusted fencing, and enlarged the play
area by 15 feet to install a new playground set.
learn and serve america--school- and community-based
The following are examples of the success of School- and Community-
based Learn and Serve America programs:
In Gresham, South Carolina, high school students, after completing
a needs assessment, built a rural fire department on property donated
by a community member. Having a fire department in the community has
resulted in a re-classification which has saved every homeowner
substantial money on their homeowner's insurance. This experience has
greatly impacted the safety curriculum throughout the K-12 system.
In Sedalia, Missouri at Smith-Cotton High School, industrial
technology students with help from the art students converted waste
materials from a local pre-fabricated building company into 400
bluebird nesting boxes. Students installed the nesting boxes on the
vast Missouri State Fair Grounds, the adjacent State Fair Community
College campus, the City of Sedalia's soccer fields, and other public
grounds. A late summer inspection revealed dramatic nesting success,
and the students learned basic wood shop, equipment safety and
operation, problem-solving, mass manufacturing techniques, quality
control, and natural history.
In Iowa City, Iowa the Iowa Service-Learning Partnership
incorporates service-learning into teacher education programs at Iowa
State University, the University of Iowa, and Northern Iowa University.
Along with training current K-12 teachers and administrators, the
Partnership trains future teachers who pair up with supervising
teachers during their student teaching assignments to implement a
service-learning project for the K-12 students.
More than 3,500 Iowa school children have been involved in service-
learning projects, thanks to the work of the 400 current teachers, and
450 prospective teachers who have received training in service-learning
concepts and practice over the past three years. A follow-up study
found 50 percent of the classroom teachers continued service-learning a
year after the original Partnership experience.
At Jane Addams Elementary School, in Chicago, Illinois fifth
through eighth grade students tutor younger students in several
academic areas. Students this year achieved the highest level ever in
the history of the school on national basic skills tests for
mathematics and reading. The school is located in an inner-city
neighborhood that is populated by first generation immigrants. Because
English is a second language for most students, peer tutors received
special pre-service training in tutoring techniques.
The Hamilton YMCA, a branch of the YMCA of Metropolitan
Chattanooga, Tennessee, has expanded their Before and After School
Child Care Tutorial program in partnership with East Brainerd
Elementary School. The after-school program involves children ages 5 to
11 in service-leaning projects such as peer tutoring and creating a
vegetable garden at school. Twenty-five students tutor 70 ``at-risk''
elementary school pupils in their areas of academic weakness. In
collaboration with local environmental agencies, the students are
developing a Field Guide to be used on the East Brainerd Elementary
Nature Trail by 500 students at the school. The program has a proven
track record of student gains in academic achievement and self-esteem.
learn and serve america--higher education
The following are examples of the success of Higher Education Learn
and Serve America programs:
In Mobile, AL, first year engineering students at the University of
South Alabama partner with math and science middle school teachers to
design course software and hardware that meet the classroom needs and
specifications of the teachers. This affords the college students an
opportunity to practice engineering design within a ``real world''
environment, while meeting the community-identified need of more
active, hands-on learning of science and math at the middle school
level.
In Crow Agency, MT, Business Administration students at Little Big
Horn College work with the Tribal Business Information Center to
provide technical assistance and office services to the Center. They
also serve as information systems technicians for community agencies,
work with local, state, and national parks to serve as cultural and
historical interpreters, and serve as advocates for clients with health
or educational needs.
Based in Mesa, Arizona, the Campus Compact National Center for
Community Colleges has a national project which teams seven community
colleges with a neighboring four-year college or university to
collaborate on community service-learning projects, and faculty and
student service-learning training and research projects. Nationally,
the program's goal is to provide exemplary models and effective
practices for developing and sustaining partnerships between two- and
four-year institutions of higher education to serve community needs.
Each collaborative project is locally determined and managed. Examples
of these innovative programs include:
--an Ohio program in which service-learning courses are focused on
the restoration of a polluted Appalachian watershed and on the
history and heritage of the impoverished community living in
the watershed area; and
--an America Reads program in Florida in which college students tutor
elementary school children both in school and in community-
based afterschool centers while developing their teaching
skills through service-learning courses in education,
psychology, and communication.
national service programs engaged in literacy activities
The following are some examples of national service programs
engaged in literacy activities: In Connecticut, AmeriCorps members
tutor seven- and eight-year-olds in reading during the school year and
during the summer in nine public housing communities in Hartford, New
Haven, and New London, CT. Members also coach parents in supporting
their child's efforts to read, volunteer in classrooms, and work with
teachers to reinforce school curriculum with supplementary services.
In Florida, AmeriCorps members tutor under-achieving K-3 students
so that all will read at or above their respective grade level. Members
also train middle and high school students to become elementary school
student tutors, and teach parent education workshops to parents to
increase the number of parents reading to their young children. Members
serve throughout Florida in local elementary schools with critically
low student performance.
In Houston, Texas, Literacy*AmeriCorps Members provide literacy
instruction for children and adults and target the specific need of
increasing children's reading skills. AmeriCorps Members increase
literacy for families by providing English as a Second Language
courses, basic skills, pre-GED and GED classes, homework assistance to
school-age children, and family and parent literacy programs. America
Reads activities include recruiting and training volunteers as tutors
for young children.
In San Francisco, California, there is a higher education service-
learning program where Corporation funds help train and place college
work-study students in schools to provide one-on-one tutoring to third
grade students who are underachieving in reading. The program includes
an intensive 45 hours of training in reading instruction, reflection
sessions and mentoring opportunities with teacher collaborators. The
project expects to develop materials for dissemination, including the
revised course syllabus, a tutoring resource manual and readings,
placement procedures and supervision guidelines, recruitment materials,
and evaluation instruments assessing the performance of tutors and
tutees alike.
In Washington state, the Governor has launched a statewide effort
to improve literacy among young children. All parts of national
service, including AmeriCorps and service-learning, are contributing to
this effort.
______
[From the Dispatch, Feb. 1999]
A Salute to the First Promise Fellows
(By General Colin Powell)
For some of our young people, preserving our democratic way of life
means shouldering a rifle, or climbing into a cockpit, or weighing
anchor and setting out to sea. For others it means helping a child to
read, or helping that child to secure needed vaccinations or health
care. Or it means building a park, or helping to bring peace to
troubled neighborhoods, or helping communities recover from natural
disasters, or reclaiming the environment.
For a select group of young people called Promise Fellows, it means
a special mission: It means providing young people with access to the
five America's Promise Fundamental Resources they need to lead
successful lives.
The Promise Fellows are new dimension in the ongoing partnership
between America's Promise and the Corporation for National Service--
AmeriCorps. From the very beginning, the Corporation for National
Service has been one of our staunchest allies. Former Senator Harris
Wofford, the Corporation's CEO, helped make the Presidents' Summit in
Philadelphia the seminal event it was, and he has been a valued
supporter of America's Promise ever since.
The creation of the AmeriCorps Promise Fellowships was announced by
President Clinton last June. This month, the first Promise Fellows--
some 500 of them--will undertake their training and then fan out all
across the country to assist in local efforts to provide the five
America's Promise Fundamental Resources.
Promise Fellows will be starting a literacy project in Florida that
will distribute books to programs across the state. In Illinois, they
will organize a summit for youth and community members. In Oklahoma,
they will be developing an after-school program at a local YMCA and
establishing a database of volunteers for the local Red Cross. In North
Carolina, they will assist a program that matches elementary school
children with senior volunteer mentors. In Mississippi, they will work
with 100 Black Men of America to recruit 10,000 new mentors in the city
of Jackson. In New Jersey, Promise Fellows will serve as coordinators
of Communities of Promise projects in all 21 New Jersey counties.
Nationally, Promise Fellows will work with another ally of America's
Promise, Communities in Schools, to identify and create up to 500
Schools of Promise across the country.
These are just a few of the many ways in which Promise Fellows will
be making America a better place by giving young people a better chance
at life. Their motto is, ``Delivering on America's Promise to Youth''--
and that is exactly what they are going to do.
The 500 Promise Fellows are the first of the hundreds more we
expect in the years ahead. Because these young people are going to be
serving in positions of leadership, they are going to exert an
influence far in excess of their numbers. They are going to be
catalysts and coordinators for a whole range of projects designed to
advance the five America's Promise Fundamental Resources. They are
going to be examples and role models for other young people. Finally,
when they finish their year of service as Promise Fellows, they are
going to carry that experience with them for the rest of their lives.
Whenever they are confronted with a problem or need in their
communities--particularly one involving young people--they will be able
to draw on their experience as Promise Fellows in devising solutions,
and their neighbors will be able to look to them for leadership and
advice. I look forward to giving you further reports on the success of
this new adventure in public service.
Senator Bond. Thank you very much, Senator. We will have a
number of questions for you submitted for the record. But let
me go back to the management reform. You made the commitment
last year to correct a number of the weaknesses. The IG has
found that the same material weaknesses exist. In fact, the
number of material weaknesses has expanded to two new areas in
the Corporation's financial operations.
You have developed an action plan. What sort of strategy or
plan did you have in place last year to address the material
weaknesses? Have you determined that implementing this action
plan will eliminate or will remedy the weaknesses, and when do
you expect to have them remedied?
addressing material weaknesses
Mr. Wofford. In just a minute, if I may, I would like our
chief operating officer, who has been a driving leader in this,
to add her comments.
As to the sequence of plans, I would like to make sure you
see this is not just one plan after other plan. The top
management of OMB, before our last hearing, had put a lot of
power and leadership--working with us very directly--into the
plan we reported to you at this committee. We made great
progress in that plan.
As the other studies by the Inspector General, our own
studies, and then the balance sheet qualified opinion and its
recommendations and findings came, we necessarily had to go
into greater depth, greater detail and specificity with our
plan submitted to you. I was glad to see that except for the
two additional points you wanted us rightly to include in that
plan--which we have now added--that will show you every 60 days
whether we have made our targets, you have no objection to the
plan that is before you.
Let me add one other thing about that sequence and the
sequence of leadership. Out of the collaboration with OMB's
management leadership, we were very fortunate to bring on board
our new chief operating officer--they let us have Wendy Zenker,
one of their top people, who by the way had run grants
management at the Department of Education some time before.
But she came in, fortunately overlapping at the same time
that our chief operating officer was taken to be Secretary of
the Army, and a little while thereafter, you probably know, our
chief financial officer was taken to be the chief financial
officer of Internal Revenue.
Wendy Zenker has given extraordinary leadership. She has
been brought in as a strong extra accounting support and I
would like her to comment, if she may, on your question.
Senator Bond. Thank you.
statement of wendy zenker
Ms. Zenker. Thank you very much, Mr. Chairman. As you
noted, we do have an Action Plan that addressed, at the time,
all of the six material weaknesses that the Inspector General
had noted in her fiscal year 1997 balance sheet audit that was
issued in October of last year. We specifically organized the
plan around those material weaknesses so we would have an
assurance that we would be able to show to you progress, and
also results, in correcting those weaknesses. The plan is
dynamic. As the year goes on, as we learn more, if it is
necessary to modify the plan or add a particular goal or
objective, we do that. As a matter of fact, in our February
progress report to you we added procurement management. We
recognized, based on the information that we had been
receiving, that there was, in all likelihood, a material
weakness in that area and have added that to our action plan.
So, as I say, we can show you results every 60 days and we can
show you real improvement within this year and the next.
You asked how long it will take to fix the material
weaknesses. We believe that we can fix them within the next 2
years. That is, 1999 and 2000. The reason I say that to you is
because many of the weaknesses are tied to our very poor
current financial management system. The efforts that we are
taking to install a new financial management system will
address several of the material weaknesses that the Inspector
General has identified.
Senator Bond. Thank you very much, Mrs. Zenker. Senator
Wofford, we are delighted you brought in a chief operating
officer, but we are still very much concerned about the
attention and time being dedicated to the Corporation's
management weaknesses.
What are the reasons that you do not have a CFO? You have a
deputy. What are you going to do about that?
chief financial officer
Mr. Wofford. I am glad to be able to report to you that,
after a frustrating and hard search, we have identified someone
who we think will perform with outstanding ability and
experience. That person is being vetted at this moment by the
White House.
Senator Bond. When do you hope to have them on board?
Mr. Wofford. I hope any day; we hope very soon. We will
have the vetting process for the initial announcement and, of
course, thereafter----
Senator Bond. Obviously we wish you luck.
Mr. Wofford [continuing]. There are the various studies
that go on, as you well know, before that person can take full
charge. That is why it is very fortunate that during this
interim, which was longer than we wanted, that we have had the
kind of leadership that Wendy Zenker is giving right now, every
day. So we have had nothing dropped. In fact, she came directly
out of the shaping of our plan last year, and came over here to
help us implement it.
national service trust
Senator Bond. Senator, the Corporation is requesting $93
million more for the National Service Trust account. The IG
states in her testimony that as of September 30 last year, the
trust liability totaled $161 billion, but the Corporation had
reserved $357 million in the trust. And thus, she calculated,
there is a projected surplus of about $196 million, according
to the auditors.
Do you agree with the auditors' assessment? Was this
existence of the surplus factored in? And the thing that really
concerns us, both from both a financial management as well as
programmatic standpoint, does this indicate that the actual
education award usage was less than what the Corporation has
been estimating?
Mr. Wofford. No. Let me separate the two parts of this
problem, which it is crucial to separate.
One, the most prudent and appropriate way to report the
liability on the financial statements is in the audit that is
just underway now. The Corporation in the beginning, it seems
to me rightly, reflected the Act, which says that every member
of the trust--of AmeriCorps--who completes service is entitled
to an education award. And we have an obligation--in fact, the
Act makes it very clear--that the money for those educational
awards must be held in the trust.
Therefore, in the beginning, with no evidence as to how
many would use those awards, knowing, of course, that some
would not--some may not want to go to college, a significant
proportion are over 30, and even though an increasing number of
people over 30 and over 70 are interested in college--we have
always known that not all members are going to use it. Some go
directly to jobs out of programs that have taught them how to
build houses for the homeless. But we accept the auditor's
recommendation that, at this point, it would be wise to
discount the amount needed--the amount that is listed as a
liability, because now we have some experience.
Experience indicates that about 78 percent--and it could go
higher--use the award. So we accept the recommendation of the
auditors and we are changing the financial statement to reflect
that liability.
But that is a different question from what funds are needed
now to be in the trust fund.
We have been discounting our request to Congress at that 78
percent rate for 2 years now. And if we had not discounted it
by that factor, we would be asking for some 70 million more for
the trust.
Maybe Wendy Zenker would want to see if I adequately
conveyed that.
Ms. Zenker. One way to think about this is--there is one
way to think about the liability as we record it on the
financial statement, and a different way that we prepare our
budget estimates that we share with you and the Congress.
In terms of our liability on the statement, we felt that it
was prudent to take a very conservative approach and assume
that every member who enrolled in the trust was going to use
their education award until we had actual facts and proof that
that was not the case.
Senator Bond. In essence, now you agree that there is
that----
Ms. Zenker. We still believe it is a judgment call. We have
not gone through a full 7-year cycle yet. So for the first
class that were enrolled, we have some usage figures and very
high usage figures for that class. But since they have not had
the full 7 years, we do not know, for sure, exactly how many
people will use their education award.
Mr. Wofford. Some are predicting a peak coming at the end
of the 7 years when people say, I will no longer have my
voucher--my education award--if I do not use it. So we have to
take into account the uncertainty.
Senator Bond. That is possible.
I think I have benefited from a hometown-like system. Back
in the heartland, if you have a referee that comes from the
same town as one of the teams, you can always count on getting
better calls.
I think I have gotten a better call on the light system. So
I will terminate my question and turn to my ranking member for
her questions. Maybe we can give you a small hometown
advantage.
Senator Mikulski. That is fine with me. As you know, we
have two basketball teams in the tournament, one a big school
like Maryland and then we are very proud of Mount St. Mary's
College, a small college that has a lot of grit and
determination. Keep your eye on them. It is the small sizes
that sometimes triumphant over the giants. [Laughter.]
use of americorps education awards
Having said that, I would like to follow up really on
Senator Bond's question about use. I really had a hard time
following that answer. And here is my question: Of the number
of volunteers, full-time and then the number of AmeriCorps
volunteers part-time--remember the part-time model which was to
be so crucial, was one of the things I advocated, because it
did not require relocation, enabled people of disabilities to
be recruited because their supports would be available.
My question is as far as you know now, how many people have
either used AmeriCorps to pay down their debt, which is one
category, or to use their voucher for additional education?
Mr. Wofford. Over 76,000 have earned the educational awards
and, of those, already 35,000 have used them or are using them
now.
Senator Mikulski. To do what?
Mr. Wofford. To pay either the loans that they had taken
out from college or to pay directly to colleges.
Senator Mikulski. Of the 35,000 then, how many have used
their service in AmeriCorps to pay down their debt, which was
one of the original purposes of the program?
Mr. Wofford. About 34 percent have used it to pay down
their debt, 56 percent use it to pay for continuing college
education, and 10 percent use it for both purposes.
Senator Mikulski. I do not know what continuing college
education means.
Mr. Wofford. About 25 percent of all members are precollege
and they use their award to pay for entering college.
Senator Mikulski. Yes?
Mr. Wofford. A continuing might also be that more than----
Senator Mikulski. I am going to be very hard here. Forty-
five percent used it to pay down their debt. And was that the
full-time or the part-time people?
Mr. Wofford. Both: we can give you the breakdown, in
general, there is no significant difference in the use of
awards between full-time and part-time members.
Senator Mikulski. That will be important. If we are looking
ahead at where we need to put our money, and even where you are
going to do your recruitment, which is who are the most people
who make the advantage, this is like the epidemiology of the
program. It tells you what is healthy and what needs
immunization and what has got real big problems.
So if 45 percent did that, but when we say continuing--are
you saying that 30 percent of the 55 percent are people who
used AmeriCorps to essentially get a voucher to begin their
higher education?
Mr. Wofford. The--exactly 30 percent, I will not say.
Senator Mikulski. I do not care if it is 29 or 30.
Mr. Wofford. Senator, yes. Of those who have not gone to
college, a high proportion----
Senator Mikulski. That is not continuing. They never began.
Mr. Wofford. I meant beginning their education; it is post-
secondary education. Some go to job training; most go to
college. Second, there is a significant number who serve in the
middle of their college. They take a year out--the full-time
members. And an even larger number of the part-time members are
in college as they serve, and they use it for future college
expenses.
Senator Mikulski. Is that the part-time group?
Mr. Wofford. Yes. A significant proportion of part-time
AmeriCorps members are at the same time studying at college. It
is part-time service in AmeriCorps, and they earn a part-time
educational award. Part-time service is an area you have been
interested in growing, and last year we had over 14,000 part-
time and reduced part-time members, compared to 7,500 the year
before.
Senator Mikulski. Yes. And I would like then to have worthy
information on this.
Now the 25 percent who then use their voucher to begin some
type of post-secondary education, whether it is job training
that is very specific--it could be computer something or other
or it could be--how many of those went to a full 4-year program
and how many went to a 2-year program?
Mr. Wofford. We may be able to get that information for
you. And, if not, we can get it in due course.
[The information follows:]
----------------------------------------------------------------------------------------------------------------
Full-time Full-time Part-time Part-time All
Program year members percent members percent members
----------------------------------------------------------------------------------------------------------------
1994..................................................... 16,054 64 9,163 36 25,217
1995..................................................... 17,844 71 7,338 29 25,182
1996..................................................... 17,608 70 7,520 30 25,128
1997..................................................... 22,963 61 14,586 39 37,549
------------------------------------------------------
Total.............................................. 74,469 66 38,607 34 113,076
----------------------------------------------------------------------------------------------------------------
Senator Mikulski. That is not a judgment about whether you
go to 2 year or 4 year. Again, it talks about who are we
recruiting and who sticks with the program.
I think it would be fantastic if somebody who never had a
chance comes into AmeriCorps and then they go and get their
voucher to get their 2-year program in nursing, or maybe a 2-
year program in emergency management, something they have got a
flavor for when they worked in AmeriCorps, and they keep on
going with the experience they earned in it.
Maybe they go into construction technology because they did
Habitat for Humanity, but those 2 years--AmeriCorps goes 2
years day school and then maybe they go on to night school or
the wonderful ways higher education recruits people. But you
see how we have to----
Mr. Wofford. Exactly.
attrition
Senator Mikulski. Now of the number of the people that have
come into AmeriCorps, what is the dropout rate?
Mr. Wofford. I think the 78 percent figure is one way of
throwing light on that. The report that is----
Senator Mikulski. What is the dropout rate?
Mr. Wofford. About 16 percent--who come in, do not complete
the service, or have a shorter term of service. They do not
have urgent personal or family reasons to leave, and they have
not left for positive reasons, such as to take a job in a
welfare-to-work program.
Ms. Zenker. There is, Senator, a range of dropout rates. I
do not mean to not answer your question. But when we look at
each of our program years, we have statistics that range from
16 to 20 percent in terms of a dropout rate.
Senator Mikulski. What is the dropout rate in each year of
the last 3 years?
Ms. Zenker. For the last 3 years--if I may, if I can start
from the first year? We only have 4 to report to you.
Senator Mikulski. Sure.
Ms. Zenker. The dropout rate in year one, which was the
1994 to 1995 year was 20 percent. The dropout rate in year two,
1995 to 1996, was 18 percent. The dropout rate in year three,
1996 to 1997, was 14 percent. And the dropout rate in the year
four, 1997 to 1998, is currently 16 percent but we still have
people serving in that year. I would suggest that that is not a
final figure.
Senator Mikulski. You would say in terms of the dropout
rate that you have really improved your screening procedure.
You see, for everybody, for whatever reason they drop out, we
have made a tremendous investment. And they have taken a slot.
So the better the screening--that is a pretty good rate.
Mr. Wofford. Senator, could I just add two figures that may
be very important to you in comparing this. Forty-seven percent
of first year students at 2-year public colleges drop out.
Thirty-one percent of first year students at 2-year private
schools drop out. Thirty-three percent----
Senator Mikulski. We are not talking about going to school.
There are a lot of reasons why people drop out of school. And
this is not a hearing in the Ed Labor Committee. I am very
familiar with why they drop out of school. What I am interested
here is--that is not a comparison that is relevant.
Mr. Wofford. Peace Corps and Job Corps and the military are
the other three figures I will give you just to compare.
Senator Mikulski. I am interested in AmeriCorps. I am
interested in the viability of AmeriCorps. That is what this
hearing is about.
Mr. Wofford. No one is more interested than you----
Senator Mikulski. So then having asked that question, I see
that my time is up in terms of recruitment. I was just going to
ask another question.
Senator Bond. Take one more. I will give you the hometown
advantage.
sustainability of americorps program impact
Senator Mikulski. Thank you. Could you then tell me the
issue in terms of the in-programmatic impacts? We have a
variety of statements here. You in your own reports talk about
how, for example, reading improves when the volunteers are
there. What I am interested in is what are the studies to show
when the volunteers leave.
In other words, is there a sustainability to the impact of
AmeriCorps as compared to AmeriCorps being there?
Mr. Wofford. In the report that Aguirre prepared--that we
are releasing on AmeriCorps, we have figures that are not on
this chart of the estimate of the percentage who continue to
serve as volunteers in their communities. There is a very
strong report from this--I think you will find a very
substantial report on just exactly how AmeriCorps has
instilled--the evidence that shows that it has instilled an
ethic of continuing service in the members.
There is already an AmeriCorps alums organization that the
AmeriCorps members have started that is very actively----
Senator Mikulski. That is an alumni association? Because
that was going to be one of the key components of the program.
Mr. Wofford. There is definitely one, very active and full
of plans and growing and committed to furthering service. The
alums have committed themselves to the five goals of the
President's summit and have made specific commitments as to
what they want to do.
Senator Mikulski. Let me just ask my last question here and
then I will come back for a second round. It says here: in all
programs 5,700 members at 305 sites supported the tutoring of
youths in grades 1 to 12. Sixty-seven percent of those tutored
showed improvement during the program year, which is great.
Then what happened in the second year? Do we know that? In
other words, what is next? If you build a Habitat for Humanity
house, there is the house. I know it is hard to do education. I
know it is hard to do public health. I know it is hard to do
these to do these things.
Mr. Wofford. In tutoring and reading?
Senator Mikulski. Yes.
Mr. Wofford. The report I want to do for you is going to
show the accumulating evidence from around the country from
literacy programs, in which AmeriCorps members serve, that
involve measurable test scores year by year.
Remember, that the AmeriCorps member--we do not run
literacy programs. AmeriCorps members get assigned to local
literacy----
Senator Mikulski. I understand all that. Is that report
done, Senator Wofford?
Mr. Wofford. We have a lot of that--yes, because we are a
major partner in the----
Senator Mikulski. Is the report done?
Mr. Wofford. We have reports that are done.
Senator Mikulski. It says the summary of recent national
evaluation. Is that a single report?
Mr. Wofford. No. In addition to this summary report, which
we are releasing today, we have a number of reports that we and
the Education Department have on what AmeriCorps participating
literacy programs are accomplishing. We will send you the
report and that study in a summary.
Senator Mikulski. We will come back to it.
Senator Bond. Thank you, Senator Mikulski. We are delighted
to have Senator Kyl today.
Senator Kyl. Thank you, Mr. Chairman. I will take so little
time that it will make up for all of that hometowning that you
were doing with each other. I just wanted to stop by and say
hello to Senator Wofford and commend you for your efforts in
trying to accomplish all that I know you wish to accomplish
with the program.
Mr. Chairman, since I am (A) a late arrival and (B) new to
the committee with not enough information to really contribute,
I will defer to you and your expertise to continue the line of
questioning. Thank you.
Senator Bond. Senator Kyl, you are always welcomed and we
are delighted to have any questions.
I am going to turn back to Senator Mikulski. I have just
one or two quick questions. We are going to have the IG and
KPMG. If you could stay around, Senator Wofford, I welcome to
give you an opportunity to respond orally to any of the points
that they raise. And obviously on this hearing as in any others
we not only will keep the record open for questions that
members may have, but if information developed at the hearing
triggers your additional thoughts, if you want to have specific
responses to that, we would be happy to have it.
national service trust
To follow up on the National Service Trust, 16 percent do
not use the education award. How is this accounted for in the
trust fund account? Do you now believe that that $196 million
is excess funds?
Ms. Zenker. No, Senator, I do not. As we stated, there is a
distinction between the way we provided the liability estimate
and the draft financial statement and the way we provided a
budget estimate for the Congress. In providing a budget
estimate, we have taken into account what is simply called
``the discount''--the people who have earned an award but who
we do not believe will use those awards. So we have applied
that discount factor in our budget estimating practices that we
have shared with you. There is still a modest surplus in the
trust account and it is there for the unexpected use of these
awards by students who may, indeed, come back and use them.
If some of those people show up and say, we are in our last
two program years, we want to make use of that education award,
we feel we need to have the money available for them to make
use of that award.
So there is a modest amount of money that is in the trust.
But there is no large surplus to the extent that has been
described.
waste, fraud, and abuse
Senator Bond. Let me turn for the last general question to
an area that reflects the concern we have about the
Corporation's management capacity, and that is the
vulnerability to waste, fraud or abuse.
The Inspector General has repeatedly found problems related
to grant oversight and monitoring. In one case an OIG
investigation revealed evidence that at one grantee site the
executive director had misapplied funds and as a result the IRS
seized and sold the site's assets to satisfy delinquent taxes.
The OIG also questioned more than 12 percent of the grantee's
claimed costs, and yet despite these problems I understand that
the Corporation continues to fund this grantee.
Could you tell us why you continue to fund the grantee?
What procedures and controls do you have in place currently to
prevent these sorts of problems, and have there been other
cases where you have taken action against noncompliant
grantees?
Mr. Wofford. Indeed, is the answer to the latter. The
Congressional Hunger Center is the sponsor of the program that
is referred to. One of their sites did have the problems that
we found--certainly the Inspector General found and that site
has been terminated by the Congressional----
Senator Bond. It was a site-specific problem of a larger
grantee?
Mr. Wofford. It was a site-specific problem. And we have
confidence in the Congressional Hunger Center's impact as a
program; it is one of the outstanding programs in the
Corporation. That site was a disaster.
Senator Bond. Did you find that or was it the IG that found
it?
Ms. Zenker. Initially, there was a participant at the site
who brought the issue to our attention. When we heard of it, we
directed that individual immediately to go to the IG's office
so that the IG could conduct the appropriate investigation into
what was going on.
Senator Bond. Are the problems that were found there the
kinds of problems that you would normally identify in your
oversight of grantees?
Ms. Zenker. If I may, Mr. Chairman. We have a situation in
the Corporation where we have grants that we give to state
commissions and other national directs, and they in turn give
subgrants to sites around the country. We have a direct
responsibility to monitor our grants and we do that. We are not
able to monitor our subgrantees.
Senator Bond. Was this a subgrantee?
Ms. Zenker. It was a subgrant of the Congressional Hunger
Center, a smaller site. I would have to honestly tell you, I do
not think we have the resources to appropriately monitor all of
the subgrantees and program sites around the country. What we
do try to do is to make sure that our grantees understand what
their responsibilities are to monitor those sites and those
subgrantees.
Senator Bond. So in this instance the grantee blew it?
Ms. Zenker. To a certain extent the grantee blew it. They
hired and had a program director at a site who turned out to be
a crook. I am looking for another word but I cannot find one.
Senator Bond. That is the problem. How do we make sure that
somebody is getting the crooks out of there?
Ms. Zenker. In this instance it happened, and I would
suggest the response happened in the appropriate way. This is
one project director in terms of thousands that we have around
the country. It was a bad apple and through the hotline, and
other mechanisms to encourage people to bring these things to
our attention, the Inspector General was able to go out and do
the type of review that needed to be done to shut down the
site.
Mr. Wofford. Mr. Chairman, could I just add, we have
convened all the national nonprofit grantees and all the main
grantors from the state commissions appointed by governors to a
training conference that focused on just this issue.
The Inspector General gave a very detailed and challenging
report of the hardest of her findings. The impact of that
training conference--I have seen it in a number of states that
I have visited. The state commission executive directors have
themselves called conferences of their grantees to make sure
that they are monitoring more effectively, if they had been
inadequate in the past.
There are a number of additional steps we are going to take
to ensure the responsibility of the state commissions--to which
two-thirds of the grants are made--and the national nonprofits.
monitoring grantees
Senator Bond. The final question is, do you now have in
place the resources to do an effective job of monitoring,
whether it is through your direct grantees or through the state
commissions? And, if not, have you requested the funds to
provide those resources to make sure there is an effective
grants monitoring regimen in place?
Ms. Zenker. Mr. Chairman, yes. We have requested additional
funds to improve our grants management activities. But even as
we await the results of the 2000 budget request, we are still
this year putting more resources into grants management and
into grant monitoring.
One of the activities that our program offices have done is
to look at the criteria that we provide to determine where they
should perform site visits this year--so that we make sure we
go to the more vulnerable sites versus the stronger sites in
our oversight activities. So we are doing things this year, but
in terms of our 2000 request, a portion of that will also go to
improve grants management.
Senator Bond. Thank you very much. Senator Mikulski.
Senator Mikulski. Thank you, Mr. Chairman. I know we will
have other questions submitted to the record.
characteristics of full- and part-time participants
Just now that as we look at the results of AmeriCorps Learn
and Serve, particularly AmeriCorps, I am interested in the
distinction between the full-time participant as well as the
part-time participant and who really made use of either/or. Did
they come predominantly from--what social backgrounds, et
cetera?
And, also, the part-time model which was to be focused on
the fact that many people cannot go away because of family
obligations or do not want to go away, but want to participate
in a program like this. So that is why the part-time model was
there, to meet that need.
And it was often designed particularly for women and
perhaps a little bit older women volunteers who wanted to be in
AmeriCorps because they either had a family obligation--they
might have been a caregiver to an older parent--as well as
people even, for example, with certain disabilities. If you
have your whole network lined up in your hometown, like in
Baltimore, and you have your physician, you have your support
services and so on, you can still be a volunteer. In fact, it
is important to show that in AmeriCorps everybody is welcomed
who wants to do a job. That was one of the other aspects.
So anyway, I am interested in the part-time model. As we go
ahead with reauthorization, we need to know this as well as the
funding.
What I have here is the Brandeis report which I have read,
which says that everybody likes AmeriCorps and everybody likes
AmeriCorps when they are there, but it is questionable about
the sustainable effort. That is complicated in education. But
if we go to this report--that says Aguirre International? Is
this report going to be released today?
Mr. Wofford. Yes.
Senator Mikulski. I sure wish we would have had it for the
hearing.
Mr. Wofford. My testimony goes into some detail, the 28-
page testimony.
Senator Mikulski. I appreciate that. But I would have liked
to have seen the report. What time are you going to release it?
Mr. Wofford. It is available, as far as I know, right now.
We have it here. We will give it to you----
[The information follows:]
AMERICORPS STATE/NATIONAL FULL-TIME/PART-TIME STATUS 1997-1998
[In percentages]
------------------------------------------------------------------------
Full- Part-
time time
------------------------------------------------------------------------
Service commitment:
Full-time......................................... 77 .......
Part-time......................................... 23 .......
-----------------
Total........................................... 100 .......
=================
Race/ethnicity:
African American.................................. 27 25
American Indian................................... 2 1
Asian/Pacific Islander............................ 1 5
Hispanic.......................................... 16 20
White............................................. 52 46
Other............................................. 2 3
-----------------
Total........................................... 100 100
=================
Gender:
Female............................................ 70 68
Male.............................................. 30 32
-----------------
Total........................................... 100 100
=================
Age:
21 or younger..................................... 20 36
22-29............................................. 51 28
30-37............................................. 13 14
38-45............................................. 9 13
Over 45........................................... 7 9
-----------------
Total........................................... 100 100
=================
Education completed:
Less than H.S..................................... 5 8
High School....................................... 17 19
Some College...................................... 36 46
College Grad...................................... 36 20
Grade. Degree..................................... 6 7
-----------------
Total........................................... 100 100
=================
Income status (family):
$5,000 or less.................................... 7 11
$5,001 to $10,000................................. 14 12
$10,001 to $20,000................................ 18 20
$20,001 to $30,000................................ 9 15
$30,001 to $40,000................................ 14 10
$40,001 to $50,000................................ 8 9
$50,001 to $60,000................................ 8 6
$60,001 to $70,000................................ 5 6
Over $70,000...................................... 17 11
-----------------
Total........................................... 100 100
=================
Members' household employment status:
Unskilled laborer................................. 14 17
Semi-skilled laborer.............................. 11 4
Skilled laborer................................... 25 28
Clerical/sales.................................... 20 26
Professional/managerial/technical................. 30 25
Other............................................. ....... .......
-----------------
Total........................................... 100 100
------------------------------------------------------------------------
Senator Mikulski. I would have liked to have had it last
night or something. This is the hearing. This is the shot. This
is the opportunity. I am glad you are releasing it and
everybody who has a newspaper will read it. But I would like to
know when do I get to read it. I do not mean to be brusque
here.
Mr. Wofford. The detailed summary of this was provided to
the staff.
Senator Mikulski. I do not want a summary, Senator Wofford.
I really want this report because I am digging into this
program. I really do not want a summary. I really wanted the
report. So let us see what we can do here. But this is kind of
where we are: I am going to be helpful, but this was my window
of opportunity to really then focus on this for the hearing. So
let us have the report. Do you understand?
Mr. Wofford. Yes.
Senator Mikulski. I am glad you gave the testimony. If I
had the report, I could have had, I think, better questions.
Mr. Wofford. We will give you an analysis of the part-time,
which is an increasing proportion of AmeriCorps.
May I add one other thing, Mr. Chairman, on this point?
Namely----
Senator Mikulski. I did not give up my time yet.
Mr. Wofford. I give up mine, which does not exist.
health services and senior services
Senator Mikulski. In terms of all of the people that we are
talking about here, it says that AmeriCorps members serve in
clinics, VA hospitals and other health-related facilities. It
says close to 500,000 people were immunized. I would like to
know what other things they did in the area of health services.
It says that over a million volunteers were generated,
recruited, trained or supervised. I hope the report goes into
how that happened and, also, this whole thing with the effort
to the seniors, helping them maintain independent living would
be very important, because that was one of the other missions
and I would like to know where that is spelled out. Is that all
in that report or not?
Mr. Wofford. It will be in the report that will come to
you. I cannot say that it is all in the Aguirre report. No.
[Clerk's note.--The following report ``Making a Difference:
Impact of AmeriCorps* State/National Direct on Members and
Communities 1994-95 and 1995-96'' can be found in the
subcommittee files.]
Senator Mikulski. I have other questions for the record. I
know we want to move on to the IG and anything else that
Senator Wofford wants to tell you.
Senator Bond. I will give Senator Wofford an opportunity to
take one last crack.
Mr. Wofford. Just one minute to make clear that with the
exception of a few programs--Teach for America, a large program
which sends teachers all around the country; Alliance for
Catholic Education which sends teachers to southern Catholic
schools--a few programs, the overwhelming majority of our
programs are programs locally based where people serve locally.
We do not come in from outside.
I want to make those facts clear to Senator Mikulski
because it is not a program--with the exception of the American
Red Cross project and the Disaster Relief teams of NCCC--that
parachutes anyone into a community. The Red Cross sends people
into disaster areas, the AmeriCorps teams. Otherwise it is a
locally based program in which the local programs select the
members, recruit them, administer them.
Senator Bond. Thank you very much, Senator Wofford. I
appreciate your testimony and Ms. Zenker's. And I do ask you to
stick around if you would care to respond. And now I invite the
Corporation's Inspector General Luise Jordan and Karen Molnar
from KPMG to come forward. If you would, take your places up
here. We would appreciate that.
We have just heard from the Corporation regarding a variety
of issues about their efforts to correct management
deficiencies. If you have any thoughts you have in response to
the Corporation's testimony, we would welcome those.
I also would like to hear the auditors' assessment to date
on the financial statements audit. Especially on the
auditability of the Corporation's statement. I will be
especially interested in hearing the auditors' view on the
Corporation's progress, addressing its management deficiencies
and what recommendations you may have that can assist the
Corporation.
Last, I am concerned about the discussion of the audit
finding of the $196 million in surplus funds. We are going to
invite you to provide details on that. I understand you have
written testimony which we will make a part of the record. And
I would like to ask you to take about 5 minutes to make any
oral statement you wish to make. Thank you.
statement of luise S. Jordan
Ms. Jordan. Mr. Chairman, Senator Mikulski, I appreciate
the opportunity to be here today to provide information related
to the Corporation's financial management.
To answer your question, although the Corporation has taken
steps to achieve financial accountability, progress to correct
its financial management deficiencies has been slow. Last year
for the first time we were able to audit the Corporation's
balance sheet. Presently we are in the final phases of a full-
scope audit of the Corporation's 1998 financial statements.
The audit, as you indicated, is being performed by KPMG
under contract to my office. Karen Molnar, the auditor partner
responsible for the work, has accompanied me here today.
Senator Bond, your referee hails from Missouri.
We planned and conducted the audit in accordance with
generally accepted government auditing standards with an
intended reporting deadline of March 31, 1999. Because of known
internal control weaknesses, the audit required, as you
indicated, extensive, costly and time-consuming procedures that
took into account in their design the pervasive deficiencies in
the Corporation's operations and systems.
Today, however, I am reporting that completion of the audit
is delayed due primarily to my decision to allow the
Corporation to revise its estimates of grant advances and
payables. The balances related to grants are among the most
significant items on the financial statements. Audit work to
date has revealed that the Corporation's procedures to estimate
the advances and payables are flawed. Because the estimates are
flawed, the Corporation has requested additional time to
correct the information by using actual information from
grantee-submitted financial reports.
The Corporation's work is made more time-consuming and more
extensive because not all the financial reports have been
entered into the financial systems. To date, however, as has
been discussed, the financial statement audit has revealed
material weaknesses in eight areas including two new areas.
Those will be item 7 and 8 in this list.
First, the general control environment. The Corporation's
general control environment is weak and not conducive to
ensuring an effective system of internal control. Control
environment factors include commitment to competence,
management philosophy and operating style, organizational
structure and assignment of authority and responsibility. The
control environment sets the tone of an organization,
influences the level of control consciousness and provides the
discipline and structure of an organization. The Corporation's
lack of effective management control is evidenced by the volume
of material weaknesses and other reportable conditions
identified in this audit and the number that have remained
uncorrected over the years. Without a strong control
environment, control weaknesses will continue, increasing the
risks and inefficiencies and reducing the reliability of the
Corporation's financial information.
Second, Financial management and reporting. The Corporation
does not currently have a chief financial officer or other
strong financial management personnel in place to provide
leadership and oversight necessary for effective quality
control of accounting and financial reporting activity. It
lacks an effective quality control structure to ensure that
significant errors and omissions are identified and corrected
in its financial information.
Third, Grants management. Adequate procedures for
monitoring grantees' financial activities and their compliance
with laws and regulations are not in place. Expired grants are
not closed out on a timely basis. And, as I stated earlier, a
reliable method for estimating expenses incurred by grantees
has not been established.
We have repeatedly reported deficiencies related to grants
oversight and monitoring in individual audit reports and in our
semiannual reports. Over the past 4 years our audits of 73 of
the Corporation's grantees reported that over one-third
experienced problems with their financial reports. The audits
disclosed that more than half of these grantees had accounting
systems and management controls inadequate to report the
expenditures or to safeguard Federal funds and that about a
half had inadequate timekeeping systems. We also reported that
one-third of these grantees failed to adequately monitor their
subrecipients.
As a result of these and other conditions, we questioned
more than six million, or six percent, of the funds awarded to
the grantees.
The Corporation remains responsible for the proper spending
of its funds, the proper oversight of its programs, regardless
of the location or regardless of whether a grantee is a
subgrantee or immediate grantee.
Financial systems. The Corporation's general----
Senator Bond. Unfortunately--we will make your full
statement part of the record. And, if you would, just hit on
the high points. We have other witnesses we need to get on to.
Ms. Jordan. All right. As a result of these conditions, the
Corporation cannot provide reasonable assurance that its
management controls properly safeguard its assets, that its
information is accurate and it complies with laws and
regulations. As I stated when I began, most of these conditions
have been reported as material weaknesses since we began
auditing.
In response, the Corporation has initiated several action
plans. However, much remains to be accomplished. The
Corporation's most recent action plan incorporates many of the
recommendations. It is the Corporation's most ambitious plan to
date. However, because it has only been in effect for 2 months,
it is too early to know when or whether the Corporation will
correct these deficiencies. However, based on the Corporation's
history, it is probable that without a strong and consistent
commitment from senior management to effective management,
without a serious and continuous commitment of resources and
without competent financial management oversight and
monitoring, the deficiencies will not be corrected in a timely
fashion.
prepared statement
Last but equally important, the audit revealed that as of
September 30 the National Service Trust had a projected surplus
of $196 million. Under the National Community Service Act as
amended this surplus can be used to provide additional
education benefits. Ms. Molnar is here to provide any
additional information on that matter, if we can, at this time.
And at this time I will be glad to answer any questions
that you or Senator Mikulski has of me.
[The statement follows:]
Prepared Statement of Luise S. Jordan
Mr. Chairman and members of the subcommittee, I appreciate the
opportunity to be here today to provide information related to the
Corporation's financial management.
OIG first reported financial management issues in an Auditability
Assessment of the Corporation issued in March 1996. The assessment
resulted from our attempts to audit the Corporation's financial
statements as required by the Government Corporation Control Act.
During an initial survey of the Corporation's internal controls, we
found many material weaknesses in the Corporation's records and
accounting systems. As a result, we concluded that the Corporation's
financial statements were unauditable. Although the Corporation has
taken steps to achieve financial accountability, progress to correct
the deficiencies has been slow. Last year, for the first time, we were
able to audit the Corporation's balance sheet.
Presently, we are in the final phases of a full-scope audit of the
Corporation's fiscal year 1998 financial statements. The audit is being
performed by KPMG under contract to OIG. Karyn Molnar, the audit
partner responsible for the work, is accompanying me today.
We planned and conducted the audit in accordance with generally
accepted government auditing standards, with an intended reporting
deadline of March 31, 1999. Because of the known financial management
weaknesses that we have previously reported, our audit required
extensive, costly, and time-consuming audit procedures that considered
the material weaknesses and other pervasive deficiencies in the
Corporation's operations and systems.
Today, however, I am reporting that completion of the audit is
delayed. The delay is due primarily to my decision to allow the
Corporation to revise its estimates of grant advances and payables. The
balances related to grants are among the most significant items on the
Corporation's financial statements. Audit work to date has revealed
that the Corporation's procedures to estimate grant advances and
payables are flawed. Because the estimates are flawed, the Corporation
has requested additional time to correct the information by using
``actual'' information from grantee financial status reports (FSRs).
The Corporation's work is made even more extensive because not all of
the FSRs have not been entered into the Corporation's financial systems
on a timely basis.
The financial statement audit has revealed material weaknesses in
eight areas of the Corporation's financial operations, including
material weaknesses in two new areas, specifically--
General Control Environment.--The Corporation's general control
environment is weak and is not conducive to ensuring that an effective
system of internal control is maintained to safeguard assets, produce
reliable financial reports, and comply with applicable laws and
regulations. The control environment sets the tone of an organization
and, thereby, influences the level of control consciousness and
provides the discipline and structure of an organization. Control
environment factors include commitment to competence, management
philosophy and operating style, organizational structure, and
assignment of authority and responsibility.
That the Corporation lacks an effective management control
environment is evidenced by the volume of material weaknesses and other
reportable conditions identified in the audit and the number that have
remained uncorrected over the years. Without a strong control
environment, control weaknesses will continue to permeate the
organization, thus increasing risks and inefficiencies and reducing the
reliability of financial information.
Financial Management and Reporting.--The Corporation does not have
a Chief Financial Officer or other strong financial management
personnel in place to provide the leadership and oversight necessary
for effective quality control of accounting and financial reporting
activities. The Corporation lacks an effective quality control process
to ensure that significant errors and omissions are identified and
corrected in its financial information. Throughout the audit, the
auditors found numerous errors in the Corporation's draft statements
and supporting documentation, many of which would have been caught and
corrected if an effective process was in place, and competent financial
managers had adequately reviewed the information.
Grants Management.--Adequate procedures for monitoring grantees'
financial activity and compliance with laws and regulations are not in
place; expired grants are not closed out on a timely basis; and a
reliable method for estimating expenses incurred by grantees, and
related amounts advanced or payable to grantees, has not been
established.
OIG has repeatedly reported deficiencies related to grants
oversight and monitoring in individual audit reports and in our
Semiannual reports. For example, over the past four years, our audits
of 73 of the Corporation's grantees reported that over one-third have
experienced problems with their FSRs, which provide critical
information on grant expenditures. The audits also disclosed that more
than half of these grantees had accounting systems and management
controls that were inadequate to report grant expenditures and to
safeguard Federal funds, and that about half (47 percent) had
inadequate time-keeping systems. We also reported that about one-third
of these grantees failed to provide adequate oversight of their
subrecipients. OIG investigations have also dealt with allegations of
irregularities at grantees, some of which may have been prevented by
better grantee oversight. As a result of these and other conditions we
have questioned more than $6 million (6 percent of the funds awarded to
these grantees).
In one recent audit, we reported on a grantee that had experienced
severe financial problems at one of its operating sites. Although an
OIG investigation had revealed evidence that the site's Executive
Director had misapplied funds, the cognizant United States Attorney
declined to prosecute. The Internal Revenue Service, however, seized
and sold the site's assets to satisfy delinquent taxes, and the
operating site closed. When this occurred, high-level Corporation
management came to my office to express their consternation as to how
this could have happened just months after awarding the grant. I
responded that my Office had reported to the Corporation in March 1996
that it did not perform or require effective reviews of grantee
financial systems or controls prior to grant awards.
Later, during fiscal year 1998, at the request of the then Chief
Operating Officer, we audited both the grantee and the Corporation's
oversight of the grant. The grant audit revealed numerous compliance
and internal control weaknesses still existed at the grantee. We
questioned more than 12 percent of the grantee's claimed costs.
The review of the Corporation's oversight found that the
Corporation had failed to adequately monitor the grant--even though it
was aware of the grantee's history. Site visits performed by the
Corporation had focused largely on programmatic, rather than financial
matters. We also reported that the Corporation failed to monitor and
detect that the grantee drew down funds in excess of its needs and that
the grantee had not submitted required information such as evaluation
reports, rosters of its AmeriCorps Members, and its required financial
audit reports, to the Corporation on a timely basis. The Corporation
continues to fund this grantee.
Issues related to grantee financial information have been reported
in a number of OIG audit reports and Semiannual Reports to the
Congress. We recently reported that the Corporation had yet to close
out grants made by its predecessor, the former Commission on National
Service, although grant performance periods expired several years ago.
It is my understanding that, few, if any, of the Commission or
AmeriCorps grants have been closed. Closing out grants is necessary to
determine the actual spending so that the accounting records and
related budgetary information can be properly adjusted.
In September 1998, we issued our report on the audit of the
Corporation's fiscal year 1997 balance sheet. In that report we
described the need for the Corporation to ensure timely processing of
its FSRs and to develop an appropriate methodology to estimate grant
advances and payables. We clearly stated that deficiencies in these
processes were a major factor in our inability to issue a ``clean''
opinion on the balance sheet. We recommended that Corporation take
action to correct these deficiencies. As I mentioned earlier, the
Corporation's failure to take action is the major cause of the delay in
completing our audit of the Corporation's fiscal year 1998 financial
statements.
Financial Systems.--The Corporation's general ledger system is not
adequate to support its financial information needs, including funds
control, or to facilitate the preparation of annual financial
statements. The Corporation plans to replace its general ledger
accounting system during this fiscal year. As we have previously
reported, it must do so because the current system is not Y2K
compliant. We have also called your attention to the high risk related
to the tight time frames in which the new system is scheduled to be
implemented. To the best of our knowledge, the Corporation has not
identified any contingency plan to support its financial operations
should implementation fail or be delayed.
National Service Trust.--Procedures to obtain AmeriCorps membership
roster information prepared by program sites and to reconcile this data
to corresponding information on file at the Corporation are
ineffective. This information is necessary to support the payment of
education awards and to validate the accuracy and completeness of the
data supporting the calculation of the service award liability.
Fund Balance with Treasury.--The reconciliation of Corporation
records to those maintained by Treasury is not performed in an
effective manner and does not adequately support the separate balances
related to Appropriations, Gift, and Trust accounts. Not reconciling
fund balances could result in material misstatements in the financial
statements and increases the risk that data in the general ledger is
inaccurate or incomplete. In addition, the absence of effective
procedures increases the risk that a misappropriation of cash could
remain undetected, and hinders effective cash management.
Net Position.--Adequate procedures for ensuring accurate and timely
deobligation of funds for undelivered orders are not in place, and
changes in the components of net position are not reviewed for
propriety on a timely basis. As a result, the Corporation reports
obligations that will never be expended. Controls have not been
established to ensure compliance with appropriation laws.
Revenue from Reimbursable Agreements.--Procedures are not in place
to ensure revenue related to offsetting collections from reimbursable
agreements is fairly stated and properly recorded in the general ledger
accounts.
As a result of these eight conditions, the Corporation cannot
provide reasonable assurance that its assets are properly safeguarded,
its financial information (including budgetary information) is
accurate, and that it complies with laws and regulations.
Most of these conditions have been reported as material weaknesses
since we began auditing the Corporation. In response, the Corporation
has initiated various action plans over the past several years.
However, as the above listing indicates, much remains to be done.
The Corporation's most recent Action Plan, issued December 21,
1998, incorporates many of the recommendations that we have made over
the years to correct these conditions. Issued in response to a
Conference Committee report, it is by far, the Corporation's most
ambitious plan to date.
Because the latest Action Plan has only been in effect for two
months, it is too early to know when or whether the Corporation will
correct these serious deficiencies. However, based on the Corporation's
history, it is clear that without a serious and continuous commitment
of resources, and competent financial management oversight and
monitoring, the deficiencies will not be corrected in a timely and
effective manner.
In addition to weaknesses in the Corporation's financial
operations, the audit work completed to date has revealed two issues
relating to compliance with laws and regulations.
First, the Corporation is subject to the reporting requirements of
the Government Corporation Control Act, as amended. This Act requires
Corporation management to provide an annual statement on its internal
accounting and administrative controls consistent with the requirements
of the Federal Managers' Financial Integrity Act--FMFIA. The
Corporation recently made its first attempt at a Corporation-wide
assessment. However, the Corporation has yet to establish an effective
risk-based assessment program. The Corporation's Action Plan indicates
that by March 31, 1999, it will establish a formal management control
plan.
Second, the Corporation has not submitted its annual management
report in a timely fashion and apparently will not meet the deadline
this year. The Corporation is required by law to submit an annual
management report 180 days after the end of its fiscal year. Its fiscal
year 1998 report is due March 31, 1999. However, the Corporation's
Action Plan indicates that it will not submit the report until April
30, 1999.
Equally important, the audit provided another benefit to the
Corporation. Our procedures revealed that, as of September 30, 1998,
the National Service Trust has a projected surplus of about $196
million. The auditors performed extensive analytical procedures on the
actual usage of education awards and determined that the Trust's
liabilities totaled about $161 million, which is about $100 million
less than the Corporation originally estimated. At September 30, 1998,
the Corporation had $357 million in Trust investments to fund this
liability, resulting in the projected $196 million surplus. Under the
National and Community Service Act, as amended, this excess can only be
used by the Corporation to fund education benefits, including payment
of all or part of the attendance at an institution, repayment of
student loans, certain student loan interest, and payment of expenses
for approved school-to-work programs. The Corporation has requested
that $93 million be appropriated to the Fund in fiscal year 2000.
Mr. Chairman, this concludes my prepared statement. I will be
pleased to answer any questions you or members of the subcommittee
might have.
Senator Bond. Ms. Molnar, would you care to--do you have
any brief comments you wanted to make in addition to what was
said?
Ms. Molnar. No, I do not, Senator Bond. I will be happy to
answer any questions you have.
Senator Bond. I have had a little experience as an auditor.
It did not really affect me that much and I did not learn that
much but I do understand some of audit speak. But let me try to
make this a little clearer.
You talk about, I guess, your major finding is a lack of
control at the top. For those of us who monthly fight the
battle of the checkbooks--and I would have to say that in the
last column I always get the cents mixed up, and I miss
agreeing with the bank by a couple of dollars at the end of the
month--now, are we talking about problems that are way over in
the right-hand column, in the small figures? Or are you saying
that the checks--some of the checks are not entered into the
book, some of the bills are being paid twice? What, in layman's
terms, what is the impact of what you say is this lack of
control, and how serious is it?
Ms. Jordan. The immediate impact on the financial
statements has been adjustments in the millions of dollars. For
example, when we held open for adjustment on the estimates of
grants, advances and payables, the adjustments in the first
round exceeded $40 million.
The adjustments to the other accounts ranged from $5
million, $10 million, in that type of range. Cash is the one
that you refer to when you talk about the cents being different
from the bank.
There were differences from the Treasury records that
exceeded about $2 million.
Ms. Molnar. $2.4 million.
Ms. Jordan. That is a significant difference for the
Corporation, which is a small agency. More importantly, those
differences are not reconciled on the appropriation level, on
the gift account level or on the trust fund level. They are not
tracked on a monthly basis. That increases the risk of fraud.
Senator Bond. What is the risk of fraud? Is this a
situation where somebody could be absconding with funds or mis-
billing or committing fraud on the Corporation? What is the
extent of the exposure? Are you talking about mis-accounting?
What is the impact on the Corporation and on the taxpayers'
dollars?
Ms. Jordan. First of all, we do find fraud and most
recently the court sent an executive director at one of our
grantees to jail because of the fraud we found.
Controls are designed to reduce risk and prevent or detect
errors or irregularities. The Corporation's controls are so
weak that they do not effectively detect. My investigators
refer to the Corporation as a target-rich environment.
Senator Bond. I think I understand that.
Ms. Molnar would you explain the discovery in your analysis
of the surplus of $196 million in the trust fund account?
Ms. Molnar. Certainly. The analysis that we performed on
the trust fund liability, which is what we were talking about,
what you make reference to, is the fact that members do earn
certain awards based on the service that they have provided.
And until recently the Corporation has not had sufficient
historical experience to actually figure out how many members
will use their awards over the lifetime that they are available
to be used.
However, it is reasonable to expect that not everyone will
use the awards that they have earned and that some of them will
expire before the end of the 7-year period. But based on the
information that has now been available in doing some cash flow
modeling, we were able to determine that of those members who
had earned awards and those members that are still earning
awards, it is likely that only about 80 percent of those
amounts will ultimately be used, even though we have not
reached the end of a 7-year period.
So based on those analyses and using statistical models, we
computed a new amount based on that information and compared it
to what the Corporation had recorded using a very conservative
method, as you heard, expecting everyone to use their award.
And the difference was approximately $100 million and that is
what you have been referring to as a surplus.
That amount cannot be used just for anything. It must be
used for educational awards. And it is, therefore, available to
both take care of any unexpected use and also to fund other
awards.
Senator Bond. Let me be clear on this. Taking a very
conservative approach, if you had a program which potentially
had $500 billion that could be spent, and you know from
experience that 22 percent of it is not being used and you have
a broad enough spectrum to make that a sound projection, the
most conservative approach would be to say that you need to
keep all $500 million even though you know from past experience
that 22 percent will not be used at the end of the day.
Do I understand you to say that based on experience that
you believe is adequate, that $110 million would be surplus,
because with only 78 percent being used, to the $500 million--
if my math is correct--$110 million can reliably be predicted
not to be used? Is that a fair assessment?
Ms. Molnar. That is a fair assessment. And also, I guess,
to expand on that a little bit, the trust fund itself, the
money that is in there, the investments that are funding the
trust fund are also earning interest that is also put into the
trust fund. And that has not been taken into consideration in
determining what the ultimate outflow or the availability is
going to be in the most conservative approach.
Senator Bond. Did you take into account the fact that all
of a sudden people may get religion or perhaps more accurately
may get education enthusiasm at the end of the 7 years and come
running back in and say, whoops, before this expires, I want to
get my education?
Ms. Molnar. We made some assumptions of a certain
percentage of youths every year until the entire 7 years is
over. But we did not take into account the fact that everyone
who had not used it would ultimately decide in the last hour,
oh, my God, I have got to use this money. That just is not a
reasonable assumption.
Senator Bond. Senator Mikulski.
Senator Mikulski. Thank you very much, Mr. Chairman. And
really I am a very strong supporter of the IG's office not only
to detect, as you said, mismanagement, but it often has
provided very important managerial advice to the agency in
which the IG functions, so that they could better improve their
both management and fiscal accountability so we can do the
mission. Accountability is really mission. And so we thank you.
In terms of the use of the educational grant, I note that--
I think there is a lot of lessons yet to be learned but I am
going to come back to my question. What we see in VA now with
the new kind of group coming out, that often young people do
not take advantage of their educational grant until they gain a
little bit more civilian insights into their life, which is
usually now in their late twenties, and that is one of the
reasons why I wanted the VA educational benefit to be used for
lifetime earning. I am not advocating this here. But I think we
will have a lot of lessons learned as we move along.
Senator Mikulski. Ms. Molnar, I want to ask you a question
because we then go to this. Obviously a great audit was done
here. My question is does KPMG have a lot of experience in
auditing nonprofits and community-based corporations?
Ms. Molnar. Yes, we do, across the country.
Senator Mikulski. That gives me confidence because this is
not General Motors here. Nonprofits, as you know, are often big
on idealism and they keep--and particularly at a very
community, neighborhood-based level where I worked for so many
years--essentially it is what I call the cigar box mentality.
They just put everything in a box and say I will get to it
because they were out either organizing or helping build the
housing.
Do you feel that part of the local accounting problems are
based on those kinds of community groups that do a great job in
the community, but do a terrible job or mediocre job in keeping
their records? Or do you think this is far more systemic? You
know the kind of group I am talking about.
Ms. Molnar. I believe your assessment is probably correct
in that there are a number of grantees and subgrantees that
were referred to earlier that do concentrate more on mission,
in getting the money out and not so much on administration and
adhering to the guidelines that have been provided to them for
doing things right. However, I do not think that that absolves
them from complying with laws and regulations and for
submitting their financial activity reports on time. If they do
not, they need to accept the consequences, which may be that
their funding will dry up.
Senator Mikulski. I appreciate that, Ms. Molnar. It is by
way of a temporary explanation. We have also within our
portfolio here something called the Neighborhood Reinvestment
Corporation which really teaches community groups how to both
do a job in the community and be accountable for the funds they
receive, which is often the groundwork for getting more funds
to do even more, better work in the community.
Do you think, as one of the mandated criteria for the
awarding of a grant, is that a state commission have criteria
in place that anyone who gets a grant from the National Service
Corporation have sound accounting as part of their ability to
get a grant?
Ms. Molnar. Yes, I do. And I believe that those
requirements are probably already in their grant agreements.
Senator Mikulski. I think we should maybe take a look at
that and then ensure that that really be an oversight, I mean,
really a vigorous oversight because it is what I would say to
community groups. You have got to get beyond the cigar box,
because the more you can show wise stewardship over the funds,
the more likely others will come in, like foundations, et
cetera, whether it is literacy or low-income housing services
or whatever.
Let us go right to the audit. This is under--this checklist
that you have here for us, it does not look like progress has
been made. I want to clarify the chart. The chart that you have
in your testimony, Ms. Jordan, says that 1994 to 1996 it was
unauditable. Then when you move on you have materially weak,
those little red checks and then you have four areas of
reportable conditions. But then when we go over to 1998 the
four reportables drop to two and the red checks increased,
which were meaning materially weak.
Are we making steady progress or are we losing ground here?
If you are making progress, that is one track we are on. I am
just looking at this chart.
Ms. Jordan. As I said, progress has been slow. It has not
always been steady. Some things that could have easily been
fixed have not been fixed. Other things have worsened. The
Corporation has become auditable because it does a better job
in retaining records. We now can audit the Corporation because
of that improvement. Improvements have occurred but not always
evenly. I hope that this answers your question.
However, one other question that has come up. There are
nine conditions on that chart. The ninth area of weakness is
procurement and results not from the KPMG audit but an audit
that we did recently, which revealed material weaknesses in the
Corporation's procurement activities.
Senator Mikulski. I know our time is moving along and we
have to go to the CDFI. First of all, I want to thank you for
your report. And the question I asked you, Ms. Molnar, was more
of a question of background and never a question of competency,
and we thank you for your work.
I find this report quite troubling. And I find it troubling
in the sense--because it talks about leadership, and leadership
is not only management but it is about creating a state of
mind. And, therefore, if the state of mind is not present about
stewardship, then that goes to the state commissions as well as
then to local grantees. And I think that this will have to be
addressed in a different forum about this.
But you have given us excellent MRI here. I am looking at
the epidemiology--you can see I am on Dr. Frisk's health
committee. We are looking at the service that is rendered and
what needs to be done here. So I am going to thank both of you.
Senator Bond. Thank you, Senator. Thank you very much, Mrs.
Jordan and Mrs. Molnar. Senator Wofford, do you have a brief
comment on the pathologist's report?
Mr. Wofford. Yes. Mr. Chairman, just a final brief word. We
will take advantage of your offer to clarify in the record.
Senator Bond. I appreciate that.
Mr. Wofford. Our main response is going to be in action and
we trust you are going to see it. We have a strong commitment
to an all-out effort. My team and I have never worked as hard
on anything, certainly in my life. And you are going to see
continued progress.
Additional committee questions
Senator Bond. Thank you. I know that we do want to give you
that opportunity and we will look forward to hearing your
response on that.
[The following questions were not asked at the hearing, but
were submitted to the Corporation for response subsequent to
the hearing:]
Question Submitted by Senator Bond
Question. For fiscal year 2000, the Corporation is requesting $93
million for the National Service Trust account. The IG stated in her
testimony that as of September 30, 1998 the Trust's liabilities totaled
about $161 million but that the Corporation actually had $357 million
in Trust investments to fund this liability. As a result, the trust has
a projected surplus of about $196 million according to the auditors.
This raises questions about the need for the $93 million request. Do
you agree with the auditor's assessment? When were you first aware of
any surplus in the Trust's account? Has the surplus been factored into
your budget requests? If so, when did you first begin factoring in this
surplus? Is the interest earned on the Trust investments factored into
your budgeting estimate? How many members could be served with this
surplus amount? How many members are you projecting to serve with the
$93 million you requested for fiscal year 2000?
Answer. The Trust liability reported in the financial statement as
of September 30, 1998 is an incomplete picture of the full estimated
liability. The liability reported in the financial statement does not
include estimates for members who started service during the summer and
for members whose service, funded with fiscal year 1998 appropriations,
will start on or after October 1. These methodology used by the
auditors to calculate the liability estimate for the purposes of the
financial statements does not include these two factors; thus, the
estimated liability is far greater than reported in the statement and
the reserve maintained in the Trust is far less than described in the
question. The methodology used to calculate the budget request
considers the two factors referenced above as well as estimates
education award utilization patterns. The Corporation does not believe
there is an inappropriately large surplus in the National Service
Trust. Rather, the amounts in the Trust represent a prudent reserve
designed to ensure that all AmeriCorps members who have earned an
educational award will actually receive them. The following fact sheet
provides detailed information concerning the Trust, its funding
history, and our estimates of the current liability.
national service trust allocation and use of education awards:
background information
The primary purpose of the National Service Trust is to serve as a
secure financial repository in the Treasury for AmeriCorps education
awards to be set aside for eligible participants in national service
programs. The Trust makes education awards available to each individual
who successfully completes a term of service in an approved national
service position.
Funds from the Trust may be expended for the purpose of providing
an education award to a national service member who has earned such an
award, and must always be paid directly to the qualified institution
(college, university or other approved educational institution or a
lending institution holding an existing qualified student loan)
designated by the participant. Disbursements from the Trust may also be
used to meet certain interest expenses that may accrue when an
individual has obtained forbearance in the repayment of a qualified
student loan during his or her term of service, and for other purposes
specifically designated in appropriations statutes (scholarships for
high school students).
The amount of the education award for completing a full-time term
of service is $4,725. By law, a member has up to seven years to use an
education award that he or she has earned. That seven-year period
expires for the first group of AmeriCorps members in 2002.
Operationally, each year the Corporation allocates a specific
number of AmeriCorps members to grantees based in part on the amounts
available in the National Service Trust for education awards, funds
appropriated by Congress for AmeriCorps grants, and the quality of
applications received for funding. In their grant document, each
grantee receives authorization for a certain number of full and part-
time AmeriCorps members. These numbers represent ceilings beyond which
a grantee cannot enroll members.
If a program does not actually enroll a member, then grant funds
may not be spent for the direct costs of that member and the slot held
for the education award is available for future use.
Under AmeriCorps*VISTA and AmeriCorps*NCCC, slots are reserved in
the Trust based on the size of the program budget and the number of
members serving in a given year.
Since the very beginning of the National Service Trust, the
Corporation's approach to managing was to be conservative to ensure we
would have funds to honor all awards earned. The Corporation's
authorizing legislation required an amount to be deposited equivalent
to the value of a full-time national service educational award times
the total number of approved national service positions. The
legislation also restricts the Corporation from approving national
service positions under this subtitle for a fiscal year in excess of
the number of such positions for which the Corporation has sufficient
funds available in the National Service Trust for that fiscal year.
(See sections 121(c) and 129(f) of the National and Community Service
Act of 1990, as amended.)
In general, in fiscal years 1994 and 1995 based on budgetary
requests, the Congress appropriated sufficient funds to pay members
under the assumption that all members would enroll in full-time service
positions, complete service, and then fully use the education award.
In fiscal year 1996, the amounts appropriated were reduced from
$115 million to $56 million, based on the consideration that not all
members would complete service and that a reserve had been created in
the first two years. Budget justifications provided to the Congress
since then identified these factors, as well as the interest earned on
Trust Fund investments, as having been considered in developing the
Administration's budget requests.
The Corporation has followed this approach in the development of
the fiscal year 2000 budget. Our request for the Trust is $93 million.
If everyone earning an award based on the fiscal year 2000 budget was
to use the entire full or part-time award, the amount of budget
authority needed to fund these awards (including the President's
Student Service Scholarship Program) would be $167 million. This amount
is not required because not all members enrolling will earn and use an
award, and because of funds that remain available at the start of the
year.
In developing budgetary requirements, attention must also be paid
to the need for a prudent reserve and the avoidance of major
fluctuations in annual budget requirements. A prudent reserve
guarantees that the Trust can adjust to changes in annual program
funding levels, and changes in usage patterns, without having to
present the Congress with a request for immediate funding needs or
annual fluctuations in budget requirements. Historically, Congress has
been critical of agencies that present major annual budget fluctuations
in requirements based on changing estimates. Quite frankly, it is
extremely difficult for the Congress to consider budgetary requests
that could fluctuate significantly, given the appropriations process
and spending caps.
The budget estimates reflect, by necessity, insufficient experience
with patterns of usage of the education award. The first class of Trust
enrollees has yet to exhaust its 7 year availability period for using
the award. We will not have a refined estimate until several classes of
members have exhausted the availability period. Moreover, modest
adjustments in assumptions over a multi-year period have a significant
impact on estimated requirements.
Finally, there are several major difficulties with using the
liability estimate alone, as developed by the auditors in preparing the
financial statements, for considering Trust Fund requirements in the
2000 budget. Specifically, the liability estimate, being by design a
snapshot as of September 30, 1998, does not reflect:
1. Activity after September 30, 1998 for some of the members
enrolled by that date.--The liability estimate in the financial
statements does not include amounts for members who had not completed
15 percent of their service by September 30, 1998. The amount required
for these members is approximately $36 million.
2. Enrollments after September 30, 1998.--The liability estimate in
the financial statements does not include amounts for any members
projected to enroll after that date and who are supported with fiscal
year 1998 program funds, even though the program budgets and the Trust
appropriation for fiscal year 1998 specifically support such members in
this forward funded program. The amount is approximately $45 million.
3. The fiscal year 1999 appropriation and projected program
activity.--The Corporation's appropriation is less than the amount
required to support the Trust activity in that year. In fact, under the
assumption that all members earning an award would fully use it, the
budget is $64 million less than Trust requirements for that year.
Assuming that members use 78 percent of the amounts earned, our current
estimate of Trust usage, the budget is $37 million less than Trust
requirements for that year.
4. The fiscal year 2000 budget and projected program activity.--As
mentioned above, if everyone earning an award based on the fiscal year
2000 budget was to use the entire award, the amount of budget authority
needed to fund these awards (including the President's Student Service
Scholarship Program) would be $167 million, or $74 million more than
the request. Assuming that members use 78 percent of the amounts
earned, the budget is $41 million less than Trust requirements for that
year.
Further Background Information on Members' Use of the Education
Award:
Those who served in program year 1994-95 had used 58 percent of the
amount they earned by the end of fiscal year 1998 and have used about
61 percent as of March of this year. A major unknown is whether there
will be a significant increase in the use of the award by the first
year class prior to the end of the seven-year period. Some argue that
many members will use the award before it expires; others argue that
former members are not likely to go to school several years after
leaving AmeriCorps. Only the experience of the next several years will
fully resolve this issue.
Before this year, the Corporation did not have enough data to
predict a percentage of awards earned that would not be used in full by
the end of the seven-year period of availability. We predict that about
78 percent of these funds will be used at the end of the seven-year
period; however, for the reasons stated above this could increase. In
formulating the fiscal year 2000 budget, we specifically estimated that
22 percent of the awards earned would not be used.
Question. I understand that the Corporation's current financial
management system is not Y2K compliant. Under the Corporation's Action
Plan, you plan to install a new financial management system, called
``Momentum,'' by the end of June 1999. However, some of the interim
deadlines in the revised Action Plan have slipped. Are you confident
that the new financial management system will be implemented on time?
Does the Corporation have a contingency plan in case the new system
does not operate correctly or its implementation is delayed?
Answer. The Corporation continues to make good progress toward
upgrading to the new core financial management system, ``Momentum.''
The Department of Interior and AMS have been working closely with the
Corporation's new financial management system team. There have been
some adjustments to the original schedule and these are reported in the
Corporation's bimonthly Action Plan, however, we remain confident that
the new system will be implemented on time. The Corporation plans to go
on-line with the new core system in July 1999.
We do have a contingency plan. Should there be any unforeseen
delays in Momentum implementation, the Corporation's contingency plan
is to continue to operate the current accounting system, Federal
Success, through September 30, 1999, and start the new fiscal year,
October 1, by manually entering summary data into Momentum. Momentum,
itself, is a certified Federal system. The basic workings of the
software have been tested and meet Federal standards. The uncertainty
is not Momentum software, but rather the Corporation's ability to
convert the data from the old system into the new system. Our
contingency plan is based on using the Momentum software.
Question. I appreciate the work the Corporation has done on its
performance plans in response to the Results Act. In your written
statement, you indicated that the annual performance indicators measure
aspects of program performance that are in the direct control of the
Corporation and that they would be useful oversight and management of
programs. Please explain in more detail how these indicators are being
used for oversight and management.
Answer. The Corporation's 1999 and 2000 performance measures are
used in several ways and at many levels of activity by managers of
national service programs. AmeriCorps*State and National enrollment
data, as an important example, is used regularly by the Office of
Recruitment to measure the results of targeted recruitment efforts and
to identify areas for more emphasis. The Trust Office uses the
enrollment data as part of its management of the rapidly growing Trust
obligations. As our grantees come on-line this year with web-based
reporting of enrollments and terminations, we will be able to use these
data to respond more quickly to grantees' needs for training and
technical assistance in areas like recruitment and member retention.
In Learn and Serve America, customer satisfaction surveys are being
designed now and data will be collected in the 4th quarter. Among Learn
and Serve's primary customers are major educational institutions and
organizations that are grantees and subgrantees, such as state
education agencies, colleges and universities, and State Commissions on
National Service. Our surveys will be asking representatives of these
institutions how well their needs for promoting service-learning are
enhanced by our grant awards and what we can do in the future to make
our partnership a more productive one. We will be using the feedback
from these surveys to improve the quality of our support for the
national service-learning community.
The National Senior Service Corps is using performance measurement
to track implementation of its important Programming for Impact
initiative. Senior Corps program officers and Corporation State Office
staff, for example, are tracking the rate at which local programs shift
to outcome-based assignments. Each state has target levels that have
been set for this year, and State Offices are monitoring this closely,
making regular reports to the national office.
Question. I am a great believer in devolving program
responsibilities to the local level. Under some of your programs, the
States have a significant role in administering programs. Last year,
Mr. Wofford, you stated that devolving responsibility to the State
level has been a major emphasis of the Corporation and may be so even
more in the future. Could you tell us in what specific areas the
Corporation has increased roles and responsibilities of the States over
the past year and what your plans are in the upcoming year?
Answer. The Corporation continues to work with states on increasing
their roles and responsibilities. Examples and major changes are
described below.
Grant Application Review and Recommendation Process.--The
Corporation used to conduct a peer review consisting of panels of
outside experts for all new applications followed by a full staff
review. Staff then recommended which programs to fund. Since 1997 the
Corporation no longer provides a peer review or full staff review of
new applications that states plan to fund with their formula grants.
States perform the peer and staff review, and the Corporation accepts
the states' funding recommendations. Corporation staff checks
applications for financial and programmatic compliance issues and until
1999 provided states with documentation on both compliance and
continuous improvement suggestions. In 1999 staff will simply review
states' formula applications to check for compliance issues which will
be noted and handled during negotiations with states. Corporation staff
will no longer provide states with continuous improvement suggestions.
Additionally, on a trial basis in 1999 the Corporation did not provide
a peer review of new applications that states submitted for national
competitive funds and instead relied on the states' peer review
process.
For fiscal year 2000 the Corporation is discussing the possibility
of further devolution in which states would submit applications chosen
for formula funding for the record but there would be no Corporation
staff review. Instead states would certify that they have reviewed all
applications for financial and programmatic compliance and will resolve
all issues with programs before awarding funds.
Statewide Initiatives.--Last year the Corporation gave states the
option of submitting individual America Reads proposals or a statewide
America Reads initiative. The statewide initiatives provided greater
flexibility. They also allowed states to submit a plan delineating
statewide needs, America Reads activities and types of partners states
would engage rather than requiring states to run a competition and
select programs ahead of time. State commissions responded favorably to
this option. In 1999 the Corporation again offered the option of
America Reads statewide initiatives and added a Governor's Initiative
competition. This new statewide initiative enables states to develop a
plan that is tied to a governor's priority. Funds requested from the
Corporation must be related to a larger plan and effort by the state
that would benefit by the inclusion of national service. The Governor's
Initiative plan will include a substantial financial commitment from
the state beyond the statutory matching fund requirements for
AmeriCorps programs. Many states are pleased with this new initiative
because it enables them to become partners in large statewide efforts
and provides a great deal of flexibility.
Program Development Assistance and Training Funds.--The Corporation
has reduced the budget for national training and technical assistance
providers and has increased the program development assistance and
training funds available to states by 50 percent. In addition, by
giving states greater flexibility in how these funds can be used,
commissions are now able to provide training that fosters collaboration
among programs in various streams of national service.
Reporting Requirements and Site Visits.--The Corporation has been
in discussion with states for some time concerning ways to reduce
reporting requirements. Instead of quarterly progress reports states
now submit reports three times a year. The Corporation is exploring the
possibility of reducing this further and requiring semi-annual progress
and financial status reports from state commissions. The purpose and
number of program site visits has changed. Corporation staff visit far
less program sites than before and are more focused on evaluating the
performance of state commission staff's site visits.
Fixed Price Grants.--In 1999 the Corporation awarded fixed amount
grants to AmeriCorps Promise Fellow grantees. Using fixed amount
grants, the Corporation awards a fixed amount of funding per AmeriCorps
member and the grantee secures any additional financial support
necessary to carry out the program. These grants eliminate the need for
a detailed line item budget and various accounting and record keeping
procedures by programs as well as state commissions. Beginning in 1999
Education Awards Programs will also be issued fixed price grant awards.
Question. Literacy is a very important priority for me. This
subcommittee has provided funding for child literacy activities such as
the America Reads and other initiatives. Could you please give me a
status [report] on America Reads and other literacy efforts of this
Corporation and what sort of impact these initiatives are having on
child literacy rates?
Answer. National service is actively engaged in supporting literacy
programs across the country, an area that is of keen interest to this
Subcommittee.
Everywhere I go and talk with teachers, principals, and other
education professionals, they tell me how it is extremely important
that the entire community support efforts to teach young children to
read. Volunteers do not substitute for the teacher's responsibility to
teach a child to read. And, as first teachers, parents have a critical
role to assure success.
Most of what we do is to supplement the role of teachers by
providing additional one-to-one support for children, including after-
school, weekend, and summer programs. We are also heavily involved in
programs providing support to parents to make them effective first
teachers of children.
I'd like to stress six points about our role in this literacy
initiative, a goal shared by governors, school superintendents, and
employers across the country:
First, we have a long history in all of our programs--AmeriCorps,
Learn and Serve America, and the National Senior Service Corps--of
supporting local literacy efforts.
Second, we provide resources, mostly in the form of people, to
local programs. They determine the literacy approach, and we are there
to support it. In states as diverse as Rhode Island and Washington,
AmeriCorps, service-learning, and senior volunteers are supporting
statewide literacy efforts.
Third, we establish local relationships with programs that have
expertise in literacy. Examples include school systems, state education
agencies, Even Start programs, Head Start programs, volunteer literacy
organizations, citywide reading programs, and universities and
colleges. These entities have structured programs that make the best
use of national service and volunteers.
Fourth, we insist that all local programs provide quality training
for those working with children. And we encourage the training to be
done by experts--reading specialists, university professors, and
others.
Fifth, we have partnerships at the national level with key
education organizations, including the Department of Education.
Sixth, and finally, we believe in the bottom line--our efforts need
to be evaluated as to whether we are helping local literacy programs
meet an objective of having children read well and independently by the
end of the third grade. There is much evidence that this one-to-one
support for children, when it is well done, works. The recently
released study by the National Academy of Sciences, on the issue of
volunteer tutors, reached this conclusion: ``Volunteer tutors are
effective in reading to children, for giving children supervised
practice in oral reading, and for allowing opportunities for enriching
conversation.'' They also said the role of volunteers should not be
``to provide primary or remedial instruction.'' That is, of course, the
role of teachers.
As I indicated in my testimony and in response to other questions,
there is growing evidence of the effectiveness of these literacy
programs. And we are supporting a nationwide evaluation to determine
the effectiveness, in the aggregate, of national service efforts.
Question. In response to congressional concerns about the costs of
the Corporation's programs, the Corporation agreed to a number of cost-
cutting steps such as reducing average participant costs. For the
record, please give us a status and a description of the specific
actions the Corporation has taken to reduce per-participant costs.
Answer. Over the last several years, the Corporation has taken a
series of steps to reduce the per member costs in the AmeriCorps
program.
In 1996, the Corporation entered into an agreement with Senator
Grassley and others to reduce its average budgeted cost per AmeriCorps
member to $17,000 in fiscal year 1997, $16,000 in fiscal year 1998, and
$15,000 in fiscal year 1999. We are on target to achieve these goals.
Meeting them has required a series of actions. Beginning in fiscal
year 1996, AmeriCorps State and national grantees were informed that
the cost per member had to be reduced by at least 10 percent in
programs that averaged above $13,800 per member, excluding education
awards. Subsequently, average Corporation budgeted costs per member in
these grants was reduced to $11,750 in fiscal year 1997 and $11,250 in
fiscal years 1998 and 1999. Further, a maximum Corporation contribution
per project was set at $14,500.
Beginning in fiscal year 1996, no Corporation funds were to be
spent on the relocation of members under AmeriCorps grant programs.
This prohibition has remained in effect to the present time.
Grants to federal agencies were discontinued in program year 1996-
97.
Also since fiscal year 1996, certain items which were originally
required to be part of the budget were made optional, thereby providing
projects with greater flexibility to reduce budgets.
The education award only program, introduced in the fall of 1996,
has grown rapidly. Under this program, the Corporation provides the
education award and a modest amount, averaging less than $500, for
program support, while the project provides all other costs, including
members' living allowances. When originally designed, the Corporation
anticipated this program operating initially at a modest level of 2-
3,000 members annually. The Corporation has actually achieved 3-4 times
these levels in fiscal years 1997 and 1998, and expects continued high
levels of participation in fiscal year 1999.
Matching requirements were increased to from 25 percent to 33
percent for non-member costs.
Under the AmeriCorps*National Civilian Community Corps, specific
cost reductions have included the closing of a large campus in 1995; a
decrease in the member living allowance from $8,000 per annum in fiscal
year 1994 to $6,000 per annum in 1995 and finally to $4,000 per annum
in 1996 to date; and a reduction in staff from fiscal year 1995 to
fiscal year 1998 of some 38 percent.
Under AmeriCorps*VISTA, the Corporation has expanded its ``cost
share program,'' where the majority of the costs of supporting a member
is paid by non-Corporation sources.
Question. Have your cost-cutting actions had any impact on program
performance?
Answer. Many of these measures are intended to increase support
from state, local, and private sources, thereby decreasing the reliance
on the amount per member provided by the Corporation. In general, as
measured by the successes of efforts such as the education award
program, this strategy has been successful. In projects where the
mixture of support has changed to a reduced reliance on federal support
and a greater share of non-federal support, we don't believe there is a
negative effect on program performance. A recent review of the
education award program did identify, however, a number of areas for
improvement, and we intend to pursue such changes to assure program
quality.
In some instances, we have heard from projects that they are unable
to increase the amount of non-Corporation support and will need to drop
its AmeriCorps program. These organizations are typically smaller,
less-well financed, community-based entities. To date, these have been
relatively isolated cases; however, we intend to monitor this situation
carefully as the continued involvement of such organizations in
AmeriCorps is important to achieving its stated mission and goals.
Other measures have reduced the total amount of support per member
in a project. While some of these measures represent efficiencies
following an initial start-up period, there is also some evidence that
important support functions, such as training and evaluation, may
suffer a disproportionate share of reduced budgets. We also continue to
monitor this situation carefully, and are committed to assuring that
projects not sacrifice quality in a manner that will affect AmeriCorps'
ability to meet its long-term goals.
While the Corporation continues to advocate greater state, local,
and private support for AmeriCorps programs, there is also the reality
that there is a basic amount necessary to enable an individual to
provide a year of full-time service in a local community in a high
quality program that meets community needs.
Further, the National and Community Service Act sets forth a number
of different programs that are to be supported in the areas of
education, public safety, the environment, and health and other human
needs. These different program models of national service are
frequently delivered by varying types of local organizations, with
significant differences in capacity and financial resources. If
national service is to continue to be provided in a decentralized
manner through these wide varieties of local service agencies, reaching
out to community organizations, faith-based entities, and nonprofit
organizations with limited financial resources, then any funding
strategy must recognize the need for continuous, flexible support from
the Corporation.
Finally, we are initiating a study of this particular issue because
of its importance to AmeriCorps' mission and goals, and will report its
results to the Congress.
Question. The Corporation has requested about $11 million in fiscal
year 2000 to fund training and technical assistance. I understand that
most of the grantees have a fairly long-term relationship with the
Corporation. Given this long-term relationship, how long do you expect
the Corporation to continue funding for training and technical
assistance? How does the Corporation determine which programs/grantees
are eligible for which training and technical assistance programs? Has
the Corporation performed any analysis of which programs (newer versus
older) are receiving which types and amounts of training and technical
assistance?
Answer. The Corporation's training and technical assistance system
was designed not only to help develop high quality programs but also to
help them maintain successful levels of operation. The commitment to
the continuous improvement of national service programs is a
fundamental concept of the Corporation's training and technical
assistance approach. We believe that there is always something new to
learn and room to improve; always new, higher levels of sophistication
of operation and effectiveness to achieve. The Corporation provides
training and technical assistance, customized to the experience and
sophistication of the grantee, to address both immediate and long-term
needs.
The reality of operating non-profit service organizations includes
managing high staff-turnover and addressing ever changing, compelling
community needs. So while the Corporation assists national service
organizations to develop and institutionalize good operational systems,
there are many times when we receive repeat calls from the same program
but different, new staff or to help address new problems. In addition,
the number of requests is directly related to the number of grantees.
Recent significant increases in national service programs have
therefore caused an increase in the number of requests for training and
technical assistance.
Training and Technical Assistance strives to keep grantees abreast
of tried and true effective practices, as well as the latest thinking,
technology, practices and applications in the national service field.
Corporation-provided training and technical assistance is relevant and
useful in addressing grantees' needs as evidenced by a recent customer
satisfaction survey where approximately 85 percent of the respondents
indicated satisfaction with these services. National service program
staff appreciate this resource and see the value of accessing it for
their varied professional development and continuous improvement needs.
Training and technical assistance--that is, ongoing or targeted
project support and member or staff training--is available to
Corporation programs at the local, state, regional and national levels.
All Corporation funded programs are eligible for this assistance.
Programs request assistance directly or are referred by their
respective administrative entities (e.g., State Commissions) or
Corporation staff based on needs of program. Most training and
technical assistance occurs at local or state levels.
We are committed to continuous program improvement. Programs'
strengths and weaknesses are identified at local and state levels
through program monitoring and formal and informal needs assessments.
In addition, the Corporation regularly conducts nationwide needs
assessments (in 1993, 1996, and 1999 respectively) which identify both
effective practices and training needs of grantees and sub-grantees,
especially those that cut across programs and states.
The Corporation requires all its training and technical assistance
providers to keep records of the number and types of programs to which
they provide services, as well as the type of service provided. As we
have reviewed both the performance of our providers and the progress of
our programs, we have found that programs' needs for technical
assistance are driven less by the length of time it has been in
operation than by the needs of the staff operating the program.
For example, the director of a program that has received an
AmeriCorps grant for three years may leave to lead another program. The
new program director may likely be hired from outside AmeriCorps,
changing the needs of this ``old'' program to be more like those of a
``new'' program.
We have found that centering our needs assessment on what is
required by a program director and staff for the success of their
program to be more useful for deciding how to deploy our training and
technical assistance resources. While evaluation of our training and
technical assistance services shows that 85 percent of recipients rate
the service as good or very good, we are also mindful that programs'
needs change with time, particularly as they branch out into new areas
of service, such as the America Reads initiative or the increased
emphasis on mentoring spurred by the Presidents' Summit and America's
Promise.
We are currently conducting our third national assessment of the
needs of our programs. We will likely find that much of the type of
assistance we've traditionally provided for newer programs will be
replaced by new needs arising from the changing needs of our program
directors, their staff and members.
Question. The Corporation noted in its budget submission that it
would ``share with the grantees the lessons learned across program for
rigorous monitoring and evaluation.'' What lessons have been learned
thus far from the monitoring effort? Please describe the Corporation's
proposed use of Evaluation funds in its budget submission? Does the
Corporation have a monitoring and evaluation office or division? Is
there a site visit schedule? Is there a site visit protocol? Are there
written site visit reports?
Answer. Funds will be used to support the independent evaluation of
National Service programs, to determine their impact on communities,
recipients of services, and members/participants providing the service.
The Corporation has an evaluation office within the Department of
Evaluation and Effective Practices. As the Aguirre evaluation study
reflects, much has been learned about the effects of AmeriCorps
programs. We are also developing a means of disseminating ``effective/
best'' practices to Corporation funded programs via electronic means
(e.g., websites, listserves), in addition to our traditional
distribution methods.
Monitoring of grantees and sub-grantees is conducted by AmeriCorps
program and grants staff as well as the State Commissions. The
Corporation's AmeriCorps*State/National, as well as the Grants
Management Office staff, have established protocols for conducting site
visits. A schedule is developed at the beginning of each fiscal year
based on an assessment of risk factors. The site visits focus on state
commissions and direct grantees (national non-profits, tribes and
territories) to review their fiscal and program management systems.
These grantees are responsible for conducting site visits to the
programs and operating sites. Each site visit, whether conducted by the
Corporation, state commission, or national non-profit organization, has
written documentation and results in a letter that is sent to the
grantee/sub-grantee.
Information gathered by the program staff during the monitoring
process is employed in a variety of ways to promote continued
improvement of grantee programs. Regular communication among grants and
program staff permits our staff to detect and react to patterns in
grantees' performance and/or needs. For example, when inadequacies in
certain record-keeping practices were raised regarding several
grantees, the monitoring protocol was modified to ensure that those
systems were scrutinized for all grantees, thereby detecting and
correcting any additional problems. When monitoring officers began to
report concerns about certain grantees' financial systems, a mandatory
financial management conference was held to ensure that grantees had
the proper information. In the first years of the Corporation,
information gained during monitoring was used to fine tune the grant
application process so as to encourage successful program designs. In
these ways, monitoring becomes part of the information loop that
permits the Corporation to serve as well as guide its grantees.
In addition, this spring and summer, we will be field testing a
Commission administrative performance standards review process which
will allow us to assess the overall administrative operation of State
Commissions.
______
Questions Submitted by Senator Shelby
Question. The Shelby County Commission and the Directors of the
Shelby County Retired and Senior Volunteer Program (RSVP) have
determined that the multi-county program that Positive Maturity now
sponsors is insufficient for serving the needs of Shelby County given
its population growth over the last decade. Given the surplus funds in
the National Service Trust and the additional funds the President is
requesting for the Corporation for National Service, how can you
justify not supporting an independent program for senior citizens of
Shelby County?
Answer. We appreciate Senator Shelby's continued interest in the
administration of the RSVP program in Shelby County.
It is important to note that the Corporation for National Service
does not believe there is a surplus in the National Service Trust.
Rather, the funds in the Trust represent an appropriate reserve
designed to ensure that AmeriCorps members who earn an education award
receive that award. Even if a surplus existed in the Trust, the
Corporation cannot transfer these funds to any other program, including
the RSVP program. Not only is the National Service Trust funded in a
different appropriations measure (the VA-HUD appropriations bill) than
the RSVP program (the Labor-HHS-Education appropriations bill), but
specific language contained in the VA-HUD appropriations bill prevents
the Corporation from transferring Trust funds to any other use, even
among the other national service programs funded by that appropriations
measure.
In addition, there have only been very limited funds for new RSVP
programs in recent years. New funds are being used by the Corporation
in accordance with the requirements of the Domestic Volunteer Service
Act and the appropriations bill for fiscal year 1999. The Act requires
the Corporation to direct one-third of any new funds to existing
programs for programs of national significance. The appropriations bill
also requires a 3 percent administrative cost increase before new
programs can be funded. As a result, there is only a limited amount of
funding for new programs.
The decision on the reach of a local RSVP service area has
purposefully been kept at the state and local level by the Corporation,
since we believe that individuals at that level are in closer touch
with the needs of the community. When the Corporation awards an RSVP
grant, it approves a service area proposed by the grantee in which
volunteers are recruited and placed. Subsequent changes in the service
area must be requested by the local sponsor and approved by the
Corporation. If Positive Maturity, Inc., the grantee in a five-county
area that includes Shelby County, wishes to establish a different
service area, our Alabama State Office will work closely with them to
assess its impact on existing project operations.
Should Positive Maturity decide to relinquish part of its grant in
order to establish an independent project in the approved service area,
we will conduct a competitive process for new sponsorship. Depending
upon an analysis of current population and RSVP funding allocations,
the Corporation designates the area(s) of competitive eligibility.
Currently, 55 percent of U.S. counties lack any access to the RSVP
program at all, and many of these counties have long expressed an
interest in competing for new resources as they become available. As a
result, the Corporation cannot justify establishing an independent
program in Shelby County, which is currently being served, except
through a competition available to these unserved areas as well.
In order to facilitate the best possible outcome for all involved,
the Corporation has taken the initiative of trying to encourage
discussions between all interested parties at the state and local
level. These parties are in the best position to make final decisions
about the best service delivery structure in Shelby County and the
surrounding areas in Alabama. We will continue to encourage that
process and to support the decision of the community on this subject.
______
Questions Submitted by Senator Kyl
Question. What is the total dollar value of all compensation and/or
benefits provided to a typical AmeriCorps volunteer in exchange for a
year of service--broken down by stipend, college tuition voucher or
credit, health insurance, child care, or any other applicable benefit?
What is the total average cost to taxpayers per volunteer?
Answer. Under the National and Community Service Act, local
programs have some flexibility in setting specific benefit levels for
AmeriCorps members. A full-time member typically receives:
--A stipend or living allowance set at levels minimally necessary to
permit full-time service; the typical amount this year is
$8,300, of which the Corporation pays no more than 85 percent
of that amount.
--Health care that averages between $900-$1,100 in annual costs,
although the 1998 average cost for AmeriCorps*State and
National is about $500 per member, because many members
maintain existing coverage at their own cost.
--Child care when necessary, which is needed by only a few members
and therefore averages about $200-300 across all members.
--An education award upon successful completion of service of $4,725.
The Corporation's average budgeted cost per full-time AmeriCorps
member, across all programs, is currently $15,300 for the program year
1998-99. This average includes all AmeriCorps programs, including
AmeriCorps*State, Ameri- Corps*National, AmeriCorps*Education Award,
AmeriCorps*VISTA, AmeriCorps*NCCC, and the new AmeriCorps*Promise
Fellows. By law and Corporation policy, organizations using AmeriCorps
members are expected to provide a significant portion of the program's
costs.
Question. In your written testimony, you discussed the literacy
programs supported by the Corporation and the results achieved for the
1996-1997 program year. You mentioned on page 11 that 67 percent of
youth tutored in grades 1-12 showed improvement. But these results were
apparently self-reported, and you cite only a few independent
evaluations of the progress that is actually being made. Has there been
any attempt to incorporate regular independent review of the
improvements made by students in each of the various programs in which
AmeriCorps participants are involved--in terms of test scores, grades,
or other measures of achievement?
Answer. Local projects define objectives and measure their progress
against those objectives. Many independent assessments are conducted of
local programs. In many literacy projects, this information is in fact
gathered by local school officials as part of their ongoing
responsibilities for providing education.
Summarizing this information across projects is extremely
difficult, however, because they have different objectives and use a
wide variety of techniques and measurement devices to assess progress.
For example, a simple measure such as improved attendance may or may
not be part of a program's objectives, and different school systems
have different techniques for measuring attendance. The Corporation
does not impose specific measures for all local literacy projects.
There have been many independent evaluations of effective tutoring
programs, and we have identified some of those in our written
testimony. We specifically promote the adoption of the effective
practices identified in the research by projects using AmeriCorps
members to help them achieve their objectives.
To obtain impact data across all projects, and as noted in response
to an earlier question, the Corporation is engaged in a national study
of literacy projects. The first phase of that study is a descriptive
analysis that will permit us to characterize how these programs'
practices compare to what is known about effective program models. Data
from this study will be available in Fall 1999. The second phase of the
study, to begin in September 1999, will collect outcome data on reading
ability in a rigorous design intended to permit us to make definitive
statements about the effects of Corporation-sponsored tutoring efforts.
Results from that phase of the research will be available late in 2000.
Question. In your testimony, you mention other activities in which
AmeriCorps participants are involved, including after-school programs
for at-risk youth (page 12). What are the specific after-school
programs in which AmeriCorps participants are engaged? Has there been
any independent evaluation of how successful these programs have been,
in terms of academic achievement, youth crime rates, etc.?
Answer. While there have been studies of various education related
programs (e.g., tutoring, literacy), which may occur in-school or
after-school, there have been no independent studies of AmeriCorps
participants serving just in after-school programs. Please see the
attached list of all after-school programs.
Grantee: Alabama State Commission on National and Community Service
Subgrantee: Birmingham Cultural and Heritage Foundation
Program Name: AmeriCorps*In Tune
Grant Type: State Program
Full-time AmeriCorps members: 25
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members provide tutoring and
homework assistance, music instruction, and preparation for musical
performance to increase the academic performance, improve attitude
toward learning, and increase participation in school of 300 K-8
students in Birmingham's Enterprise Community.
Grantee: Alabama State Commission on National and Community Service
Subgrantee: Family Healthcare of Alabama
Program Name: Rural AmeriCorps Student Project
Grant Type: State Program
Full-time AmeriCorps members: 25
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor and mentor 400
disadvantaged and predominantly African-American students in grades K-6
to improve their academic performance and school attendance. Seventy-
five percent of students are expected to increase by at least one
letter grade in math or reading. Services are provided at ten schools
during regular school hours, in after-school and weekend programs, as
well as during the summer in rural Greene and Sumter Counties in west
Alabama.
Grantee: Alabama State Commission on National and Community Service
Subgrantee: Butler Co. Board of Education
Program Name: AmeriCorps Instructional Support Team
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor and mentor 250 K-3
students in three rural Alabama schools. Members tutor students
individually and in small groups, provide mentoring in after-school
activities and provide homework assistance and enrichment activities.
Member service will result in improved academic performance, improved
attitude toward school, and improvement in attendance.
Grantee: Alabama State Commission on National and Community Service
Subgrantee: Calhoun Community College
Program Name: Calhoun Community College AmeriCorps Program (CAP)
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor and mentor 300 K-3
children in an America Reads initiative in ten north Alabama elementary
schools. Eighty percent of students increase reading skills by at least
one grade level. Members also conduct after-school and summer
educational programs for children and youth. The program is endorsed by
Decatur's Promise.
Grantee: Alaska State Community Service Commission
Subgrantee: Nine Star Enterprises, Inc.
Program Name: AmAK Literacy Project
Grant Type: State Program
Full-time AmeriCorps members: 16
Part-time AmeriCorps members: 2
Program Descriptions: AmeriCorps Members serve in 16 community
based organizations providing literacy and computer training to
preschool and elementary school students and their families. Members
serve in single site placements in rural communities in Alaska.
Grantee: Arkansas Commission on National and Community Service
Subgrantee: Southeast Arkansas Community Based Education Center
Program Name: POP's Latchkey Program
Grant Type: State Program
Full-time AmeriCorps members: 6
Part-time AmeriCorps members: 6
Program Descriptions: AmeriCorps Members provide a safe haven and
enrichment activities for children in Kindergarten through 6th grade,
assist with Spanish translation for parents and students in schools,
and offer life skills trainings to families. Members are placed in four
elementary schools and two child care centers.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Child Abuse Prevention Council of Sacramento, Inc. +
Program Name: Child Abuse Prevention Council of Sacramento, Inc.
Grant Type: State Program
Full-time AmeriCorps members: 70
Part-time AmeriCorps members:
Program Descriptions: 70 AmeriCorps members serve a consortium of
public and non profit organizations in three municipalities whose
purpose is to provide a continuum of services to children at risk for
neglect or abuse. Members are recruited from the communities
surrounding three service centers to tutor/mentor children identified
by child protective services or their teachers for participation in the
program. Some members serve in the centers to assist with intake and
make referrals to services for families. Members also serve as points
of contact from the apartments and homes in which they live to serve
members of the community in need. Many members are receiving temporary
assistance to needy families. The program also provides training to 900
elementary students in a child prevention curriculum and a summer
recreation program which provides free lunches.
Grantee: California Commission on Improving Life Through Service
Subgrantee: California Conservation Corps--Cadre of Corps +
Program Name: Cadre of Corps
Grant Type: State Program
Full-time AmeriCorps members: 130
Part-time AmeriCorps members: 4
Program Descriptions: Cadre of Corps is a statewide AmeriCorps
program sponsored by the California Conservation Corps. 134 AmeriCorps
members are assigned to one of nine sites, sponsored by a District
Office of the California Conservation Corps or by a local conservation
corps office. The areas served include Klamath, Shasta-Pacific, Marin,
San Francisco, Pacific Bays, San Jose, Central Coast, Los Angeles, and
Long Beach. Members provide tutoring for 1216 at risk youth,
environmental education for 6,217 students in 89 schools, and community
service activities for 7,332 youth in 49 communities or neighborhoods.
Grantee: California Commission on Improving Life Through Service
Subgrantee: California Conservation Corps--Watershed Project
Program Name: Watershed Project
Grant Type: State Program
Full-time AmeriCorps members: 147
Part-time AmeriCorps members:
Program Descriptions: The Watershed Project engages 147 full time
members to coordinate school and community partnerships that foster
community responsibility for healthy watersheds. Members assist
teachers in developing service-learning activities centered around
watershed restoration and lead field trips for students to complete
service projects. Members also complete watershed restoration projects
such as protection against erosion or building trails. Members serve in
11 regions of the California Conservation Corps system: Lassan/Plumas,
Mendocino, Napa, San Diego, San Francisco, Shasta, Siskiyou, Sonoma,
Tahoe/Placer, Tehama and Trinity.
Grantee: California Commission on Improving Life Through Service
Subgrantee: San Diego State Unv. Foundation +
Program Name: CA YMCA/CSU PRYDE AmeriCorps Consortium
Grant Type: State Program
Full-time AmeriCorps members: 22
Part-time AmeriCorps members: 85
Program Descriptions: The YMCA PRYDE AmeriCorps program engages 22
full-time and 88 part-time members to serve in five regions of
California: San Diego, Long Beach, Los Angeles, Oakland/East Bay, and
San Francisco. Within each region, members are placed at school or YMCA
sites to conduct after school programming. Activities include academic/
homework assistance, life skills development (conflict resolution,
substance abuse prevention, pregnancy prevention, communication),
recreation activities, and field trips. A partnership with the local
California State University campuses provides training and technical
assistance for members and staff.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Los Angeles Unified School District +
Program Name: AmeriLiteracy
Grant Type: State Program
Full-time AmeriCorps members: 50
Part-time AmeriCorps members:
Program Descriptions: AmeriLiteracy AmeriCorps members tutor
elementary students in fifteen schools throughout the Los Angeles
Unified School District. The program utilizes 5 distinct models for
member involvement in the schools, ranging from involvement in
intersession classes to sustained tutoring, in which the same group of
children are tutored daily for 30 to 40 minutes.
Grantee: California Commission On Improving Life Through Service
Subgrantee: Los Angeles Conservation Corps +
Program Name: Building Up Los Angeles
Grant Type: State Program
Full-time AmeriCorps members: 50
Part-time AmeriCorps members: 60
Program Descriptions: In the Building Up Los Angeles AmeriCorps
program, 50 full-time and 80 part-time members serve in teams at one of
7 clusters in the greater Los Angeles area: San Fernando Valley, South
Central/Watts, Northeast, Hollywood, Pico Union, Central City, and East
Los Angeles. Service objectives include: (1) providing in-class
tutoring in specific subjects and skills for students in grades 1-12
who are at risk of academic failure; (2) conducting after school and
intersession programs that provide academic assistance/enrichment and
recreation activities; and (3) holding seven 2 week Summerbridge
Programs to prepare and mentor entering middle and high school students
for academic and personal success.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Lifespan Services Network, Inc. +
Program Name: San Luis Obispo County AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 40
Part-time AmeriCorps members: 10
Program Descriptions: The San Luis Obispo County AmeriCorps program
engages 50 AmeriCorps members to serve at risk youth with goals of
decreasing juvenile crime, substance abuse, and teen pregnancy and
increasing school success and positive behavior. Fourteen AmeriCorps
members serve as mentors to 120 juvenile offenders, helping them
complete their probation contracts and resist new criminal activity.
Six members assist youth who are enrolled in the county's substance
abuse program. Members assist youth in developing an action plan to
resist substance abuse and in learning positive decision making skills.
Thirty members assist 240 youth who are at risk of academic failure.
Grantee: California Commission on Improving Life Through Service
Subgrantee: East Bay Conservation Corps
Program Name: East Bay Conservation Corps
Grant Type: State Program
Full-time AmeriCorps members: 159
Part-time AmeriCorps members:
Program Descriptions: 143 AmeriCorps members serve as literacy
tutors for 1,300 Oakland students in 13 elementary schools to improve
reading scores by at least one grade level. Teams of 10-12 members
provide in school and after school tutoring to 10 students each. 8
AmeriCorps members serve in a school health program which involves
children in the development and maintenance of the garden and
introduces a healthy diet curriculum. 8 AmeriCorps members work with
teachers at the elementary and middle school level to develop service
learning curricula and activities.
Grantee: California Commission on Improving Life Through Service
Subgrantee: EYE Counseling and Crisis Services +
Program Name: EYE Empowerment Corps
Grant Type: State Program
Full-time AmeriCorps members: 40
Part-time AmeriCorps members: 20
Program Descriptions: In the EYE Empowerment Corps, 40 full-time
and 20 part-time AmeriCorps members provide services for youth in the
greater Escondido area. Half of the members serve on the Community
Services team and provide mentoring to first time youth offenders.
Members and youth participate in community service activities as a
means to: help students develop a service ethic, provide needed
assistance to the community, and create an environment where mentoring
can happen. The other group of members serve on the education team as
mentors to children who have been identified as being at risk for
school failure. Members provide an after school program where children
receive academic assistance, participate in recreation activities, and
develop a relationship with another caring adult.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Chancellor's Office, CA Community Colleges +
Program Name: Chancellor's Office, CA Community Colleges
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 724
Program Descriptions: 616 AmeriCorps Members recruited from the T-
A-N-F and other student populations of 15 community colleges are
trained in the ``rolling readers'' curriculum and tutor 7-9 children
each in K-3 public schools and head start programs. A minimum of 2,168
low-income and/or limited English proficiency children will complete 80
percent of their individual student literacy development goals.
Grantee: California Commission on Improving Life Through Service
Subgrantee: City Year, Inc. +
Program Name: City Year San Jose/Silicon Valley
Grant Type: State Program
Full-time AmeriCorps members: 69
Part-time AmeriCorps members: 6
Program Descriptions: AmeriCorps members in the City Year San Jose/
Silicon Valley program are organized in diverse teams of 8 to 10
members. The 75 members are involved in one or more of the following
activities: tutoring youth to improve basic academic skills, mentoring
youth in the development of an ethic of citizenship, providing
assistance to low income families, seniors, and non profit
organizations, and providing safe and supportive environments for
youth.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Bay Area Community Resources--San Jose
Program Name: San Jose AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: The San Jose AmeriCorps program has 20
members who serve in four schools in the Franklin McKinley Elementary
School District. The members address the needs of students who have a
low rate of academic success. Members tutor students in the classroom
and after school, conduct intersession academic and recreation
programs, and develop and implement activities to involve parents of
the student participants. In addition, members implement a sunshine
club intended to reduce truancy by having members meet with students
before school to help prepare them for the day and to ensure
participation in a nutrition program.
Grantee: California Commission on Improving Life Through Service
Subgrantee: California Conservation Corps Ambassador's Mentoring
Project
Program Name: Ambassador's Mentoring
Grant Type: State Program
Full-time AmeriCorps members: 23
Part-time AmeriCorps members: 2
Program Descriptions: The Ambassador's Mentoring Project supports
25 AmeriCorps members who are placed with agencies around the state
that provide mentoring services for youth and/or support mentoring
initiatives. Members recruit, train, and support individuals who serve
as mentors. Members also serve as mentors for at risk youth.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Amador Tuolumne Community Action Agency
Program Name: AmeriCorps Academic Mentoring
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 4
Program Descriptions: Members in the AmeriCorps Academic Mentoring
program tutor 200 at-risk K-8 grade students at 10 schools in Amador
and Tuolumne counties. The goal of the program is to increase the
students' reading and math skills and comprehension in other academic
topics. Tutoring occurs before, during and after school; in and out of
the classroom; one on one and in small groups. Improvement will be
measured against an individual academic plan created for each student
and through standardized state test results (Stan 9). The 24 members
also mentor 100 at-risk youth to increase positive personal growth and
citizenship skills and to reduce negative risk-taking behaviors such as
truancy and disruptive behavior.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Bay Area Community Resources--Larkspur
Program Name: BAYAC AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 79
Part-time AmeriCorps members: 10
Program Descriptions: AmeriCorps Members provide tutoring and
mentoring to at risk youth in Bay Area communities, so that they can
achieve school success and realize their potential. Members work in
small teams with twenty collaborating community based organizations to
provide tutoring and mentoring to 2,155 young people.
Grantee: California Commission on Improving Life Through Service
Subgrantee: California Human Development Corporation +
Program Name: Rural AmeriCorps Partnership
Grant Type: State Program
Full-time AmeriCorps members: 18
Part-time AmeriCorps members: 4
Program Descriptions: AmeriCorps members tutor and mentor middle
school Limited English Speaking (LEP) students considered to be
educationally at risk in order to reduce the number of drop outs during
high school. Members serve in teams of two in middle schools in rural
Sonoma, Yolo, and San Joaquin Counties and serve a largely Latino
population.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Feather River Community College +
Program Name: AC Academic Mentoring Program of Plumas County
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 40
Program Descriptions: AmeriCorps members mentor five educationally
at risk high school or college students to increase academic success,
encourage attendance in higher education, and prevent drop out. Each
beneficiary will develop an individual development plan.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Volunteer Center of San Francisco +
Program Name: San Francisco AmeriCorps Collaborative
Grant Type: State Program
Full-time AmeriCorps members: 46
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members serve in public schools
and community based organizations in the Bay area to engage youth in
service learning activities, mobilize adult volunteers and build
sustainable school and community partnerships. Members serve in one of
the four teams. One team's activities focus on developing service
learning activities, one is engaged in healthy start activities, one
team focuses on volunteer generation; and one team serves in child
development centers to increase literacy of pre-K to third grade.
Grantee: California Commission on Improving Life Through Service
Subgrantee: Partners in School Innovation +
Program Name: Partners/ACT
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members serve in small teams at
schools serving K-12 students. Members support whole-system change
efforts of schools. Activities are designed to increase literacy and
reading comprehension and increase parent and community involvement in
the school.
Grantee: Catholic Network of Volunteer Service
Subgrantee: Catholic Network of Vol. Service
Program Name: CNVS AmeriCorps Program
Grant Type: Ed Award Only
Full-time AmeriCorps members: 750
Part-time AmeriCorps members: 286
Program Descriptions: Members will serve in areas of child care,
school counseling, tutoring, literacy, elderly outreach, social
services, counseling and civic responsibility.
Grantee: City Year, Inc.
Subgrantee: City Year--Columbia
Program Name:
Grant Type: National Direct Central
Full-time AmeriCorps members: 48
Part-time AmeriCorps members: 4
Program Descriptions: City Year is a national non-profit with
strong public-private partnerships, devoted solely to full time
national service and the development of a diverse and well-trained
corps. AmeriCorps Members serve in classrooms, run after school and
school break programs, teach violence and HIV/AIDS prevention,
rehabilitate public housing units and build parks and playgrounds.
Members increase academic success through in school tutoring,
increasing parental involvement and promoting conflict resolution. They
increase civic responsibility by engaging children and youth in out-of-
school activities and meet needs of local organizations through short
term physical and human needs projects.
Grantee: City Year, Inc.
Subgrantee: City Year--Cleveland
Program Name: City Year--Cleveland
Grant Type: National Direct Central
Full-time AmeriCorps members: 95
Part-time AmeriCorps members: 10
Program Descriptions: City Year is a national non-profit with
strong public-private partnerships, devoted solely to full time
national service and the development of a diverse and well-trained
corps. AmeriCorps Members serve in classrooms, run after school and
school break programs, teach violence and HIV/AIDS prevention,
rehabilitate public housing units and build parks and playgrounds.
Members increase academic success through in school tutoring,
increasing parental involvement and promoting conflict resolution. They
increase civic responsibility by engaging children and youth in out-of-
school activities and meet needs of local organizations through short
term physical and human needs projects.
Grantee: City Year, Inc.
Subgrantee: City Year--Columbus
Program Name: City Year Columbus
Grant Type: National Direct Central
Full-time AmeriCorps members: 57
Part-time AmeriCorps members: 6
Program Descriptions: City Year is a national non-profit with
strong public-private partnerships, devoted solely to full time
national service and the development of a diverse and well-trained
corps. AmeriCorps Members serve in classrooms, run after school and
school break programs, teach violence and HIV/AIDS prevention,
rehabilitate public housing units and build parks and playgrounds.
Members increase academic success through in school tutoring,
increasing parental involvement and promoting conflict resolution. They
increase civic responsibility by engaging children and youth in out-of-
school activities and meet needs of local organizations through short
term physical and human needs projects.
Grantee: City Year, Inc.
Subgrantee: City Year, Inc.--Parent
Program Name:
Grant Type: National Direct Central
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: City Year is a national non-profit with
strong public-private partnerships, devoted solely to full time
national service and the development of a diverse and well-trained
corps. AmeriCorps Members serve in classrooms, run after school and
school break programs, teach violence and HIV/AIDS prevention,
rehabilitate public housing units and build parks and playgrounds.
Members increase academic success through in school tutoring,
increasing parental involvement and promoting conflict resolution. They
increase civic responsibility by engaging children and youth in out-of-
school activities and meet needs of local organizations through short
term physical and human needs projects.
Grantee: Colorado Governor's Commission on Nat'l & Community
Service
Subgrantee: Adams County School District 14
Program Name: Community Action on Reading and Education
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 4
Program Descriptions: Members serve as literacy instructors and
tutors for children in grades 1, 2, 3, 6, and 9. They also launch a
family literacy program, and provide instruction and tutoring to out-
of-school youth. This program provides team based services in an urban
community.
Grantee: Colorado Governor's Commission on Nat'l & Community
Service
Subgrantee: Sheridan School District # 2
Program Name: Sheridan Family Res. Center AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 29
Part-time AmeriCorps members: 1
Program Descriptions: AmeriCorps Members tutor and mentor at-risk
youth in the Sheridan School District. Members also implement
interactive educational after-school and summer camp programs for
students. Additionally, Members coordinate health promotion activities
in the Sheridan School-Based Clinic.
Grantee: Colorado Governor's Commission on Nat'l & Community
Service
Subgrantee: St. Andrew's Episcopal Church
Program Name: The Children's Center for Arts and Learning
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 2
Program Descriptions: Members offer a free afterschool and summer
program of arts instruction and tutoring for at-risk children.
Grantee: Connecticut Commission on National and Community Service
Subgrantee: Bridgeport Police Dept. Regional Youth/Adult Substance
Abuse
Project Program Name: Safe Neighborhood AmeriCorps Partnership,
Year I
Grant Type: State Program
Full-time AmeriCorps members: 44
Part-time AmeriCorps members: 96
Program Descriptions: Members provide tutoring, mentoring, and
community service projects through after-school programs for 100 youth
in the East End, East Side and South End neighborhoods of Bridgeport.
Members conduct home security assessments and installations for 200
elderly residents, individuals with disabilities, and other vulnerable
populations in 6 Bridgeport neighborhoods. Members also engage in
community revitalization projects including planting community gardens,
boarding up abandoned buildings, and installing ramps for physically
challenged residents.
Grantee: Connecticut Commission on National and Community Service
Subgrantee: City of Meriden, Connecticut
Program Name: City SERVE! AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: Members provide in-class support and after-
school enrichment activities for 400 elementary school children.
Members work one-on-one with the students to improve their reading and
writing abilities. Members also provide enrichment activities for 8
preschool classes to prepare them to succeed in school. In addition,
Members provide after-school tutoring and mentoring for K-12 youth to
help improve their academic achievement and improve their behavior.
Grantee: Connecticut Commission on National and Community Service
Subgrantee: Leadership, Education and Athletics in Partnership
Program Name: LEAP
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 280
Program Descriptions: AmeriCorps Members tutor and mentor over
1,100 inner-city children ages 7 through 16 in after-school programs.
During the Summer months Members live in the housing developments where
the children reside and provide structured activities throughout the
day. The intensive tutoring and mentoring provided by the Members
result in improved reading skills, increased self-esteem and better
social behavior for 80 percent of the participating school-aged
children. In addition, Members organize 300 community service
activities for the children, their families and neighbors to
participate in during the program year.
Grantee: Connecticut Commission on National and Community Service
Subgrantee: Volunteer Center of Greater Bridgeport (BIRA)
Program Name: Bridgeport InterRegional AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members: 5
Program Descriptions: AmeriCorps Members coordinate community
volunteer programs at high schools and community-based organizations
throughout the city of Bridgeport and its neighboring communities.
Through their scattered-site placements Members provide in-school and
after-school activities for K-12 children to increase math, reading and
computer skills. Members also provide mentoring and after-school
enrichment activities for youth ages 6-14 to improve academic and
social skills, literacy skills training for adult learners and their
children, and health and parenting education classes.
Grantee: Connecticut Commission on National and Community Service
Subgrantee: Community Action for Greater Middlesex County, Inc.
Program Name: CAGMC AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 8
Program Descriptions: AmeriCorps members serve in 15 rural
communities in Middlesex County where they tutor and mentor children in
before, during, and after-school programs. Members also work with
parents of young children providing them with assistance in accessing
health care, and other services to help ensure a healthy start for
their children.
Grantee: Connecticut Commission on National and Community Service
Subgrantee: Southend Community Services, Inc.
Program Name: Hartford AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members serve in public elementary
and middle schools in Hartford. They tutor children in English language
arts, and provide assistance in after-school programs like homework
clubs. Members also engage youth in service learning projects and
recruit community volunteers to participate.
Grantee: Delaware Community Service Commission
Subgrantee: University of Delaware
Program Name: First State Mentor Corps, CHEP
Grant Type: State Program
Full-time AmeriCorps members: 3
Part-time AmeriCorps members: 63
Program Descriptions: AmeriCorps Members participate in the state-
wide initiative to enlist citizens to serve as one-on-one mentors.
Members collaborate with RSVP participants to recruit and train
volunteers to serve as mentors to 800 pre-kindergarten through middle
school students. In addition, Members engage Delaware businesses in
Adopt-A-School mentoring programs.
Grantee: Educational Service District 112/Northwest Service
Academy, Inc.
Subgrantee: Northwest Service Academy/ESD112--Parent
Program Name: Northwest Service Academy/ESD 112
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: Educational Service District 112 serves
largely as financial overseer of the three sites, provides in-kind
staff support, and acts as an advisor on program-related decisions. The
major responsibilities for program design, accomplishing objectives,
day-to-day management and strategic planning rest with the Northwest
Service Academy executive director and the site directors. AmeriCorps
members at one residential and two non-residential sites restore
Northwest watersheds, provide environmental education and academic
reinforcement to schools, and help rebuild communities.
Grantee: Florida Commission on Community Service
Subgrantee: Centro Campesino
Program Name: AmeriCorps Youth Pride
Grant Type: State Program
Full-time AmeriCorps members: 22
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor and mentor 250 low
income youth ages 6 to 18 to ensure that 80 percent achieve grade level
as measured by the Basic Reading Inventory. Members also provide after-
school activities to 350 students to decrease school suspensions and
detention among 90 percent of those served. Students' parents are
encouraged to attend a Parent Club. Members serve in one of four school
and two community-based sites. AmeriCorps YouthPride involves over 20
adult mentors who volunteer 2,000 hours.
Grantee: Florida Commission on Community Service
Subgrantee: Academy for Better Communities--Barry University School
of Social Work
Program Name: Americorps Barry University
Grant Type: State Program
Full-time AmeriCorps members: 18
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members provide individual and
group social services to 900 elementary school children in order to
decrease school absenteeism, detentions and suspensions by 24 percent,
improve grades by 20 percent, and improve classroom behavior by 25
percent. Members also provide to 450 parents classes and counseling
sessions to improve parenting skills by 33 percent. Members serve in
small teams at six elementary schools and middle schools in Dade
County.
Grantee: Florida Commission on Community Service
Subgrantee: College of Fine Arts, USF
Program Name: AmeriCorps Arts, USF
Grant Type: State Program
Full-time AmeriCorps members: 6
Part-time AmeriCorps members: 18
Program Descriptions: AmeriCorps members teach arts skills (dance,
visual arts, theater, music, singing, etc.) in after-school programs to
500 low income children ages 6 to 14. Members are assigned to one of
nine Boys & Girls Club sites throughout Hillsborough County and serve
in teams. Small teams of volunteers are utilized to support program
activities through fund raising and assisting with service projects.
There is a 10 week summer component.
Grantee: Florida Commission on Community Service
Subgrantee: Eckerd Family Youth Alternatives, Inc.
Program Name: Americorps Hi-Five
Grant Type: State Program
Full-time AmeriCorps members: 14
Part-time AmeriCorps members: 10
Program Descriptions: AmeriCorps members tutor 90 elementary school
students so that 75 percent will increase one grade level in the
targeted subject area. Another 90 students will be provided conflict
resolution training to reduce disciplinary referrals by 30 percent.
Selected Members work with parents of students with chronic behavioral
problems, students who are struggling academically, and students who
are chronically absent from school so that 75 percent of the families
will report increased knowledge of their child's academic progress and
behavior in school. Members serve in one of three elementary schools
and four after-school locations. Volunteers are also recruited to serve
as mentors to at-risk students.
Grantee: Florida Commission on Community Service
Subgrantee: Lake County Board of Commissioners
Program Name: Partners For Success
Grant Type: State Program
Full-time AmeriCorps members: 15
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor 200 K-2 academically
at risk and under-achieving students to increase the reading ability by
two grade levels of 80 percent of those participating. Members also
provide out-of-school programs to 200 students to increase by 25
percent the study skills of at least 60 of those students. Members
serve at one of three elementary schools. AmeriCorps Partners for
Success recruits and utilizes 50 community volunteers to collect books
and read to students.
Grantee: Frostburg State University
Subgrantee: Frostburg State
Program Name: Allen HallSTARS!
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 80
Program Descriptions: Members will tutor, mentor, and lead
environmental activities for youth. Some member activities include
taking part in the America Reads Challenge.
Grantee: Georgia Commission for National and Community Service
Subgrantee: Fannin County Family Connection (NPPSIS/Fiscal Agent)
Program Name: AmeriCorps Service to Families in Fannin County
Grant Type: State Program
Full-time AmeriCorps members: 18
Part-time AmeriCorps members: 4
Program Descriptions: AmeriCorps members tutor 250 children in pre-
school through middle school during school hours and after school to
improve reading and math skills by \1/2\ grade level in 80 percent of
students served. In addition, members mentor 30 middle-school students
to increase school attendance and decrease behavior problems. Members
also recruit community volunteers to deliver additional services to
children.
Grantee: Georgia Commission for National and Community Service
Subgrantee: Southwest Georgia Easter Seal Society, Inc.
Program Name: Easter Seal-AmeriCorps After School & Summer
Enrichment
Grant Type: State Program
Full-time AmeriCorps members: 8
Part-time AmeriCorps members: 20
Program Descriptions: AmeriCorps members provide in-school and
after-school tutoring, homework assistance, and supervised recreation
for children with disabilities, their families, and their non-disabled
peers in five southwest Georgia counties. In pre-school settings
members develop and provide activities that support the growth and
early development of children with disabilities from low-income
families, and conduct parenting classes for these families. Members
also assist program participants with daily living functions and
provide them with opportunities for community service.
Grantee: Georgia Commission for National and Community Service
Subgrantee: City of Macon/Macon Police Department
Program Name: MPD/AmeriCorps Cadet Program
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 5
Program Descriptions: AmeriCorps members conduct bicycle patrols
within five low-income/high crime neighborhoods in this community
policing program. In addition, members conduct crime prevention
activities and operate police athletic leagues and other enrichment
services for at-risk youth. All activities are undertaken to reduce the
fear of crime within targeted neighborhood and increase civic
responsibility among neighborhood residents.
Grantee: I Have A Dream Foundation, Inc.
Subgrantee: I Have A Dream Foundation--New York
Program Name: ``I Have a Dream'' Foundation-New York/AmeriCorps
Grant Type: National Direct Sub
Full-time AmeriCorps members: 3
Part-time AmeriCorps members: 16
Program Descriptions: The I Have a Dream Foundation (IHAD) model
connects individuals who want to sponsor a group of children with
neighborhood in need. An entire elementary school class or an age group
in a housing project become ``Dreamers'' and receive academic and
social support designed to see them through high school and into
productive lives. Those Dreamers who graduate from high school are
eligible for college or vocational school tuition assistance. Members
enable (IHAD) sites to intensify their outreach to Dreamers, their
families and the community. In addition to tutoring and mentoring,
providing academic and social enrichment, members recruit and train
community volunteers, organize family involvement activities and lead
Dreamers in community service projects.
Grantee: I Have A Dream Foundation, Inc.
Subgrantee: I Have a Dream/AmeriCorps--Parent
Program Name: ``I Have a Dream'' Foundation/AmeriCorps
Grant Type: National Direct Sub
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The I Have a Dream Foundation (IHAD) model
connects individuals who want to sponsor a group of children with
neighborhood in need. An entire elementary school class or an age group
in a housing project become ``Dreamers'' and receive academic and
social support designed to see them through high school and into
productive lives. Those Dreamers who graduate from high school are
eligible for college or vocational school tuition assistance. Members
enable (IHAD) sites to intensify their outreach to Dreamers, their
families and the community. In addition to tutoring and mentoring,
providing academic and social enrichment, members recruit and train
community volunteers, organize family involvement activities and lead
Dreamers in community service projects.
Grantee: Iowa Commission on Community Service
Subgrantee: Des Moines Public Schools--New Horizons Program
Program Name: AmeriCorps Enterprise Community Service Project
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: The AmeriCorps Enterprise Community Service
Project utilizes 20 members to tutor more than 100 youth, renovate low-
income houses, create community green spaces and organize neighborhood
safety patrols. The program maintains a diverse member base and
partnerships with government and community-based organizations.
Grantee: Kentucky Commission for Community Volunteerism and Service
Subgrantee: The City of Leitchfield
Program Name: Tri-City Link
Grant Type: State Program
Full-time AmeriCorps members: 3
Part-time AmeriCorps members: 14
Program Descriptions: AmeriCorps members tutor and mentor students
in grades 1-12 and engage classes in service-learning activities
focused on environmental awareness. Individual tutoring decreases the
high school drop-out rate of 125 students participating in the program
hosted at Family Youth and Resource Centers in three counties. Members
with Tri-City Link also provide community enrichment activities through
structured quality after-school programs for youth, from recreation to
cultural arts.
Grantee: Lincoln University
Subgrantee: Lincoln University
Program Name: You Can Institute on Family Values & Rites of Passage
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 20
Program Descriptions: Members will launch a program to assist at-
risk youth in the transition from adolescence to adulthood through a
year long program including an after-school enrichment program.
Grantee: Local Initiatives Support Corporation
Subgrantee: New York LISC
Program Name: New York City LISC AmeriCorps
Grant Type: National Direct
Full-time AmeriCorps members: 10
Part-time AmeriCorps members:
Program Descriptions: The Local Initiatives Support Corporation is
a national non profit organization that provides funding and technical
guidance to local Community Development Corporations (CDC's) which are
rebuilding neighborhoods across the nation. Members engage in community
revitalization activities including housing outreach and education, job
training, youth education programs, neighborhood planning, and human
services planning.
Grantee: Louisiana Serve Commission
Subgrantee: St. Mark's Community Center
Program Name: AmeriCorps of New Orleans
Grant Type: State Program
Full-time AmeriCorps members: 45
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members tutor and mentor at-risk
children, perform home repairs on a minimum of 30 low income homes,
board up a minimum of 90 abandoned houses and help revitalize
neighborhood green spaces and parks. In addition, the program works
with local organizations to address the needs of children. These
include working with homeless youth, teen parents and youth crisis
services. Most Members serve in teams, although a few are single-site
placements. Potential impacts of the program include, 80 percent of
participating students will advance a minimum of one grade level in
mathematics and reading skills, increased sense of security by
residents and reduction in illegal activities, and allowing homeowners
to remain in their homes and prevent further deterioration of the
housing stock. This is an urban program.
Grantee: Lower Mississippi Delta Service Corps
Subgrantee: Center for Community Development, Delta State University
Program Name: Mississippi Delta Service Corps
Grant Type: National Direct
Full-time AmeriCorps members: 70
Part-time AmeriCorps members:
Program Descriptions: The Lower Mississippi Delta Service Corps,
Inc. (LMDSC) is a national non-profit, tri-state collaboration with
partners in Louisiana, Arkansas, and Mississippi, whose mission is to
provide effective management and governance of a regional national
service corps. The Lower Mississippi Delta Service Corps, Inc., is
committed to meeting the unique needs of the people of the Delta.
AmeriCorps Members perform a variety of functions in the areas of
education and human service. Activities include tutoring children and
adults in literacy skills, serving in food banks, locating shelter and
affordable housing for low income residents, and facilitating
independent living for homebound. Members are placed individually or in
small groups in host agencies throughout the Delta.
Grantee: Lower Mississippi Delta Service Corps
Subgrantee: Good Neighbor Center
Program Name: Delta Service Corps
Grant Type: National Direct
Full-time AmeriCorps members: 60
Part-time AmeriCorps members: 20
Program Descriptions: The Lower Mississippi Delta Service Corps,
Inc. (LMDSC) is a national non-profit, tri-state collaboration with
partners in Louisiana, Arkansas, and Mississippi, whose mission is to
provide effective management and governance of a regional national
service corps. The Lower Mississippi Delta Service Corps, Inc., is
committed to meeting the unique needs of the people of the Delta.
AmeriCorps Members perform a variety of functions in the areas of
education and human service. Activities include tutoring children and
adults in literacy skills, serving in food banks, locating shelter and
affordable housing for low income residents, and facilitating
independent living for homebound. Members are placed individually or in
small groups in host agencies throughout the Delta.
Grantee: Lower Mississippi Delta Service Corps
Subgrantee: Louisiana Delta Service Corps Inc.
Program Name: Louisiana Delta Service Corps
Grant Type: National Direct
Full-time AmeriCorps members: 57
Part-time AmeriCorps members: 20
Program Descriptions: The Lower Mississippi Delta Service Corps,
Inc. (LMDSC) is a national non-profit, tri-state collaboration with
partners in Louisiana, Arkansas, and Mississippi, whose mission is to
provide effective management and governance of a regional national
service corps. The Lower Mississippi Delta Service Corps, Inc., is
committed to meeting the unique needs of the people of the Delta.
AmeriCorps Members perform a variety of functions in the areas of
education and human service. Activities include tutoring children and
adults in literacy skills, serving in food banks, locating shelter and
affordable housing for low income residents, and facilitating
independent living for homebound. Members are placed individually or in
small groups in host agencies throughout the Delta.
Grantee: Lower Mississippi Delta Service Corps
Subgrantee: Lower Mississippi Delta Service Corps, Inc.--Parent
Program Name: Lower Mississippi Delta Svc Corps, Inc
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The Lower Mississippi Delta Service Corps,
Inc. (LMDSC) is a national non-profit, tri-state collaboration with
partners in Louisiana, Arkansas, and Mississippi, whose mission is to
provide effective management and governance of a regional national
service corps. The Lower Mississippi Delta Service Corps, Inc., is
committed to meeting the unique needs of the people of the Delta.
AmeriCorps Members perform a variety of functions in the areas of
education and human service. Activities include tutoring children and
adults in literacy skills, serving in food banks, locating shelter and
affordable housing for low income residents, and facilitating
independent living for homebound. Members are placed individually or in
small groups in host agencies throughout the Delta.
Grantee: Maryland Governor's Office on Service & Volunteerism
Subgrantee: University of Maryland at Baltimore
Program Name: Enhancing Neighborhood Action By Local Empowerment
Grant Type: State Program
Full-time AmeriCorps members: 38
Part-time AmeriCorps members: 240
Program Descriptions: AmeriCorps Members, conduct health
assessments and monitor clinical symptoms for persons with chronic
illnesses, and provide the HIPPY (Home Instruction Program for
Preschool Youngsters) and other pre-school readiness programs. In
addition, Members provide after-school literacy tutoring for 500 2nd
and 3rd grade students, and reduce environmental risks for children and
families by educating residents about reducing lead hazards in their
homes and establishing recycling programs. Members serve in teams
organized around the 4 separate initiatives: Community Health, Early
Childhood Development, Reading Edge, and Healthy Environment. Through
the Reading Edge initiative, Members also provide literacy tutoring to
1000 K-3 children in summer camps.
Grantee: Maryland Governor's Office on Service & Volunteerism
Subgrantee: Frostburg State University (A STAR in Western MD)
Program Name: A STAR! in Western MD (Appalachian Service Through
Action & Resource)
Grant Type: State Program
Full-time AmeriCorps members: 32
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members provide independent living
assistance, with a focus on preventive health, shelter and housing
support, to families, children, and the elderly, create and implement
youth literacy programs and other after-school educational programs,
and conduct environmental preservation projects. Members create green
spaces, implement recycling programs, partner with Habitat for Humanity
to construct low-income housing, and reduce environmental risks in
homes by conducting home safety assessments including tests for water
contamination and radon. Through an alliance of community-based
organizations in Western Maryland, Members are scattered throughout the
region performing a wide-variety of services.
Grantee: Maryland Governor's Office on Service & Volunteerism
Subgrantee: Salisbury State University
Program Name: Partnership for Adolescents on the Lower Shore
Grant Type: State Program
Full-time AmeriCorps members: 23
Part-time AmeriCorps members: 9
Program Descriptions: AmeriCorps Members tutor and mentor at-risk
adolescents on the Lower Eastern Shore of Maryland. In addition,
Members improve the life and parenting skills of pregnant and parenting
teens through health education. Members also conduct health screenings
and health education events, and provide conflict resolution training
for adolescents. Members will help improve the educational achievement
and school success of adolescents as measured by an increase in grade
point average and a reduction of school reports of violence,
expulsions, and suspensions.
Grantee: Maryland Governor's Office on Service & Volunteerism
Subgrantee: Dept. of Natural Resources--Maryland Conservation Corps
Program Name: United Youth Corps of MD (UCOM)
Grant Type: State Program
Full-time AmeriCorps members: 142
Part-time AmeriCorps members: 100
Program Descriptions: AmeriCorps Members maintain and restore state
forests, parks, and wildlife management areas. Members rehabilitate
abandoned houses, construct community parks and gardens in low-income
Baltimore neighborhoods, and tutor students with special needs. In
addition, Members develop after-school programs where middle school
students perform community service and participate in environmental
education activities.
Grantee: Maryland Governor's Office on Service & Volunteerism
Subgrantee: Action for the Homeless, Inc.
Program Name:
Grant Type: State Program
Full-time AmeriCorps members: 35
Part-time AmeriCorps members: 26
Program Descriptions: AmeriCorps Members help 5,000 homeless and
near homeless households obtain access to service providers. Members
also help 1,250 homeless and near homeless families to obtain permanent
housing or to prevent from being evicted. In addition, Members operate
a Summer camp program for 320 at-risk homeless youth in Baltimore and
coordinate after-school service-learning clubs for 10,000 students. The
Adopt-A-Shelter program is one example of the partnerships forged
between local schools and shelters.
Grantee: Maryland Governor's Office on Service & Volunteerism
Subgrantee: Governor's Office--Volunteer Maryland
Program Name: Volunteer Maryland
Grant Type: State Program
Full-time AmeriCorps members: 40
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members develop volunteer programs
and management systems in community-based organizations and public
agencies. They mobilize and supervise volunteers who provide direct
service to communities in need. Sample projects include rehabilitating
low-income housing for families, tutoring programs for school-age
children, and preserving public land along Maryland's rivers.
Grantee: Maryland Governor's Office on Service & Volunteerism
Subgrantee: Anne Arundel Community College--# 2
Program Name: Campus Corps
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 48
Program Descriptions: AmeriCorps Members coordinate service
learning activities at 15 community colleges for 1500 community college
students. Each of the students will engage in an average of 15 hours of
service to benefit their communities. In addition, Members create
cascading volunteer programs in which community college students train
high students to tutor elementary school students.
Grantee: Massachusetts Service Alliance
Subgrantee: Cambridge Community Services
Program Name: Cambridge Community Service, Inc.
Grant Type: State Program
Full-time AmeriCorps members: 2
Part-time AmeriCorps members: 18
Program Descriptions: AmeriCorps members run academic enrichment
programs, focusing on literacy and the use of technology, for 200 pre-
teens (grades 3-8) and new immigrant high school youth. Members serve
in teams at 8 after-school and summer enrichment programs. Members also
coordinate service-learning projects for the youth at each of the 8
sites. At least 75 percent of the students involved will demonstrate
improved academic skills and knowledge as measured by pre-post tests.
Grantee: Massachusetts Service Alliance
Subgrantee: Lawrence Family Development and Education Fund, Inc.
Program Name: City C.O.R.E.
Grant Type: State Program
Full-time AmeriCorps members: 35
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members serve as teachers'
assistants and tutors for elementary school children in an effort to
improve teacher capacity and increase academic performance. Members
also provide in-school and after-school literacy programs for K-3
students reading below grade level, and coordinate after-school
service-learning activities for school students. School and community
volunteers are generated to help run the literacy programs and service-
learning activities focusing on healthy living, the environment and
watershed revitalization. As a result of these services more students
will reach grade level in reading skills and demonstrate an increased
knowledge of issues relating to the service projects they perform.
Grantee: Massachusetts Service Alliance
Subgrantee: City Year Boston
Program Name: City Year Boston
Grant Type: State Program
Full-time AmeriCorps members: 249
Part-time AmeriCorps members: 32
Program Descriptions: AmeriCorps Members tutor and mentor inner-
city children in public elementary and middle schools throughout
Boston. Members serve over 10,000 young people by providing in-class
assistance, after-school and weekend programs, camps during school
vacations and the Young Heroes program. Members coordinate 25
``legacy'' service projects, including vacant lot clean-ups, community
gardens and rehabilitating low-income housing. Over 1000 community
volunteers participate in these projects. In addition, Members partner
with local organizations such as the American Red Cross and Peace at
Home to conduct health awareness, HIV/AIDS prevention, and violence
prevention workshops for young people.
Grantee: Massachusetts Service Alliance
Subgrantee: Franklin County DIAL/SELF
Program Name: GAP Youth-Corps
Grant Type: State Program
Full-time AmeriCorps members: 11
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members provide support services
to at least 60 homeless, runaway, and other at-risk youth. Members work
with the participating youth to develop individual working plans and
track progress made toward those plans. Members also facilitate
prevention and support groups for at least 150 youth focusing on issues
such as HIV/AIDS, drug use, smoking, self esteem, and parenting skills,
and provide after-school programs for school-aged youth which provide
tutoring academic enrichment, and recreational activities.
Grantee: Massachusetts Service Alliance
Subgrantee: Greater Holyoke Foundation, Inc.
Program Name: Greater Holyoke Youth Services
Grant Type: State Program
Full-time AmeriCorps members: 24
Part-time AmeriCorps members:
Program Descriptions: Members serve in 6 Community Policing
Substations in targeted neighborhoods. They coordinate crime prevention
initiatives including crime watches, open houses, gang and drug
awareness training, and personal safety training. Members operate
after-school service programs for 60 8-15 year olds providing them with
structured activities and a safe place during out-of-school time.
Members also coordinate service activities for 40 first-time juvenile
offenders through the Juvenile Diversion Progam.
Grantee: Massachusetts Service Alliance
Subgrantee: University of Massachusetts Boston, (CAPAY) Institute
for Asian American Studies
Program Name: CAPAY Community YouthLearn AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 1
Part-time AmeriCorps members: 17
Program Descriptions: AmeriCorps Members tutor and mentor 350 Asian
Pacific American youth in after-school programs. In addition, Members
tutor adults in ESL and serve as reading tutors in a family literacy
program. Members also recruit youth to volunteer in community and
school success service projects.
Grantee: Massachusetts Service Alliance
Subgrantee: B.E.L.L. Foundation/BASICS
Program Name: BASIC's
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 50
Program Descriptions: Fifty part-time AmeriCorps Members tutor and
mentor elementary school children during the school year and the summer
holidays. Members use the BASICS curriculum to increase children's
knowledge and mastery of reading, writing, and arithmetic skills,
enhance self-esteem, and strengthen communication between parents and
teachers. Members engage children in a 6-week summer camp where the
skills learned during the school year are reinforced and built upon.
Grantee: Massachusetts Service Alliance
Subgrantee: YouthBuild Boston, Inc.
Program Name: YouthBuild Boston
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 50
Program Descriptions: Members rehabilitate 6 units of previously
abandoned housing so that 6 low-income and/or homeless families have
access to affordable housing and the opportunity to be first time
homeowners. Members also operate an after school and summer enrichment
program for at-risk youth. Up to 300 youth receive tutoring an
mentoring so that 80 percent demonstrate an increase in academic
success and self-esteem, as measured by parent and teacher feedback.
Members also engage in community service projects where they work in
partnership with local non-profits to rehabilitate and repair
facilities where community based organizations are based.
Grantee: Massachusetts Service Alliance
Subgrantee: Worcester Community Action Council
Program Name: CITYWORKS
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members serve as school-based
literacy tutors for 40 public school students in grades K through 4.
Members also operate ESL programs and adult basic education sessions at
low income housing developments for adults. In addition, Members
increase the usage of city parks by removing safety hazards and
conducting community watch programs.
Grantee: Massachusetts Service Alliance
Subgrantee: Health and Education Services, Inc.
Program Name: AmeriCorps Victim Assistance Linkages & Enhancements
Grant Type: State Program
Full-time AmeriCorps members: 6
Part-time AmeriCorps members: 8
Program Descriptions: AmeriCorps Members provide crisis
intervention, information and referral services to victims of crime.
Member referrals result in 400 linkages to regional health care
organizations. In addition, Members provide hotline and in-person
counseling to residents of the North Shore communities. Members conduct
presentations to school children and community members to increase
awareness about issues such as physical and sexual abuse and the wide
range of services that are available. Members also work with
established community partners to build a coordinated approach to
victim assistance.
Grantee: Massachusetts Service Alliance
Subgrantee: Just A Start Corporation
Program Name: YouthBuild Just A Start Program
Grant Type: State Program
Full-time AmeriCorps members: 1
Part-time AmeriCorps members: 40
Program Descriptions: AmeriCorps Members serve in teams to renovate
and rehabilitate 10 to 15 affordable housing units for low income
families, provide major renovations to 3 to 5 units for sale to first-
time home buyers, and upgrade public hallways and exterior painting to
185 units of public housing. In addition, Members tutor, mentor, and
provide after-school activities to at least 100 6-14 year old low-
income children.
Grantee: Massachusetts Service Alliance
Subgrantee: People Acting in Community Endeavors, Inc.
Program Name: YouthBuild New Bedford
Grant Type: State Program
Full-time AmeriCorps members: 10
Part-time AmeriCorps members: 20
Program Descriptions: AmeriCorps Members rehabilitate two community
centers and renovate an abandoned home for a low-income family. In
addition, Members mentor 75 elementary school students during in-school
and after-school programs. The students participate in academic and
recreational activities.
Grantee: Massachusetts Service Alliance
Subgrantee: The Student Conservation Association
Program Name: c/o SCA, Inc.
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members, based at a rustic
residential camp in Western Massachusetts, revitalize neighborhoods by
restoring green spaces, creating community gardens and other community
recreational areas, and assist in revitalizing and protecting natural
resource areas, state and local parks and riverways. In addition,
Members assist community organizations with the elimination of
environmental hazards and reduce environmental risks for youth. During
the winter months, Members serve as in-school assistants, providing
environmental and conservation instruction and service learning
activities, and mentors to 400 to 800 school-aged youth.
Grantee: Michigan Community Service Commission
Subgrantee: Oakland University
Program Name: Oakland University
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 40
Program Descriptions: The Oakland University AmeriCorps program
provides reading/literacy and life skills training for youth and
families. The program provides year-round support for youth through
educational programs including a Character Education curriculum that
focuses on topics such as respect, trustworthiness, responsibility and
citizenship. Members conduct workshops with parents to encourage
parents to read with their children at home. Members serve on teams in
elementary and junior high schools. This program serves an urban
population.
Grantee: Michigan Community Service Commission
Subgrantee: The Regents of The University of Michigan
Program Name: The Michigan Neighborhood AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 50
Program Descriptions: The Michigan Neighborhood AmeriCorps program
strengthens the social development of children and families in Detroit
neighborhoods through violence prevention workshops, after-school and
summer programs, and increased access to health education and health
promotion services. Members will serve in teams. This program serves an
urban population.
Grantee: Michigan Community Service Commission
Subgrantee: United Way Community Services
Program Name: Detroit's Academic Success Project
Grant Type: State Program
Full-time AmeriCorps members: 25
Part-time AmeriCorps members:
Program Descriptions: The Detroit Academic Success Program
increases the academic achievement and reading comprehension of youth
in kindergarten through fifth grade in Detroit's Empowerment Zone. The
program infuses service learning as an instructional method, while
building lasting partnerships between schools and communities to create
an educational environment supportive of academic excellence.
AmeriCorps members placed in five elementary schools located in
Detroit's Empowerment Zone provide tutoring to low achieving students,
enrichment and academic support workshops to parents, and develop
service learning curriculum in math English and science. This program
plans to serve 3,000 students.
Grantee: Mid-Atlantic Network of Youth & Family Services, Inc.
Subgrantee: Mid-Atlantic Network of Youth & Family Services--Parent
Program Name: Mid-Atlantic Network of Youth & Family Services
(MANYCorps)
Grant Type: National Direct Sub
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The Mid-Atlantic Network of Youth and Family
Services (MANY) is a regional network of 50 community-based agencies
providing services to runaway, homeless and other youth in high-risk
situations. MANY provides coordination, training, and technical
assistance to affiliates in six states. AmeriCorps Members tutor and
mentor runaway, homeless and at-risk youth. They lead after school and
summer education and enrichment programs, teach independent living,
engage in intergenerational projects such as renovation of facilities
for use by the elderly, build recreational facilities for adventure-
based programming, conduct drug and alcohol prevention workshops, and
organize volunteers for Big Brothers/Big Sisters.
Grantee: Mississippi Commission for National and Community Service
Subgrantee: North MidTown Community Development Corporation
Program Name: AmeriCorps Assist
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 10
Program Descriptions: AmeriCorps members serve the North Midtown
community of Jackson through home renovations, adult education
tutoring, after-school tutoring, and health care assistance. Divided in
four teams, the housing renovation team rehabilitates 15 sub-standard
homes, the child care team provides parent supportive services for 36
children, the health care team assists the medical clinic in offering
health education seminars, the adult education team recruits and tutors
60 welfare recipients in attainment of their GED, and after-school team
tutors children to increase their reading levels.
Grantee: Mississippi Commission for National and Community Service
Subgrantee: Campus Link--AmeriCorps formula
Program Name: Campus Link
Grant Type: State Program
Full-time AmeriCorps members: 15
Part-time AmeriCorps members: 20
Program Descriptions: AmeriCorps members tutor 500 under-achieving
elementary school students from fourteen partnering schools in order to
increase the reading comprehension two levels for 75 percent of those
students participating, as well as increase the students' self-esteem
and motivation for reading. The fifteen full-time and twenty part-time
members serve in pairs at 10 university campuses throughout Mississippi
via existing or newly established Campus Service Centers. Volunteer
generation is a key component of this program--members are certified as
reading tutors and recruit and train 500 volunteers who contribute
17,000 hours of tutoring through this program.
Grantee: Mississippi Commission for National and Community Service
Subgrantee: Mississippi Institutions of Higher Learning
Program Name: Learning Experiences for Adults to Develop
Employability Related Skills
Grant Type: State Program
Full-time AmeriCorps members: 8
Part-time AmeriCorps members: 12
Program Descriptions: AmeriCorps members assist 345 out-of-school,
unemployed 16-25 year olds in their preparation for employment
opportunities. Through skill building and experiential community
problem solving, the LEYDERS program focuses on alternative methods to
improving marketable key competencies, interpersonal social skills, and
thinking skills such that 229 youth participate in community problem
solving activities and 25 youth are placed in jobs related to their
career education plan.
Grantee: Mississippi Department of Education
Subgrantee: Mississippi Department of Education
Program Name: Volunteer Assistant Teachers Train to Become Teachers
Grant Type: Ed Award Only
Full-time AmeriCorps members: 200
Part-time AmeriCorps members:
Program Descriptions: Members will serve as assistant teachers,
tutoring to raise literacy levels and receiving more training to better
their abilities.
Grantee: Missouri Community Service Commission
Subgrantee: American Youth Foundation (Education Program)
Program Name: St. Louis Partners AmeriCorps--Education
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members: 12
Program Descriptions: AmeriCorps Members tutor elementary and
middle school children, and assist teachers in developing projects in
literacy, the environment, first aid and personal safety, and substance
abuse prevention. Activities are structured at six sites, continue into
an extended literacy program, and lead into a Summer Literacy
Institute. This is a team-based program which serves an urban community
in St. Louis.
Grantee: Montana Community Services Advisory Council
Subgrantee: The University of Montana
Program Name: The Montana Campus Corps
Grant Type: State Program
Full-time AmeriCorps members: 3
Part-time AmeriCorps members: 32
Program Descriptions: AmeriCorps members recruit and place students
from Montana colleges to provide tutoring and mentoring to at-risk
students.
Grantee: National Assoc. of Child Care Resource & Referral
Agencies, Inc.
Subgrantee: National Association of Child Care Res Referral
Agencies--Parent
Program Name: National Association of Child Resource and Referral
Agencies
Grant Type: National Direct Central
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The National Association of Child Care
Resource and Resource (NACCRRA) and Referral Agencies promotes the
growth and development of high quality resource and referral services;
and exercises national policy leadership to build a diverse, high
quality child care system with parental choice and equal access for all
families. AmeriCorps members build community stability by improving the
quality and availability of infant/toddler and school age child care.
Members work directly with families, children, child care providers and
the community by serving in child care settings, provide trainings to
child care providers, consult with child care centers on program
improvements, provide resource materials to families, and help families
obtain education, health care, and other services.
Grantee: National Council of Churches of Christ
Subgrantee: Ecumenical Program for Urban Service (EPRUS)--Parent
Program Name:
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The National Council of the Churches of
Christ is the nation's largest ecumenical organization. The Council's
mission is to support its member denominations and churches in working
toward social, economic and racial justice. The Council received a
National Direct grant in 1994. AmeriCorps Members serve in schools and
community organizations in low-income neighborhoods, primarily offering
tutoring and mentoring support, leading after-school recreation and
enrichment activities, assisting runaway and homeless youth, providing
drug abuse prevention and other healthy lifestyle information, and
delivering gang prevention and intervention assistance.
Grantee: Nebraska Volunteer Service Commission
Subgrantee: Community Action of Nebraska, Inc.
Program Name: Community Action of Nebraska
Grant Type: State Program
Full-time AmeriCorps members: 33
Part-time AmeriCorps members:
Program Descriptions: Community Action of Nebraska is a statewide
program that implements conflict resolution training for in-class
training and for youth groups, enhances the educational performance of
at-risk youth through tutoring, and works with Head Start programs to
teach conflict resolution skills. Members also recruit and train
volunteers. Most of the members serve in teams ranging from two to ten
Members. Some Members serve at individual placement sites. Potential
outcomes of the program are an increase in conflict resolution skills,
a reduction of detentions, suspensions, fights and expulsions in
schools establishing peer mediation programs, and an increase in the
academic performance of students being tutored. This program serves
both rural and urban youth.
Grantee: Nebraska Volunteer Service Commission
Subgrantee: Lincoln-Lancaster County Health Department
Program Name: Lincoln-Lancaster County Health Dept.
Grant Type: State Program
Full-time AmeriCorps members: 18
Part-time AmeriCorps members:
Program Descriptions: The Comprehensive School Health Initiative
integrates health education into academics. The program works directly
with students, parents, educators, and community members to enrich
educational opportunities, provide outreach and mentoring to encourage
the adoption of healthy lifestyles, and cultivate the creation of
school and community partnerships. Members will serve in teams and
individually during the course of the program year. Potential impacts
of the program include an increase in academic achievement by the
students being tutored, the availability of after school programming
for youth that will provide a safe and academically enriching
environment, and increased parental involvement in school and community
activities. This program serves an urban population.
Grantee: New Hampshire College and University Council
Subgrantee: NH College and University Council
Program Name: Campus Compact for New Hampshire
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 75
Program Descriptions: Members enhance and expand service-learning
programs at 15 Institutions of Higher Education to meet the needs of
children and youth across NH. Coordinate 60 community service-learning
partnerships which engage in appropriate activities, incl. America
Reads.
Grantee: New Hampshire Job Training Council
Subgrantee: Tri-County Community Action Program, Inc.
Program Name: Natural Resource Conservation & Development Area
Council
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members serve in single site
placements throughout the North Country region of rural NH. Members
target specific community needs in the areas of education and other
human needs. Members develop and implement service-learning
opportunities for 200-300 youth in grades K-14; tutor 200 youth and
adults in basic academic skills; develop and provide well health
services and programs to 500 families; and support community health
agencies in such areas as coordinating cancer screenings, facilitating
immunizations, disseminating preventative health literature, and
securing pharmaceutical samples for low income clients. Members will
strive to sustain this support by generating volunteers and by
initiating collaborations among the various programs.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: NJ Department of Education (Urban Schools Service
Corps)
Program Name: USSC Administrator
Grant Type: State Program
Full-time AmeriCorps members: 75
Part-time AmeriCorps members: 10
Program Descriptions: AmeriCorps Members serve community schools in
eight New Jersey school districts. Members provide safe havens for
children by extending the school day where they tutor children and run
after-school programs. Members also provide in-class academic support
and mentoring activities aimed at improving math, science and literacy
skills. The program aims to improve the school success of 80 percent of
600 students served in eight districts.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: New Jersey Dept. of Human Services--Youth Corps
Program Name:
Grant Type: State Program
Full-time AmeriCorps members: 80
Part-time AmeriCorps members: 51
Program Descriptions: AmeriCorps Members serve in five teams
assigned to five sites that focus on a distinct issue area. One site
emphasizes school success through teaching and motivating children at
the Jersey Explorer Museum. Another site concentrates on violence
prevention through mediation in public schools. A third site focuses on
community revitalization by rebuilding neighborhoods and parks. At the
last site, members provide meals to the homebound in an effort to
increase independent living.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: A+ for Kids Teacher Network, Inc.
Program Name: Mercer County Reads Literacy Program
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: Twenty AmeriCorps members provide literacy
tutoring to 190 students at the district's most troubled school; they
also provide after-school homework assistance and run a summer reading
lab. Members provide tutoring and mentoring services to children and
parents in transitional housing with an emphasis on employability
skills for parents. The program brings at least 50 percent of the
children who receive literacy tutoring up to grade level.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: Catholic Community Services
Program Name: C.C.S AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 21
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor and mentor children
who are homeless or in crisis. Members also provide case management
services to clients living in shelters in the areas of public
assistance, job readiness skills, health care and living skills. As a
result, 80 students per shelter are tutored, 20 preschool children
participate in school readiness activities, and 70 families are
assisted.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: International Institute of New Jersey
Program Name: ``Bringing New Jersey Together''
Grant Type: State Program
Full-time AmeriCorps members: 9
Part-time AmeriCorps members: 16
Program Descriptions: AmeriCorps Members work with immigrants from
seven nationalities to (1) improve the academic performance of
children, (2) assist families to access mainstream human service and
health care delivery systems, and (3) resolve problems experienced by
victims of bias crime and housing related violations. Goals include
improved grades for 450 of the tutored children and improved
satisfaction by 675 people from the serviced populations.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: Urban League of Hudson County
Program Name: AmeriCorps Problem Solvers
Grant Type: State Program
Full-time AmeriCorps members: 5
Part-time AmeriCorps members: 36
Program Descriptions: AmeriCorps Members who are parents serve as
teaching assistants in day care classes, deliver community outreach
literacy programs, assist with recycling and beautification efforts and
lead substance abuse prevention activities.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: Red Bank Borough Board of Education
Program Name:
Grant Type: State Program
Full-time AmeriCorps members: 10
Part-time AmeriCorps members: 10
Program Descriptions: AmeriCorps Members support the success and
achievement of 150-200 school-aged children, particularly in math and
reading. Members provide in-class support, after-school tutoring, group
mentoring, and safe havens for youth. Additionally, Members increase
the number of community volunteers who work with students. Goals
include increasing math and reading scores by 10 percent, increasing
attendance while decreasing the numbers of students suspended, and
increasing volunteer participation.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: St. Paul's Community Development Corp.
Program Name: City SERVE AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 15
Part-time AmeriCorps members: 20
Program Descriptions: AmeriCorps Members provide literacy and ESL
training for low-income adults, reading improvement for homeless
elementary school children, after-school and summer programming for
teens, and family literacy activities that raise parents' awareness
about the need for early literacy development. As a result of these
efforts, 50 children will show an increase of 25 percent in reading
improvement, low income adults will show a grade level improvement in
their basic education skills, 50 teens will demonstrate increased
motivation to stay in school, and parents will show increased self
confidence in their work with children.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: New Jersey Statewide Initiative
Program Name: NJ Reads (America Reads)
Grant Type: America Reads
Full-time AmeriCorps members: 27
Part-time AmeriCorps members: 18
Program Descriptions: This is a statewide initiative where 45
AmeriCorps members recruit and train 450 volunteers (10 per member) to
assist with tutoring, mentoring and family literacy. Members and
volunteers tutor and mentor 900 K-3 students to bring the reading
abilities of 80 percent of the 900 students targeted up to or above
grade level.
Grantee: New Jersey Commission on National and Community Service
Subgrantee: New Jersey Commission--PF
Program Name:
Grant Type: Promise Fellows
Full-time AmeriCorps members: 15
Part-time AmeriCorps members:
Program Descriptions: Fellows will serve as coordinators of
Communities of Promise projects in 21 New Jersey counties. Service
activities will include expanding the KidCare program that provides
health care coverage for every child, promoting service learning for
inner city youth and K-12 students, and establishing after-school
mentoring programs for children. Anticipated outcomes are 5,000
children enrolled in heath care coverage, 2,500 youth participate in
service learning projects, and 500 youth involved in mentoring
programs. Fellows will be placed in Volunteer Centers across New
Jersey.
Grantee: New Mexico Commission for National and Community Service
Subgrantee: National Indian Youth Leadership Development Project
Inc.
Program Name:
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 8
Program Descriptions: 30 AmeriCorps members will serve in eight
schools and two hospitals. Members will provide direct tutoring
services, and will coordinate cross-age tutoring and mentoring
activities for children K-8. Service activities will take place in
eight schools and two hospitals, and will also take place on weekends
and evenings. Additionally, members will host a four week summer
literacy camp. In the schools, members will serve in teams of two or
three.
Grantee: New Mexico Commission for National and Community Service
Subgrantee: Families and Youth
Program Name: Families and Youth, Inc.--CARAS Program
Grant Type: State Program
Full-time AmeriCorps members: 25
Part-time AmeriCorps members: 19
Program Descriptions: AmeriCorps Members tutor and mentor at-risk
students. Working in three teams, Members will provide an alternative
education program to youth ages 11-17 who have been suspended or
expelled from school, develop reading skills and parental reading
support among elementary students grades K-3 who are reading below
grade level, or provide homework assistance and mentoring in class and
in an after-school homework club for middle school students who have a
history of incomplete assignments. This program will operate in city of
Las Cruces.
Grantee: New York Office of National and Community Service
Subgrantee: New York Restoration Project
Program Name: Don't Trash New York
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members focus on environmental
clean-up in New York City. Members clean, create, restore and maintain
350 acres of parkland; provide neighborhood ecology at 2 outdoor
science learning facilities for 1000 students; build a boat with
community students; engage community leaders in the creation of a plan
for sustainability; and link public spaces to the public education
system.
Grantee: New York Office of National and Cummunity Service
Subgrantee: Schenectady County Job Training Agency
Program Name: The Schenectady Bridge Builders
Grant Type: State Program
Full-time AmeriCorps members: 29
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members serve in teams to tutor
students in grades K-3; mentor youth in after school programs in
conflict resolution, personal safety, and drug resistance; rehabilitate
2 single family low income houses; and construct community paths and
revitalize nature trails. As a result of the tutoring services provided
to 2000 students and family members, ninety five percent of the
participating students will be able to read independently by age 8.
Additionally, forty percent of parents will complete activities at home
to strengthen student reading skills. Three hundred youth will learn
new skills improve their attitudes and behavior. Two low or moderate
income families will own newly renovated homes, not otherwise available
to them. The community parks will be more accessible to the public as
well as to the disabled community. Volunteers will contribute 100 hours
to a greenhouse and community gardens.
Grantee: New York Office of National and Community Service
Subgrantee: Phoenix House Foundation, Inc.
Program Name: New York State Substance Abuse Service Program
Grant Type: State Program
Full-time AmeriCorps members: 85
Part-time AmeriCorps members:
Program Descriptions: The Phoenix House AmeriCorps program expands
and improves the network of substance abuse and alcohol treatment/
prevention services available to New Yorkers. Members assist various
communities by developing linkages between treatment providers,
organizations, and schools. Members provide substance abuse prevention
counseling and education to community residents, including individuals
in recovery, educators, school-aged youth and parents.
Grantee: New York Office of National and Community Service
Subgrantee: Grand Street Settlement
Program Name: AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 40
Program Descriptions: 40 part time AmeriCorps members serve in
various sites throughout the lower east side of Manhattan. Members
address school safety, school readiness and school success issues of
community residents. By escorting youth to after school activities,
program attendance has increased. Service in the Early Head Start
Program and work with parents support family literacy and school
readiness. Members also provide homework assistance, computer training,
and one to one tutoring to promote school success.
Grantee: New York Office of National and Community Service
Subgrantee: YMCA of Greater New York
Program Name: YMCA AmeriCorps School Success Program
Grant Type: State Program
Full-time AmeriCorps members: 72
Part-time AmeriCorps members:
Program Descriptions: YMCA School Success program is an extended
day youth-based program where 72 AmeriCorps Members facilitate
classroom-based service activities and enrichment activities in 12 Low-
performing schools. Members also lead physical fitness and health
awareness activities and provide community service-learning activities.
Expected impact includes, 120 service projects, a 5-percent increase in
student reading and math scores, and a 15-percent increase in student
fitness levels.
Grantee: New York Office of National and Community Service
Subgrantee: Monroe Community College
Program Name:
Grant Type: State Program
Full-time AmeriCorps members: 94
Part-time AmeriCorps members:
Program Descriptions: 94 full-time AmeriCorps Members serve in 25
community-based organizations in Rochester, New York's Enterprise
Community. The purpose of this program is to increase the reality and
perception of public safety in the community. Members provide
assistance to police substations, prevention and intervention education
to youth around issues of substance abuse and conflict resolution, and
implement positive developmental and community service activities with
neighborhood youth. Expected impacts include: a 20 percent increase in
geographic area covered by Neighborhood Watch and block clubs; a 20
percent increase in contacts at police substations; a reported increase
in intervention/prevention services offered to youth; and a 10 percent
increase in numbers of youths participating in targeted activities.
Grantee: New York Office of National and Community Service
Subgrantee: Bank Street College of Education
Program Name: AmeriCorps Community Service Internship
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 25
Program Descriptions: Members provide classroom and after-school
literacy training and reading/tutoring support for 700+ elementary
school students who do not perform at grade level.
Grantee: New York Office of National and Community Service
Subgrantee: Research Foundation of SUNY--New Paltz
Program Name: AmeriCorps Education Awards Program
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 100
Program Descriptions: Members provide tutoring and literacy
assistance to 500+ youth; after school, weekend, and summer activities
in 4 community centers; and involve youth in community service efforts.
Grantee: New York Office of National and Community Service
Subgrantee: Albany Service Corps
Program Name: Albany School Success AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 16
Part-time AmeriCorps members: 16
Program Descriptions: AmeriCorps members support school success
through three principal initiatives: (1) to improve the literacy of 500
students, (2) to provide extended day programming for 500 youth, and
(3) to improve school attendance of 300 students. The program goals are
to improve the achievement poential of at-risk youth.
Grantee: New York Office of National and Community Service
Subgrantee: Buffalo Place Foundation
Program Name: AmeriCorps Ranger Escort Program
Grant Type: State Program
Full-time AmeriCorps members: 12
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members increase public safety
visibility and effectiveness through identifying potential crimes and
patrolling the streets of downtown Buffalo. Expected impacts include a
10 percent decrease in crime and a 20 percent increase in the
perception of a safer downtown area. Additionally, members provide
safety escorts for 500 people and distribute safety tips to 3000
people.
Grantee: New York Office of National and Community Service
Subgrantee: Syracuse Area Catholic Charities
Program Name: Syracuse Area Catholic Charities AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 15
Part-time AmeriCorps members: 1
Program Descriptions: AmeriCorps members serve in seven centers in
the greater Syracuse, NY region with attention in three areas: (1) to
assist with the early childhood education of 150 3-5 year olds to
foster school readiness and school success, (2) to teach and model
prosocial skills to 1200 children 5-18 years and (3) to transport 800
low income children and women to medical appointments to improve
compliance with medical treatment. Members work with children in
schools and in after school programs. Additionally, members will expand
their service to support the needs of refugee youth in the area, which
includes providing them an orientation to the community and to the
schools, providing support with the adjustment to a new culture, and
teaching ESL and assisting with citizenship classes.
Grantee: New York Office of National and Community Service
Subgrantee: Oswego City-County Youth Bureau
Program Name: Oswego AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 17
Part-time AmeriCorps members: 48
Program Descriptions: AmeriCorps members serve in multiple agencies
throughout Oswego County to provide positive prevention services to
youth and families. Members assist youth and families with basic needs
that permit self-sufficiency such as with food, clothing, shelter,
child care and safety. Additionally members provide school readiness,
literacy readiness and tutoring opportunities by supporting parents of
preschoolers, assisting with in-school and after school activities, and
establishing a summer reading program for elementary students. Members
also provide positive alternatives and relationships for youth and
their families by developing a youth leadership program, establishing
parent support groups and developing meaningful community service
projects. Members will serve at least 2000 youth and their families.
Grantee: New York Office of National and Community Service
Subgrantee: West Seneca Youth Bureau--Share the Word
Program Name: Sharing the Words, America Reads
Grant Type: State Program
Full-time AmeriCorps members: 38
Part-time AmeriCorps members: 80
Program Descriptions: In partnership with Universities at Buffalo,
Buffalo State College and the King Urban Center, 38 full-time
AmeriCorps Members provide one-on-one tutoring to 2500 at-risk children
in Buffalo, New York. Members will ``adopt'' elementary and secondary
schools with low retention rates in order to increase retention through
tutoring and providing public awards for the students' work. Members
also design and implement service projects with these students.
Expected impacts include: a 75 percent improvement in test scores of
students tutored; a 75 percent satisfaction rate among service
recipients; and a 75 percent improvement in student retention rate.
Grantee: New York Office of National and Community Service
Subgrantee: The Institute for Human Services, Inc.
Program Name: AmeriCorps Kids First Initiative/Steuben County
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: Twenty AmeriCorps members serve in single
site placements throughout rural Steuben County supporting various
goals of the Summit. Members provide 3750 of the county's youth with
positive role models and alternative activities through tutoring,
mentoring, and planned activities. Members ensure that youth and their
families receive the support needed to succeed in and stay in school.
Additionally, members provide support to ensure that children have safe
and healthy home environments and behaviors. Specific member services
include providing safe places, substance abuse prevention counseling,
adolescent pregnancy training, health care counseling, and alternative
after school activities.
Grantee: New York Office of National and Community Service
Subgrantee: Pace University
Program Name: Lower East Side/Chinatown AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 57
Program Descriptions: 11 part-time and 46 reduced part-time members
serve the primarily Asian community in Lower Eastside NYC. Members
tutor and mentor low achieving junior high students to improve their
grades and attendance; provide college and career counseling to high
school students and their parents to increase the rate of h.s.
graduation, college matriculation and career/employment options; and
provide service-learning opportunities to students to help them
increase their problem solving skills.
Grantee: New York Office of National and Community Service
Subgrantee: City College of the City University of New York
Program Name: City College's Empowering Communities Program
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 30
Program Descriptions: AmeriCorps Members from the City College of
New York facilitate a community service learning program that increases
community members' computer skills and school success. Members train
community members in computer skills, tutor students after-school, and
work with parents to involve them more in their child's education.
Expected impacts include: Community members will be trained in computer
skills and targeted youth will show an improvement in college
preparatory skills.
Grantee: New York Office of National and Community Service
Subgrantee: SUNY Oneonta Research Foundation
Program Name: Oneonta Rural School Empowerment Program
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members: 30
Program Descriptions: AmeriCorps members improve the school success
of youth in Oneonta County. Focusing on reading and math, members tutor
and mentor 900 students in school and engage 450 students in after
school and evening programs. Additionally, through the development of
15 Youth Leaders in Action service clubs, members provide leadership
training for 225 youth.
Grantee: New York Office of National and Community Service
Subgrantee: Latino Pastoral Action Center
Program Name: Latino Pastoral Action Center
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members improve the literacy of
150 5-7 year old students through a comprehensive school day and
extended day program. Additionally, members improve the academic
performance of 150 6-14 year olds through an after school program.
Members also serve to increase the access and use of community services
by 100 youth and their family members.
Grantee: New York Office of National and Community Service
Subgrantee: Families First in Essex County
Program Name: Families First in Essex County
Grant Type: State Program
Full-time AmeriCorps members: 12
Part-time AmeriCorps members: 14
Program Descriptions: AmeriCorps Members serve in eleven agencies
throughout Essex County to address all five goals of the Summit as well
as the human needs of its citizens. Members tutor, mentor, and counsel
youth, train parents of youth with disabilities and provide educational
support to older adolescents. Program goals are to improve the academic
and behavioral performance of students in schools and to increase the
numbers of community agencies and businesses that collaborate.
Grantee: New York Office of National and Community Service
Subgrantee: Student Conservation Association NY
Program Name: NY Adirondack Youth Conservation AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members serve in a residential
environmental conservation program in the Adirondacks region. Members
build, repair, refurbish and restore recreational and natural areas
such as hiking trails, camp grounds, recreational and historic
buildings. Additionally, members use service learning models to provide
environmental and ecological education for 400-800 in-school, after
school, and out of school youth. 60-100 volunteers will be recruited
and trained to assist with these activities.
Grantee: North Carolina Commission on National & Community Service
Subgrantee: Children First of Buncombe County
Program Name: Project POWER
Grant Type: State Program
Full-time AmeriCorps members: 16
Part-time AmeriCorps members: 6
Program Descriptions: AmeriCorps members serve as reading coaches
to K-8th grade children performing below grade level in Asheville/
Buncombe County schools. In addition, members set up mediation programs
to teach conflict resolution to children in grades 5 and 6 and lead
small groups of students in service learning projects.
Grantee: North Carolina Commission on National & Community Service
Subgrantee: Communities in Schools of North Carolina, Inc.
Program Name: Project REACH
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 30
Program Descriptions: AmeriCorps members tutor 400 elementary
school children who read below grade level, utilizing the Great Leaps
curriculum to increase reading proficiency and comprehension. Members
also train parents to better support their children's learning and
recruit 90 community volunteers to tutor in the schools.
Grantee: North Carolina Commission on National & Community Service
Subgrantee: Warren Family Institute
Program Name: Warren Service Corps
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 40
Program Descriptions: AmeriCorps members provide one-on-one
instructional Support to K-12 students and GED students; literacy
development with pre-schoolers in day care; and provide homework
assistance and enrichment activities in after-school and Saturday
academies.
Grantee: North Carolina Commission on National & Community Service
Subgrantee: Southeastern Community College
Program Name: Steps to Success
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor and mentor 400 3rd-
5th grade students to increase reading proficiency and school
attendance. Members serve in four schools in Columbus County.
Grantee: Northeastern University
Subgrantee: Athletes in Service to America--Parent
Program Name: NE University/Athletes in Service
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The Northeastern University Center for Sport
in Society increases awareness of sport's relation to society and
develops programs that identify current problems and offer solutions
promoting the benefit of sport. The Center, founded in 1984, designed
the program models used by sites: Project TEAMWORK (conflict
resolution) and Mentors in Violence Prevention (MVP) concerning gender-
based violence. President Clinton recognized TEAMWORK as a national
model in 1994. AmeriCorps Members recruit college and high school
students to tutor and mentor school-age youth during full-time summer
and year-round after school programs. The full-time Members train part-
time Members and community volunteers in curriculum development and
tutoring skills and all Members expand the program's partnership with
families, schools and community agencies.
Grantee: Notre Dame Mission Volunteer Program, Inc.
Subgrantee: Notre Dame Mission Volunteer Program, Inc.--Parent
Program Name: Notre Dame Mission Volunteers, Inc.
Grant Type: National Direct Central
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The Notre Dame Mission Volunteers, Inc., is a
non-profit organization founded by the Sisters of Notre Dame, a
religious institution which has been serving communities in need for
over 150 years. Among other social issues which the organization
addresses, the Notre Dame volunteers target the educational needs of
the disadvantaged youth and their families. AmeriCorps Members tutor
low income children, teach ESL to immigrants and GED and literacy
skills to adults such as single mothers and high school drop-outs, and
operate after school programs. Members also recruit volunteer parents
for enrichment programs, teach conflict resolution skills, and provide
school-to-work transition support for migrant farmworkers.
Grantee: Oregon Community Service Commission
Subgrantee: Central Oregon Community College Foundation
Program Name: COCC/AmeriCorps Service to Community
Grant Type: State Program
Full-time AmeriCorps members: 9
Part-time AmeriCorps members: 58
Program Descriptions: 9 full-time and 36 part-time AmeriCorps
members serve in an urban and several rural communities in central
Oregon in small teams or individual placements. These members provide
tutoring in elementary schools to increase literacy and life skills;
provide community service projects in middle schools; and develop
leadership training and opportunities for high school.
Grantee: Oregon Community Service Commission
Subgrantee: Forest Grove School District
Program Name: Partnerships For Student Achievement
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 10
Program Descriptions: AmeriCorps members serve in eleven schools in
the Forest Grove school district in K-12 grades to improve literacy
among low achieving and at risk students, and generate parental
involvement in the schools. As a result five hundred school students
will increase reading scores and parental involvement will increase by
15 percent in targeted schools.
Grantee: PennSERVE: The Governor's Office of Citizen Service
Subgrantee: City Year, Inc. PA
Program Name:
Grant Type: America Reads
Full-time AmeriCorps members: 12
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members deliver a specialized
literacy curriculum to children with physical, emotional, and cognitive
disabilities and to children for whom English is a second language.
Through a partnership with City Year Philadelphia and the Institute on
Disabilities, Members serve in 2 public elementary schools where they
provide one-on-one tutoring to 60 children in grades K-3. Members help
improve reading ability and interest levels for the children they serve
in addition to integrating children with disabilities into normal
classroom activities.
Grantee: PennSERVE: The Governor's Office of Citizen Service
Subgrantee: Keystone School District
Program Name: Keystone SMILES
Grant Type: State Program
Full-time AmeriCorps members: 27
Part-time AmeriCorps members: 59
Program Descriptions: AmeriCorps members tutor and mentor K-12
school aged children. Their primary focus is on students at risk of not
completing school. They accomplish their goal by expanding learning
environments, recreational and health facilities. As a result of
Members' efforts, 281 students are tutored and 1,282 students
participate in the Computer Lab.
Grantee: PennSERVE: The Governor's Office of Citizen Service
Subgrantee: Appalachia Intermediate Unit 8: Pennsylvania Mountain
Service Corps
Program Name: Pennsylvania Mountain Service Corps
Grant Type: State Program
Full-time AmeriCorps members: 56
Part-time AmeriCorps members: 4
Program Descriptions: AmeriCorps Members serve in teams where they
institute violence prevention programs for students, provide health
care and education to the elderly and preschoolers. Members also design
and implement watershed projects in a vast 10 county rural area through
the cooperative use of volunteers. Members' efforts result in the
increase of school readiness and parental involvement for 2,000
individuals.
Grantee: PennSERVE: The Governor's Office of Citizen Service
Subgrantee: Family Services of Butler Memorial Hospital
Program Name: Family Services of Butler Memorial Hospital
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members: 16
Program Descriptions: Members provide family support services in
the areas of counseling, child development, parenting classes, violence
prevention, and personal development. Members support needs identified
by the community to reduce isolation; increase access to health,
education and recreation programs; and increase volunteerism. Members
also assist 30 new programs, expand or enhance the services of existing
programs by 10 percent, and increase local volunteerism by 10 percent.
Grantee: PennSERVE: The Governor's Office of Citizen Service
Subgrantee: County of Allegheny DFP (KEYS to Success)
Program Name: KEYS PUBLIC SAFETY INITIATIVE
Grant Type: State Program
Full-time AmeriCorps members: 22
Part-time AmeriCorps members: 7
Program Descriptions: AmeriCorps members improve the rate of
academic success by tutoring 175 economically disadvantaged and high
risk students. They broaden the horizons of these students though
engagement in 16 service-learning/community service projects and the
development of individual career plans. To assist with these efforts,
parents provide 100 hours and other volunteers provide 650 hours of
additional support.
Grantee: PennSERVE: The Governor's Office of Citizens Service
Subgrantee: County of Allegheny DFP (Public Safety)
Program Name: Knowledge to Empower Youths to Success (KEYS) Service
Corps
Grant Type: State Program
Full-time AmeriCorps members: 19
Part-time AmeriCorps members: 8
Program Descriptions: AmeriCorps Members serve in sites throughout
Allegheny County to develop and implement crime prevention strategies,
including community policing. Members also develop and implement youth
mentoring programs. Members' efforts result in the implementation of
six neighborhood watches or block clubs.
Grantee: Puerto Rico State Commission on Community Service
Subgrantee: University of the Sacred Heart
Program Name: USH AmeriCorps Program: Public Safety Through School
and Community Empowerment
Grant Type: State Program
Full-time AmeriCorps members: 10
Part-time AmeriCorps members: 20
Program Descriptions: AmeriCorps members work with 100-160 students
at each of five schools (elementary, intermediate, and high schools) to
increase school success and reduce at-risk behavior. Members serve to
reduce the use of alcohol, tobacco, and other drugs; prevent the crime
and violence that often accompanies this behavior; and improve the
school success of the students. Program strategies include the use of
fine arts and the development of student groups at each school.
Additionally, the program emphasizes the training of teachers and
parents in the management of high risk youth and violence for the
improvement of public safety.
Grantee: Rhode Island Commission on National and Community Service
Subgrantee: Children's Museum of Rhode Island
Program Name: Providence Children's Museum AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 15
Part-time AmeriCorps members:
Program Descriptions: Fifteen AmeriCorps Members provide community
service opportunities through the Children's Museum of Rhode Island for
low-income high-risk families. Members serve in three teams--after
school learning club, community service learning, and Head Start. In
the After School Learning Clubs, five members encourage students to
increase independent learning and serve as a resource for parents. The
community service team involves four members and at least 500 children
who participate in ``Community Quest'' a program that explores the
meaning and importance of serving the community. The Head Start team is
made up of three members and serves 886 children in 44 classes. With
Head Start teachers and parents, members develop enriched museum visits
for Head Start students. These classes visit the Children's Museum
where they explore exhibits and participate in art activities.
Grantee: Rhode Island Commission on National and Community Service
Subgrantee: Rhode Island Children's Crusade for Higher Education
Program Name: Rhode Island Children's Crusade for Higher Education
Grant Type: State Program
Full-time AmeriCorps members: 40
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members support the educational
success of participating students in the sixth through ninth grades.
Additionally, members provide direct service to strengthen schools,
families, and communities in order to support poor children at risk of
dropping out of school. The Crusade assists children to graduate and
take advantage of a scholarship for higher education. Members complete
assessments and assist the progress of 80 percent of the at-risk
children identified as Crusaders and make appropriate referrals to
service agencies to help students and their families. Approximately
3270 sixth-ninth grade children will be profiled, followed, and aided
in staying in school and maintaining satisfactory academic performance.
Grantee: Rhode Island Commission on National and Community Service
Subgrantee: Public Education Fund (Parents Making a Difference)
Program Name: Parents Making A Difference
Grant Type: State Program
Full-time AmeriCorps members: 35
Part-time AmeriCorps members: 14
Program Descriptions: AmeriCorps members create and operate family
centers in 21 Providence elementary, middle and high schools as part of
a state-wide effort at school reform. In the family centers, members
provide GED, ESL, and parenting education classes as well as Domestic
Violence Prevention training for 3,000 adults in the community. Members
also plan to tutor and mentor 14,600 students in those participating
schools. This program addresses the America Reads challenge by
launching Providence Reads where they collaborate with Learn and Serve
America. Members are actively recruited from the local welfare to work
program.
Grantee: Rhode Island Commission on National and Community Service
Subgrantee: City Year, Inc.
Program Name: City Year Rhode Island
Grant Type: State Program
Full-time AmeriCorps members: 100
Part-time AmeriCorps members: 10
Program Descriptions: One hundred and seven full-time and 6 part-
time AmeriCorps Members tutor and mentor elementary school children,
implement an after school program, and present special issues
workshops. In middle schools, members teach a six week Creating
Community Curriculum and operate Young Heroes which is a junior service
and service-learning program. Finally, members work to revitalize 6
urban neighborhoods. These members serve in three teams and are placed
at six high need urban elementary and middle schools. Impact includes:
improved learning environment for 2,870 children; enriched middle
school environment for 1,200 children; and improved urban habitat for
children and families in 6 urban neighborhoods.
Grantee: Rhode Island Commission on National and Community Service
Subgrantee: City of Pawtucket
Program Name: Partners in Learning/AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 21
Program Descriptions: AmeriCorps Members provide educational
assistance for at-risk children grades K-2 from the diverse Cities of
Pawtucket and Central Falls. Members also tutor adults enrolled in GED,
ESL and literacy programs and involve children in community based
academic enrichment programs during the summer months. Expected impacts
include, 60 percent of those who receive tutoring support will show
progress in reading skills; 70 percent of those parents involved in
these programs will report involvement in their child's schooling; and
80 percent of those enrolled in summer enrichment programs will report
improved attitudes and interest in the sciences as career options.
Grantee: Rhode Island Commission on National and Community Service
Subgrantee: Community College of Rhode Island
Program Name: CRRI--AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 30
Part-time AmeriCorps members: 4
Program Descriptions: AmeriCorps Members serve in three sites in
the Providence area, to provide educational support, bridge community
needs through service learning, and encourage civic responsibility.
Members specifically provide school readiness activities for limited
English proficient children, tutor and mentor low-income elementary
school students, and assist parents in skills to enhance child
development. Expected impacts include, 75 percent of children who
participate will increase their school readiness by 75 percent; 75
percent of children participating will increase their English language
skills; and 75 percent of parents participating will report a 50
percent increase in their parenting skills.
Grantee: Rhode Island Commission on National and Community Service
Subgrantee: Rhode Island Commission--PF
Program Name: AmeriCorps Promise--Rhode Island
Grant Type: Promise Fellows
Full-time AmeriCorps members: 5
Part-time AmeriCorps members:
Program Descriptions: Fellows will serve in several capacities led
by the United Way in order to focus on all five resources of the
Summit. Service activities will include establishing 50 neighborhood
homework safe places, encouraging 100 Employers to allow employees paid
time off for community service, and organizing an interactive Youth
Resource Bank where people can contribute skills and talents to the
community. Expected results include increased volunteerism and
resources across Rhode Island. Fellows will serve in sites to be
selected in a competitive process.
Grantee: Robert F. Kennedy Memorial
Subgrantee: RFK Fellows AmeriCorps Program--Parent
Program Name:
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The Robert F. Kennedy (RFK) Memorial works
across the county and around the world to carry forward Robert
Kennedy's mission for social justice by helping disadvantaged and
oppressed people and recognizing, training, and supporting upcoming
leaders. It currently sponsors the RFK Fellows program, which is
designed to train young people and provides them with public-service
placements. AmeriCorps Members, placed at community-based
organizations, will assist at-risk youth to gain leadership skills
through provision of solutions to neighborhood violence and out-of-
school learning activities. Members will serve as mentors and tutors,
organize out-of-school activities, teach conflict resolution and
violence prevention, youth case management, and integrate community
members in service.
Grantee: Round Rock Chapter
Subgrantee: Round Rock Chapter
Program Name: Round Rock AmeriCorps
Grant Type: Tribe Territory
Full-time AmeriCorps members: 15
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps Members tutor 85 K-5 students to
bring them up to grade level in reading on this remote chapter of the
Navajo Nation in Arizona. Members are also constructing 2 homes and a
teen center, building 8 bathrooms for houses that lack them, and
producing a community newsletter. Members will recruit 115 community
members including local teens, to assist them in providing youth
recreational activities and culture camps after school and in the
summer. Members serve in two teams in a isolated, rural area.
Grantee: South Carolina Commission on National and Community
Service
Subgrantee: Winthrop University
Program Name: Winthrop AmeriCorps: Empowerment Through Literacy
Grant Type: State Program
Full-time AmeriCorps members: 8
Part-time AmeriCorps members: 24
Program Descriptions: AmeriCorps members tutor 225 low performing
students in grade 2-6 and 9-12 to raise 90 percent of their reading
scores above the 50th percentile or pass the state competency for
reading and literacy. Members also tutor 30 special needs students in
grades 2-6 to increase their standardized test scores by one grade.
Additionally members tutor 100 students in grade 2-5 to increase their
reading comprehension scores by one grade level. Members serve at one
of four sites. The program will recruit and utilize 40 community
volunteers in support of this literacy effort.
Grantee: South Carolina Commission on National and Community
Service
Subgrantee: Benedict College
Program Name: Benedict College AmeriCorps Program
Grant Type: State Program
Full-time AmeriCorps members: 12
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor 150 K-6 low-achieving
students (both in-school and after-school) so that 85 percent increase
reading and math scores one grade level. Members also tutor 75-
achieving students in a summer enrichment program so that 85 percent
increase math and reading scores one grade level. Members serve in one
of three elementary school. This program recruits and utilizes 30
volunteers to provide 1,500 hours of service.
Grantee: Summerbridge National, Inc.
Subgrantee: Summerbridge National--Parent
Program Name: Summerbridge ACorps Teaching Program
Grant Type: National Direct Central
Full-time AmeriCorps members.
Part-time AmeriCorps members:
Program Descriptions: Summerbridge National promotes school success
while preparing students for high-school programs and developing high
school and college students as future educators. Summerbridge National
AmeriCorps Members provided tutoring and mentoring support in after-
school, weekend, and summer settings, provided enrichment class
instruction, provided service and service-learning opportunities for
elementary, middle, secondary school and college students, and
cultivated young educators.
Grantee: Teach For America, Inc.
Subgrantee: Baltimore/Teach For America, Inc.
Program Name: Teach for America--Baltimore
Grant Type: National Direct Central
Full-time AmeriCorps members: 63
Part-time AmeriCorps members:
Program Descriptions: Teach for America (TFA) is a national teacher
corps dedicated to improving educational achievement of under-served
school age youth. TFA places a diverse group of recent college
graduates as teachers in urban and rural school districts facing
critical teacher shortages. AmeriCorps Members teach under-served youth
at inner-city and rural public schools. Members assume leadership roles
on school committees, sponsoring after school enrichment and
recreational opportunities. Members also coordinate and implement
service projects addressing specific community needs.
Grantee: Teach For America, Inc.
Subgrantee: Houston/Teach For America, Inc.
Program Name: Teach for America
Grant Type: National Direct Central
Full-time AmeriCorps members: 37
Part-time AmeriCorps members:
Program Descriptions: Teach for America (TFA) is a national teacher
corps dedicated to improving educational achievement of under-served
school age youth. TFA places a diverse group of recent college
graduates as teachers in urban and rural school districts facing
critical teacher shortages. AmeriCorps Members teach under-served youth
at inner-city and rural public schools. Members assume leadership roles
on school committees, sponsoring after school enrichment and
recreational opportunities. Members also coordinate and implement
service projects addressing specific community needs.
Grantee: Teach For America, Inc.
Subgrantee: Enfield/Teach For America, Inc.
Program Name: Teach for America
Grant Type: National Direct Central
Full-time AmeriCorps members: 60
Part-time AmeriCorps members:
Program Descriptions: Teach for America (TFA) is a national teacher
corps dedicated to improving educational achievement of under-served
school age youth. TFA places a diverse group of recent college
graduates as teachers in urban and rural school districts facing
critical teacher shortages. AmeriCorps Members teach under-served youth
at inner-city and rural public schools. Members assume leadership roles
on school committees, sponsoring after school enrichment and
recreational opportunities. Members also coordinate and implement
service projects addressing specific community needs.
Grantee: Teach For America, Inc.
Subgrantee: McAllen/Teach For America, Inc.
Program Name: Teach for America--McAllen
Grant Type: National Direct Central
Full-time AmeriCorps members: 78
Part-time AmeriCorps members:
Program Descriptions: Teach for America (TFA) is a national teacher
corps dedicated to improving educational achievement of under-served
school age youth. TFA places a diverse group of recent college
graduates as teachers in urban and rural school districts facing
critical teacher shortages. AmeriCorps Members teach under-served youth
at inner-city and rural public schools. Members assume leadership roles
on school committees, sponsoring after school enrichment and
recreational opportunities. Members also coordinate and implement
service projects addressing specific community needs.
Grantee: Tennessee State Commission on National and Community
Service
Subgrantee: The University of Tennessee at Chattanooga
Program Name: Chattanooga Family Service Corps
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 16
Program Descriptions: AmeriCorps members provide mentoring, in-
school and after-school tutoring, and summer learning opportunities to
more than 250 children, of which 75 percent will reach their individual
reading learning goal. Chattanooga Family Service Corps aims to improve
the academic success of low-income children from south Chattanooga who
have been identified as at-risk of school failure and encourages
parental participation in school activities by involving more than 100
parents of the children tutored. Members also coordinate service-
learning at 4 area schools with children in grades K-3 and involve
parents to participate in school activities.
Grantee: Tennessee State Commission on National and Community
Service
Subgrantee: Upper Cumberland County Community Health Agency
Program Name: School Achievement Partnership Project
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 30
Program Descriptions: AmeriCorps members tutor children and make
family contacts in an effort to promote regular attendance of children
identified as truant and to involve the parent in the children's
academic achievements. The School Achievement Partnership Project is
increasing attendance by 15 percent of at least 70 percent of the 450
students served. Of the 300 elementary school children tutored in four
participating rural counties of the Upper Cumberland region of Middle
Tennessee, 70 percent will demonstrate academic success with an
increase of one or more letter grade(s). In the summer, corps members
organize Youth Power Teams to engage 4th-6th graders in service-
learning activities.
Grantee: Tennessee State Commission on National and Community
Service
Subgrantee: Emerald Avenue Urban Youth
Program Name: Emerald Avenue AmeriCorps Urban Youth Initiative
Grant Type: State Program
Full-time AmeriCorps members: 12
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor at-risk students in
grades 2-5, as well as teach computer skills through newsletter
production in an after-school program and summer day camp for 6th-8th
grade students. Of 75 children tutored, 65 percent demonstrate an
increase in academic achievement. Members also lead nonviolent learning
sessions to 100 students in grades 2-8, resulting in a 30 percent
decrease of violent/aggressive behavior by the end of the year and 75
percent decrease in nonviolent classroom behavior. Members are assigned
to three community centers in the Knoxville area.
Grantee: The Arc of The United States
Subgrantee: The Arc of Montgomery County
Program Name: The ARC of Montgomery County--C.O.N.N.E.C.T.S.
Grant Type: National Direct
Full-time AmeriCorps members: 20
Part-time AmeriCorps members:
Program Descriptions: The Arc of the United States is the nation's
largest volunteer organization solely devoted to improving the welfare
of Americans with mental retardation and their families, working
through 1200 chapters across the nation. AmeriCorps Members mentor
individuals with mental retardation on a one-to-one basis, teach
independent living skills, and assist integration into community life.
Members serve as liaisons between the community and disabled persons
and educate community groups, local businesses and the general public
about the needs of developmentally disabled.
Grantee: The ASPIRA Association Inc.
Subgrantee: Aspira (Washington)--Parent
Program Name: ASPIRA/AmeriCorps Community Service Program
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: Aspira Association, Inc. is a national non-
profit organization devoted solely to serving Puerto Rican and other
Latino youth through leadership development and education. AmeriCorps
Members teach Latino youth literacy, language and mathematical skills
through tutoring and mentoring in school and after school. Members
develop and facilitate programs providing leadership development,
service learning, and enrichment activities. Members also conduct
outreach to parents individually and through group programming.
Grantee: The Houston READ Commission
Subgrantee: The Houston READ Commission--Parent
Program Name: National Direct Sub
Grant Type:
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The Houston READ Commission is a non-profit
created in 1988 by the City of Houston to coordinate, promote and
expand adult and family literacy services in the greater Houston area.
It has been instrumental in raising an additional million dollars to
support local community-based literacy efforts. It enjoys strong
relationships with the Houston Community College System and the Texas
State Commission. Literacy*AmeriCorps Members provide literacy
instruction for children and adults and target the specific need of
increasing children's literacy skills. AmeriCorps Members increase
literacy for families by providing English as a Second Language
courses, basic skills, pre-GED and GED classes, homework assistance to
school-age children, family and parent literacy programs. America Reads
activities include recruiting and training volunteers as tutors for
young children.
Grantee: University of Maryland Baltimore County
Subgrantee: UMBC/Shriver-Choice
Program Name: The Choice Program
Grant Type: Ed Award Only
Full-time AmeriCorps members: 131
Part-time AmeriCorps members: 11
Program Descriptions: Members work in round-the-clock service
designed to curb delinquency and reduce school dropout among the most
troubled youth in the area.
Grantee: University of St. Thomas
Subgrantee: Minnesota Campus Compact
Program Name: STAND and Deliver
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 100
Program Descriptions: Members will organize and lead service-
learning projects--tutoring, building homes, researching, and cleaning
streams.
Grantee: Utah Commission on Volunteers
Subgrantee: Salt Lake County Reads and Promotes Service
Program Name: Salt Lake County Reads and Promotes Services (SLORPS)
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 85
Program Descriptions: Members provide small group instruction for
youth who need additional help after-school.
Grantee: Vermont Commission on National and Community Service
Subgrantee: Lyndon State College
Program Name: Northeast Kingdom Initiative
Grant Type: State Program
Full-time AmeriCorps members: 14
Part-time AmeriCorps members: 10
Program Descriptions: Members tutor 300 Northeast Kingdom youth.
Also, members operate resource centers that provide 400 residents of
rural Vermont with computer resources, educational material, and
courses on adult literacy and parenting skills. These members
effectively impact 150-220 children and adults by increasing reading
skills by a grade level; assisting 125 victims of domestic violence
resulting in 70 percent of the families choosing healthy behavior; and
mentoring 200 youth in order to increase their academic success by 40-
55 percent.
Grantee: Vermont Commission on National and Community Service
Subgrantee: Lyndon State College
Program Name: Literacy in the Kingdom (Northeast Kindgom Initiative
AmeriCorps)
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 20
Program Descriptions: Members provide tutoring, reading, and
mentoring to young children and at-risk youth. Members also provide
needed support for unemployed or underemployed adults and welfare
recipients.
Grantee: Vermont Commission on National and Community Service
Subgrantee: Vermont Commission--PF
Program Name: Vermont America's Promise Fellowship Program
Grant Type: Promise Fellows
Full-time AmeriCorps members: 8
Part-time AmeriCorps members:
Program Descriptions: Fellows will serve in non-profit and state
agencies to help private and public agencies focus on the goal of
serving 15,000 additional Vermont Children by 2000. Service activities
will include identifying and working with community partners to develop
service learning programs, developing a T/TA Needs Assessment tool and
organizing a statewide conference to disseminate information, and
coordinating a process to recruit mentors. Anticipated outcomes are an
increase in students participating in service learning, a system to
recruit mentors and volunteers, and the creation of afterschool
programs and out of school programs. Fellows will serve in eight
organizations across the state.
Grantee: Virginia Commission on National & Community Service
Subgrantee: Fredericksburg City Public Schools
Program Name: Rappahannock AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 14
Part-time AmeriCorps members: 20
Program Descriptions: AmeriCorps members provide in-class support
to educationally at-risk students in grades K-8 to increase K-5 grade
children to ``satisfactory'' performance and to improve middle
schoolers' grade point average at least one letter grade. Members also
provide individual tutoring for students at risk of failing state-
mandated achievement tests, and mentor truant students in after-school
programs. A total of 500 students are served.
Grantee: Virginia Commission on National & Community
Subgrantee: Virginia Cooperative Extension Americorps Program
Program Name: VCE AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 40
Program Descriptions: AmeriCorps members deliver educational
activities at 4-H after-school and summer programs for youth ages 5-14.
Members plan and conduct training sessions for workforce preparation
for 13- to 19-year-old teens. Members serve in one of three northern
Virginia communities.
Grantee: Virginia Commission on National & Community
Subgrantee: Northern Virginia Urban League--2
Program Name: Alex Can Read Initiative
Grant Type: State Program
Full-time AmeriCorps members:
Part-time AmeriCorps members: 24
Program Descriptions: AmeriCorps members provide tutoring in
reading to 100 K-3rd grade children in four elementary schools to
increase student reading ability by \1/2\ grade level. Members also
lead and support learning activities for 3- to 5-year-olds in Head
Start classrooms, and coordinate the reading tutorial services of
community volunteers in the schools served by members.
Grantee: Virginia Commission on National & Community
Subgrantee: Virginia Commonwealth University Americorps
Program Name: VCU AmeriCorps
Grant Type: State Program
Full-time AmeriCorps members: 15
Part-time AmeriCorps members: 40
Program Descriptions: AmeriCorps members assist families
transitioning from welfare to work in three impoverished inner-city
neighborhoods. Services include job readiness training, job search
assistance, and quality care and academic enrichment to pre-school and
school-aged children during the school day and after school.
Grantee: Washington Commission on National and Community Service
Subgrantee: Washington Dept. of Social and Health Services
Program Name: Fostering Youth and Community Partnerships
Grant Type: Ed Award Only
Full-time AmeriCorps members: 5
Part-time AmeriCorps members: 20
Program Descriptions: Members recruit, select, train and support
mentors for adolescents in foster care.
Grantee: West Virginia Commission for National and Community
Service
Subgrantee: Regional Family Resource Network
Program Name: Regional Family Resource Network
Grant Type: State Program
Full-time AmeriCorps members: 20
Part-time AmeriCorps members: 3
Program Descriptions: AmeriCorps members tutor and mentor 575
children to improve academic and behavioral problems, coordinate
immunizations and health clinics for more than 7,200 children resulting
in a 10 percent increase in the area's immunization rate, and assist in
the development of pre-school programs that enrich parent/child
interactions and school preparedness for more than 200 families.
Members are assigned to one of 8 participating Family Resource Center
sites in rural and urban communities of West Virginia and, in addition
to their direct services, they recruit and train more than 250 parents
and community volunteers to assist in service activities.
Grantee: West Virginia Commission for National and Community
Service
Subgrantee: North Central Regional Education Service Agency
Program Name: The Challenge Club
Grant Type: State Program
Full-time AmeriCorps members: 10
Part-time AmeriCorps members:
Program Descriptions: AmeriCorps members tutor and mentor 600
elementary-aged school children in-and after-school, and as part of a
summer program. Through a balance of educational and recreational
activities, more than 80 percent of the 600 students participating
improve one letter grade in one subject tutored and demonstrate marked
improvements in their social and life-coping skills. Members with The
Challenge Club are serving two communities of north central West
Virginia.
Grantee: Western Washington University/WA Campus Compact
Subgrantee: Western Washington University /WA Campus Compact
Program Name: Campus Reads Education Awards Program
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 210
Program Descriptions: Members tutor K-6 youth using resources from
WA Institutions of Higher Education to improve reading skills.
Grantee: Wisconsin National & Community Service Board
Subgrantee: North Central Community Action Program
Program Name: AmeriCorps Team-Greater Wausau Area
Grant Type: State Program
Full-time AmeriCorps members: 9
Part-time AmeriCorps members: 16
Program Descriptions: AmeriCorps members provide direct service to
youth to increase their level developmental assets in order to reduce
youth involvement in at- risk behaviors. Members activities include
literacy tutoring, mentoring, after-school activities, and volunteer
generation.
Grantee: Woodrow Wilson National Fellowship Fnd.
Subgrantee: National School and Community Corps (Princeton)--Parent
Program Name:
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: The Woodrow Wilson National Fellowship
Foundation identifies critical education needs and develops programs to
address those needs, including fellowships and programs for students,
minorities and teachers. The National School & Community Corps (NSCC)
was established in 1994. Its AmeriCorps Members provide services in
literacy, the arts, and service learning to children and adults.
Members also provide mentoring, homework assistance, club activities,
youth leadership, conflict resolution, and other programs as identified
by local communities and schools.
Grantee: Youth Volunteer Corps of America, Inc.
Subgrantee: Youth Volunteer Corps of America--Parent
Program Name: Youth Volunteer Corps of America
Grant Type: National Direct Central
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: Youth Volunteer Corps of America (YVCA)
creates and increases volunteer opportunities to enrich America's
youth, addresses community needs, and develops a lifetime commitment to
service. There are currently Youth Volunteer Corps programs in over 50
communities in the United States. AmeriCorps Members act as service
learning coordinators, recruiting and training school-age youth to
recognize and address community problems, and provide tutoring,
mentoring, and reading support. Members also recruit, lead, and
supervise volunteers in youth-generated service projects, while
encouraging each volunteer to commit to a lifetime of service.
Grantee: Youth Volunteer Corps of America, Inc.
Subgrantee:
Program Name:
Grant Type:
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions:
Grantee: Youth Volunteer Corps of America, Inc.
Subgrantee: YVCA
Program Name: YVCA AmeriCorps Education Awards Program
Grant Type: Ed Award Only
Full-time AmeriCorps members:
Part-time AmeriCorps members: 70
Program Descriptions: Members will recruit, organize, and lead
youth volunteers to engage in community service projects--tutoring,
mentoring, after-school and summer programming.
Grantee: Youth Volunteer Corps of America, Inc.
Subgrantee:
Program Name.
Grant Type:
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions:
Grantee: YouthBuild USA, Inc.
Subgrantee: YouthBuild USA--Parent
Program Name: Youthbuild USA
Grant Type: National Direct
Full-time AmeriCorps members:
Part-time AmeriCorps members:
Program Descriptions: YouthBuild USA, Inc., is a national non-
profit organization that engages educationally at risk youth in a
combination of service and youth development activities. The service
activities focus primarily on renovating houses and buildings for the
homeless and low income families. YouthBuild USA has a substantial
number of affiliate organizations across the country. Members serve
directly with community based organizations to rehabilitate abandoned
housing and build new homes for homeless people, persons with HIV/AIDS,
the physically challenges, and low income families. They build
awareness of community issues and generate volunteers for local service
projects.
Question. A news report on December 31, 1998 indicated that
AmeriCorps participants have engaged in partisan political activities
and so-called ``AmeriRallies'' to solicit money for political purposes
and to hand out political literature for partisan causes. The report
even mentions rallies for Members of Congress. I will provide you with
a copy of the report. Can you tell me if AmeriCorps workers are indeed
engaged in these kinds of activities, and if so, what the justification
is for it? What rules are in place to guard against misuse of
AmeriCorps participants for partisan political causes?
Answer. The report essentially repeats concerns expressed several
years ago by the House Education and the Workforce Subcommittee on
Oversight and Investigations. At that time, the Corporation reviewed
each matter and determined either that the allegations were not
supported in fact or had been appropriately addressed by the
responsible oversight agency.
For example, on June 7, 1995, the Corporation explained to the
Subcommittee that the ``Maxine Waters Day of Caring'' was a service
event sponsored by a local non-profit foundation, which occasionally
names service events after well-known citizens of Los Angeles.
Representative Waters did not attend the event; her staff did not
attend the event; and no political activity occurred on that day.
Instead, community volunteers and AmeriCorps members gave food and
other assistance to homeless veterans in Los Angeles. When questions
were raised about this event, the Corporation provided supporting
documentation to the committee from the Los Angeles Veterans Education
and Training Service, the Los Angeles Veterans Initiative, and the
Kenny Nickelson Memorial Foundation for Homeless Veterans.
The Corporation takes such concerns seriously. We have adopted
strict rules prohibiting partisan political activities by AmeriCorps
members. The grant agreement for every AmeriCorps program contain very
detailed restrictions, including the following:
While charging time to the AmeriCorps Program, accumulating
service/training hours or otherwise engaging in activities associated
with the AmeriCorps program or the Corporation, staff and Members may
not engage in the following activities:
--a. Any effort to influence legislation.
--b. Organizing or engaging in protests, petitions, boycotts or
strikes.
--c. Assisting, promoting or deterring union organizing.
--d. Impairing existing contracts for services or collective
bargaining agreements.
--e. Engaging in partisan political activities or other activities
designed to influence the outcome of an election to any public
office.
--f. Participating in, or endorsing, events or activities which are
likely to include advocacy for or against political parties,
political platforms, political candidates, proposed
legislation, or elected officials--.
--g. Voter registration drives by AmeriCorps Members.
These prohibitions on political activities are in place to guard
against misuse of AmeriCorps members for partisan political causes.
Should any instance of violation be brought to our attention, we will
take swift action to enforce the prohibitions.
______
Questions Submitted by Senator Mikulski
Question. How many AmeriCorps members have completed their term of
service?
Answer. As of March 17, 1999, 77,514 have earned an education
award. Most members in program years 1994 through 1997 have completed
their service. Most members funded in program year 1998 are still
serving.
Question. How many AmeriCorps members have used their education
awards?
Answer. Of the awards earned, 43,793 have been used in whole or in
part. Members have seven years after completion of their service to use
the education award. About 70 percent of the awards earned in the first
year of the program have been used in whole or in part. Members in that
first year have until 2002 to use their awards. See attached fact sheet
entitled ``AmeriCorps and the National Service Trust: Enrollment Data
and Use of the Education Award'' for more information.
Question. How many volunteers were recruited? What have they done
in their communities?
Answer. Most AmeriCorps programs recruit, train, and/or supervise
uncompensated members of their local community to assist in their
service activities. These so-called leveraged volunteers substantially
increase the amount of service AmeriCorps can provide to communities.
In addition, the volunteers benefit from the opportunity to give back
to their communities through meaningful, well-planned activities.
We estimate that during the period 1994 through 1999, AmeriCorps
programs recruited, trained or supervised about 1.7 million community
volunteers. This averages out to about 12 leveraged volunteers per
member since 1994.
The recently released evaluation of AmeriCorps State/National
Direct sheds some light on the roles, contributions and experiences of
leveraged volunteers in AmeriCorps programs. The report notes that the
leveraged volunteers ``varied greatly in education, age, demographics
and socioeconomic backgrounds.'' They were involved in a range of
service activities, including `` * * * holding one day events, for
example, health fair, tutoring students, constructing houses, cleaning
up trash, and other labor intensive environmental projects.'' The
researchers drew a clear distinction between the roles of the
AmeriCorps members and those of the community volunteers. Members
tended to be engaged in activities that traditional volunteers could
not perform because they required full-time or extensive part-time
effort. Community volunteers were used in roles more appropriate to
their available time, usually a few hours per week at most. The
programs and the communities appear to have benefited from the
relationships, however. The volunteers were interested in what
AmeriCorps programs were doing, and often benefited from the overall
impact of the program on their community. The AmeriCorps programs, in
turn, used the knowledge gained from volunteers to more quickly tailor
the programs to community needs, to reduce resistance toward new
community initiatives, and to more deeply engage their members.
The report points out that for volunteers to be used to greatest
advantage, and to ensure that they have a positive experience, certain
conditions need to be met, for example, programs must be well-
organized, be able to solicit community members to become involved.
Some programs during the startup years of AmeriCorps struggled to meet
these conditions. Others were hampered by the realities of their
program locations; community members were too economically pressed to
have spare time to volunteers or, in other cases, had concern for their
personal safety.
Overall, however, AmeriCorps' efforts with community volunteers
have been of great value to the programs, the volunteers, and their
communities. To better understand AmeriCorps' use of community
volunteers, their value to the programs, and their experiences, the
Corporation's Office of Evaluation will be initiating a study during
this fiscal year to study volunteer leveraging in detail.
Question. What happened in the communities where members served?
Answer. Aguirre International's evaluation of AmeriCorps during
1994-1996 documents many of the significant contributions that
AmeriCorps made to communities during its first years. Perhaps first
among them is the tremendous volume of service accomplishments achieved
by the local AmeriCorps programs. The report describes a detailed
investigation of randomly selected programs and concludes that,
overall, the accomplishments resulted in positive impact on the service
recipients. The report is also encouraging in its depiction of the role
of AmeriCorps in strengthening the institutions and communities in
which it serves. The report concludes:
``The institutional impacts of AmeriCorps were far stronger
than expected * * *. Often as a result of partnership with
AmeriCorps, institutions were able to streamline their service
delivery within communities * * *. New relationships between
agencies were made [that permitted agencies to] pool
resources--and provide communities with more cohesive,
comprehensive services. In some instances, AmeriCorps was a
catalyst for change [among community agencies].
``In almost all cases (95 percent), involved institutions
felt that AmeriCorps had a positive impact on their
organizations. Only 2 percent said that they did not want to
continue their AmeriCorps collaborations. Involved institution
representatives stated that AmeriCorps had infused their
organizations with new resources, helped them achieve their
goals, made their jobs easier, and helped their clients.
Schools that were host sites to members were particularly
grateful to AmeriCorps programs for easing teachers' burdens,
expanding the quality of education, and increasing contacts
between students and adults. Businesses that began by providing
resources often became involved in direct service over time.''
As the report details, community representatives nationwide gave
AmeriCorps high marks for the impact of its services and for the role
it is playing in the community. The authors note that ``The impact of
AmeriCorps in terms of mobilizing communities and infusing hope into
depressed communities cannot be understated.''
In addition to results for communities and service recipients, the
report provides data on the positive short-term outcomes of service for
AmeriCorps members themselves. Members achieved statistically
significant gains in so-called SCANS skills (life skills, general
employment skills) over comparison groups of non-members. These skills
permit members to better help themselves, as well as their communities,
long after their service ends.
Question. What is the sustainability of the impact of AmeriCorps on
local communities?
Answer. The Aguirre International report provides clear indication
AmeriCorps programs are providing the services whose impact will be
sustained. As the following table, taken from the Aguirre report,
indicates, programs are having the type of impact likely to be
sustained in communities. Community members value the program services,
perceive the program to have a very positive impact on their
communities and view them as strengthening their communities. All of
these indicators are critical to the sustainability of the service
impact.
COMMUNITY REPRESENTATIVE RATINGS OF AMERICORPS' COMMUNITY STRENGTHENING INDICATORS
[Percentages]
----------------------------------------------------------------------------------------------------------------
Unsatisfactory/
Measure Outstanding Excellent/ Satisfactory Development
Very Good Needed
----------------------------------------------------------------------------------------------------------------
Overall project impact.................................. 14 69 13 3
Impact on the community................................. 11 71 17 2
Strengthen communities.................................. 12 56 25 7
Overall project quality................................. 20 65 11 4
Provide support to the community........................ 20 63 14 3
Working with other groups/agencies...................... 23 63 18 4
Understanding clients................................... 29 61 15 1
Understanding community politics........................ 10 53 21 16
Community mobilization.................................. 15 45 28 12
Reach goals/objectives.................................. 24 59 15 2
Make communities more aware of issues................... 8 46 27 2
Help organizations work better w/each other............. 4 53 36 8
Provide sense of community leadership................... 15 47 25 13
Change ways CBOs work together.......................... 10 54 32 5
Encourage civic responsibility among groups............. 12 57 24 6
----------------------------------------------------------------------------------------------------------------
Source: Community representative interviews.
For several reasons there is, at present, no more direct evidence
about the sustainability of the impacts of AmeriCorps service on local
communities. For the most part, successful AmeriCorps programs continue
to receive Corporation funding. A study being initiated this year will
attempt to assess the sustainability of the institutional networks and
community building effects of AmeriCorps.
Question. What have participants done once they have left programs?
Answer. Although the Corporation has not conducted a specific
survey of all former AmeriCorps members to determine what they do
following AmeriCorps service, we do know several things.
First, after leaving service members enter or continue schooling.
Of those members earning education awards in the first program year,
approximately 50 percent have used all or a portion of their award to
attend institutions of higher education. (Others have used their
education award to pay off loans, and still others have several years
remaining in which to use the award.)
Second, many members continue their service activities. A study of
the alumni in the AmeriCorps Leader program concluded the following:
--92 percent volunteered in their community.
--96 percent contributed monies to nonprofit organizations and
charities.
--87 percent provided labor, training, grant writing and consulting
assistance to local projects.
--87 percent continued in service as a profession.
A national study of all AmeriCorps members conducted by Aguirre
International found strong interest in community service careers among
AmeriCorps members. Two-thirds of those leaving said they would
probably or definitely become involved in community service as staff
members. In terms of actions taken, one in eight had already taken
steps to secure a staff position in a community service agency.
This same study found that by the end of the AmeriCorps service
term, almost all members (99 percent) reported plans of engaging in
future community service.
Third, we know from the experience of Peace Corps and
AmeriCorps*VISTA that many former members will go on to be among the
political, civic, and education leaders of our communities. There are
already many individual stories of remarkable career successes by
former members.
Beginning this fiscal year we are considering initiating a
longitudinal study of AmeriCorps members that will provide a detailed
analysis of the post-program life and career paths of former members.
Alternatively, we are considering conducting a retrospective study of
AmeriCorps members who have graduated.
Question. Is there an AmeriCorps alumni association?
Answer. Yes. Please see the attached information.
Letter From Katie Floyd
Americorps Alums, Inc.
Washington, DC, April 14, 1999.
Senator Barbara Mikulski,
Senate Office Building,
Washington, DC.
Dear Senator Mikulski: Greetings from AmeriCorps Alums, Inc., the
national alumni association for AmeriCorps graduates. I am aware that
at the Senate hearing for the Corporation for National Service in early
March, you inquired about the existence of an alumni association for
AmeriCorps. I would like to take this opportunity to introduce you to
our small but growing organization.
Our history dates back to the fall of 1995. That year, AmeriCorps
Alums was launched as a program of the Partnership for National
Service, a non-profit organization which raised private sector support
for AmeriCorps programs. In April 1997, the weekend of the Presidents'
Summit in Philadelphia, roughly 70 alumni convened for the first-ever
reunion of AmeriCorps graduates. During the weekend, AmeriCorps Alums
officially incorporated as an independent 501(c)(3) non-profit
association. Our three-fold mission is to meet the needs of AmeriCorps
graduates, to support AmeriCorps, and to uphold the ethic and practice
of community service.
Currently, the organization serves almost 1,600 active members.
Though we have limited resources at this point, I am proud to note that
through our programs, we have been able to keep alumni informed about
legislative updates; direct alumni to post-AmeriCorps career
opportunities; deliver transitional training to a few thousand
graduating corps members; and start the development of local alumni
chapters in 13 cities across the U.S.
An October 1997 survey of AmeriCorps Alums' membership shows that
almost 40 percent are working in the non-profit field, and over 60
percent continue to volunteer in their communities at least 10 hours a
month. Given the civic-mindedness that many AmeriCorps members possess
and develop upon entering the program, coupled with the skills they
acquire while in AmeriCorps, I am confident that there are thousands of
AmeriCorps alumni who continue to touch the communities in which they
live.
The enclosed flyer, list of achievements, and newsletters should
give you a greater understanding of the organization. If you have any
other questions about AmeriCorps Alums, Inc., please do not hesitate to
contact me at (202) 729-8180 or [email protected]. Thank you for your
interest.
In service,
Katie Floyd,
Member Services Coordinator.
americorps alums, inc. accomplishments: 1997-1998
Meeting the Needs of AmeriCorps alumni
Developing partnerships which provide association members with over
1,800 jobs each year.
Preparing 2,500 members of the AmeriCorps Class of 1998 for the
post-AmeriCorps transition through career development training.
Improving communication with alumni by launching two e-mail
listservs for networking and job searching, and by doubling the size of
Alum Action, the association newsletter.
Raising the awareness of the education awrd tax with the help of an
AmeriCorps graduate who relayed statistics and hardship stories to 15
congressional offices and two leading publications: The Chronicle of
Higher Education (July 31, 1998) and the Christian Science Monitor
(September 22, 1998).
Building a national network of AmeriCorps graduates
Increasing current association membership by 225 percent.
Establishing affiliate networks with local alumni leaders in
Baltimore, Philadelphia, and Washington.
Instituting partnerships with fifteen state community service
commissions, which provides AmeriCorps Alums, Inc. memberships to over
one-third of all AmeriCorps programs (providing our career development
resources to over 5,500 current AmeriCorps members).
Creating an official website (http://www.americorpsalums.org) into
a one-stop shopping place for graduates by linking them to the
association, one another, service opportunities, job postings,
financial and education award tips, higher education resources, and
information on the AmeriCorps reauthorization process. Over 8,000 hits
to date.
Strengthening Organizational Capacity
Hiring a full-time member services coordinator.
Developing training capacity so that AmeriCorps Alums, Inc. can
assist AmeriCorps grantees in increasing the likelihood of success of
the AmeriCorps graduate.
Raising $25,000 and $32,000 in the first two annual ``Friends of
AmeriCorps'' fundraisers, with honored guest First Lady Hillary Rodham
Clinton attending the second celebration.
Collaborating with nationally-recognized membership organizations
(NAACP, Child Welfare League, National Peace Corps Association) and
higher education institutions (College of William and Mary, University
of Notre Dame) to implement a national network of AmeriCorps alumni
chapters.
[Clerk's note.--Additional background on AmeriCorps Alums can be
found in the VA-HUD subcommittee's files.]
Question. How many education awards are used to pay off loans? What
percentage of those awards are for full-time participants?
Answer. Of the awards that have been used, 44 percent have been
used in whole or in part to pay off existing student loans. Of those,
82 percent were full time awards.
Question. What percentage of participants use their vouchers to
begin higher education?
Answer. Approximately one-fourth of all AmeriCorps members have a
high school education or less, and use their voucher to begin higher
education. The other 75 percent of AmeriCorps members use their voucher
to continue higher education or pay off qualified student loans.
Question. Of the participants who use their education award to
begin higher education, how many went to two-year schools and how many
went to four-year schools?
Answer. The Corporation does not routinely collect data on the
types of institutions attended by AmeriCorps members, including a
breakdown of two- and four-year institutions. If the Committee wishes a
separate study to be done on this matter, the Corporation can do so.
Question. Have AmeriCorps participants used their education awards
to further higher education?
Answer. Yes. Please see the attached information.
AmeriCorps and the National Service Trust
enrollment data and the use of the education award \1\
Education awards earned
To date, over 77,000 awards have been earned. Of those, full-time
members have earned 70 percent of the awards, and part-time members
have earned 30 percent.
---------------------------------------------------------------------------
\1\ As of March 16, 1999.
---------------------------------------------------------------------------
Part-time members
Since the beginning, State Commissions and local programs have
enrolled a significant number of part-time members, including those
serving in summer programs. The following table summarizes actual full-
time and part-time Trust enrollments by program year:
----------------------------------------------------------------------------------------------------------------
Full-time Full-time Part-time Part-time All
Program year members percent members percent members
----------------------------------------------------------------------------------------------------------------
1994..................................................... 16,054 64 9,163 36 25,217
1995..................................................... 17,844 71 7,338 29 25,182
1996..................................................... 17,608 70 7,520 30 25,128
1997..................................................... 22,963 61 14,586 39 37,549
------------------------------------------------------
Total.............................................. 74,469 66 38,607 34 113,076
----------------------------------------------------------------------------------------------------------------
Use of education awards
Members have used over 40,000 awards to:
--Pay for the cost of going on to school (56 percent);
--Pay education loans for previous schooling (34 percent); and
--Pay for both going on to school and for loans for previous
schooling (9 percent).
Of those members enrolled in the first year class (94) who earned
awards, 70 percent have used all or a portion of their award.
Of the dollar value of the education awards earned by members in
the first year class (94), 61 percent has been used to date. First-year
members have three more years to use their awards. The Corporation's
budget estimates that 78 percent of awards earned will be used before
the seven-year expiration date.
There is no substantial difference in the use of awards between
full-time and part-time members, except that those serving only in
summer programs tend to use their award, which is smaller, more quickly
than those serving in full-year programs.
Question. What has been the impact of literacy programs?
Answer. Since fiscal year 1994, education programs, including
literacy activities for young children, have been a high priority for
national service. Governor-appointed state commissions on national and
community service have focused national service resources on unmet
needs in education. In addition, AmeriCorps*National and Education
Award programs, as well as service-learning programs at the K-12 and
higher education levels, and senior programs have targeted service
activities on the education needs of youth.
I summarized some of these impacts in my written statement for the
record. We will provide copies of all literacy evaluations to the
Committee.
Literacy programs supported by the Corporation under the
AmeriCorps*State and National category reported the following results
for the 1996-97 program year:
1. In all programs, 5,700 members at 305 sites supported the
tutoring of youth in grades 1-12. Sixty-seven percent of youth tutored
in grades 1-12 (of 128,000 measured) showed improvement during the
program year.
2. In all programs, 4,700 members supported academic mentoring at
258 sites. Seventy-six percent (of 53,000 mentored students measured)
showed improvement during the program year.
3. In all programs, over 2,000 members taught in grades 1-12.
Sixty-nine percent (of 70,000 students measured) showed improvement
during the program year.
An independent analysis of these project reports and program
generated evaluation materials, noted:
`` * * * programs are using measures [evaluation] that are
appropriate for the individuals they are serving and the type
of tutoring they are providing.
`` * * * tutoring programs investigated in this study
reported positive changes for the students who receive
tutoring.''
In a 1999 study of the Corporation for National Service's Seniors
for Schools pilot program, principals and teachers indicated the
following: 90 percent reported an increased positive attitude in
students toward reading; 85 percent reported improved self-esteem among
students; 84 percent reported increased self-confidence in reading; 82
percent reported increased reading skills; and 79 percent reported
general academic improvement. Of the teachers reporting in that same
study, 79 percent reported improved student attitudes, 60 percent
reported improved overall student performance levels; and 58 percent
reported an increased number of students keeping up with the class.
In the District of Columbia, low achieving children, tutored by
Federal Work Study students and other volunteers in a program managed
by AmeriCorps*VISTA members, improved reading scores to the national
average at the end of the first year of the program.
Other Senior Corps evaluations have produced similar results. The
recent evaluation of Foster Grandparents in Head Start centers (1998)
found volunteers exhibiting well-researched positive caregiver
behaviors. It also concluded that consistent with previous research,
these effective practices were observed to contribute to the emotional,
social, behavioral, and cognitive development of the pre school
children as well as to classrooms and centers.
In addition to these recent studies done by the Corporation,
independent evaluations of individual projects have produced comparable
results. Several examples are provided below:
Professor George Farkas of the University of Texas documented gains
for a Reading One-to-One program of 0.4 to 0.7 grade equivalents above
what students would have attained without tutoring. This significant
improvement will help assure that these children become literate. The
program uses college students, AmeriCorps members, and community
residents to tutor more than 6,000 students in more than 70 schools
across ten school districts.
In New Haven Connecticut, the Leadership, Education, Athletics in
Partnership program helped produce increases in children's reading test
scores; children read an average of 24 books during the summer in the
program.
In West Virginia, a summer project that uses AmeriCorps members
documented the following results:
``Energy Express, through a print-rich environment, increases
children's reading scores. An intensive evaluation to measure
impact was conducted for last summer's project by West Virginia
University faculty members and graduate students. Six hundred
four children were tested in matched pairs pre to post using
the Woodcock Johnson (revised 1989). Data indicates significant
increases in reading comprehension (p<.0001) and word
recognition (p<.0001). Seventy-one percent of all children
increased in reading comprehension and 67.6 percent in word
identification.''
An independent researcher who examined Jumpstart, a pre-school
program noted:
``The results of the analyses on the first 2 Cohorts of
children over their first year in the Jumpstart program suggest
that the program has positive effects on at-risk children's
school readiness, and suggest that, as the program is developed
further and more children participate in the evaluation, there
is real potential for showing stronger and positive program
effects.''
University of Delaware researchers concluded:
``Tutoring, that is, periodic meetings of a student with a
tutor as a supplement to classroom instruction, can increase
reading achievement, improve self-confidence in one's reading
skills, and increase motivation for reading. Positive results
for reading have been obtained with volunteers, peers, and
cross-age tutors, as well as with professionals.''
Finally, the Corporation is engaged in a national study of
Corporation-sponsored tutoring programs funded by AmeriCorps State/
National and America Reads. The first phase of that study is a
descriptive analysis that will permit us to characterize how these
programs' practices compare to what is known about effective program
models. Data from this study will be available in Fall, 1999. The
second phase of the study, to begin in September, 1999, will collect
outcome data on reading ability in a rigorous design intended to permit
us to make definitive statements about the effects of Corporation-
sponsored tutoring efforts. Results from that phase of the research
will be available late in 2000.
[Clerk's note.--Further information concerning the literacy
question can be found in the VA-HUD subcommittee files.
Reports included with Literacy Questions:
--Seniors for Schools Content Analysis of 1997-98 Project Evaluation
Reports
--Effective Practices of Foster Grandparents in Head Start Centers
--Evaluation of DC Reads Book Partners Program Year 1 Final Report
--Foster Grandparent Program Accomplishment Summary July 1, 1997-June
30, 1998 National Senior Service Corps
--Retired and Senior Volunteer Program Accomplishment Summary July 1,
1997-June 30, 1998 National Senior Service Corps.]
Question. With the exception of immunizations, what accomplishments
have occurred in the Health care area?
Answer. AmeriCorps programs are involved in providing a variety of
health care related services in local communities. Data taken from the
Aguirre evaluation report indicates AmeriCorps programs, in addition to
immunizations, provided the following health care related services:
--Made independent living easier for disabled, elderly, or
hospitalized individuals by providing independent living
assistance to over 15,000 people;
--Provided emergency medical services, as well as health training and
education;
--Provided access to health care, diagnosis, and/or follow-up to over
57,000 individuals and/or screened for needed care;
--Provided access to pre-natal care, screening or actual health
services, and/or taught about children's health or development,
* * * to over 21,000 pregnant women or families with young;
--Distributed health related informational material to over 973,000
people.
Question. What is AmeriCorps doing to help seniors live
independently?
Answer. There are currently fifteen programs that focus
specifically on working with seniors to assist them in living
independently. Programs are located in the Atlantic region (Maryland);
the Northeast (New York, Massachusetts, New Jersey, Vermont); the
Southeast (Florida, North Carolina, Mississippi, Georgia, South
Carolina, Alabama); and the Southwest (Texas).
DEPARTMENT OF THE TREASURY
Community Development Financial Institutes Fund
STATEMENT OF ELLEN W. LAZAR, DIRECTOR
ACCOMPANIED BY:
MAURICE A. JONES, DEPUTY DIRECTOR, PROGRAM AND POLICY
PAUL R. GENTILLE, DEPUTY DIRECTOR, MANAGEMENT AND CHIEF
FINANCIAL OFFICER
opening remarks
Senator Bond. Now I want to call on a final panel, Ellen
Lazar, the Director of the CDFI program, accompanied by her
Deputy Director Mr. Maurice Jones and Deputy Director for
Management and the CFO Mr. Gentille.
The administration's budget requests for CDFI asks for an
increase of $30 million from $95 million to $125 million for
the year 2000. I understand that $15 million of the request
would be to fund the new microenterprise program. I am very
much concerned about the amount and purposes of the CDFI
funding request, especially as we prioritize the funding needs
of some of the primary programs and activities. It is a
relatively new operation and its track record is still unclear.
And it does seem that some of its activities overlap with those
of other programs designed to revitalize distressed
communities. I do want to congratulate the director of the
fund, Ms. Lazar and her staff, for correcting the management
deficiencies identified in the past.
KPMG, the Fund's independent auditors, has provided an
unqualified or clean opinion on its financial statements and
further reported no new material weaknesses. We all know the
CDFI had a rocky beginning. I am interested to hear the
specific steps taken to address the program management.
Second, we are interested in how well the performance goals
and objectives are being met. GAO had a report last July and
had some questions about emphasis on outputs rather than
outcomes. A particular concern was in the area of external
factors that the Fund's strategic plan only partially meets the
requirements to describe the external factors. I think it is
critical that we look at the Fund's activities where they may
be overlapping.
And finally, I have some real questions about the Program
for Investment in Microentrepreneurs or PRIME. I happen to
chair the Committee on Small Business Administration and the
SBA has programs in that area, as does the Economic Development
Administration and many states in their welfare-to-work
programs.
I would also say that I will ask unanimous consent to
include in the record a statement by Senator Shelby, a member
of the committee, raising serious questions about some of the
CDFI activities, challenging whether the Fund has received the
necessary authorization from the authorizing committee, the
Committee on Banking, Housing and Urban Affairs. And he also
raises questions about the new so-called PRIME program in the
Banking Committee's letter to the Budget Committee on which I
also serve, transmitting the views and estimates of the Banking
Committee.
The Banking Committee notes that it opposes any increase in
funding for CDFI. The Committee has not received adequate
assurances that CDFI's current operations are fully consistent
with congressional intent and void of any form of misuse of
public moneys.
Senator Bond. With those opening comments, any opening
comments you wish to make, Senator Mikulski?
statement of senator barbara mikulski
Senator Mikulski. Just a very few, Mr. Chairman, one to Ms.
Lazar and to her team. Thank you for really strengthening the
management so that we could get to the ability to evaluate the
programmatic impacts and where best to target our resources.
Second, I have to leave at about 11:20 a.m. So if I am not
here, it is not because of a lack of interest.
I note the Maryland programs. I think groups like the
Enterprise Foundation working with you have always, from what I
know, leveraged other funds. So we look forward to it. Some
programs I am not familiar with, but others I am. So I look
forward to your testimony.
I just want to say this generally. We are in the world of
the mega-merger of the bank, so we have big banks buying each
other and big banks then being bought internationally. And then
what happens at the local community, whether it is to the
community or the Small Business Administration, whether it is
the farmer or the business person trying to get started in a
multi-ethnic community, goes to how do we stay local while we
go global?
I think that is one of the big challenges for both the
Banking Committee--knowing we have to reform and change, but
all I see is us going global. The more global--I know right now
a couple of organizations are merging in Maryland. And Alex
Brown was sold to Bankers Trust, which is now in line to be
bought in Deutsche Bank; and where I used to go downtown to the
Center Club to talk things over, I might now have to go to
Berlin. And what I am interested in is the neighborhoods in
Baltimore. So any insights you could provide to us would be
very helpful.
Senator Bond. Ms. Lazar.
statement of ellen lazar
Ms. Lazar. Good morning. Thank you, Chairman Bond and
Ranking Member Mikulski. I am happy to be here today. I am
Ellen Lazar. I am the director of the Community Development
Financial Institution's Fund at the Treasury Department. I am
here today with my two deputies, Paul Gentille our deputy
director for management and CFO and Maurice Jones our deputy
director for program and policy. I would ask the chair to
submit my written statement for the record and for the purposes
of time I will abbreviate my testimony.
Senator Bond. We appreciate that. And we will accept your
full written statement and give you 5 minutes.
Ms. Lazar. Thank you, Senator.
major points
I will talk about four major points today: management,
programs activity, our evaluation and impact work, and our
fiscal year 2000 budget request.
We have, at the front, have taken key steps over the past
year to develop and implement necessary improvement to the
Fund's financial and program management. I am happy to report,
as you had so observed, that this year we received for our
second year in a row a clean audit from KPMG Peat Marwick. All
the material weaknesses identified in 1997 have been corrected
and no new material weaknesses have been found for 1998. We
have worked hard to build an infrastructure and have hired a
staff at the Fund to serve. We are disbursing our funds more
expeditiously and we have developed a strategic plan that has
been delivered to the Hill for consultation and consideration.
cdfi's
On the program side, the Fund's mission is to promote
access to capital and local economic growth by directly
investing in and supporting community development financial
organizations, what we call CDFI's. We also work towards
expanding financial service organizations, lending investment
and services within under served communities. Our CDFI's--it is
really an umbrella term for a number of different types of
organizations: community development banks and community
development credit unions, which are regulated institutions,
nonprofit loan funds which can be working in both business and
housing, microenterprise loan funds, community development
venture capital funds.
The CDFI program includes our core funding which helps
build the financial capacity of CDFI's by providing equity
investments, grants, loans or deposits to enhance the capital
base of these institutions to help them better address unmet
community development needs in their target markets. We also
have a technical assistance program which fills the capacity of
start-up, young and small institutions.
bank enterprise awards program
Another major program is our bank enterprise awards program
which is our primary tool for pursuing our strategic plan goal
of expanding banks and thrifts, community development, and
lending and investment activity. Incentives encourage banks to
increase investments in underserved communities, and we have
seen startling leveraging numbers of the $58 million that we
have provided in incentives to the banks. We have seen their
investments grow to $983 million, 17 times the amount of our
investment.
nonmonetary programs
Each year there has been an increased demand for our
funding. And since 1996 we have obligated $190 million in
funding. We run a number of other programs both nonmonetary and
in initiatives that I would like to talk to you about for a
minute.
Our Presidential Awards for Excellence in Microenterprise
Development is a nonmonetary award which brings attention to
organizations that have demonstrated excellence in
microentrepreneurship. We have begun our Native American
Lending Study and Action Plan which will help to improve access
to capital for Native Americans.
And, finally, we have embarked on a policy and research
program to evaluate the impact of our Federal investments.
impact of our federal investments
I would like to talk with you for a few minutes now about
those evaluations and the outcomes that we have unearthed. The
Fund collected performance and outcome data on 30 of our first-
round awardees; those 30 awards totalled $34 million. This was
money that was obligated in 1996 that was put out over the
subsequent 18 months and has been put to work now for over a
year. Our plans for these organizations are based on a 5-year
business plan that we require of our awardees.
Over the past 3 years our preliminary data shows that $565
million in CD loans and investments have been made by these
institutions. They have created or expanded 895 microenterprise
organizations and over 1,100 businesses. They have helped to
create or retain over 12,000 jobs. That have developed over
8,000 units of affordable housing. They have developed child
care, health care, human service and educational facilities and
they have provided business training, credit counseling, home
buyer training and other development services to over 10,000
people.
The assets of these organizations have grown by 122
percent, from $473 million to $1.5 billion in the aggregate in
1998. Seventy percent of the clients served by these
organizations are low income and 53 percent of them live in the
inner city.
We have also been conducting case studies. We have done
field work in Boston, Santa Cruz and San Antonio. And my
written statement contains more information about these case
studies. Our initial research shows how positively these CDFI's
are affecting their communities.
fiscal year 2000 budget
I would like to take a minute now to talk about our fiscal
year 2000 budget. We have asked for $125 million, an additional
$30 million above the fiscal year 1999 funding level. Fifteen
million dollars has been set aside for our core programs and
$15 million for the new PRIME Act, the Program for Investment
in Microentrepreneurs. The PRIME Act legislation was introduced
by Congressman Bobby Rush and Chairman Leach in the House as
H.R. 413. It was introduced by Senators Domenici and Kennedy as
S. 409 here in the Senate. Essentially PRIME will allow the
CDFI Fund to build the capacity of low income and disadvantaged
microentrepreneurs, to build the capacity of micro
organizations to better serve these low-income clients and to
support best practices and research in the field. The PRIME Act
essentially complements the current work of the Fund, which is
to build community-based organizations, to serve low income and
very low-income people in communities.
prepared statement
I think our fiscal year 2000 funding request is a logical
one, based on need demonstrated in the field. We want to
continue our vision of providing greater access to credit for
all Americans. And I would like to thank the committee for the
opportunity to talk with you this morning and look forward to
working with you on this appropriation. I am happy to entertain
any questions, as are my deputies.
[The statement follows:]
Prepared Statement of Ellen W. Lazar
introduction
Chairman Bond, Senator Mikulski and distinguished Members of the
Subcommittee, it is a pleasure to be before you today to represent the
Community Development Financial Institutions (CDFI) Fund. I am Ellen
Lazar, the Director of the Fund. Before I begin my testimony, I would
like to introduce you to two other key members of the Fund who are with
me today: Paul Gentille, Deputy Director for Management/Chief Financial
Officer of the Fund, and Maurice Jones, Deputy Director for Policy and
Programs at the Fund.
strong and effective management
When I testified before this Subcommittee this time last year, I
described key steps that the Community Development Financial
Institutions Fund (the CDFI Fund or the Fund) would take to develop and
implement necessary improvements to the Fund's financial and program
management, reporting systems, internal controls, operating procedures,
and awards monitoring. I am very pleased to report to the Subcommittee
that over the past twelve months we have made great progress in these
areas.
In the Fund's financial audit for fiscal years 1995 through 1997,
our independent auditors, KPMG Peat Marwick, LLP (KPMG), provided an
unqualified opinion, affirming that our financial statements fairly
presented the financial position of the Fund as of September 30, 1997,
1996, and 1995. KPMG also confirmed our identification of material
weaknesses that we needed to correct.
KPMG recently completed the Fund's fiscal year 1998 audit, and I am
pleased to report that we have again received an unqualified opinion.
In addition, KPMG verified that we have successfully corrected all
material weaknesses identified in last year's audit. They have reported
no new material weaknesses for this year's audit.
We are in compliance with the Federal Managers' Financial Integrity
Act (FMFIA). Our system of internal management, accounting and
administrative control has been strengthened and is operating
effectively. Our enhanced policies and procedures ensure that our
programs achieve their intended results; our resources continue to be
used in a manner that is consistent with our mission; and our programs
and resources are protected from waste, fraud, and mismanagement.
As evidenced by our auditor's report, the Fund has taken critical
steps to strengthen and build its infrastructure and hire staff. During
fiscal year 1998, a Deputy Director for Management/Chief Financial
Officer, Awards Manager and Financial Manager were hired--critical
positions for ensuring proper internal controls and accountability. In
addition, a Deputy Director for Policy and Programs was appointed and
program managers for each program were hired. The Fund's legal
department was substantially increased and additional staff have been
hired to help carry out the Fund's many programs. Our enhanced internal
procedures and staff capacity has helped us to deliver more effectively
our award dollars to the institutions selected to receive awards. For
example, with respect to our Core Component CDFI Program, all of our
1996 awardees have received disbursements and 84 percent of our 1997
awardees has received disbursements. We are currently disbursing the
1998 awards, which were announced in late September of last year. We
anticipate disbursing funds to all 1998 awardees by August of this
year. Our 1999 awards have not been determined yet.
As I discussed with the Subcommittee last year, the Fund is
committed to managing for results. We have undertaken a rigorous review
of the Fund's five-year strategic plan, goals, and performance
measures. I am happy to report that we have completed this process and
have forwarded to you a draft of our revised strategic plan for your
consultation and consideration.
strengthening communities: providing access to capital
Overview
The Fund's mission is to promote access to capital and local
economic growth by directly investing in and supporting community
development financial institutions (CDFIs) and expanding banks' and
thrifts' lending, investment, and services within underserved markets.
Currently, the CDFI Fund pursues its mission primarily through five
initiatives: the CDFI Program, which includes the Core, Technical
Assistance and Intermediary Components; the Bank Enterprise Award (BEA)
Program; the Presidential Awards for Excellence in Microenterprise
Development; the Native American Lending Study and Action Plan; and our
Policy and Research Programs. The CDFI Fund also administers a
Certification Program for community development financial institutions.
CDFI Program and Certification
The CDFI Program has three funding components: Core, Intermediary
and Technical Assistance. These three components promote the CDFI
Fund's goal, articulated in its strategic plan, of strengthening the
expertise and the financial and organizational capacity of CDFIs to
address the needs of the communities that they serve. CDFIs include
community development banks, community development credit unions, non-
profit loan funds, micro-enterprise loan funds, and community
development venture capital funds.
The Core Component builds the financial capacity of CDFIs by
providing equity investments, grants, loans or deposits to enhance the
capital base--the underlying financial strength--of these organizations
so that they can better address the unmet community development needs
of their target markets. In addition, under the Core Component, the
Fund provides technical assistance grants in conjunction with loans and
investments in order to maximize the community development impact of
the Fund's awards.
The Fund selects awardees that clearly demonstrate private sector
market discipline and the capacity to positively impact underserved
communities. The Core Component leverage encourages additional private
and public sector investments into these same organizations through its
one-to-one non-federal match requirement.
The Intermediary Component allows the Fund to invest in additional
CDFIs indirectly, through intermediary organizations that support
CDFIs. These intermediary entities, which are also CDFIs, generally
provide intensive financial and technical assistance to small and
growing CDFIs, thereby strengthening the industry's financial and
institutional capacity.
Since inception, under the Core and Intermediary Components, the
Fund has made 123 awards totaling $122 million.
The Technical Assistance (TA) Component of the CDFI Program is the
Fund's newest funding program. Introduced in 1998, this component
builds the capacity of startup, young and small institutions. The TA
Component allows the Fund to direct relatively small amounts of funds
to CDFIs that demonstrate significant potential for generating
community development impact but whose institutional capacity needs to
be strengthened before they can fully realize this potential.
In the first TA Component round held in 1998, the Fund awarded $3
million to 70 institutions.
In 1998, the Fund awarded a total $47 million to 112 institutions
through its CDFI Program. In 1998 as in all previous years, demand for
CDFI Program funding far exceeded the funding we announced as
available. Under the Core and Technical Assistance Components we
announced the availability of approximately $45 million. We received
requests for more than $176 million.
For 1999, with the help of the $95 million appropriated to the Fund
for fiscal year 1999, we anticipate that we will make $62 million in
awards to 130 institutions under the CDFI Program. In October, the Fund
published the fiscal year 1999 Notice of Funds Availability (NOFA) for
both the Core and Intermediary Components, announcing a total of $57.5
million available, $50 million for the Core Component and $7.5 million
for the Intermediary Component. We received 153 Core applications
requesting a total of $184 million. We anticipate making approximately
55 Core awards. We received eight Intermediary applications requesting
a total of $16 million. We anticipate making five Intermediary awards.
In January, we published the fiscal year 1999 NOFA for the Technical
Assistance Component. With the $5 million available for TA awards, we
anticipate making 75 awards.
To date, institutions in 43 states plus Puerto Rico and the
District of Columbia have received CDFI Program awards. To encourage
applications from a diverse pool of applicants, the Fund is conducting
a record number of informational workshops. Among the nineteen Core and
Intermediary workshops conducted in 1998, five were located in States
that have not had previous Core or Intermediary Awardees. This month
the Fund will hold eighteen informational workshops on the Technical
Assistance Component around the country, again selecting several
regions in which there are no current awardees.
To further our goal of building the institutional capacity of the
CDFI field, we provide debriefings to applicants that were not selected
for an award. To date in fiscal year 1999, the Fund is responding to 92
requests for debriefings. Applicants are given valuable feedback about
strengths and weaknesses of their applications as observed by those
community development professionals involved in reviewing their
requests for funding. Many of these applicants use the information
gathered from the debriefing to build the strength of their operations
and to improve their performance.
In addition to our CDFI funding programs, the Fund administers a
CDFI Certification Program. CDFI certification increases the
credibility of community lending organizations in the eyes of potential
funders and investors. An organization that is certified is better able
to attract private sector investments from local banks, corporations,
foundations, and individuals. To date, we have certified a total of 280
organizations in 45 states, plus the District of Columbia and Puerto
Rico. New applications arrive each month. Currently, applications are
pending for the Virgin Islands, plus two of the five states that do not
currently have any certified CDFIs.
Bank Enterprise Award Program
The Bank Enterprise Award (BEA) Program is the Fund's primary tool
for pursuing its strategic plan goal of expanding banks' and thrifts'
community development lending and investment activity. By providing
incentives to these mainstream financial institutions, the Fund
encourages them to increase their investments in underserved
communities. These financial institutions do this in two ways: by
providing loans, investments and services directly to the communities
in need; and indirectly, by investing in local CDFIs or other community
development programs, that then provide financial and development
services to the communities.
The leveraging involved in this program is impressive. To date, 124
banks and thrifts in 30 states have received $58 million in BEA
funding. This $58 million actually translates into investments in
underserved communities of $983 million, seventeen times the amount of
the CDFI Fund's investment. The awardees have invested $712 million in
direct loans, investments and services to the community, and $271
million into CDFI's.
The Fund dramatically increased our BEA awards in 1998 when we made
79 awards totaling $28 million. In 1996, we made 38 awards totaling
$13.1 million; in 1997 we made 54 awards totaling $16.5 million. The
three-year total for the 171 BEA awards is $57.5 million. For the
fiscal year 1999 funding round, we conducted twelve informational
workshops around the country and received 139 applications. The Fund
anticipates selecting approximately 80 of these institutions to receive
awards totaling $25 million.
Presidential Awards for Excellence in Microenterprise Development
The Presidential Awards for Excellence in Microenterprise
Development is a non-monetary program administered by the Fund that
recognizes and seeks to bring attention to organizations that have
demonstrated excellence in promoting micro-entrepreneurship. By
recognizing outstanding microenterprise organizations, the Presidential
Awards seek to promote best practices and bring wider public attention
to the important role and successes of microenterprise development
especially in enhancing economic opportunities among women, low income
people and minorities who have historically lacked access to
traditional sources of credit. This program is one of the ways that the
Fund is promoting performance best practices in the industry.
In February of this year, the President presented awards to six
organizations for their work in the microenterprise industry.
Native American Lending Study and Action Plan
Our Native American Lending Study and Action Plan is intended to
stimulate private investment on Indian Reservations and other land held
in trust by the United States. The first step in accomplishing this
goal is identifying the barriers to private financing in these areas.
In 1998, we launched an action plan that will examine lending and
investment practices on Native American lands, identify lending and
investment barriers and their impacts, and make recommendations for
removing them. As part of that plan, we will be holding workshops in 13
cities across the country this year. The workshops will involve the
Native American community, financial institutions, state agencies and
community development organizations. With the assistance of the
participants in these workshops, we anticipate that the study will be
completed in fiscal year 2000.
Policy and Research
The Fund is perhaps the largest single source of capital available
to the CDFI industry nationwide. It has access to data from hundreds of
community development financial institutions nationwide. This includes
information about the institutions as well as their target markets. In
addition to baseline data derived from the process of certifying or
funding applicants, the Fund collects longitudinal data on all of its
awardees over at least a five-year period. Our policy and research
goals include: measuring and reporting on the performance and outcomes
of the Fund and its awardees and seeking to advance the CDFI industry
as a whole through involvement in industry-wide research and
development efforts.
In 1998, we moved forward on the first of these, measuring and
reporting on the performance and outcomes of Fund awardees. As you
know, the Fund invests in CDFIs to promote their long-term viability
and ability to serve distressed communities. Today, I am pleased to be
able to report some preliminary findings of our efforts thus far with
respect to the accomplishments of our awardees.
performance and impact
Surveys
Using surveys, the Fund collected performance and outcome data on
30 of our 31 first-round CDFI Core Component awardees. These awardees
were chosen in 1996. We began our evaluation on only first round
awardees because they have had at least a year to absorb the Fund's
investments and put them to work. Our sample of 30 first round awardees
includes six credit unions, fourteen loan funds, three community
development banks, three venture capital funds, two microenterprise
programs, and two multifaceted CDFIs. Together, they received $34
million in CDFI awards. What has our $34 million helped these
institutions to accomplish?
Our preliminary findings demonstrate that these awardees have
accomplished significant community development impact over the past
three years. For example, they have made $565 million in community
development loans and investments. These loans and investments have
helped to create or expand 1,895 microenterprises and 1,148 businesses;
create or retain 12,412 jobs; develop 8,617 units of affordable
housing, 98 childcare centers serving 7,168 children, 17 health care
facilities serving 32,723 clients and 170 additional community,
cultural, human services and educational facilities. Further, these
awardees have provided business training, credit counseling, homebuyer
training and other development services to 10,641 individuals.
Based on our sample, 70 percent of the clients of the average 1996
awardees are low-income individuals. Sixty percent are minority
individuals. Fifty percent are women. Fifty-three percent live in the
inner city. Eleven percent live in rural communities. Thirty-six
percent live in suburban areas.
Since receiving their Fund awards, the 1996 awardees in our sample
have strengthened their capacities to deliver products and services to
their target communities. Their total assets have increased by 122
percent, growing from $473 million in the aggregate before they
received their awards to $1.05 billion in the aggregate in 1998.
Case Studies
In addition to the outcomes surveys, the Fund is conducting in-
depth case studies of a sample of awardees. The case studies include on
site evaluations by the Fund to examine the CDFI's activities within
the local economic development context. To date, we have completed
three case studies. We anticipate completing several more in the coming
year. The three case studies that have been completed thus far have
been in Boston, Massachusetts, San Antonio, Texas and Santa Cruz,
California. Our initial research suggests how CDFIs are positively
affecting their communities.
In Boston, many of the city's poorer neighborhoods did not benefit
from the economic growth in the 1980s; their conditions actually
worsened during that period. Yet these same neighborhoods have
experienced notable improvements in the past 10 years, thanks in no
small part to the work of CDFIs such as the Boston Community Loan Fund
and the Local Initiatives Support Corporation, two CDFI Fund awardees.
These CDFIs have been critical behind-the-scenes actors. They have
provided badly needed financial and technical support to two of the
city's most effective community development corporations (CDCs),
enabling the groups to develop the scale necessary to carry out
affordable housing and commercial projects that have revitalized long-
declining communities such as East Boston and Egleston Square. Since
the mid-1980s, the CDFIs have provided over $7.5 million to the CDCs,
which in turn have: built or rehabbed over 800 units of affordable
housing; managed an additional 900 apartments and commercial
properties; and operated after-school and other programs for 150
neighborhood youths. The CDFIs have also played a crucial intermediary
role, working with bankers, city officials, and corporate and
foundation leaders to encourage additional targeted investment in these
neighborhoods. A number of bankers view the CDFIs as important partners
in their community development work, crediting the CDFIs with
effectively serving organizations and individuals that the banks cannot
afford to serve.
All around San Antonio, public and private sector institutions
recognize the important work of ACCION Texas, a CDFI Fund Awardee. From
the city's Economic Development Office to local Chambers of Commerce to
banks ranging in size from local independent banks to Chase Manhattan,
ACCION is viewed as the source of financial services for a previously
neglected--yet significant--segment of the population: the low- and
moderate-income micro entrepreneurs who live and work in some of the
city's poorest neighborhoods. ACCION is seen as the organization that
can get loan capital into the hands of this underserved population--and
just as important--get it back. ACCION's 400 clients include plumbers,
electricians, seamstresses, independent taxi drivers, and street
vendors. They are primarily Hispanic. Without ACCION, they would not
have access to credit for their businesses. The stories are by now
familiar: these micro entrepreneurs do not have sufficient collateral;
they don't have good business records; or they don't need enough money
to make them attractive to a bank. With ACCION, they are able to get
the financial and technical assistance they need to grow their
businesses and to make them more prosperous through better business
management. ACCION's success in San Antonio has led it to begin opening
offices around the state, in the Rio Grande Valley, Houston, Dallas,
Austin, and Fort Worth.
In Santa Cruz county in California, the third largest community
credit union in the nation, the Santa Cruz Community Credit Union
(SCCCU), offers a wide range of financial products and services
designed to meet the financial needs of a predominantly rural low
income population. The need is perhaps greatest in Watsonville, where
the unemployment rate is 15.8 percent--more than three times the
national average. This area has been hard hit by recent plant closings
resulting from import competition from Mexico. Adding to the
unemployment rate are the once-migrant agricultural workers who are
settling in the area in increasing numbers, even though agricultural
work remains seasonal. The employment and income figures highlighted
the importance of focusing on the Watsonville population. With the help
of its CDFI Fund award, the Santa Cruz Community Credit Union opened a
branch in Watsonville so that it could ensure credit and banking access
for all citizens, especially the Latino population which had
historically distrusted traditional banking enterprises due to
discrimination and neglect.
the year ahead: fiscal year 2000
The President's fiscal year 2000 budget requests $125 million in
appropriations for the Fund. This request is $30 million above fiscal
year 1999 funding levels. The Fund proposes to use $15 million of the
increase to enhance its core programs; thus, $110 million will be used
to administer the CDFI, BEA, Training, Policy and Research and
Secondary Market Programs and the Native American Lending Study and
Action Plan. The remaining $15 million will be used to launch a new
initiative, the Program for Investment in Microentrepreneurs (PRIME).
In fiscal year 2000 and beyond, the CDFI Program will continue to
focus on building the capacity of the CDFI industry to facilitate
access to capital in underserved and low-income markets. I believe the
Fund will be able to build on its previous years' experience and
findings from its first outcomes surveys to inform our practice in
identifying organizations that can maximize impact in needy
communities. We will also seek to enhance the performance and impact of
the industry through our Technical Assistance Program. Through the BEA
Program, the Fund will continue its efforts to facilitate community
reinvestment by providing incentives for banks and thrifts to reach new
markets through partnerships with CDFIs and by targeting lending,
investment and services in the most distressed neighborhoods. Finally,
the Fund will seek to enhance the effectiveness and impact of CDFIs,
banks, thrifts and others engaged in community development finance
through its Training Program.
In fiscal year 2000, the Fund will complete its Native American
Lending Study. We plan to make recommendations to the President and
Congress on needed statutory and regulatory amendments to existing
Federal programs and other needed policy changes to improve access to
capital for Native Americans.
Based on a feasibility study to be conducted in fiscal year 1999,
in fiscal year 2000, the Fund plans to launch a secondary market
program for loans made by CDFIs and examine the potential role of the
Fund in creating and sustaining these efforts.
I believe one of the most exciting proposals in the President's
budget is the creation of the Program for Investment in
Microentrepreneurs (PRIME). The $15 million PRIME Act was introduced in
the Senate on February 10 of this year. Senator Kennedy introduced the
bill. Senators Domenici, Reid, Grassley, Abraham, Robb, Collins, Boxer,
Santorum, Sarbanes and Snowe are also sponsors of the bill. The bill
was introduced in the House on January 19 of this year by Congressman
Bobby Rush. House Banking Chairman James Leach and Ranking Member John
LaFalce are among the bill's sponsors.
This program will allow the Fund to meet a growing need that we
currently cannot address. This is the need to strengthen organizations
that are providing critical training and technical assistance to the
most vulnerable population of entrepreneurs: low-income and
disadvantaged microentrepreneurs. One of the clearest lessons that has
emerged from the first decade of microenterprise development in the
United States is that provision of training and technical assistance is
a necessary ingredient for building successful entrepreneurs. In the
highly developed U.S. economy, starting and running a successful
business requires a solid understanding of business regulations, tax
issues, record keeping, and marketing. Many of the thousands of people
who have started microenterprises to make ends meet do not have these
skills.
Many of the organizations that provide training and technical
assistance to microentrepreneurs are not currently eligible for Fund
assistance because they do not meet our financing entity test under the
CDFI Program. PRIME will allow the Fund to reach these organizations.
The PRIME Act first, provides training and technical assistance to low
income and disadvantaged microentrepreneurs; second, builds the
capacity of microenterprise organizations so that they can better serve
their low-income clients; and third, supports best practices research
and development. I believe that PRIME complements the Fund's existing
programs and will be a key tool for creating opportunity for low-income
people.
conclusion
Mr. Chairman, Members of the Committee, thank you for giving me the
opportunity to provide you with this information on the Fund's current
activities and its plans for the future. I look forward to working with
you over the course of this year's appropriations process. I would be
happy to respond to any questions you may have.
cdfi
Senator Bond. Ms. Lazar, the CDFI has not been authorized;
is that correct? There is no legislation by which you can
measure the accomplishments of goals because this has been an
appropriated program created out of the hip pocket of the
Treasury. It has not been reauthorized?
Ms. Lazar. That is right. The program had been authorized
originally in 1994 and the legislation sunsetted last
September.
Senator Bond. One of the major concerns we have about the
Fund is the ability to measure the impact of the programs. The
GAO raised concerns about the impact of the strategic plan, the
impact of external factors. How have you been able to measure
the impact the CDFI Fund has on the economic development and
revitalization of the depressed communities?
Ms. Lazar. We have done a number of things. Why do I not
start and I will ask Mr. Jones to add to it as we go along. The
Fund requires each of its awardees to enter into an assistance
agreement with us. We set up performance goals with measures
for our awardees based on the 5-year business plan that they
submit to us with their application. Those goals and measures
are in large part developed between our staff and the awardees
after the award is made.
The GAO has suggested, when they came to visit with us last
year, they made three recommendations for improvement in those
goals and measures. They advised us that we should use greater
accomplishment measures, outcome measures, if you will, rather
than output measures. We have moved forward with doing that and
adding at least one performance measure into the assistance
agreements that reflects more of an outcome base.
We also have begun an evaluation system whereby we require
all of our awardees to fill out a survey that we have recently
pretested, and the data that I read to you earlier came from
that survey. The survey will be a requirement to be submitted
by all of our awardees on an annual basis. So we have good
information that is coming from those surveys about the
economic impact of our award.
We also were advised by the GAO to make sure that the
measures that we set forth address key aspects of all the goals
and we are moving forward with doing that. They also
recommended that we provide baseline and target market
information in our assistance agreements. And since last July
when the GAO recommendations were final, we have been doing
that. So we are working hard to make sure that we are
consistent with the GAO recommendations.
On the strategic plan side, the GAO reviewed the strategic
plan that had been prepared earlier. It was done for our fiscal
year 1998 budget submission. We undertook last spring a very
intensive process and a very consultative process to redo our
strategic plan. That strategic plan has been sent up here to
the Hill for consultation, and we look forward to talking with
you about the contents of the strategic plan.
conflicts of interest
Senator Bond. Thank you. We look forward to following up on
that. As I mentioned earlier, I do congratulate you on a very
effective job of dealing with the Fund's management
deficiencies. It is nice to have a contrast where KPMG comes
back and says that the financial controls are in place.
There is one serious issue that I must raise with you. It
is been brought up by the Inspector General who rated a
conflict of interest. I understand that you have taken some
steps to address the potentials of conflicts of interest. The
Treasury OIG has recently released a report and made some
recommendations. They include training and materials for
guidelines. What action have you taken to implement the
recommendation on the conflicts of interest policy made by the
Treasury OIG in their last month's audit?
Mr. Jones. We have undertaken several actions with respect
to the OIG's recommendations as well as recommendations that we
have received from congressional committees. One thing that we
do is we use outside consultants to help us review
applications. And all of the outside consultants have to
disclose any relationships that they have with an applicant in
a pool that they are about to review. We recuse them from that
application as well as any other applications of the same
category of institution. And so that way, they are not only not
reviewing an applicant with respect to which they have a
conflict, they are also not reviewing an applicant that is
competing against that application that they have a conflict
with.
Internally, we also review all Federal individuals who are
reviewing applications, fund staff as well as other Federal
people. We get disclosure information from them as well and
also recuse them from applications that there is a conflict
with. So we are constantly keeping our eye on making sure, one,
that there is no conflict of interest and, two, there is no
appearance of a conflict of interest. And where there is, we
take decisive and quick action to remove those folks from
reviewing those applications.
prime proposal
Senator Bond. Thank you very much. Let me ask a question on
the microenterprise program. I understand that in 1995 the
White House directed the Secretary of the Treasury to take all
appropriate actions to coordinate all microenterprise programs
administered by the Federal agencies and departments, and the
interagency coordinating body was to be chaired by the
administrator of CDFI. To what extent has this interagency
group been involved in the development of the PRIME proposal?
How did the interagency group relate this to existing programs,
for example, in the Small Business Administration?
Ms. Lazar. Let me tell you a little bit about the
interagency council, the interagency working group on
microenterprise. We formed it in July of this past year, July
1998, and we brought together 12----
Senator Bond. It took 3 years to get that done?
Ms. Lazar. I am sorry. I would have to say that is how long
it took.
Senator Bond. For the immediate release, August 28, 1995.
And it got going in 1998. Okay. We appreciate your coming on
and taking that on.
Ms. Lazar. We got started in July and I will say there had
been some work done in anticipation of pulling together this
working group. The first meeting of the working group took
place July 8, 1998. We developed a mission for the group and we
established three working committees.
Senator Bond. Without going into the group, did they
develop the PRIME proposal?
Ms. Lazar. No. The PRIME proposal had been developed prior
to the group really forming.
Senator Bond. What was the relationship--developing the
PRIME proposal, how did that relate to the programs of the
Small Business Administration programs on micro loans and
microenterprises?
Ms. Lazar. In developing the PRIME program which was
developed up on the Hill with input from us at the Fund, a good
deal of time was spent trying to coordinate our efforts with
other Federal agencies, trying to understand other Federal
programs in this area. What distinguishes the PRIME legislation
from other pieces of other programs is that it is really a
training-led program rather than a credit-led program.
We are right now putting together a compendium of all the
programs in the Federal Government that will be linked together
through a Web site. This is part of the work that we have
undertaken with the interagency work group. To that end, we are
making sure that the programs are not duplicative but rather
complementary with one another.
Senator Bond. I do believe the Small Business
Administration has a technical assistance and capacity-building
program already. And we will confer with our staff over there
and submit some further questions because I am a little bit
puzzled. It is a good idea but if it is being done once, that
does not mean because it is a good idea, it ought to be done
twice. We will work with our staffs on the Small Business side
and perhaps submit some more questions for the record so I can
get a better understanding of how this fills in an area that we
are not already covering, or what the deficiencies are in these
SBA programs.
I see that my opportunity to turn to other members of the
committee for further questioning has deteriorated. At this
point, I thank you for your testimony. I congratulate you on
the good work that you have done and we will leave the record
open.
There will be other questions, I am sure, from other
members of the committee. I believe you will want to respond to
the points raised by Senator Shelby in his statement for the
record. That will be very helpful. And, as I said, we will have
some further questions.
Additional committee questions
Ms. Lazar. Thank you very much, Senator. Thanks for having
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 Bond
microenterprise programs
Question. In your fiscal year 2000 budget request, an initial
funding of $15 million is being proposed for a new microenterprise
technical assistance and capacity building program called ``PRIME.'' It
is my understanding that there are already several microenterprise
technical assistance and microloan programs throughout the federal
government. In 1995, GAO identified seven other federal agencies and 20
specific federal programs that support microenterprise development. For
example, SBA has been administering technical assistance and capacity
building programs since 1992. The Administration is also proposing an
increase to the SBA microenterprise programs to $60 million in fiscal
year 2000. I have also heard that some states and private foundations
provide support for microenterprise development. I am concerned about
creating a duplicative program within the Federal government,
especially for an agency that does not have an established track
record.
Could you please describe the objectives of ``PRIME'' and what
distinctions this proposed program has from other existing programs?
Answer. The primary purpose of the PRIME Act is to build the
institutional strength of microenterprise development organizations and
programs and other qualified entities and assist these organizations to
effectively meet the training and technical assistance needs of low-
income and disadvantaged entrepreneurs. The proposed program would be a
competitive grant program under which the Fund would provide funds to
microenterprise development organizations, microenterprise development
programs, intermediaries or other qualified organizations for the
following purposes: (i) to provide training and technical assistance to
low-income and disadvantaged entrepreneurs interested in starting or
expanding their business; (ii) to engage in capacity building
activities in order to enhance their ability to serve low-income and
disadvantaged entrepreneurs; and (iii) to engage in research and
development activities aimed at identifying and promoting
entrepreneurial training and technical assistance programs that
effectively serve low- income and disadvantaged entrepreneurs.
PRIME would allow the Fund to meet a growing need that we currently
cannot address. This is the need to strengthen organizations that are
providing critical training and technical assistance to the most
vulnerable population of entrepreneurs: low-income and disadvantaged
microentrepreneurs. Many of the microenterprise development
organizations that provide training and technical assistance to
microentrepreneurs are not currently eligible for Fund assistance
because they do not meet our financing entity test under the CDFI
Program.
One of the clearest lessons that has emerged from the first decade
of microenterprise development in the United States is that provision
of training and technical assistance is a necessary ingredient for
building successful entrepreneurs. In the highly developed U.S.
economy, starting and running a successful business requires a solid
understanding of business regulations, tax issues, record keeping, and
marketing. Many of the thousands of people who have started
microenterprises to make ends meet do not have these skills. PRIME
would address this issue.
As you note, several agencies within the Federal government
currently run microenterprise programs, and some states and private
foundations provide support for microenterprise development. However,
the overwhelming bulk of this support is in the form of loan capital.
Support for microenterprise development organizations to meet the
training needs of low-income and disadvantaged entrepreneurs has been
minimal. PRIME is aimed at meeting such needs.
The SBA's microloan program currently focuses on lending to
qualified intermediaries which in turn provide small scale loans to
small businesses for working capital, materials, supplies or equipment.
The intermediary may also receive grant funds in an amount that is no
more than 30 percent of its SBA loan. The grant funds may be used by
the intermediary to provide technical assistance to borrowers and
prospective borrowers. In addition, SBA makes grants to non-profit
entities that provide technical assistance. These technical assistance
providers primarily assist clients to access capital by offering them
marketing and management help. Finally, SBA offers training to
intermediary lenders to enhance these lenders' capacity.
PRIME aims to meet the training and technical assistance needs of
low-income entrepreneurs. It is a human capacity development strategy,
rather than a credit and finance development strategy. The strategies
are complementary, and are necessary to assist low-income people to
enter the economic mainstream.
PRIME is targeted to some of our most vulnerable citizens. At least
50 percent of the grants made under the PRIME program must be used to
benefit very low-income individuals, those persons with incomes of not
more than 150 percent of the poverty line.
management issues
Question. Ms. Lazar, I am pleased about the progress the Fund has
made in its management. It seems that you have been able to hire strong
financial management leadership.
Could you please elaborate on how you were able to remedy the
Fund's management problems? I would especially like to hear about how
critical it has been to have a CFO and other financial management staff
to deal with these matters.
Answer. Critical to success in remedying management problems was
the Fund's organizational restructuring implemented in the fall of
1997. In addition to the Director, the restructured organization
includes two Deputy Directors: a Deputy Director for Policy and
Programs, responsible for Fund policy and programs and a Deputy
Director for Management and Chief Financial Officer, responsible for
management and administration functions. In addition, the Fund's Legal
Counsel handles all of the legal matters of the Fund. The External
Affairs Officer manages the Fund's outreach activities. This
organizational structure enables the Fund to effectively manage its
program, finance, management, legal and external affairs matters.
Simultaneously with restructuring, we focused on recruiting,
developing and retaining high-caliber staff throughout the Fund. Our
goal was to enhance the in-house capacity and expertise of the Fund's
staff. Among other hiring, the Fund fully staffed a financial
management unit, including a Financial Manager (controller), staff
accountant, and budget officer, all critical to successfully performing
the full range of federal financial management functions (e.g.,
planning, budget formulation and execution, accounting, internal
controls, and auditing).
We also developed, implemented and completed an aggressive
corrective action plan to address quickly the material weaknesses that
had been identified by both our new CFO and KPMG during the fiscal year
1997 audit with a goal of achieving a ``clean'' audit for fiscal year
1998. Throughout the year, there was a constant management team
awareness of and support for establishing and maintaining a strong
management control environment within the Fund--key to an unqualified
audit opinion. In addition, there was complete management involvement
and participation in implementing the provisions of the Government
Performance and Results Act (GPRA) and the integration of the Fund's
new strategic planning, performance planning, and budget processes.
Having a CFO and other financial management staff was critical in
helping the Fund to successfully implement its corrective action plan
and obtaining a clean audit opinion.
performance measures
Question. Last year you indicated that the Fund, in its reporting
process for its awardees, had created a rigorous process to allow you
to understand the impact of the CDFIs at the community level and their
capacity to sustain themselves over time.
Please provide some detailed results from this new process.
Answer. Since the Fund began making awards, we have required our
CDFI awardees to submit quarterly reports, annual reports and financial
statements. These reports enable the Fund to monitor the organization
and financial condition of the awardees as well as understand the
impact of the awardees on the communities that they serve. In 1998, we
enhanced our ability to collect data on the impact of our awardees by
requiring them to complete and submit an annual survey designed to
collect detailed information on the accomplishments of the awardees and
their capacity to sustain themselves over time and by conducting on-
site, in-depth case study analyses of a number of the awardees and
their communities.
In 1998, our survey collected performance and outcome data on 30 of
our 31 first-round CDFI Program Core Component awardees. The Core
Component is the largest of the CDFI funding programs administered by
the Fund. The first-round awardees were chosen in 1996.
We began our evaluation on only first-round awardees because they
have had at least a year to absorb the Fund's investments and put them
to work. Our sample of 30 first round awardees includes six credit
unions, fourteen loan funds, three community development banks, three
venture capital funds, two microenterprise programs, and two
multifaceted CDFIs. Together, they received $34 million in CDFI awards.
What has our $34 million helped these institutions to accomplish?
Our preliminary findings demonstrate that these awardees have
accomplished significant community development impact over the past
three years. For example, they have made $565 million in community
development loans and investments. These loans and investments have
helped to: create or expand 1,895 microenterprises and 1,148
businesses; create or retain 12,412 jobs; develop 8,617 units of
affordable housing, 98 child care centers serving 7,168 children, 17
health care facilities serving 32,723 clients and 170 additional
community, cultural, human services and educational facilities.
Further, these awardees have provided business training, credit
counseling, home buyer training and other development services to
10,641 individuals.
Based on our sample, 70 percent of the clients of the average 1996
awardees are low-income individuals. Sixty percent are minority
individuals. Fifty percent are women. Fifty-three percent live in the
inner city. Eleven percent live in rural communities. Thirty-six
percent live in suburban areas.
Since receiving their Fund awards, the 1996 awardees in our sample
have strengthened their capacities to deliver products and services to
their target communities over time. Their total assets have increased
by 122 percent, growing from $473 million in the aggregate before they
received their awards to $1.05 billion in the aggregate in 1998.
The Fund's case studies include on-site evaluations by the Fund to
examine the CDFIs activities within the local economic development
context. To date, we have completed three case studies. We anticipate
completing several per year. The three case studies that have been
completed thus far have been in Boston, Massachusetts, San Antonio,
Texas and Santa Cruz, California. Our initial research suggests how
CDFIs are positively affecting their communities.
In Boston, many of the city's poorer neighborhoods did not benefit
from the economic growth in the 1980s; their conditions actually
worsened during that period. Yet these same neighborhoods have
experienced notable improvements in the past 10 years, thanks in part
to the work of CDFIs such as the Boston Community Loan Fund and the
Local Initiatives Support Corporation, two CDFI Fund awardees. These
CDFIs have provided financial and technical support to two of the
city's most effective community development corporations (CDCs),
enabling the groups to develop the scale necessary to carry out
affordable housing and commercial projects that have revitalized long-
declining communities such as East Boston and Egleston Square. Since
the mid- 1980s, the CDFIs have provided over $7.5 million to the CDCs,
which in turn have: built or rehabilitated over 800 units of affordable
housing; managed an additional 900 apartments and commercial
properties; and operated after-school and other programs for 150
neighborhood youths. The CDFIs have also played a crucial intermediary
role, working with bankers, city officials, and corporate and
foundation leaders to encourage additional targeted investment in these
neighborhoods. A number of bankers view the CDFIs as important partners
in their community development work, crediting the CDFIs with
effectively serving organizations and individuals that the banks cannot
afford to serve.
Throughout San Antonio, public and private sector institutions
recognize the important work of ACCION Texas, a CDFI Fund Awardee. From
the city's Economic Development Office to local Chambers of Commerce to
banks ranging in size from local independent banks to Chase Manhattan,
ACCION is viewed as a crucial source of financial services for a
previously neglected yet significant segment of the population: the
low- and moderate-income microentrepreneurs who live and work in some
of the city's poorest neighborhoods. ACCION is seen as the organization
that can get loan capital into the hands of this underserved population
and just as important--get it back. ACCION's 400 clients include
plumbers, electricians, seamstresses, independent taxi drivers, and
street vendors. They are primarily Hispanic. Without ACCION, they would
not have adequate access to credit for their businesses. With ACCION,
they are able to get the financial and technical assistance they need
to expand their businesses and to make them more prosperous through
better business management. ACCION's success in San Antonio has led it
to begin opening offices around the state, in the Rio Grande Valley,
Houston, Dallas, Austin, and Fort Worth.
In Santa Cruz county in California, the third largest community
credit union in the nation, the Santa Cruz Community Credit Union
(SCCCU), offers a wide range of financial products and services
designed to meet the financial needs of a predominantly rural low-
income population. The need is perhaps greatest in Watsonville, where
the unemployment rate is 15.8 percent, more than three times the
national average. Adding to the unemployment rate are the once-migrant
agricultural workers who are settling in the area in increasing
numbers, even though agricultural work remains seasonal. The employment
and income figures highlighted the importance of focusing on the
Watsonville population. With the help of its CDFI Fund award, the Santa
Cruz Community Credit Union opened a branch in Watsonville so that it
could ensure credit and banking access for all citizens, especially the
Latino population.
subcommittee recess
Senator Bond. The hearing is recessed. Thank you.
[Whereupon, at 11:25 a.m., Thursday, March 11, the
subcommittee was recessed, to reconvene subject to the call of
the Chair.]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
THURSDAY, MARCH 18, 1999
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:32 a.m., in room SD-192, Dirksen
Senate Office Building, Hon. Christopher S. Bond (chairman)
presiding.
Present: Senators Bond, Burns, and Mikulski.
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
STATEMENT OF HON. DANIEL S. GOLDIN, ADMINISTRATOR
ACCOMPANIED BY:
MALCOLM PETERSON, COMPTROLLER
LEE HOLCOMB, CHIEF INFORMATION OFFICER
ARNOLD G. HOLZ, CHIEF FINANCIAL OFFICER
JOHN D. SCHUMACHER, ASSOCIATE ADMINISTRATOR FOR EXTERNAL
RELATIONS
EDWARD HEFFERNAN, ASSOCIATE ADMINISTRATOR FOR LEGISLATIVE
AFFAIRS
JOSEPH H. ROTHENBERG, ASSOCIATE ADMINISTRATOR FOR SPACE FLIGHT
SPENCE M. ARMSTRONG, ASSOCIATE ADMINISTRATOR FOR AERO-SPACE
TECHNOLOGY
EDWARD J. WEILER, ASSOCIATE ADMINISTRATOR FOR SPACE SCIENCE
ARNAULD E. NICOGOSSIAN, ASSOCIATE ADMINISTRATOR FOR LIFE AND
MICROGRAVITY SCIENCES AND APPLICATIONS
ROBERTA GROSS, INSPECTOR GENERAL
GHASSEM ASRAR, ASSOCIATE ADMINISTRATOR FOR EARTH SCIENCE
OPENING STATEMENT OF CHRISTOPHER S. BOND
Senator Bond. Good morning.
The hearing of the Senate's VA-HUD-Independent Agencies
Subcommittee will come to order.
This subcommittee meets today to review the fiscal year
2000 budget request of the National Aeronautics and Space
Administration, or NASA.
We welcome Dan Goldin, NASA's Administrator and his staff.
I am always excited by what NASA does--the awe-inspiring
visions which allow us to picture the far reaches of the
universe, to see the birth of stars and galaxies, and to
imagine the possibility of life existing throughout the
universe.
This past year has continued that excitement, probably most
emphatically with the return to space of Senator John Glenn and
the successful launch of the first two elements of the
International Space Station, which included the successful
assembly of the Russian Zarya module and the U.S. Unity
pressurized node.
I am optimistic, despite the many challenges facing NASA in
the coming year, that NASA will have another exciting year of
achievement and success. In addition, the administration's
budget request for fiscal year 2000 has attempted to establish
a more honest NASA budget. Over the last few years, the
administration has failed NASA and the Congress by requesting
budgets that underfunded priorities and pitted the escalating
costs associated with the Space Station with the costs
associated with Space and Earth Science Programs.
Nevertheless, with strong concerns voiced by both the
ranking member, Senator Mikulski, my good friend and colleague,
and me, the administration, at least within the NASA account,
has begun to provide a more balanced and rational budget
request by proposing some $13.58 billion for NASA in the year
2000. While this is a decrease of $86 million from the fiscal
year 1999 appropriations, the President's budget does commit an
additional $180 million in fiscal year 2000 for the continued
construction of the Space Station while providing balanced
funding for the Space and Earth Sciences. Nevertheless, I
expect this to be another very difficult year for funding
decisions for the VA-HUD Appropriations Subcommittee.
Mr. Goldin, those who have been to previous hearings have
heard this sad story. You should be no exception. I need to let
everybody know what a tough year we expect to have, especially
since the budget submitted by the President raises expectations
by not structuring spending decisions according to fiscal
requirements and program needs. We have significant funding
needs that we must address in this subcommittee, ranging from
medical care and increased costs of medical care for veterans,
to climbing costs associated with housing for low-income
Americans, to relief for victims of disasters.
We are not far enough along in the budget process to have
an allocation for the subcommittee. So it is premature to
discuss what levels of funding might be available to NASA. But
you can be sure, with all of these pressures coming in other
parts of our subcommittee's jurisdiction, it is going to be a
tight year for allocations.
Moreover, we did not get the budget deficit under control
by inventing new programs and priorities. The budget surplus
belongs to the American taxpayers and, ultimately, priorities
such as Social Security are going to have to be addressed
first.
As we have learned, Federal spending must be responsible
spending. NASA, as well as every agency, department, and office
within the jurisdiction of this subcommittee, will have to
justify fully its funding requests.
NASA's biggest priority remains the International Space
Station. Despite the retirement of our good friend Dale
Bumpers, the continuing escalating costs of the International
Space Station, from $17.9 billion to some $24 billion, and
likely more, at completion, will remain a point of controversy
and concern.
Somebody will take up the cudgel, I am sure, to lead the
opposition.
The problem is compounded by significant and continuing
concerns certainly that I have and that others have expressed
over Russia's ability to meet its financial commitment as a
partner, coupled with questions over its ability to meet
schedule and hardware commitments.
In addition, I have been very concerned that every year the
funding for the Shuttle is reduced to continue to pay for the
shortfalls and overruns of the International Space Station. And
every year NASA assures us that safety issues for the Shuttle
are not being short-changed.
For example, in fiscal year 2000, the Shuttle account will
receive about $20 million less than fiscal year 1999's
appropriation.
Shuttle safety, the safety of the men and women who venture
so heroically into space, must remain our highest priority. In
addition, the next major issue of program debate in NASA is the
future of space transportation, with additional investment in
the Shuttle pitted against the development of Reusable Launch
Vehicles, including the development of a Crew Return Vehicle
for the ISS.
NASA is currently working with industry to develop a
Reusable Launch Vehicle, or RLV, Program, that would be
considered as a replacement program for the Shuttle, with a
decision on the status of the RLV and the Shuttle due before
the end of this century.
As we all know, the purpose of the RLV is to develop the
next generation Reusable Space Transportation Systems, such as
the Single Stage to Orbit, or SSTO, concept, under which a
rocket attains orbit with only one stage, instead of the two
which is more common today, carrying a cargo or crew. The
purpose is to have a vehicle capable of returning to Earth,
being serviced quickly, and flying again in a very short time.
Proponents believe the success of RLV will result in
dramatically lower costs in accessing space, perhaps from the
current $12,000 per pound associated with the current Shuttle,
to as low as $1,000 per pound if our hopes and projections come
out right on the Reusable Launch Vehicle.
But for the cost of going into space, the critical
component of the success of a commercial space program, we need
to insure that this debate begins now. With the exploding costs
of the ISS as a reminder of the costs of exploring space, we
need to find ways to justify the costs of these new
technologies and have the private sector as a partner in
developing these technologies.
Finally, I am very concerned about how NASA prioritizes
programs and funding. We have been informed that a Hubble
Telescope repair mission may be scheduled for the near future
and that, because of failures of the gyroscopes, Hubble could
stop being operational during this year.
Hubble is clearly one of the crown jewels of NASA, and the
loss of its use for even a day would be more than unfortunate.
Nevertheless, I understand that NASA is struggling with
budgeting a repair mission in large part because it has used
Hubble reserves for other program shortfalls.
I understand the risk of failure with the space mission
because it is often cutting edge science. Nevertheless, NASA
needs to budget its programs to anticipate needs like those of
Hubble. We cannot continue robbing Peter to pay Paul. That is
not an appropriate way to do business.
We clearly need to understand how NASA prioritizes its
missions and activities and how funding decisions are made.
Finally, I conclude by applauding, once again, NASA on its
many successes. I can assure you that I, and I believe all the
members of this subcommittee and our staff look forward to
working with NASA on its budget and programs.
Having said that, I now, with pleasure, turn to my
colleague and ranking member, Senator Mikulski, for her
statement and comments.
STATEMENT OF SENATOR BARBARA MIKULSKI
Senator Mikulski. Thank you very much, Senator Bond.
I am going to welcome you, Dr. Goldin, and the entire NASA
team here as we consider our appropriations.
I am going to have a rather brief opening statement so that
we can get right into the hearing. We have a vote on at 11:00.
I also want to acknowledge and express my appreciation to
Senator Conrad Burns, who is actually on the Commerce
Committee, which is the authorizer for NASA. Therefore, this is
quite a lineup that you have here this morning, with
authorizing and appropriating members here.
I really want to associate myself with many of the issues
raised by Chairman Bond. But I will not elaborate on them in
great detail until we get to the questions.
I am glad to see that the administration has funded NASA in
a 5 year approach.
I am going to thank you, Dr. Goldin, for your work to
insure that the out-year funding for NASA does not dip to a
level that hollows out NASA programs. As you know, I have been
deeply concerned about that.
Now with a stable request over 5 years, we need to take a
look at what we are going to do.
I share Senator Bond's belief that we need to fund Social
Security first, make sure that we set aside money for Medicare,
because those two could really gobble up so much of our effort.
But I do, I think, respectfully disagree with the other party
that the money we are gathering in general revenues should not
go for new tax cuts when we need to stabilize and modernize our
programs. I'm not talking about new starts. But we have such a
backlog of what we need to do to catch up in work, maintenance,
and so on that I think ``no new starts, no new tax cuts'' might
be a nice mantra.
Having said that, then, I want to say that not only are we
looking for stable funding, but we are also looking for
stability and safety in our programs.
We are pleased that NASA has included funding for the
upgrades in the Shuttle's safety because it continues to be a
top priority.
We also know that we are deeply concerned about the issue
of the whole Space Telescope endeavor; for one, not only the
funds for a new, next generation telescope, but I am very much
concerned about Hubble.
We want to hear about the Hubble telescope. We want to hear
about the mission that you are going to be doing, how it is
going to be paid for and, once we do it, do we then truly
extend the life of Hubble in a way that is reliable and
sustainable. We will go into those questions.
The other continues to be--I see the flashing yellow light
on my time--the other is the continued escalating cost of the
Space Station. We now know that we are moving to assemble and
we are dazzled by the pictures. But we are concerned, once
again, about Russia as a partner in this.
As you know, Senator Bond and I asked you for a report on
whether there should be new approaches. We had hoped to have
that report in December so we could talk with the
administration and so on. We want to hear from you on the
report and why, quite frankly, it took you so long to give us
the report so that we have it only a few days before the
hearing, where we really could not give it the proper scrutiny.
But I know it will be the source of other conversations,
some of which might be classified.
In terms of the Russians, I continue to be concerned about
their missile transfer approaches and, therefore, their hand-
to-hand complicit cooperation in the proliferation of the
potential to deliver weapons of mass destruction.
There are many other issues that we want to talk about,
and, of course, I will always be interested in the Goddard
budget. But we are really interested in space science and Earth
science because that truly is really why we are really here
with NASA.
I could elaborate on this, but I would prefer to do it
through the questions, knowing that Senator Burns will want to
make some statements as well.
So we are glad to have your budget. We need to know how we
are going to sustain it. We are also interested in the fact
that I truly believe that, because of the situation in which we
have been and the escalating costs of the Station, you have had
to--I don't want to say ``rob Peter to pay Paul,'' but you have
certainly borrowed heavily. And if you have mortgaged the
family farm, I think this is a good time to talk about it.
Having said that, I thought I would use an agricultural
analogy in deference to you, Senator.
Senator Bond. Well, I'll tell you what--that dog will hunt.
[Laughter.]
We need to block those metaphors and see if we can't avoid
space interference from metaphors. [Laughter.]
With that, as Senator Mikulski said, we are very pleased to
have the head of the authorizing team in the Senate, a member
of this subcommittee, Senator Conrad Burns.
Senator Burns.
statement of senator conrad burns
Senator Burns. Mr. Chairman, thank you. I have no
statement, prepared statement. Because we are going to have a
vote at 11:00, we should get Administrator Goldin and his
directors' presentations this morning.
I share some of the same concerns that both of you have
expressed.
However, Senator, we have changed the view of some folks on
wools. So if you need some wools down in Missouri, why we know
where to get them, how to transport them, and so on.
Senator Bond. You are putting them in the Space Shuttles,
right? [Laughter.]
Senator Burns. We want to send some to Missouri, don't we
now?
Senator Bond. Are we on the same wavelength?
Senator Mikulski. I'm not going to jump in here.
[Laughter.]
Senator Bond. I think we will not go there any further.
Thank you, Senator.
Dr. Goldin, we have your wonderful statement of about 25
pages in very small type. This is going to be great reading for
us today. We will study it carefully.
I would appreciate it if perhaps you could summarize it for
us in 10 minutes so that we will all get several rounds of
questions before we get to our vote.
statement of daniel s. goldin
Mr. Goldin. Good morning, Mr. Chairman and members of the
subcommittee. I am pleased to appear before you today to
present the President's budget request for fiscal year 2000.
And I am really pleased. For the first time in many years, NASA
has a projected out-year budget that is higher than the budget
year request.
I want to thank both the chairman and the ranking member
for the support you have given this agency in working with the
administration on this issue.
Funding has been added to the International Space
Station's, Space Science and Future Launch. I am gratified by
the administration's alignment of NASA priorities with the out-
year NASA budget.
Nonetheless, the request of approximately $13.6 billion for
the fiscal year 2000 budget can be appropriately characterized
as lean. It is below the fiscal year 1999 enacted levels and so
tightly constructed that there are several areas where concerns
have been raised and I heard a few of them.
Senator Mikulski. Was it deliberate that we turned out the
lights?
Mr. Goldin. Yes.
Senator Mikulski. Is this because of a sun spot?
[Laughter.]
Senator Burns. It's Y2K. [Laughter.]
Mr. Goldin. It is not a Y2K bug. We were going to give you
a multi-media presentation as I speak.
Senator Bond. Fantastic. Thank you.
[A video presentation was shown.]
Mr. Goldin. We will be glad to enter into a dialogue with
the subcommittee today to address concerns you may have about
our funding levels for aeronautics, academic programs, space
launch and technology investments, or any other area in which
you have concerns.
Mr. Chairman, we are proud of our accomplishments. Our
agenda is ambitious, but it is achievable.
Last year, a new star appeared on the horizon. It is called
``The International Space Station.'' With our international
partners, we have begun to build this research center, which
will be as big as the U.S. Capitol on orbit. The launches of
Zarya and Unity and the spectacular EVA's to connect them mark
the beginning of this next great human adventure in space.
NASA is more than about space. We are about life on Earth.
Our technology enriches people's lives, like this child
(indicating), who is wearing a suit to protect him from
sunlight. You are seeing the first flower this child has ever
picked.
Our Space Science Program is producing fantastic results as
we keep driving down mission costs. We are in the middle of an
intense launch period of 10 launches in 9 months.
Lunar Prospector, which cost only $60 million for the
entire mission, found indications of water ice on the moon, a
still controversial finding.
Deep Space I is testing advanced technologies such as
electric propulsion. Stardust will return samples of primordial
material from a comet in interstellar space. Chandra will be
our third great observatory in orbit. It will explore highly
energetic bodies, like black holes and quasars.
Our Earth Science Program is experiencing the most
ambitious year ever and is providing down to Earth benefits. We
have a very ambitious program with almost a launch a month for
the rest of the year.
For instance, our data helps improve agricultural
management by identifying disease susceptibility, assessing
soil moisture, and helping farmers determine how much
fertilizer to use and where.
This year is very exciting as we launch Landsat 7. It will
have many applications in agriculture, forestry, and regional
planning. Terra will provide daily global measurements of ocean
color and Earth's biosphere, key data for resolving unknowns in
the global carbon cycle.
Quikscat, developed in just 12 months, will use ocean winds
data to track movement of storm systems. This should lead to a
significant advance in weather prediction.
In aeronautics, we are breaking through boundaries of
flight. The solar powered, remotely piloted aircraft flew at a
record breaking height of over 80,000 feet. The revolutionary
X-33 is the flagship of our Reusable Launch Vehicle Program.
You could see the oxygen tanks and the entire structure being
built and the Aerospike engine being tested.
NASA is doing more with less.
This committee has had concerns about the International
Space Station hurting other programs. This chart (indicating)
shows that by 2001, the Space Science budget alone will be
greater than the International Space Station.
We have crossed over in fiscal year 1999 with a total
science budget greater than that for the entire human space
flight program. Recognizing this trend, the administration has
included $10 million for next decade planning in this budget to
insure an appropriate vision for the future that integrates
robotic and human exploration.
With funding for fiscal years 1999 and 2000, we are also
continuing our Space Transportation Architecture studies to
develop an investment strategy for reducing the cost of access
to space by using commercial capabilities, Mr. Chairman.
Now I would like to share NASA's future plans with you. New
challenges will require revolutionary approaches. We have
embarked on a NASA-wide program to establish an intelligence
synthesis environment. Our goal is to enable scientists and
engineers who are in geographically dispersed areas to work
together as a team in a totally immersive, controlled, real-
time, virtual environment for end-to-end space design,
development, test, manufacturing, and operation.
This will lower costs, accelerate development time, and
increase mission success in times of ever decreasing budgets.
We will look forward to completing the construction of the
International Space Station with our partners. This research
center in space will include over 100 major pieces of hardware
from 16 countries. These pieces will be delivered by 6
different vehicles from 4 different launch complexes around the
world.
The availability of this lab in space will create new
opportunities for long-term research. For example,
biotechnology facilities will enable us to uniquely grow and
study cellular structures, including living tissue and protein
crystals.
The requirements of keeping a crew healthy in space so that
we will be able to go to other planets in our solar system will
lead to a whole new variety of medical technologies, including
telemedicine techniques, that will have applications around the
world.
One goal of our Space Science Program is to establish a
virtual presence throughout our solar system, sending fleets of
small spacecraft, rather than single large missions. This will
include a sample return mission from Mars in the next decade.
We will rendezvous with comets.
The next generation Space Telescope will build on Hubble's
marvelous results. It should cost about one-fifth of what
Hubble cost but be about 3 times bigger and 10 times more
powerful. It will explore much longer wavelengths of key
scientific interest.
In the future, NASA will have spacecraft, rovers, and
probes in orbit around various planets and the moon, in their
atmospheres around their surfaces, and burrowing underneath
their surfaces.
We will require an inter-planetary internet to assemble and
send back to Earth the tremendous amount of information that
will be generated by these robotic emissaries. The first step
at Mars is in this year's presidential budget.
Future Earth science will help us better understand our own
planet. We will be able to see the Earth through different
lenses showing water vapor, the biosphere, global cloud cover,
ocean temperature, and crystal dynamics. Collectively, these
views show us how the planet works as a system.
In the future, we will integrate detailed measurements at
the global, regional, and local levels and combine them with
predictive modeling. We hope to be able to understand and
predict weather and climate on a seasonal, annual, and,
ultimately, decadal basis.
Commercial applications will include agriculture, urban
planning, disaster mitigation, environmental compliance,
highway and pipeline siting, and resources management. A whole
new industry is growing based on this work.
NASA will continue to push the frontiers of flight from
general aviation to space access. We are developing aeronautics
technology to help reduce the fatal accident rate by a factor
of 5 in 10 years and a factor of 10 in 20 years.
For example, we are working advanced true interfaces that
will make it easier for pilots to understand what is happening
in and around the aircraft. We are working at putting air
traffic control technologies in the cockpit to give pilots the
ability to optimize their costs based on weather, traffic, and
other factors.
With synthetic vision, pilots will be able to see the
landscape no matter what the weather, day or night, decreasing
the likelihood of accidents. This technology has applications
for civil and military, commercial and private, large and small
aircraft.
A new Ultra-Efficient Engine Technology program will push
the state of the art in high temperature materials and
combustion to lower fuel consumption and improve performance.
We are looking to the future when there will no longer be a
distinction between air and space travel. The X-43 is a flight
experiment that will, for the first time in history, test a
SCRAMjet at speeds of up to MACH 10.
Another concept we are studying is the rocket based
combined cycle with magnetic levitation launch. This is not
science fiction.
The revolutionary Reusable Launch Vehicle Program, a
partnership with industry, is demonstrating technologies that
could dramatically reduce the cost of launching a payload to
orbit from today's roughly $10,000 a pound to $1,000 a pound
while, at the same time, improving safety by a factor of 10.
Because NASA does not think small, because we plan for the
long-term, not the short-term, this budget is not designed for
the next decade. It is an investment in the next millennium.
prepared statement
NASA is proud to lead the way. This program is not for the
faint of heart. NASA boldly pushes forward and performs to make
America better. I am very proud and honored to lead the NASA
team as we serve our country.
Here you are seeing a plane that will fly on Mars in 2003.
[The statement follows:]
Prepared Statement of Daniel S. Goldin
Mr. Chairman and Members of the Subcommittee: I am pleased to be
here to present to you NASA's budget request for fiscal year 2000. It
is a great time at NASA. This budget is the first budget for the 21st
Century, a century in which humans will live permanently in space, on
the International Space Station, and later perhaps beyond. Before we
look ahead to the bright future, I want to lay the foundation by
looking at the past. Our achievements, and yes, our problems, have
prepared us for the future.
While the fiscal year 2000 request represents a decrease from the
fiscal year 1999 enacted level, it is the first budget in five years
which reflects an increase in the outyears. NASA has undertaken the
challenge of the past five years by becoming more efficient. By
prioritizing and, as required, cutting programs whose cost estimates
were unrealistically low, schedules unacceptably long, or objectives no
longer relevant to our mission, we saved valuable resources. With those
savings, we started 9 new programs, like Origins, which could help us
to answer fundamental questions about life in the universe, and
Advanced Space Transportation, which could revolutionize space travel.
The percentage of our budget devoted to science and technology has
increased from 31 percent in fiscal year 1991 to 41 percent today, and
is planned to grow to 45 percent in fiscal year 2004. At the same time,
the percentage of our budget devoted to human spaceflight has declined
from 48 percent in fiscal year 1991 to 40 percent today, and is
projected to decline to 35 percent by fiscal year 2004. As a result,
our budget is much more balanced.
We have made difficult choices to enable us to move toward an
ambitious, but achievable, future.
We are managing our programs in a fiscally responsible manner. In
1992, a General Accounting Office survey of our major programs
identified an average cost growth of 77 percent. We aggressively
attacked the problem, and through management oversight, cost-cutting
efficiencies and identifying the problems, have created positive
results. Cassini, Mars Global Surveyor, Mars 1998 Orbiter, Mars 1998
Lander, Stardust, NEAR, ACE, and Mars Pathfinder have all been launched
on time and within budget.
We continue to find efficiencies in operations while we improve
safety; from fiscal year 1993 to fiscal year 1998, the annual Shuttle
budget is down 29 percent, while the measures of Shuttle safety and
performance have improved dramatically. I am proud of the NASA-
contractor team that made this happen. Over the same time period, we
have improved the manifest lead time by 28 percent, and increased the
maximum lift capacity to the International Space Station by 71 percent.
Some of my favorite metrics are associated with science spacecraft
design and development. In the early 1990s, the average cost of
spacecraft development was $590 million. From fiscal year 1995 to
fiscal year 1999, it is $205 million, and our goal for fiscal year 2000
to fiscal year 2004 is $79 million. Development time has come down
dramatically. In the early 1990s, the average development time for
spacecraft was eight years. From fiscal year 1995 to fiscal year 1999,
it is five years, and for fiscal year 2000 to fiscal year 2004 our goal
is four years. Our annual flight rate went from two in the early 1990s
to seven in fiscal year 1995-1999, and we plan on fourteen flights a
year on average from fiscal year 2000 to fiscal year 2004. The missions
are exciting, as attested to by extensive media coverage and hits on
NASA's World Wide Web site, and scientifically sound.
We're not just talking about improvements, we're implementing them.
Our Discovery series of spacecraft must be developed in less than three
years and for less than $150 million (FY 1992 dollars). Stardust,
launched this month to gather and return samples from a comet, took 27
months to develop and cost $120 million. We have 11 planetary
spacecraft that, together, cost the same as the single Galileo
spacecraft.
We have changed NASA as an institution. In 1995 we conducted a Zero
Base Review (ZBR) which created Lead Centers and Centers of Excellence.
This led to the elimination of redundant capability at our Centers and
allows each Center to focus on what it does best. We redefined the role
of Headquarters to define ``what'' NASA should do, and leave it to the
Centers to figure out ``how'' to make it happen. We met our goal of
cutting the total Government/contractor workforce at Headquarters by a
factor of three, including cutting the civil servant staff in half. The
total NASA workforce has come down from about 25,000 in fiscal year
1993 to 18,545 for fiscal year 1999 without a reduction-in-force.
We established a Program Management Council to catch cost overruns
and schedule problems, and it is working in programs like Chandra,
Clark, and X-33/RLV. Our new approach to contracting, holding
contractors accountable for delivering on budget and on schedule, is
working in programs like SFOC, CSOC and the TDRS-Hughes contract.
Within NASA, I have established safety as our most important core
value. The safety ethic will permeate all NASA activities, on the
ground, in the air and in space. Our current program is good; however,
we can and will do better. I am working to ensure that all NASA
managers understand what is expected of them when it comes to safety
and health. Our managers and employees are stepping up to the challenge
and working to identify and correct any deficiencies in safety and
health as these are identified. No compromises shall be made when lives
are at stake.
We at NASA are proud of our Strategic Plan. We have a vision for
the Agency and roadmaps to get there. We look forward to working with
this committee and others in the coming year as we revise and refine
our Strategic Plan. Our fiscal year 2000 Performance Plan, which will
be sent to you shortly, will include interim adjustments to our 1998
Strategic Plan. These changes reflect a special emphasis on safety and
changes we have made in the NASA organization. Under the Government
Performance and Results Act (GPRA), a fully updated Strategic Plan must
be submitted by September 30, 2000. We intend to get an early start and
will be working with you to enable the Committee's full participation
in this process. GPRA, through its requirements for strategic and
performance plans, has provided a structure for NASA to prove to the
American taxpayer that we do what we say, and that what we do matters.
In order to assure that NASA can implement its Strategic Plan, we
have underway a Core Capabilities Assessment, led by the Chief
Engineer. The purpose of the assessment is to identify the physical and
human assets required to deliver on the established Mission Areas and
Center of Excellence assignments identified in the Strategic Plan. We
will use the results of the assessment in formulating the fiscal year
2001 budget.
We had a very exciting year in 1998, full of new discoveries and
heroes, and a celebration to commemorate our 40th anniversary. The sun
rose on the International Space Station with the launch of the first
element, Zarya (Sunrise), in November, and the world watched as our
astronauts connected the U.S. Unity node to it in December. John Glenn
returned to space in October for a nine-day research mission. We now
have images of the faintest galaxies ever seen. We launched the Mars
Climate Orbiter, the third mission to that planet in as many years. The
Tropical Rainfall Measuring Mission, a cooperative mission with Japan
launched last year, will revolutionize our knowledge of how storms and
hurricanes form and dissipate and enable new weather forecasting
methods. The U.S.-Canadian Radarsat created the first detailed radar
map of Antarctica. We took atmospheric flight to new heights as the
remotely piloted Pathfinder aircraft surpassed 80,000 feet. We
continued to push the technology to lower space launch costs, making
the first selection under the new Future-X program, which is the next
step in the space access revolution. This is just a sampling; I will
discuss in more detail the achievements of NASA's Enterprises later in
the statement.
We see where we have been; where are we going from here?
In five years, the International Space Station (ISS) will be
complete and serving as an outpost for humans to develop, use, and
explore the space frontier. The ISS will greatly expand research
opportunities, leading to exploration breakthroughs, scientific
discoveries, technology development and new space products. We will
continue to safely fly the Space Shuttle--the workhorse to support
assembly for the Space Station. While we do this, we will make
fundamental decisions on the long-range strategy for sustaining human
access to space through upgrades to the Space Shuttle, or through
replacement of the Space Shuttle. We will stay on the road to
commercializing space operations, including space transportation, space
communications, and the International Space Station. As we transition
from operations to core R&D functions, we will lay the groundwork for
decisions on extending human presence beyond Earth orbit.
In Space Science, we are poised on the edge of a new undertaking
aimed at helping us answer some very old questions: What is our place
in the cosmos? How did we get here? Are we alone? You first heard about
the Origins program a few years ago. It is time to turn Origins into a
reality. In the not-too-distant future, we will move from the planning
stages to actual launch and operations of a number of Origins missions.
These missions include powerful telescopes to find the earliest
structure in the universe, to search for planets around other stars,
and to look for potential evidence of life on these newly discovered
planets. They also include robotic probes to Mars, Europa, and other
targets in the search for the beginnings of life in the backyard of our
own solar system. The data gathered from these new missions combined
with what we continue to learn about the mysteries of the deep universe
and our own Sun from ongoing missions should help us begin to unravel
the answers to these questions that are as old as humankind itself. Our
goal is simple--to do what no generation before us has been able to--
understand our place in the cosmos.
Closer to home, through the Earth Science Enterprise (ESE) we will
develop a comprehensive understanding of the total Earth system and the
effects of natural and human-induced changes on the global environment.
To accomplish this, we are drastically shrinking the size, cost and
development time for missions in the next decade. But NASA is not going
to stop with just smaller, cheaper versions of today's science
satellites or be confined to low-Earth orbit. The state-of-the-art in
instrument and spacecraft technologies points to the near future when
present-day thousand kilogram, cubic meter satellites are replaced by
constellations of micro and nano-satellites with instruments on chips.
These advanced satellites will not operate independently of each
other--they will be intelligent constellations working together to
provide the views having the temporal and spatial resolutions users
want. They will be capable of on-board data processing and direct
downlink of information to users' desktop computers in near real time
at the cost of long distance telephone calls. While accomplishing our
science objectives, these advanced satellites will enable the next
great advances in weather and climate prediction, improve agricultural
productivity, and advance the growth of the U.S. commercial remote
sensing industry.
With the Aero-Space Technology Enterprise, NASA seeks nothing less
than to revolutionize the way we travel to neighboring cities,
countries and planets. The benefits of the communication revolution we
are living through today will only be fully realized when it is
accompanied by a transportation revolution. In a ``wired'' economy, we
need to move people and goods more safely, more quickly, more
efficiently, and with less environmental impact. Today, NASA is
concentrating on these public goods issues in partnership with the
aviation community. Working with the Federal Aviation Administration
(FAA), airlines and industry, we are going to create a commercial
aviation system that is safer, more efficient and friendlier to our
communities and our globe. And while we are revolutionizing aviation,
by significantly reducing the cost and increasing the reliability of
space transportation, we will open space to human endeavor. Think of
the science missions we do today, and then imagine space transportation
systems that support faster missions with three or four times the
amount of science at lower cost. Imagine the commercial opportunities
that will develop in earth orbit for communications, materials science
and pharmaceuticals, space-based power and other applications when the
cost is one tenth or even one hundredth of today's costs. That is what
we are working for.
We understand the road ahead presents challenges. First among these
is keeping our promises on key programs such as International Space
Station and the Earth Observing System. This will require in the first
case flexibility and determination, and in the second case new
information technologies and management approaches. Another challenge
is within NASA itself: the design of the NASA organization, the skills
of our workforce, the availability of research and technical
facilities, the evolution of existing assets, and our interactions with
customers, partners, and suppliers must reflect and support the
changing nature of our programs. For instance, the emergence of
``virtual'' structures--collaborative and geographically dispersed
teams--to conduct work requires new concepts of organization and
management. And our emphasis on commercializing operations while
focusing on R&D requires new ways of dealing with customers, partners
and suppliers. The third major challenge I see for NASA is that of
``continued relevance.'' Fundamentally, NASA needs to continue to
benefit the taxpayers who foot the bill for a vibrant aeronautics and
space program. To meet this challenge, we need to remain focused on our
ultimate customer, the taxpayer, while doing a better job communicating
the outcomes and benefits of our programs. Mr. Chairman, I believe NASA
is poised to meet these challenges and achieve our vision for the
future.
fiscal year 2000 budget
This budget is another important step on NASA's path back to its
roots in research and development, an important step towards achieving
the vision I just laid out. The fiscal year 2000 budget provides
stability in the outyears, and strikes a balance between upholding our
commitment to the International Space Station (ISS) and advancing
research and technology.
All of you are aware of the challenges facing us and our
International Partners on the ISS program. This budget reflects an
Administration policy decision to reduce the level of risk to the ISS
with a net increase of $1.4 billion over the next five years, including
$349 million more for fiscal year 2000 alone. We have enhanced Station
budget reserves, are developing a robust Russian Contingency Plan,
which includes use of the Shuttle for ISS reboost, development of a
U.S. propulsion module, and additional Shuttle launches for logistics
support. While advancing the ISS, we have preserved NASA's other core
research activities and are investing in new technology initiatives
that will provide robust options for exciting NASA missions in the next
decade.
As ISS brightens the sky, so will many, many science missions
funded in this budget. We are in the middle of launching ten Space
Science missions in nine months. With the funds provided by the
Administration in this budget, we will be developing Self-Sustaining
Robotic Networks. Building on the enormous success of Mars Pathfinder,
these self-tasking, self-repairing, evolvable networks of small, highly
mobile machines will give us the permanent ``virtual presence''
outposts we need to achieve high priority Origins science objectives on
Mars, Europa, Titan, Callisto and other key points throughout the solar
system. Thanks to Administration investments, we will also be
developing the other end of the spacecraft technology spectrum in
Gossamer Spacecraft. These are lightweight, large-scale, deployable
spacecraft that will enable revolutionary, light-gathering capabilities
for solar sails, telescopes, and power collection. Through Mars Micro-
Missions and a Mars Network, the Administration is also supporting
enhancements to the baseline Mars Surveyor program that greatly
increase the quality and quantity of the Program's science return and
the Program's opportunities in public education and exploration.
In recent days, I have accepted a recommendation from my senior
management that NASA revise its previous plan for the next Hubble Space
Telescope (HST) servicing mission (SM-3), to undertake an expedited
servicing mission in October 1999, and a second servicing mission as
soon as operationally feasible. The need for a mission to ensure
continued HST science operations has arisen suddenly because two of the
remaining five operational gyroscopes in the telescope's guidance
system have malfunctioned in the past six months. Although the loss of
gryoscopes is expected over time, the recent loss of two, in rapid
succession, leaves the Telescope one failure away from a total shutdown
of science operations. The spacecraft is not in danger, and will remain
safe until a repair mission can be launched. However, a shutdown in
science operations would be a severe blow to the scientific community,
as Hubble is arguably the most productive, and certainly the best-
known, astronomical science facility in the world. Developing and
executing this servicing mission within seven months is a challenge,
and would not have been possible if it were not for the fact that
training has been ongoing for the previously planned servicing mission.
Furthermore, the HST replacement hardware required for this expedited
servicing mission has been budgeted for in the fiscal year 1999 and
prior budgets. We are in the process of identifying offsets to
accommodate the costs of this expedited mission, and will submit a
revision to our fiscal year 1999 Operating Plan to the Committee in the
near future.
We will launch eight Earth Science missions this year, including
the first two Earth Observing System missions. NASA will continue to
contribute to the ``Digital Earth'' effort, by fusing Earth Science
data, socio-economic data, and other data sets that can be ``geo-
referenced'' and used to communicate a tremendous amount of information
to scientists and non-scientists.
A broad new technology initiative I am particularly excited about
is the Intelligent Synthesis Environment (ISE) that will revolutionize
the way NASA conceives, plans, and develops its missions. In today's
engineering environment, we and industry take too long to develop our
missions and effectively commit about 90 percent of cost very early in
the development cycle when we only have about 10 percent of total
design knowledge. Over the next five years NASA will research, develop,
and implement the tools and processes to dramatically reduce spacecraft
development time while creating much higher confidence in performance
and total life cycle cost estimates. ISE will exploit emerging advances
in ultra-high speed computing, advanced communication networks and
totally new analysis methods; it will allow us to ``virtually'' build
and test vehicles and systems before we spend money on expensive
hardware. When fully deployed, ISE will enable geographically dispersed
scientists and engineers to function as an integrated, collaborative
team with the understanding and knowledge necessary to develop complex
missions faster, with better- understood risk and much lower life-cycle
costs.
We are continuing to focus on high-priority aeronautics research,
aggressively pursuing our goals in aviation safety and systems capacity
as well as next-generation design tools. And our pursuit of cheaper,
more reliable space transportation for the next century continues with
our Reusable Launch Vehicle technology program and the ongoing,
industry-led Space Transportation Architecture Study (STAS). This Study
was initiated last year to help us develop an investment strategy for
reducing the cost of access to space by using commercial capabilities.
The study is assessing: (1) if the Space Shuttle should be replaced;
(2) if so, when the replacement should take place and how the
transition should be implemented; and (3) if not, what upgrades should
be made to continue safe and affordable flight of the Space Shuttle. We
awarded study contracts to the Boeing Corporation, Kelly Space and
Technology, Lockheed Martin Corporation, Orbital Sciences Corporation,
and Space Access--representing the entire spectrum of players in the
launch vehicle business--to solicit their assessments of future options
to that could feasibly commercialize NASA's space launch requirements.
The industry teams gave NASA their final reports in late January. These
results are being independently assessed and will be integrated by an
in-house team into space transportation architecture options. Over the
next few months, additional work will be tasked to refine and further
develop some of these options. NASA has set aside a portion of its
outyear budget to provide resources for achieving a reduction in future
launch costs, while funding the Space Shuttle Program at levels which
accommodate essential safety obsolescence mitigation. The STAS will
help us understand how we can make investments to leverage commercial
launch capabilities that transition us away from owning and operating
space transportation systems and toward private sector competition for
NASA's launch requirements. From these options, the NASA Space
Transportation Council will make recommendations this summer to me
concerning a future space transportation investment strategy. We expect
to continue to invest in critical technologies that reduce financial
and technical risks for competing concepts leading to a competitive
selection of a preferred approach or approaches in the 2002-2005
timeframe. I will make recommendations in this regard to the
Administration this fall as part of the fiscal year 2001 budget
process.
We have taken aggressive actions to ensure that our missions,
systems, and supporting infrastructure and facilities are not disrupted
by the transition to the year 2000. As of March 15, 1999, 93 percent of
our 158 mission critical systems are, or have been made to be Y2K
compliant. NASA has completed renovation and validation on all but one
of the 101 mission critical systems we are repairing (Y2K work on the
SOHO ground system has been deferred until full recovery is complete).
We will complete implementation of planned repairs and replacements for
mission critical systems by the end of March. In addition, we have
repaired almost 350 non-mission critical systems, validated over 6000
commercial products, and tested over 52,000 workstations and servers.
No significant Agency asset has been untouched.
While these accomplishments are noteworthy, NASA is going beyond
stated requirements to ensure our missions and programs are ready for
the new millennium. During the remainder of 1999, NASA will conduct a
suite of extensive end-to-end tests that include interfaces to external
infrastructure outside NASA control (e.g. electric power grid) to
validate our Y2K operational readiness. For example, we will be
executing a series of end-to-end tests, culminating in a Space Shuttle
pad test, to verify that all aspects of the Space Shuttle program will
be functional in the Year 2000. As part of this test, we will run a
pre-launch countdown (to L+5 seconds) with a vehicle physically on the
pad and all supporting systems in a Y2K configuration. For the
International Space Stations, we are conducting an end-to-end test with
Mission Control Center-Houston, Mission Control Center Moscow, and the
supporting networks. We are also conducting a series of twelve end-to-
end tests to demonstrate the readiness of command, tracking, telemetry,
and data services supporting all NASA missions, including NASA's Deep
Space Network, Ground Network, Space Network, and NASA Integrated
Services Network. We will continue to conduct end-to-end tests for
Space and Earth Science missions similar to the recently completed
Cassini test. This test demonstrated end-to-end compliance by flowing
data in a Y2K environment from a Deep Space Network facility at the
Goldstone complex all the way to two end user sites at John Hopkins
University and in England. In addition to ensuring compatibility
between NASA's systems and external infrastructure, these end-to-end
tests will provide added confidence regarding the operations of
internal NASA systems.
As a further assurance, each NASA Enterprise and field Center is
preparing business continuity/contingency plans to provide an
acceptable level of NASA functions in the event of failures of internal
or external assets or services due to Y2K anomalies. During the
rollover weekend, we will have additional ``Response Center'' staff on-
site at each field Center and Headquarters. We are also establishing
strategies for all missions for the selective quiescence of facilities
and systems, including restriction of spacecraft commands during the
rollover. NASA is committed to ensure that the Agency transitions
safely to the new millennium with zero failures or significant
malfunctions and that any unforeseen discrepancies are resolved with
minimal impact on normal operations.
We are excited about what the future holds for NASA. The fiscal
year 2000 budget of $13.6 billion provides not only continuity and
stability, but also a moderate investment in far-term technologies and
planning. This vote of confidence from the President that we are ready
and energized to tackle new challenges in the new millennium is a
challenge we proudly accept.
nasa's enterprises
Human Exploration and Development of Space Enterprise
International Space Station.--The International Space Station (ISS)
has become a reality. The foundation, befittingly named Zarya, for it
marks the dawn of a new era, was lifted to orbit aboard a Russian
Proton launch vehicle last November. A month later, Unity was carried
to orbit aboard Shuttle Endeavour and berthed with the Zarya module.
Before long, passageways from Unity will link to other chambers such
as: Destiny, the U.S. laboratory; the Russian Service Module; and the
airlock.
Astronauts James Newman and Jerry Ross made it look easy,
connecting umbilicals providing power and communication links from
Zarya to Unity, bringing Unity's on-board systems to life. This is the
first time ever that two such complex international spacecraft--built
10,000 miles apart, and assembled permanently in orbit over a period of
a few short days--has been accomplished. We understood that the
complex, international nature of this venture would present
unprecedented challenges, because we would not be able to perform
integrated testing of all international elements on the ground. The
Zarya/Unity mating was truly an outstanding effort by the NASA/RSA
team. Many challenges were overcome to reach that moment, and we know
that many formidable tasks lay ahead. Since the beginning of the
International Space Station Program, we have worked through many
questions and uncertainties with our partners to achieve definite,
measurable, and notable forward progress. In 1994, we were moving out
of the design phase and into manufacturing. By 1997, we began to see
major subsystems and elements take shape as we entered into test and
validation activities. We began to integrate these systems with the
Shuttle fleet. Today, while the Boeing developmental effort is over 80
percent complete, we continue to have elements in all phases of
development, and operational elements on orbit. The International Team
has demonstrated that it is fully committed to working together to
overcome new challenges as they arise, to assure safe design and
operations and to make the ISS a reality.
russia
When provided with adequate resources, the Russian Space Agency
(RSA) has demonstrated worthy performance. However, despite a high
level of commitment by RSA, Russia's fiscal realities continue to
impede RSA's ability to deliver its substantial contributions to the
ISS in a timely manner. Those contributions include propulsive attitude
control, reboost, early crew quarters and life support, crew rescue,
and command and control during the early assembly period. NASA has
plans for U.S. capabilities in all these areas, which provide backup
and in the long-term make ISS operationally more robust. But the costs
of delaying the assembly until these U.S. capabilities are available
would be significant; the prudent course is to continue to seek
Russia's contributions.
NASA's approach to contingency planning has been to incrementally
fund activities that permit station development to continue to move
forward, although not as originally planned, should the planned
contributions of our ISS partners not be delivered as scheduled. Our
Contingency Plan to mitigate the financial and schedule risk from
potential shortfalls in Russian contributions consists of: (1) building
up U.S. capabilities as backup to protect against possible Russian
shortfalls, which will also make the ISS more robust; and, (2)
potential purchases from RSA in specific areas where Russian goods and
services are of value to the United States.
In October 1998, to provide funding stability to RSA, NASA
purchased for $60 million valuable crew research time and stowage space
in Russian elements of the ISS. To mitigate further schedule
disruptions and cost growth, NASA is considering plans to continue
contracting with RSA for additional goods and services of value to the
U.S. We are carefully monitoring three areas before we make decisions
regarding any follow-on contract with RSA for goods and services: (1)
confidence in the Service Module launch schedule, based on successful
testing, shipment to Baikonur, and funding flow; (2) clarity on the
Russian Government plans for the future of the Mir, specifically
including validation that any extension of Mir operations will cause no
interference with Russian Government funding for their commitments; (3)
clear understanding from RSA that other Russian hardware and vehicles
they have committed for ISS are being produced. NASA has budgeted $100
million in fiscal year 1999 to procure goods and services, which could
include a Soyuz vehicle needed by the United States to enable a 6-
person ISS crew prior to the deployment of a U.S. crew return
capability. However, this budget includes no provision for purchases
from Russia in fiscal year 2000 and beyond. We will continue to monitor
the overall Russian situation in this regard.
The Interim Control Module (ICM), another element of NASA's
contingency plan, can provide propulsion and attitude control
capability. Through innovative Shuttle flight planning, NASA has
developed an ``each flight'' reboost capability, under which NASA
could, if necessary, offset as much as a 30 percent shortfall in
Russian Progress vehicle propellant logistics. We are modifying the
Orbiter fleet to enhance this Shuttle reboost capability to both
increase flexibility of reboost as well as increase the propellant
shortfall offset to at least 50 percent. When coupled with the ICM's
capabilities, Shuttle reboosts will provide needed contingency
protection to safely maintain elements already in orbit, and allow us
to continue ISS assembly in the event of Russian shortfalls until a
U.S. permanent propulsion module can be deployed. As a result of our
review of the Propulsion Module requirements and implementation plan on
February 17, we have authorized the contractor to proceed with
procurement of the next set of long-lead parts, and to prepare for a
Systems Requirements Review later this month. Delivery of the
Propulsion Module could be as early as fiscal year 2002.
Relative to the Service Module, Mr. Koptev, RSA's Director,
informed me last month that despite running Service Module (SM)
integration tests around the clock and on weekends, some schedule
slippage has occurred due to normal technical difficulties. Our ISS
management team will be traveling to in Russia for a General Designers
Review and Service Module roll out prior to shipment to the launch site
next month. At this meeting we will gain better insight into the
progress of the SM, allowing the partners to evaluate a revised launch
date for the Service Module. During our assessment last April, we knew
that the July 1999 schedule for SM launch was aggressive and that a
September date was possible. This slippage does not impact the elements
already in orbit.
mir space station
Over the last six months, Russian news media have been reporting on
the possibility of extending the life of the Mir space station. RSA has
repeatedly made clear that the Russian Government's top priority for
human space flight is the ISS. Any potential extension of the Mir
program would require private funding and must not in any way impact
Russia's ability to meet its commitment to the ISS program. In mid-
January, Russian Prime Minister Primakov signed a decree outlining the
conditions under which Mir could be extended on orbit on a commercial
basis. RSA indicated that a final decision on a potential extension of
Mir would be made in the Spring timeframe, depending on the success of
finding a commercial investor. Assuming no investors come forward, RSA
has stated that it intends to deorbit Mir in late summer. RSA has
publicly stated that, currently, there are no investors coming forward.
NASA is working closely with RSA to understand the status of their Mir
deorbit plans, and related implications to their ISS commitments.
iss budget
Last year, the Committee heard from an outside task force of
independent experts on the projected U.S. cost for the ISS. The Task
Force report specifically highlighted the extraordinary level of
complexity inherent in the ISS and concluded that the Program had made
``notable and reasonable progress over the past four years'' and faced
no extraordinary or programmatic ``show-stoppers.'' Nonetheless, the
report concluded that Program cost and schedule projections were
optimistic given the challenges ahead, partially due to domestic cost
increases and partially due to the uncertain status of the Russian
contributions.
We recognize the validity of findings of this Task Force,
particularly in the resources needed for increased risk mitigation,
schedule protection, and crew return capability. In my October 7, 1998,
testimony before the Committee on Science, I stated that the Agency
would require additional resources to continue forward with this
valuable laboratory in space. I am happy to report that the President's
fiscal year 2000 budget request provides an additional $349 million in
fiscal year 2000, and a total net augmentation of $1.4 billion over
five years, reconfirming the Administration's strong support of the
ISS. We also recognize the recommendations of the Task Force in a
number of management areas, and recognize our fiscal responsibility to
the American taxpayer to balance all aspects of this program and manage
within the resources available. The Administration has highlighted this
responsibility by establishing the management of risks in development
of the ISS as one of the Administration's Priority Management
Objectives in the President's fiscal year 2000 Budget. We have already
begun to make management improvements, including the initiation of a
new management review process for those activities not under the prime
contract, and are committed to making continued improvements. We are
also making schedule adjustments and rephasing some content to limit
the financial augmentation required.
development status
In 1999, development activities are phasing down, while operations
and research utilization activities are escalating. The fiscal year
1999 vehicle development budget is nearly $600 million below fiscal
year 1998, and the number of contractors supporting the program is
several thousand less than at the peak of the development effort. This
trend will continue this year, with several thousand additional
contractors transitioning to other tasks, such as sustaining
engineering or other non-ISS work. ISS operations planning is now well
underway. In fact, NASA is already working plans for operations that
will occur in fiscal year 2001. Mission Control Center-Houston is
already operational, and has overall authority and responsibility for
the safety and operations of the ISS and crew. Mission Control Center-
Moscow is currently performing the actual uplink of commands, and will
continue to do so until U.S. communications and control systems become
fully operational with the U.S. Laboratory delivery to orbit in fiscal
year 2000.
Near-term, high visibility activities this year include the flight
of critical ISS spares and an external Russian cargo crane to be flown
in May 1999. This flight will be followed by the launch of the Russian
Service Module, providing the early crew quarters and ISS propulsion
systems. Next, another Shuttle logistics flight is scheduled, followed
by Shuttle flights to assemble some of the U.S. external framework,
electronics, communications, attitude control and thermal systems prior
to flight of the first crew in early 2000.
Near-term hardware development activities are focused on completion
and delivery of the U.S. airlock. The ISS involves many systems which
entail multiple, identical elements, such as the photovoltaic arrays,
of which four are planned. For the most part, the high-risk, first
elements of these systems have been delivered to KSC. This year will
begin the delivery to KSC of many of the subsequent, identical items.
We will continue Multi-Element Integration Testing (MEIT) effort on the
next complement of U.S. elements: the initial truss segment, the early
thermal control system, the first Photovoltaic Arrays, the Canadian-
built ISS robotic arm and the U.S. Laboratory, Destiny.
In 2000, we will launch the first ISS crew to orbit, as the launch
of the first Soyuz to ISS enables permanent crew capability for three
people. Microgravity research capability will be available in the
spring of 2000, with the outfitting of the U.S. laboratory, Destiny.
When Phase II of ISS is complete in late fiscal year 2000, the Station
configuration will include Unity, Destiny, pressurized mating adapters,
power, airlock, and Multi-Purpose Logistics Module (MPLM); Zarya, the
Russian Service Module and Soyuz; and the Space Station remote
manipulator system (SSRMS) provided by Canada. By early 2003, the ISS
configuration will also include the second U.S. node, truss segments,
three solar arrays, the Japanese Experiment Module (JEM) and resupply/
support vehicles. In 2004, U.S. Station development efforts will near
completion, with the delivery of a six-crew capability on orbit.
international partners
The work of NASA's other international partners on the ISS program
is proceeding well and according to plan. All of the partners have
stated their commitment to do whatever possible to help Russia fulfill
its obligations to the ISS program and to ensure that the program
remains on track.
NASA is also working aggressively with all of its partners to
ensure that all ISS components are fully Y2K compliant. When I attended
the historic launch of Zarya from Baikonur on November 20, 1998, I had
the opportunity to meet with the head of each partner agency on the
Year 2000 issue. Each agency gave an in-depth presentation on their
work to ensure full Y2K compliance, and reiterated the commitment to
achieve compliance early this year. Although I have received Y2K
assurances from each international partner, I do, however, remain
concerned about the health and welfare of their critical infrastructure
(e.g. power, telecommunications), and how it may potentially affect ISS
activity. As described above, our business continuity/contingency plans
are intended to ensure an acceptable level of NASA functions in the
event of failures of external infrastructure in any of the partner
countries.
The various international components of the ISS are progressing
nicely. The Canadian Space Station Remote Manipulator System, or
``Robotic Arm,'' will be shipped to Kennedy Space Center in April,
after stringent testing. The European Laboratory development is on
schedule and NASA is continuing discussions with the European Space
Agency (ESA) about the possibility of ESA providing critical crew
rescue vehicle components. The second Multi-Purpose Logistics Module
(MPLM), built by Italy, is scheduled for delivery to Kennedy Space
Center in August. The Japanese Experiment Module and Centrifuge
Accommodations Module (CAM) development is on schedule. Finally, the
Brazilian Space Agency has selected its prime contractor and is
proceeding with its hardware contributions.
research utilization
We are continuing to make progress on ISS research planning and
facilities development. However, because of schedule delays and the
need to bolster development reserves, we have slowed the development of
research equipment. Assuming that the Service Module is launched by
September 1999, we estimate that the Russian-driven delay to the
assembly sequence already has slipped utilization flights on average 6-
8 months. The research funding for ISS is still growing and will, in
fact, double by fiscal year 2001 over fiscal year 1998 levels, but the
rate of growth is slower than previously planned. As a result, some
funding for research facility development has been rephased from fiscal
year 2000-2003 into fiscal year 2004 and beyond.
We are focused on developing most of the permanent research
facilities, while leaving adequate margin in the research utilization
budgets for some investigation-specific hardware. Our approach is to:
protect research facility hardware deployment and schedules; maintain
multi-use hardware schedules (EXPRESS Racks and Pallets, Window
Observation Research Facility ); maintain planned flight investigation
buildup rate to the maximum extent possible, fund research utilization
(experiment unique hardware and support), sub-rack integration at
approximately 70 percent of that previously planned; and fund payload
operations and integration (analytical integration, operations
facilities, training) at approximately 85 percent of that previously
planned. The ISS program will continue to emphasize the early research
program by utilizing recently added Shuttle logistics flights,
accelerating the Human Research Facility, and adding two EXPRESS racks
to assembly flights 5A.1 and 6A in fiscal year 2000.
iss commercialization
We were pleased with the passage of the Commercial Space Act of
1998 (Public Law 105-303). This visionary step will serve the American
people well by demonstrating our government's commitment to the
economic development of space. NASA is dedicated to continuing its
leadership in this important area. In conjunction with the Act, we
released our draft Commercial Development Plan for the International
Space Station last November. The ISS represents a platform in space of
unprecedented capability. We envision that it will become a seed for
emerging commercial activity in the coming decade and we are moving
ahead to ensure this outcome.
Our goal is to serve as a marketplace foundation and stimulate a
national economy for space products and service in low-Earth orbit,
where both demand and supply area dominated by the private sector. In
partnership with the private sector, we plan to initiate a series of
pathfinder activities that could lead to businesses with profitable
operations over the long run and that become self-sustaining without
public funding. One area we are examining closely is the provision of
ISS resupply and servicing by multiple commercial competitors. Our
draft Commercial Development Plan provides a summary of both our
overall strategy and potential tactics we intend to pursue in the
coming years. It will also benefit from a private sector review, now
underway, and the independent market studies and cost analyses which we
have recently initiated. We look forward to reporting our progress as
we open the path for 21st century economic expansion in space.
x-38 and crv
The Crew Return Vehicle (CRV) will provide a seven-person crew
return capability for the ISS, beginning no earlier than 2004. The
Space Transportation Architecture Studies (STAS) are assessing the role
of systems that provide not only return, but also delivery of humans to
orbit in a range of potential future architectures. Based on the STAS
architecture concepts, NASA is evaluating the potential of a CRV to
evolve to serving a dual-purpose role, or evolve to a Crew Transfer
Vehicle (CTV) that can deliver and return humans. NASA will finalize
the CRV requirements and issue a draft Request for Proposals (FP) for
comment before finalizing the plan for the CRV. The results of the STAS
and the potential role of a CRV/CTV in potential future architectures
will be integrated into the final CRV plan.
Space Shuttle
The Space Shuttle Program successfully completed its four assigned
flights in fiscal year 1998. Fiscal year 1999 began successfully with
STS-95 in October, the mission on which Senator John Glenn returned to
flight. Most recently, STS-88 opened a new era for the Space Shuttle--
support of the assembly operations for the International Space Station.
No longer just a research platform, the Shuttle is now fulfilling its
original objectives, as the workhorse that will carry equipment,
supplies and the personnel required to assemble the International Space
Station during the next several years.
During 1998, the Super Lightweight Tank was successfully flight
demonstrated, increasing payload capacity to ISS by over 7000 lbs. The
SSME Block IIA improvements, which improved the reliability on ascent,
clearly demonstrate that NASA's investment in safety and supportability
initiatives have dramatically improved the performance and reliability
of the fleet.
In 1998, the Space Shuttle Programs principal operational contract,
the Space Flight Operations Contract (SFOC), now in its third year,
made great strides. All of the Phase I contracts have been successfully
incorporated and the first of the Phase II production contracts, the
Solid Rocket Booster project, transitioned to SFOC in July 1998. The
External Tank project is scheduled to move under SFOC in fiscal year
2000. The smooth transition of other projects to the SFOC is expected
to occur as major development activities are completed.
This year, the Shuttle will support ISS logistics and assembly
flights and a number of research objectives. In addition to setting the
stage to begin ISS utilization, the Shuttle Program is prepared to
launch the Advanced X-ray Facility (AXAF), now called Chandra, a Hubble
Space Telescope repair mission, and the Shuttle Radar Topography
mission (SRTM) for the National Imagery and Mapping Agency (NIMA).
When the Orbiter Atlantis returns to flight later this year, after
its recently completed Orbiter Maintenance Down Period and installation
of major modifications, it will take advantage of numerous other
upgrades. Examples are:
--The Multifunction Electronic Display System (MEDS), a state-of-the-
art integrated display system used in the cockpit of the
orbiter. Pioneered by NASA and in use as the standard for
commercial and military aircraft the world over.
--The Micro-meteoroid and orbital debris (MMOD) protection system for
the Orbiter radiators and wings, increases protection of the
vehicle from the potential damage to critical systems while in
orbit.
--Solid Rocket Booster aft skirt improvements reduce risk during
initial seconds after main engine ignition.
NASA continues to place the highest priority on the safe launch,
operation and return of the Space Shuttle and crew, while continuing to
seek efficiencies in the Space Shuttle Program. The fiscal year 2000
budget of $2,986.2 million will enable the system to successfully meet
its goals: (1) fly safely; (2) meet the flight manifest serving diverse
customers; (3) improve supportability; and (4) continuously improve the
system. The Space Shuttle Program's fiscal year 2000 budget remains
essentially constant, with a slight decrease of $12 million from fiscal
year 1999. We continue to seek efficiencies in the Space Shuttle
Program. The Space Shuttle manifest currently reflects eight missions
scheduled to fly during fiscal year 2000--an emergent HST servicing
mission to replace science critical gyros and five ISS assembly flights
and two ISS logistics missions.
Space Shuttle Operations ($2,547.4 million) includes sustaining
engineering, hardware production, ground processing, launch and
landing, mission operations, flight crew operations, training, and
logistics.
Funding for Safety and Performance Upgrades ($438.8 million)
provides for modifications and improvements to the flight elements and
ground facilities including expansion of safety and operating margins.
This budget also includes supportability and obsolescence mitigation
efforts, which will be used to develop systems to combat obsolescence
of vehicle and ground systems in order to maintain the program's
viability well into the next century.
This budget will enable the enhancement of the Space Shuttle
vehicle capabilities as well as the replacement of obsolete systems and
components. We will address vendor loss, aging components, high repair
cost of Shuttle-specific devices, and negative environmental impacts of
some out-dated technologies.
The Space Shuttle continues to prove itself as the most versatile,
robust, and reliable space vehicle in use today. Since 1992, Shuttle
program costs have already decreased by about 37 percent (factoring in
inflation), while significantly improving flight safety. As we continue
to look for efficiencies, we will also look for opportunities to
improve the system, including reducing the standard manifest time
period and simplifying the payload review process to allow flexibility
for the science community.
Consolidated Space Operations Contract (CSOC)
On September 25, 1998, NASA awarded the Consolidated Space
Operations Contract (CSOC) to a team led by Lockheed Martin. This
contract (base period of five years, and an option period of five
years) began on January 1, 1999, when five current space operations
contracts transitioned to CSOC. During the remainder of the CSOC
program, 10 other existing space operations contracts will transition
to CSOC. The CSOC contract provides a new approach to space flight
operations, consolidating and privatizing operations facilities under a
single contract. Over the potential 10-year life of the contract, CSOC
is expected to provide cost savings to the taxpayer of $1.4B in the
conduct of Space Communications and Mission Operations for NASA
Missions.
The major features of the CSOC Integrated Operations Architecture
(IOA) that define the implementation are:
--Consolidation of mission and data services;
--Application of architectural changes, based on commercially
developed technology;
--Centralization & automation; and
--Conversion to commercial providers.
NASA has applied a 25 percent small business goal to the CSOC
contract. Lockheed Martin and its teammates, Allied Signal and CSC,
propose to meet this target and are in the process of implementing the
necessary actions to meet the goal.
Inherent in the successful implementation of CSOC are reductions in
the contractor work force supporting space operations at five NASA
Centers over the 10-year period of performance. There will be initial
reductions to the work force at the beginning of the CSOC program, and
these reductions are currently being implemented. Following this
transition, work force impact is, on average, slightly less than 100
jobs per year in total at all five NASA centers. The CSOC contractor
team expects to absorb these out-year-staffing reductions based on
natural attrition and reassignment of employees to other non-CSOC
programs.
Life and Microgravity Sciences and Applications
NASA's Office of Life and Microgravity Sciences and Applications
(OLMSA) is eagerly looking forward to the remarkable new opportunities
that will be available on the ISS. Our ISS Phase I Program and
scientific experiments on Spacelab gave us tremendous insight into the
possibilities as well as the challenges we will encounter as the ISS
becomes fully operational.
Our past successes provide the foundation upon which future
research will be based. In fiscal year 1998, NASA supported a total of
850 ongoing, peer-reviewed investigations. Preliminary analysis
suggests that the commercial cost share investment with NASA in space
products and service development for fiscal year 1998 was approximately
$45M. Twenty-one new industry partners joined OLMSA's Commercial Space
Centers. The organizational merger of our basic science and commercial
research elements is beginning to show synergies and efficiencies as
the two groups work together to solve common problems and to use common
hardware.
We look forward to increased commercial applications of NASA
research. Understanding the structure of a virus is key to
understanding its behavior. Dr. Alex MacPherson published a structure
of the satellite tobacco mosaic virus at far greater resolution (1.8
Angstrom) than has ever been published before. Mosaic virus crystals
grown in space increased by a factor of four over crystals grown on the
ground. Basic discoveries in this field may hold great potential for
supporting near-term commercial applications. For example, Biocryst
Pharmaceuticals, Inc. and Johnson & Johnson have agreed to collaborate
on the development of a drug (neuraminidase) to treat influenza.
BioCryst used data from protein crystals grown on Earth and in space to
develop four lead product candidates that have performed strongly in
pre-clinical trials against both influenza A and B.
NASA flight research in protein crystal growth has established a
hypothesis to account for the increases in purity found in space grown
crystals. Crystals grown in space are believed to be surrounded by a
diffusion-zone that acts as a filter to remove impurities. The
resulting pure solution accounts, in part, for the higher structural
resolution. This unique zone surrounding the space crystals is
prevented by convection when these crystals are grown on the ground.
We had two exciting science flights last year. The Neurolab Mission
in April 1998, a NASA contribution to the ``Decade of the Brain,''
helped to expand understanding of how the nervous system develops,
functions in, and adapts to a microgravity environment. We performed 26
peer-reviewed investigations and collected a wide range of
physiological and behavior data in-flight and post-flight. STS-95, in
October 1998, flew a SpaceHab module dedicated to multidisciplinary
research. This mission marked the first space flight collaboration
between NASA and the National Institute on Aging. It carried 26
commercial research experiments sponsored through NASA's Commercial
Space Centers. Senator John Glenn's involvement highlighted health care
and healthy aging. The wealth of scientific data accumulated during
this flight will help validate apparent symptomatic similarities
between the effects of space flight and aging.
In fiscal year 1999, preparation for use of the ISS will continue.
In order to maximize return on the ISS investment, we will continue to
build up and maintain a community of over 900 experienced principal
investigators. We are committed to continue this buildup in fiscal year
2000. The Commercial Space Centers plan to add 9 new industry
affiliates and 10 new university affiliates in 1999. To enhance science
and technology development activities in an era of constrained budgets,
NASA continues to leverage resources through partnerships and
cooperative ventures.
The fiscal year 2000 budget request for OLMSA, $256.2 million, will
support a variety of activities on ISS, the Space Shuttle, and on the
ground. Early in the assembly phase of the ISS, research will
concentrate on small-scale investigations, an approach that has been
successfully demonstrated on both the Space Shuttle and on the Russian
Mir space station. We will study the environment, habitability, and
safety. To help maintain NASA's research communities during the ISS
build-up, NASA plans to add a SpaceHab research mission (STS-107) in
early fiscal year 2001. Increased Shuttle middeck locker opportunities
using both the utilization and assembly flights have been part of ISS
planning. In addition, we are developing a plan for a stand-by research
mission which can be inserted into the Shuttle Manifest should the
opportunity arise.
Research opportunities aboard the ISS will start in earnest with
the arrival of the crew and the Human Research Facility (HRF) in early
2000. The HRF will help us understand the basic mechanisms of
adaptation to microgravity and help develop and validate
countermeasures to maintain crew health on orbit. NASA will continue to
augment its efforts in validating countermeasures with research carried
out by the National Space Biomedical Research Institute (NSBRI), and
ground-based research and technology programs. One of the major
concerns is the biological impact to the crews of the effects of
radiation. NASA, through peer-reviewed research and in cooperation with
organizations such as Loma Linda University, Brookhaven National
Laboratories, and NIH, is developing countermeasures to increase
predictability of biological damage and lower risk to crew health.
We will continue to pursue innovative sensor technologies. We plan
to create an Environmental Systems Commercial Space Center to foster
commercial interest and participation in research and technology
development for recycling air and water and monitoring the spacecraft
cabin environment.
Gravitational Biology and Ecology flight experiments in fiscal year
2000 will provide information on the effects of microgravity on plant
growth and development, and the effects of gravity on plant
photosynthesis and respiration. Research will begin in evolutionary
biology with participation of at least five research institutions.
Flight research on the effects of microgravity on avian development
will be carried out and research proposals on biologically inspired
technologies will be implemented. Microgravity Research flight
experiments in fiscal year 2000 in the area of colloid physics will
help refine the technologies required for photonic devices used in
optical communications and computing.
Space Science Enterprise
NASA's Space Science program is scientifically robust and more
ambitious than ever. It is also more streamlined, effective, and cost-
efficient to the U.S. taxpayer. Beginning with the launch of the Deep
Space 1 mission on October 24, 1998, the Space Science Enterprise
entered a nine-month period in which it will have ten launches. Six
missions have already been launched successfully: DS-1; two Mars 1998
Surveyors and the piggyback DS-2 microprobes; four payloads on STS-95;
the Submillimeter Wave Astronomy Satellite; and Stardust, a comet
sample-return mission.
On March 4, 1999, the Wide Field Infrared Explorer (WIRE) was
launched from Vandenberg Air Force Base. Unfortunately, shortly after
launch, WIRE experienced technical problems that exhausted all of the
cryogen used to keep the science instrument cold. The mission will not
be able to deliver any science. However, we hope to recover some of the
WIRE science with SIRTF and SOFIA. In April, we will launch the
Tomographic Experiment using Radiative Recombinative Ionospheric
Extreme Ultra-Violet and Radio Sources (TERRIERS) spacecraft. In late
May, we will launch the Far Ultraviolet Spectroscopic Explorer (FUSE)
aboard a Delta rocket. In recent months, technical problems with
circuit boards identical to those in AXAF, recently renamed Chandra X-
ray Observatory, were discovered in a non-NASA satellite. Testing of
the circuit boards on the Chandra observatory was conducted and a
number of faulty circuit boards were replaced. Chandra has been shipped
to the Kennedy Space Center and will be launched July 9, 1999 aboard
STS-93.
But this intense launch schedule is only part of the story, because
the existing Space Science programs and missions continue to deliver a
wealth of new scientific data and insight.
Results from the Mars Global Surveyor (MGS) and Mars Pathfinder
spacecraft show mineralogical and topographic evidence confirming
earlier indications that Mars had abundant water and thermal activity
in its early history. Measurements from the spectrometer aboard MGS
show a remarkable accumulation of the mineral hematite, well-
crystallized grains of ferric oxide that typically originate from
thermal activity and standing bodies of water. Measurements by the Mars
Orbiter Laser Altimeter (MOLA) aboard MGS are providing striking new
views of Mars' north pole and the processes that have shaped it. MOLA
data reveal that the 750-mile-diameter polar ice cap has a maximum
thickness of 1.8 miles. The cap is cut by canyons and troughs that
scientists believe were carved by wind and evaporation of ice.
Closer to home, the Discovery program's Lunar Prospector spacecraft
has provided further indications of water ice at the Moon's poles,
which remains under scientific debate. The spacecraft has recently
entered a lower lunar orbit for even more precise mapping activities.
Although its orbital capture has been delayed by about a year, the Near
Earth Asteroid Rendezvous mission performed a swingby of its target
asteroid, Eros, adding to our still small inventory of in-situ data on
small bodies.
Further out in the Solar System, the Galileo spacecraft continues
to provide insights into the mysteries of Jupiter and its moons. Last
year, I reported that Galileo found very strong evidence of a
subsurface liquid ocean on the Jovian moon Europa. Recent data from
Galileo suggest that Callisto, another moon of Jupiter, may also have a
liquid ocean under its icy, cratered crust. The common evidence for
past or present liquid water on Mars, Europa, and Callisto provides a
key initial step in our Origins program. Galileo images have also shown
how Jupiter's intricate, swirling ring system is formed by dust kicked
up as interplanetary meteoroids smash into the giant planet's four
small inner moons.
The Hubble Space Telescope (HST) continued its impressive
performance. This year, Hubble observations made a watershed event in
astronomy--the first potential direct image of a planet outside our
solar system--another key initial step for Origins. A ``long exposure''
infrared image taken with the NICMOS camera has allowed astronomers to
peer into a previously unseen realm of the universe and uncover the
faintest galaxies ever seen. The Hubble Space Telescope has brought us
unprecedented new science discoveries and continues to revolutionize
our understanding of the universe. However, in January 1999 HST lost
the use a third, redundant gyroscope. This has caused us to plan an
accelerated Hubble servicing mission in October of this year to replace
the gyroscopes and several other items which were planned for the 2000
Hubble servicing mission.
Last year we confirmed the existence of a special class of neutron
stars, now dubbed ``magnetars.'' Magnetars are dense balls of super-
heavy matter, no larger than a city, but weighing more than the Sun.
They have the greatest magnetic field known in the Universe, so intense
that it powers a steady glow of X-rays from the star's surface, often
punctuated by brief, intense gamma-ray flashes, and occasionally by
cataclysmic flares like the one observed on August 27, 1998. Our own
star provided surprises as the Solar and Heliospheric Observatory
(SOHO) team dramatically recovered from what was thought to be a lost
mission, and obtained the first evidence of long-theorized quakes on
the surface of the Sun. Another important first for NASA Space Science
is the ongoing demonstration of ion main propulsion and other new
technologies on the Deep Space 1 technology validation spacecraft.
We have learned some fascinating new things about our own star, the
Sun, as well. Last May, the first images from NASA's Transition Region
and Coronal Explorer spacecraft revealed activity in the solar
atmosphere in stunning detail and included the first detailed
observations of a magnetic energy release, called a magnetic
reconnection. Less than a month later, SOHO, a NASA/European Space
Agency mission, revealed a rare celestial spectacle: two comets
plunging into the Sun's atmosphere in close succession. In July,
scientists confirmed for the first time that solar flares produce
seismic waves in the Sun's interior that resemble those created by
earthquakes. (Enough energy was released from that quake to power the
United States for 20 years at its current level of consumption.)
This year has certainly been impressive, but we are very excited
about what is ahead as well. The proposed budget of $2.197 billion, an
increase of $77 million over last year's budget, continues to support a
strong and well balanced Space Science program that will allow us to
carry on research of the Sun, the Solar System, and the Universe. It
maintains support for the Origins Initiative to search for planets
around other stars, to study galaxies and stars as they are born, and
to look for evidence of life elsewhere in the solar system and the
universe. The fiscal year 2000 budget also maintains support for a
multitude of ongoing missions.
The budget request features five new items in the Space Science
Enterprise. Two new program elements are funded in the Mars Surveyor
program beginning in fiscal year 2000: Mars Network and Micromissions.
Mars Network will develop communications capability to provide a
substantial increase in bandwidth and connectivity from Mars to Earth,
thus greatly improving the scientific and educational return for this
ongoing program. Mars Micromissions will provide low-cost capability
for delivering small payloads, including telecommunications elements of
the Mars network. Competitively selected Micromissions will deliver up
to a 50-kg science payload to Mars to collect high-priority scientific
data. The first planned Mars Micromission is the ``Mars Airplane,''
which will commemorate the 100th anniversary the Wright brothers'
historic first flight in 2003.
Also in the fiscal year 2000 request, the Cross-Enterprise
Technology program budget is augmented to include funding for three
initiatives: Self-Sustaining Robotic Networks; Gossamer Spacecraft; and
Next Decade Planning. Self-Sustaining Robotic Networks will build on
the success of Mars Pathfinder. This initiative's goal is to extend
ongoing advances in spacecraft automation and miniaturization
technologies to produce self-tasking, self-repairing mobile robots for
permanent, ``virtual presence'' planetary science and exploration
outposts in challenging environments. The Gossamer Spacecraft
initiative provides additional funding to develop and demonstrate the
deployment, control, and utility of ultra-lightweight deployable
structures. These structures can be used as sun shields, ultra-large
telescopes, solar arrays, antennas, or solar sails, and will
revolutionize a wide variety of missions, including those of other
agencies such as NOAA and the Air Force. Next Decade Planning will
support an improved, Agency-wide planning process to develop and refine
concepts and technologies for a robust menu of potential future civil
space programs.
As we continue to explore our Universe, we bring scientific benefit
not only to the space science community, but to America's taxpayers and
citizens of the world. Our Space Science program is exciting and
relevant, as attested to by numerous front-page stories and magazine
covers, and by World Wide Web interest in this field in the past few
years. NASA has made countless scientific discoveries and advances over
its 40-year history, but stay tuned--there is much more to come.
Earth Science Enterprise
Since its creation in 1958, NASA has been studying the Earth and
its changing environment by observing the atmosphere, oceans, and land,
and their influence on climate and weather. The perspective afforded
since the beginning of the space age planted a growing seed of
knowledge--we now understand that the key to gaining a better
understanding of the global environment is exploring how the Earth's
systems of air, land, water, and life interact with each other. This
approach, called Earth System Science, integrates fields like
meteorology, oceanography, biology, geology, and atmospheric sciences.
The Earth Science Enterprise continued to make great progress
through 1998. We have recently revealed evidence to suggest that the
1997-98 El Nino event may have been a major contributor to the average
global sea level rising about eight-tenths of an inch before it
returned to normal levels, according to scientists studying TOPEX/
Poseidon satellite measurements of sea surface height. While NASA can
accurately measure global sea level rise today, we really need a decade
or more of sustained research before we can say with certainty whether
there is a definitive link between sea level variation and climate
change. The SeaWiFS instrument on Orbview-2, a commercial satellite
launched in 1997, is providing data on ocean biological productivity
for NASA research, and the firm is marketing these same data to the
commercial fishing, oil, and shipping industries. The data are being
procured by NASA as a ``data buy'' from the commercial supplier.
NASA has also begun to measure rainfall in the tropics and sub-
tropics. Approximately two-thirds of the global rainfall occurs within
the tropics, directly influencing our day-to-day weather, according to
scientists studying measurements of sea surface height from the US/
French TOPEX/Poseidon mission. The Tropical Rainfall Measuring Mission
(TRMM), a joint endeavor with Japan which was launched in 1997, is for
the first time delivering accurate measurements of precipitation over
the global tropical oceans, a critical indicator of climate patterns
over the whole world.
Polar regions also have a major influence on moderating the Earth's
climate. Until the fall of 1997, Antarctica, a region the size of
Canada and Alaska combined, had never been fully mapped at high spatial
resolutions. The Antarctic Mapping Mission (AMM) is accomplishing this
mapping using data from the Canadian Radarsat satellite in which NASA
is a partner.
While 1998 was an outstanding year for Earth Science results,
missions launched in 1999 and beyond promise to increase our
fundamental understanding of the Earth system. We have 30 Earth Science
launches scheduled over the next five years. The President's budget
request for Earth Science for fiscal year 2000 is $1.459 billion.
The Earth Observing System (EOS), the largest element of NASA's
Earth Science Enterprise ($663.2 Million for fiscal year 2000), is a
program of multiple spacecraft designed to provide measurements of the
key, multi-disciplinary parameters needed to understand global climate
change. The first EOS spacecraft--EOS AM-1 and Landsat-7--represent 2
of the 8 missions the Earth Science Enterprise will launch this year.
These missions, plus the EOS PM-1 and Chemistry-1 missions, will help
achieve the fundamental EOS measurements, which will begin our
understanding of the Earth system. PM-1 and Chemistry-1 remain on track
for launch in 2000 and 2002, respectively. The EOS program also
includes several small spacecraft such as the U.S.-French TOPEX/
Poseidon follow-on mission known as Jason-1, QuikScat, Ice, Cloud and
Land Elevation Satellite (ICESAT), Solstice, and the Active Cavity
Radiometer Irradiance Monitor (ACRIM) satellite.
The Earth Probes program ($138.2 Million for fiscal year 2000)
addresses specific, highly focused Earth science questions that are new
or complementary with other parts of NASA's Earth Science enterprise.
It also has the flexibility to take advantage of new opportunities in
international cooperation or technical innovation. Currently approved
Earth Probes include the Total Ozone Mapping Spectrometer-EP and the
Earth System Science Pathfinder missions (the Vegetation Canopy Lidar
and the Gravity Recovery and Climate Experiment). A new US/French ESSP
mission called PICASSO-CENA was selected in December 1998 to study the
Earth's atmosphere in tandem with the EOS-PM-1 satellite.
A parallel series of New Millennium program missions is being
developed to validate advanced technology for future Earth Science
spacecraft. The Earth Orbiter-1 mission will demonstrate an advanced
land imaging system with a hyperspectral and multispectral capability
starting in 1999. The Space-Readiness Coherent Lidar Experiment will
fly in the cargo bay of a Space Shuttle in 2001 to test whether a
space-based sensor can accurately measure atmospheric winds from the
surface to a height of ten miles. Atmospheric winds determine the
transport of energy and chemical constituents across the Earth--hence
an important parameter for weather prediction. Recognizing the high
value of ocean winds data, we have rapidly developed a replacement
mission for the failed NSCAT mission called QuikScat, which was ready
for launch in November 1998--only 18 months after the loss of NSCAT.
Safety concerns with the QuikScat's launch vehicle will push the launch
into the spring of 1999. We are also purchasing ocean wind vector data
during this interim period between NSCAT and QuikScat.
The EOS Data Information System (EOSDIS $231.5 Million for fiscal
year 2000) has been serving thousands of users by providing available
data and information from NASA-sponsored programs since September 1995.
EOSDIS will operate the EOS spacecraft, and acquire and distribute the
basic data gathered by them. An essential element of EOSDIS, the Flight
Operations Segment (FOS) was to provide command and control of EOS
spacecraft including the upcoming launch of EOS-AM-1. FOS experienced
serious schedule and performance problems throughout 1998, which
resulted in replacement of an essential element of FOS with a
commercial, off-the-shelf system developed by Raytheon. This new system
has enabled EOSDIS to progress toward the goal of meeting all ESE
mission needs from now through 2002. Command and control of the EOS-AM-
1 mission is currently on schedule for meeting the July 1999 launch
date. In addition, EOSDIS is also on track to support operations of the
PM-1 (12/00), ICESat (7/01) and Chemistry (11/02) spacecraft.
The Triana mission is an Earth observation spacecraft to be located
at the Earth-Sun LaGrange-1 point providing a near-term real time,
continuous high definition color view of the full Sun-lit disc of the
Earth. This mission will carry three major scientific experiments to
make the first direct measurements of the solar radiant power reflected
by the Earth, to make global aerosol and ozone measurements, and to
observe solar wind. A selection was made in October 1998 for the
Scripps Institution of Oceanography to conduct the Triana mission with
the Goddard Space Flight Center. Launch is scheduled for December 2000.
Along with basic Earth Science research, we also conduct
Applications Research to help universities and State & local
governments apply remote sensing data and science to practical
problems. We have established five Regional Earth Science Applications
Centers (RESACs) to target efforts on specific regional issues. The
Commercial Remote Sensing Program (CRSP) at the Stennis Space Center
works with industry to extend the utility of ESE's science data within
the broader U.S. economy. Through partnerships with CRSP, companies
gain assistance in product development and in validation of new remote
sensing instruments.
In 1992, CRSP, along with KPMG Peat Marwick, performed a study that
valued the remote sensing and geospatial market at $850 million
annually, using airborne platforms. In 1998, due to NASA's strides in
Earth Observations satellite R&D and corporate commitments, the market
was valued at $2 billion. With the anticipated operations of
commercial, space-based, high-resolution systems, low-cost positioning
data from GPS, enhanced internet access to data and value-added
information, underpinned by low-cost, high-performance work stations,
industry is projecting a conservative estimate of $4 billion in private
investment by 2005.
CRSP's data buy program has been active and robust. In September
1998, NASA awarded five contracts for Phase II of the $50 million
Scientific Data Purchase. NASA is developing plans for the next data
buy as the commercial remote sensing market matures. Also last year,
NASA's CRSP entered into a five-year Joint Sponsored Research Agreement
with Mississippi for the purpose of developing commercial remote
sensing through collaborative research and public-private partnerships.
This year, CRSP will establish at least 75 commercial partnerships in
``value-added'' remote sensing product development, an increase from 37
in fiscal year 1997. In addition, CRSP will establish at least 20
agreements with industry in support of other federal agency needs. In
fiscal year 2000, the CRSP will focus Earth Observing Commercial
Applications Program (EOCAP) joint commercial applications research to
develop 20 new-market commercial products.
The Earth Science Enterprise balances funding across observations,
research and data analysis, applications and commercial remote sensing,
information systems, and advanced satellite technologies to ensure the
Nation has the tools to answer scientific questions about the Earth,
and to put these answers to work for the benefit of society. Earth
science is science in the national interest, and NASA is committed to
its success.
Aero-Space Technology Enterprise
The Aero-Space Technology Enterprise is working in an exciting and
challenging time as we revolutionize the science and technology that
powers U.S. civil aeronautics and space transportation. Last year we
presented to you an Enterprise program focused on three ``Pillars'' for
success--Global Civil Aviation, Revolutionary Technology Leaps, and
Access to Space--and a set of ten goals to address current and future
National needs. By developing high technical risk technologies, we
contribute to aviation safety, increase air system capacity, enhance
environmental compatibility, and open new opportunities in space.
Within the past year this Enterprise has had to make some hard choices.
Budget pressures, along with shifting industry and market conditions,
made it impossible to pursue with excellence all our ambitions. Rather
than spread the pain and do a little less of everything, we established
a set of priorities among the goals, and are pursuing our top
priorities as coordinated with our customers and stakeholders. Our
priority goals are aviation safety, aviation systems capacity, next-
generation design tools, ultra-efficient engine technology, general
aviation, experimental aircraft and access to space. We have
dramatically reduced our support to the high-speed civil transport and
affordability goals, canceling the High Speed Research and Advanced
Subsonic Technology Programs.
We have worked hard over the last year to take advantage of
synergies between aeronautics and space transportation activities and
are increasing funding in the latter. We have made significant progress
in defining the contribution of our existing projects and programs to
the goals. We believe these goals will help us better manage our
research activities while fostering a better understanding of these
activities for the American people. The President's proposed budget for
fiscal year 2000 of $1.0065 billion is focused on maximizing a return
to our highest priority goals.
Aeronautics
We are proud of our past accomplishments in two focused programs,
High Speed Research (HSR) and Advanced Subsonic Technology (AST).
Although dramatic advances were made against the original HSR program
goals, our industry partners indicated that product development would
be significantly delayed, which led to the decision to terminate this
program in fiscal year 1999. The need to refocus our technology efforts
from industrial competitiveness issues to a broader, more public
policy-oriented emphasis resulted in the decision to terminate the AST
program at the end of fiscal year 1999.
The aeronautics budget request, $620.1 million, enables us to
pursue a new focused program, Aviation Safety, as our top aeronautics
priority. As global GDP expands over the next decade by an annual rate
of 3 to 4-percent, demand for air travel will dramatically increase--it
is expected to triple within 20 years. Great strides have been made
over the last 40 years to make flying the safest of all major modes of
transportation. However, even today's low accident rate is not good
enough and if air traffic triples as predicted, this rate will be
totally unacceptable. The national goal is to reduce the aircraft
accident rate by a factor of five within 10 years, and by a factor of
10 within 20 years. In addition to accident rate reduction, we will
work to decrease injuries and fatalities when accidents do occur. We
are also working on aviation system technologies that could support
pilots and air traffic controllers. Safety is also a top priority of
the FAA. We are working closely with FAA, manufacturers and airlines to
prioritize technology efforts and to ensure their rapid implementation
in order to meet our aggressive safety goal. FAA is responsible for the
operation and near-term research and development of the National Air
Traffic System, while NASA conducts the longer-term, higher-risk
research and development. Last October, we signed an MOA with the FAA
to solidify our cooperation in this area.
Our fiscal year 2000 budget also support the Aviation Systems
Capacity (ASC) Program, which builds on research we have conducted over
the past few years in the Advanced Subsonic Technology program. Our
goal in capacity is ``while maintaining safety, triple the aviation
system throughput, in all weather conditions, within 10 years.'' This
is absolutely required if the aviation system is to keep up with demand
and allow the predicted growth in air travel to occur. The ASC program
is looking at modernization and improvements in the Air Traffic
Management System and the introduction of new vehicle classes which can
potentially reduce congestion. Efficient and flexible routing,
scheduling and sequencing of aircraft in all weather conditions are
critical to meeting capacity demands. As in safety, we are working
closely with FAA on this program.
I am very excited about our work in experimental aircraft. On
August 6, 1998, the solar-powered Pathfinder Remotely Piloted Aircraft
broke its own world altitude record for a solar-powered aircraft by
almost 10,000 feet, and established a world record for propeller driven
aircraft of 80,201 feet. This flight was another step in meeting the
challenge of flying a solar powered aircraft at 100,000 feet. In
another first, an international cooperative project with the Russian
Central Institute of Aviation Motors achieved the first extended
supersonic combustion in flight using a scramjet flown to Mach 6. The
X-43 (HYPER-X) research vehicle, which is an air-breathing, dual-mode
scramjet-powered plane capable of speeds up to Mach 10, will be
delivered this year and will have its first powered flight ( to Mach 7)
in fiscal year 2000. Experimental aircraft such as these are invaluable
tools for exploring new concepts and for complementing and
strengthening laboratory research. In the very demanding environment of
flight, X-planes are used to test innovative, high-risk concepts,
accelerating their development into design and technology applications.
We are pioneering a new safe and efficient general aviation air
transportation system that will allow us to travel up to four times
faster than we can by car from doorstep to destination, even if that
doorstep or destination is a small community many miles from a large
hub airport. To make this possible, NASA has been working and will
continue to work on advances in propulsion and avionics that will make
general aviation affordable and safe.
Our fiscal year 2000 budget includes the Ultra Efficient Engine
Technology Program and REVCON, or revolutionary concepts. The Ultra
Efficient Engine Technology Program will enable the next breakthroughs
in propulsion systems that will spawn a new generation of high-
performance, operationally efficient, economically viable and
environmentally compatible U.S. aircraft. We will develop and
demonstrate breakthrough technologies in propulsion component and high-
temperature engine materials which can create future commercial and
military propulsion systems which are simpler, achieve higher
performance, and do less damage to the environment. REVCON is a process
that will develop concepts that are a revolutionary departure from
traditional approaches to aeronautical design. We will fully utilize
the next-generation design tools we are developing to produce
substantial benefits in concept development. REVCON will change
fundamentally the way systems are designed and accelerate the
transition of high-risk/high-payoff technology from the laboratory to
flight.
Advanced Space Transportation Technology
The Advanced Space Transportation Technology program supports our
``Access to Space'' pillar. Our goal is to completely revitalize access
to space by reducing launch costs dramatically over the next decade,
increasing the safety and reliability of current and next generation
launch vehicles, and establishing new plateaus of performance for in-
space propulsion while reducing cost and weight. We are committed to
developing technology that will reduce the payload cost to low-Earth
orbit by an order of magnitude, from $10,000 to $1,000 per pound,
within 10 years. The budget request, $254 million, fully supports this
goal.
NASA's Reusable Launch Vehicle (RLV) Program includes both ground-
based technology development and flight demonstrators (X-33, X-34,
Future-X Pathfinder vehicles) to validate key component technologies,
prove that the technologies can be integrated into a functional
vehicle, and demonstrate the required operability to make low-cost
access to space a reality. Once demonstrated, we expect that these
technologies will be used by private industry to build next-generation
launch vehicles that will meet government and commercial needs at
dramatically reduced costs.
Early last year the X-33's first major flight component, the liquid
oxygen tank, was placed in the vehicle's assembly structure. The X-33
launch site at Edwards Air Force Base is nearly complete. The
technologies we are developing are risky, and development problems are
not unexpected. In fact, the landing gear is the only piece of existing
hardware on the X-33. All other components require advanced
development. Recently, the X-33 program has experienced some
manufacturing and technical problems that have led to a slip in the
first flight to July 2000. We are working with the industry team to
resolve these problems and expect no additional cost to the government.
The X-34 also has experienced some manufacturing difficulties that will
delay the first unpowered flight four months to September 1999; the
first powered flight is currently scheduled for February 2000. We are
confident that these problems will be overcome and these programs will
provide valuable technology for application to future space launch
vehicles.
In fiscal year 1999, we initiated the Future-X program which
includes ``Pathfinder'' flight experiments for demonstrations of
technologies which can further reduce the cost and increase the
reliability of reusable space launch and orbital transportation
systems. We are particularly pleased with the selection of the Advanced
Technology Vehicle (ATV), the first contract award under Future-X. The
ATV includes cost-sharing by industry and possibly the Air Force. We
are working closely with the Air Force on this program to ensure it
will meet defense as well as civil space needs. We are strengthening
the links between the Advanced Space Transportation Program, which is a
technology development program, and Future-X flight validation; we want
to make more transparent the decision-making mechanism for determining
if an ASTP technology truly requires flight validation in Future-X.
ASTP will continue to push the state-of-the-art technologies that will
be flown under the Future-X program if required for validation prior to
implementation in commercial, DOD or civil transportation systems.
We have restructured the Small-Payload Focused Project (Bantam).
Its goal is to develop and demonstrate unique technologies that will
enable the development of a reusable launch system that will launch
200- to 300-pound payloads for $1-to-$1.5 million per flight by 2004/
2005. The ground technology program, commercial market, and provider
developments will support decisions on whether to pursue a Future-X
flight demonstration of the most promising vehicle concept. Concepts
currently under study include multi-stage rockets, air-breathing
combined-cycle vehicles, magnetic levitation launch assist, and beamed-
energy laser-powered vehicles--to name a few. In fiscal year 2000, the
results of these technology demonstrations and system level analyses of
multiple concepts will support concept down-selection. As we proceed
with this program, we will periodically solicit proposals from industry
to supply such a launch vehicle for this payload class and as with all
NASA technology programs, industry will have access to the technology
as we develop it.
Commercial Technology
Since its inception in 1958, NASA has been charged with ensuring
that NASA-developed technology is transferred to the U.S. industrial
community to improve its competitive position in world markets. The
fiscal year 2000 budget request of $132.5 million continues this
important aspect of our mission. Our commercialization effort
encompasses all technologies created at NASA centers by civil servants
as well as innovations from NASA contractors. The technology
commercialization program conducts a continuous inventory of newly
developed NASA technologies, maintains an internet-based database of
this inventory, assesses the commercial value of each technology,
establishes R&D partnerships with industry for dual use of the
technology, disseminates knowledge of these NASA technology
opportunities to the private sector, and supports an efficient system
for licensing NASA technologies to private companies. The amount
requested for NASA commercialization efforts includes $97.5 million to
carry out the provisions of the Small Business Innovation Research
(SBIR) Act, which requires a set-aside of 2.5 percent of NASA's total
extramural R&D spending for small business research grants, along with
an additional set-aside for the Small Business Technology Transfer
(STTR) Program of 0.15 percent of NASA's total extramural R&D spending.
The NASA SBIR program has contributed to the U.S. economy by fostering
the establishment and growth of over 1,100 small, high technology
businesses.
conclusion
Mr. Chairman, I am proud of NASA and I am pleased with this budget.
It gives us the stability we need to continue the construction of the
ISS and to conduct cutting-edge research in science and technology.
There is no question that the ISS partnership will continue to face
challenges. But if the successes of the last few months are any
indication of our ability to jointly overcome difficulties and succeed,
I look forward to the coming year with great enthusiasm. While we are
building this magnificent international laboratory in space, we already
are studying how we can make this facility a seed for commercial space
activity for the early part of the next century, and for opening the
space frontier for human activity beyond low-Earth orbit. Like the
railroads, the Government will build it, and it will create entirely
new opportunities for private enterprise. To get there, we will
continue to fly the Shuttle safely while developing new technologies
that could make space launch more affordable and reliable. We look
forward to a robust competition for NASA's launch business among
several providers in the next decade. We will not just be going to low-
Earth orbit, as NASA will continue to push the frontiers of knowledge
about our planet, our Solar System, and our Universe. Micro-rovers will
look for signs of ancient life on Mars, and perhaps existing life on
the moons of Jupiter and Saturn, while we continue to search for
planets in nearby solar systems that could also harbor life today. This
budget is the beginning of a new era in vehicle and mission design, as
we create an Integrated Synthesis Environment that will dramatically
lower costs and reduce development times, allowing us to do even more
exciting science and technology.
NASA remains committed to providing the American taxpayer with the
best possible space and aeronautics program in the world. Our
accomplishments demonstrate we are capable of that. We are determined
to continue that tradition. I truly believe the best is yet to come.
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION FISCAL YEAR 2000 ESTIMATES
[In millions of real year dollars]
----------------------------------------------------------------------------------------------------------------
Fiscal year
------------------------------------------------
1998 OPPLAN 9/ 1999 OPPLAN 12/ 2000 PRES
29/98 22/98 BUDGET
----------------------------------------------------------------------------------------------------------------
SPACE STATION.................................................. 2331.3 2304.7 ..............
RUSSIAN PROGRAM ASSURANCE...................................... 110.0 (53.0) ..............
SPACE SHUTTLE.................................................. 2912.8 2998.3 ..............
PAYLOAD AND UTILIZATION OPERATIONS............................. 205.4 177.0 ..............
------------------------------------------------
HUMAN SPACE FLIGHT....................................... 5569.5 5480.0 ..............
================================================
INTERNATIONAL SPACE STATION.................................... .............. ............... 2482.7
================================================
SPACE SHUTTLE.................................................. .............. ............... 2986.2
PAYLOAD AND UTILIZATION OPERATIONS............................. .............. ............... 169.1
------------------------------------------------
LAUNCH VEHICLES AND PAYLOAD OPERA- TIONS................ .............. ............... 3155.3
================================================
SPACE SCIENCE.................................................. 2043.8 2119.2 2196.6
LIFE AND MICROGRAVITY SCIENCES AND APPLICA- TIONS............. 214.2 263.5 256.2
EARTH SCIENCE.................................................. 1417.3 1413.8 1459.1
AERO-SPACE TECHNOLOGY.......................................... 1483.9 1338.9 1006.5
MISSION COMMUNICATION SERVICES................................. 400.8 380.0 406.3
ACADEMIC PROGRAMS.............................................. 130.0 138.5 100.0
------------------------------------------------
SCIENCE. AERONAUTICS AND TECHNOLOGY...................... 5690.0 56553.9 5424.7
================================================
SAFETY, MISSION ASSURANCE, ENGINEERING, AND ADVANCED CONCEPTS.. 37.8 35.6 43.0
SPACE COMMUNICATION SERVICES................................... 194.2 185.8 89.7
RESEARCH AND PROGRAM MANAGEMENT................................ 2025.6 2121.2 2181.2
CONSTRUCTION OF FACILITIES..................................... 122.4 168.5 181.0
------------------------------------------------
MISSION SUPPORT.......................................... 2380.0 2511.1 2494.9
================================================
INSPECTOR GENERAL.............................................. 18.2 20.0 20.8
================================================
TOTAL BUDGET AUTHORITY................................... 13,647.7 13,665.0 13,578.4
TOTAL OUTLAYS............................................ 14,206.2 14,043.0 13,356.8
----------------------------------------------------------------------------------------------------------------
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Senator Bond. Thank you, Dr. Goldin.
flood plane mapping program
Before I get into the questions I have prepared, it struck
me when you mentioned disaster mitigation that our friends in
FEMA, who also come within the jurisdiction of this
subcommittee, have been having tremendous problems trying to
find the resources to do flood mapping and other things.
I trust you have been having discussions with James Lee
Witt on the potential application of your capabilities to their
needs?
Mr. Goldin. Yes, sir. We are standing by to support FEMA
and we are working on a joint program right now, the planning
for that program, to do that flood plain mapping.
Senator Bond. How long or to what extent do you think you
can meet their needs?
Mr. Goldin. I think we could make a significant
contribution in cutting their costs. Instead of using
conventional techniques whenever you send people out into the
field, by using our aircraft and spacecraft technologies, I
think we could cut their costs significantly. We are in the
process of performing the analysis to substantiate that right
now.
Senator Bond. Any idea of how much that might cost?
Mr. Goldin. No. We are in that process now.
Senator Bond. Well look carefully because every dollar we
have to give to them is probably a dollar that comes out of
NASA.
Mr. Goldin. Oh, we will look very carefully, sir.
[Laughter.]
Senator Bond. This is what I call the incentive means of
assuring that we all work together.
As this goes forward, would you please do that.
Mr. Goldin. Dr. Ghassem Asrar can speak to this.
Dr. Asrar. Good morning.
We have three pilot projects with the objective of
identifying what are their requirements and what are the costs
associated with them. We are also bringing the private sector
in to work with us in a partnership because we want to make
sure that once we demonstrate the utility of our technology,
there is a means for FEMA to obtain those services routinely.
The pilot projects, two of them are on the West Coast, one
is in the Midwest, and we are in the process of mapping them,
combining the observations with the model to give them the
decision-making tools that FEMA needs.
setting goals for the civilian space program
Senator Bond. I appreciate that. That will be of continued
interest to this subcommittee and I would ask that you keep us
advised on that.
I would like to ask a sort of general question about the
setting of goals for the civilian space program. Does NASA have
plans that either go to the White House and Congress, or does
the White House set the plans, or do you get approval from
Congress? To what extent does the scientific community have
input--people and places like the National Academy of Sciences?
I would like for you to address that in terms of the next major
manned mission to be. What are your discussions that are going
on? Are you looking at manned flight or even the establishment
of a man based on Mars or the Moon?
How do you set those priorities? What are your long-term
goals?
Mr. Goldin. First, let me say that we spend a lot of time
consulting with all the people who have a vested interest in
NASA. My staff spends a lot of time at the White House. I spend
time going to each of your offices. My staff talks to your
staff. We have people who have outreached different groups in
the country. We work very closely with the National Academy of
Engineering, the National Academy of Sciences, and we integrate
all that input. We do this routinely, day in and day out.
Senator Bond. We are very interested. But our knowledge is
that of a mustard seed when it comes to these areas.
I hope that you are getting the National Academy of
Engineering and the National Academy of Sciences to really help
direct your work. The peer review scientific decisionmaking
would be of most interest to me.
Mr. Goldin. I was just honored by being nominated--and I
accepted--to the National Academy. I am a member of that
organization now.
I cannot participate in my capacity as NASA Administrator,
but I certainly am very sensitive to that. We, NASA, fund many,
many studies at the National Academy.
There is one point I would like to make. We intend to get
the Space Station done before we come back to this Congress and
this administration and ask for more money for another human
expedition beyond Earth orbit.
The administration has put $10 million in this year's
budget for future planning. As part of that, we intend to look
to all of the scientific community, the Congress, the
administration, and citizens groups to figure out what is the
right thing to do for NASA next.
Over the next 2 years, we will be doing studies and share
those studies with this committee and other committees of the
Congress so that everyone knows what we are doing.
Senator Bond. What is the scientific community telling you
would be the most productive use? Have you gotten any word back
yet?
Mr. Goldin. There are many different opinions. But there
seems to be an opinion swelling up which says instead of just
having robotic missions and missions with people, we ought to
be able to integrate the two and perhaps build things like
robotic colonies in advance so that before we send people, we
build up an infrastructure, rather than trying to put
everything in one big vehicle and going off and doing it.
space station overruns
Senator Bond. Let me talk now about the Space Station. The
estimated cost has grown from $17.4 billion to more than $23.4
billion.
Depending upon how you look at it, the Space Station
overruns are anywhere from $6 billion to $8.3 billion,
depending on which estimates are correct. What have you learned
that can be applied to the next major large space project or
even any other government initiative in the scientific field?
What can we learn from these overruns?
Mr. Goldin. There are a couple of issues.
First, NASA has not built a major human space flight
activity in over 25 years. That was a very big problem. In the
space science area, and in the Earth Science area, we are able
to do things many, many times.
One thing is clear: the engineering tools we have are
inadequate. In this year's budget, we have a significant
activity to develop better engineering tools. We have worked on
this with the engineering community.
Senator Bond. What do you mean by engineering tools? Can
you give us some idea of what you mean by that?
Mr. Goldin. Yes.
When we commit to a major new program, whether it is Boeing
building the 777 or NASA building a Space Station, whether GM
is building a car or General Electric is building a
refrigerator, you commit roughly 90 percent of your money when
you have about 10 percent design knowledge on building
something new.
We intend to develop a set of tools that will allow us to
completely simulate in virtual space the design, operation, and
maintenance of these activities before you have to go and cut
any hardware and commit money.
I feel this has been a major problem in engineering in this
country.
Senator Bond. Well, NASP was out in the forefront of
development. I saw the computer models for NASP. But that may
not be a good example.
Mr. Goldin. NASP had the problem of not being able to
predict how we could build materials that could handle the
incredible heat load. For that reason, we were never able to
make NASP work after spending some billions of dollars.
That is precisely the issue. They had tools that showed how
it operated, but it did not simulate the physics of the details
of the system and how you could build it up. That was the
problem.
Senator Bond. Let me turn now to Senator Mikulski.
hubble space telescope
Senator Mikulski. Thank you, Mr. Chairman.
I would like to get right to the issues around the Hubble
Telescope, the Space Telescope.
Dr. Goldin, could you tell us what is really now the status
of the Hubble Space Telescope? We know, we understand that some
of the gyroscopes are failing. You had wanted some help in an
emergency supplemental now that you are going to be doing it
differently.
Could you tell us the operational status of Hubble, number
two, what you are going to do to correct it, and, number three,
does this really extend the life of Hubble in a reliable way or
has this just been one more contract failure at Hubble? You
know, first it was the mirror; now the gyroscopes, I think
three of them, have failed.
Mr. Goldin. Yes. Yes.
Senator Mikulski. Why don't you try to tell us the Hubble
story and then the implication of the cost of fixing Hubble on
the rest of the NASA budget?
Mr. Goldin. Okay.
First, so everyone knows what I am talking about, that
[indicating] is the Hubble Space Telescope. It is about 30 feet
long. Next to the Hubble Telescope [indicating] is a gyro. This
piece [indicating] is so everyone would know about what a gyro
looks like in size. If you look into this element here, you can
see the wires that failed. They are 1/1000th an inch by 1/
6000th an inch. There is a white surface and over the white
surface you will see two small wires. This gyroscope is the
state of the art. You can buy no better in the world than this
gyroscope. The Hubble has the most rigid requirements for
stability, and this gyroscope tells us exactly where the Hubble
is so that we can operate the control system.
At the present time, there are three operating gyros on the
Hubble. Three of them have failed. We are very concerned that,
if we lose one more gyro, we lose science on Hubble, which is
perhaps one of the most productive scientific instruments that
NASA has, if not one of the most productive instruments in the
world. We cannot afford to lose the science on Hubble.
Senator Mikulski. I agree. But if three have failed, are
you saying--what are you saying?
Mr. Goldin. Now let me tell you our understanding of that.
Senator Mikulski. I am not trying to finger-point here. I
am trying to pin-point the problem. If we come back with the
same gyroscopes, will then others fail again?
Hubble can only get so many rescue missions before the
Congress tires of it.
Mr. Goldin. Yes. We have planned servicing missions to the
Hubble. When we first went up and launched the Hubble, we had a
series of gyroscopes on board and three of the six failed. Two
failed for electronic reasons which were fixed. One failed
because this little wire that you saw eventually wore out
because it is immersed in what is called a viscous damping
fluid.
We then replaced four of those gyroscopes on the first
servicing mission and then they all lasted. The expected life
of these gyros is about 12 years. So we thought we had the
problem in hand. We did not have any failures, and when we went
up for the second servicing mission, we did not replace them.
Then they failed. We had three of them fail.
We are prepared to replace four to six gyros on this next
mission. We believe we have good gyros. No one in industry is
incompetent. This is the best technology available. There is
one change being made to the gyros which pertains to the
chemistry, by packing them instead of with an oxygen
pressurant, which could eat up the wire, with an inert one.
Senator Mikulski. In my limited time, I don't need to know
that kind of detail.
Mr. Goldin. Okay. In any case, we will replace these gyros.
We will be going up in another 12 to 18 months and, at that
time, we will assess whether we will keep those gyros or make
another replacement so that we will not have to have an
emergency mission.
Senator Mikulski. You are planning a Hubble servicing
mission in October 1999, is that correct?
Mr. Goldin. Yes.
Senator Mikulski. That is to deliver six new gyros, is that
right?
Mr. Goldin. Yes. Then we will also replace a computer and
some other equipment which we checked out on the John Glenn
flight.
Senator Mikulski. Now how long do you think this will
extend the life of Hubble?
Mr. Goldin. We believe that these gyros have an expected
lifetime of 6 to 12 years.
Senator Mikulski. And what is the expected life of Hubble?
Mr. Goldin. Hubble, if we continue to service it, will be
good perhaps to the end of the first decade of the next
century.
Senator Mikulski. So it is worth the investment to make
these repairs?
Mr. Goldin. It is among our highest priority to make these
repairs.
servicing mission cost for hubble
Senator Mikulski. Now how much will this servicing mission
cost and how will this impact on the rest of the NASA budget?
Mr. Goldin. The servicing mission will cost about $75
million in fiscal year 1999 and fiscal year 2000, and when we
replace all of the equipment for the Shuttle, to replace the
equipment we used, the total cost will be about $136.6 million
through 2003.
Of that, $26.3 million is for the science package; $26.3
million is for operational activity; and $84 million is to
replace the expendable pieces of the Shuttle equipment.
We intend, for fiscal year 1999, to absorb within our
existing budgets in the Human Space Flight Account, $45.5
million, which is what we need for fiscal year 1999 to get this
going.
We are presently working with the administration to see
where we might reprogram in fiscal year 2000 through fiscal
year 2003.
Senator Mikulski. Dr. Goldin, as you know, we need to have
the Hubble repaired for all the reasons you talked about--its
scientific accomplishment, it will be a good investment to keep
an existing program going that is bringing us a tremendous
amount of scientific knowledge. However, you said that the
budget is lean. Therefore, this is now a new $75 million hit
that was unexpected and unanticipated. Therefore, we look at
the Hubble and, therefore, look at how we are going to work
this appropriation and how we work with the administration who,
essentially, I know said to you ``eat it.'' I mean, that is
what they said. You are trying to swallow it while we are
trying to do other things.
My question to you is will there be negative consequences
on other programs that we need to take into consideration as we
work both with you and the administration and among ourselves?
Mr. Goldin. There is no doubt that there will be negative
impact on other programs. Our budget has come down for 6 years
and we have to do things. The only way we could fix it is by
not doing something else. That is the level of discussion we
are having with the administration.
Senator Mikulski. Do you now know what you will not do
because of it?
Mr. Goldin. Not yet. But we will know before your markup
and we are committed to getting you that data before your
markup.
russian report
Senator Mikulski. I see that I have a yellow light. Hubble
took a lot of time.
Could you tell us where we are now? You did this Russian
report. As you know, we are very concerned about the continued
unreliability of the Russians to deliver what they promised.
You then have to fund a redundancy program to support them.
We asked for a report that said are there other ways where we
could honor our international relationship with them but
essentially get a dollar's worth of guaranteed value for a
guaranteed American taxpayer dollar. This is with full
knowledge that it is the Soviet, the Russian, scientists that
are competent, but the political and bureaucratic situation
there is not as reliable as the Hubble gyroscopes.
Mr. Goldin. First let me say the reason the report was late
was we wanted to be thorough. So we contacted a number of
companies who had been doing business in Russia. We contacted
10 different elements of the Department of Defense and other
activities.
We wanted to know how did they do business. There was one
common theme: set a fixed set of requirements, negotiate a firm
fixed price contract, have measurable milestones, and have the
ability to do audits and traceability. That was the common
theme that came out of all of it.
We then analyzed that data and proposed that this is the
right way to go.
Should I keep going, Mr. Chairman? I see the red light.
Senator Bond. Please finish. Finish the answer because we
are going to be back and forth on this subject.
Mr. Goldin. It is our assessment at the present time that
this is the right way to do business. We have brought in Arthur
Andersen to audit the work that we are doing. The GAO and the
IG, has audited the approach we have been using with the
Russians. So far we have an ability to trace when we send
dollars there, to trace it through the system.
Senator Mikulski. Dr. Goldin, my time is up. I am trying to
get a dollar's worth of value for a dollar's worth of taxpayer
dollars and that we don't have to go to a redundancy system
because we are already foraging for funds in important
programs.
So where are we and where are we going?
If we want to go to Senator Burns and get back to me on
this, that's fine. But I am continually frustrated by this
Russian endeavor.
Mr. Goldin. That report dealt specifically with if we
bought goods and services from Russia, how would we do it to
assure taxpayer value. I believe we have answered that question
and we can assure the taxpayers for every dollar spent that we
are getting a dollar's value.
The broader question you are asking is how can we deal with
a Russian Government that does not pay its bills to the Russian
Space Agency. That is a broader question. That is a question of
great concern to me. The Russian Space Agency, when they have
been given dollars by their government, performs superbly.
Senator Mikulski. So we are still back to the political
problem that we had some months ago?
Mr. Goldin. Yes. There will be a meeting next week between
the Vice President and Mr. Primakov. This will be the only
significant subject that I have to bring up at that meeting,
about the ability of the Russian Government to do what it says
it is going to do.
Senator Mikulski. I know my time is up.
Will you then really press firmly?
Mr. Goldin. Oh, yes.
Senator Mikulski. I don't want to take any more of the
Senator's time.
Senator Bond. We will come back to it. We want to come back
to that subject.
I want to give Senator Burns an opportunity to get in here,
too.
Senator Burns. Thank you, Mr. Chairman. I just have a
couple of comments.
I think Senator Mikulski has pretty well covered this.
There is still a lot of concern about the Russian situation.
I just want to bring the committee's attention to a couple
of areas which I think are very important.
prepared statement
By the way, I have a statement and, if I may, I would put
that into the record.
Senator Bond. Without objection, we would be happy to have
it. Thank you.
[The statement follows:]
Prepared Statement of Senator Conrad Burns
Thank you Mr. Chairman, I would like to begin by saying that NASA
has been the Administration's shining star in this decade and I am very
confident in saying Dan Goldin is the reason for that success.
I think very highly of the Administrator's abilities. I also find
it difficult to believe that year after year NASA is punished for it's
abilities to save American tax dollars. The research conducted by NASA
is research that has unbelievable returns and applications in the
private sector. NASA has retained the mission of our federal government
to conduct R&D to be disseminated to our nation's economy.
NASA's current budget request is $87 million below the fiscal year
1999 appropriated level. Considering NASA's investment into the
International Space Station (ISS), this is a substantial decrease in
the agency's budget. Granted, the Space Station has hit its share of
speed bumps. However, it is my opinion that the Space Station is back
on the right track.
Mr. Chairman, I would like to encourage you to consider increasing
NASA's budget and reaffirming Congressional support for NASA. A $500
million dollar targeted increase in NASA's budget would be one of the
best investments this nation could make.
NASA is an investment in America's future. Recently, a NASA
astronaut volunteered to visit a couple of high schools in Montana.
Students in Whitehall and Bozeman had an opportunity to visit with NASA
astronaut Robert Curbeam and discuss his recent space shuttle mission.
These kids and communities are still talking about this visit. The
impression Mr. Curbeam had on these children will not be forgotten
soon. He is a very valuable asset to the nation's space program.
We cannot continue to penalize NASA for the agency's cost
efficiency. Each time the agency reduces its costs, they find they are
also reducing their budget levels. It's time to recognize that NASA's
return on the dollar to the taxpayer is positive in terms of our
federal budget.
I am also very supportive of Administrator Goldin's ``three pillars
of success'':
First, Global Civil Aviation--The goals of this objective is to
reduce the aircraft accident rate by a factor of five within 10 years,
and a factor of 10 within 25 years.
Additionally, this research will reduce emissions and noise levels
to give general aviation a place in the future of everyday
transportation in our nation. That means commuting for many of us in
rural states. I applaud Administrator Goldin for his work in this area.
Additionally, I would like to suggest that much of the work at the
FAA in terms of general aviation may be better suited in NASA. Safe and
affordable general aviation is an objective we need to continue to
pursue.
In 1998, we did not have a major commercial passenger jet accident
in our nation. However, major commercial aviation accident rates
globally have been nearly constant over the past two decades. While the
rate is very low, increasing traffic over the years has raised concerns
in the potential for these accident rates increasing.
NASA's research and technology development will address accidents
involving hazardous weather, controlled flight into terrain, human-
error-caused accidents and incident, and mechanical or software
malfunctions.
Pillar two: Revolutionary Technology Leaps.
NASA's vision to reduce airline travel time and increase the
production of affordable general aviation aircraft will ensure the
future of alternative travel methods in our future. Rather than driving
into D.C. on a bottlenecked I-395 or Route 66, workers can safely
commute in small, efficient planes.
NASA's third pillar for success is one I am certainly interested.
Affordable access to space. The opportunity we have before us today in
this field will save the taxpayer millions and reinvest those dollars
into the nation's economy. NASA is best suited for R&D. Taking the
operations expense out of NASA's budget and putting those funds toward
hard R&D in cooperation with our nation's universities will be the best
thing we can do for our nation.
This third pillar reduces the payload cost to low-Earth orbit from
$10,000 to $1,000 per pound and does this within ten years. In Montana,
we are very excited about the Future X program. The X-33 is scheduled
to land in Montana on test flights from Edwards Air Force Base in
California late next year.
The Future X program has been extremely successful--continuation of
programs like X-33 and X-34 will result in further development in the
private sector. I am awed by the technologies developed by NASA and
later applied in the private sector. This is the definition of what our
government is about--Research and Development.
Montanans are also very excited about the future of space launch
development. We are convinced it is only a matter of time that the
shift of space launch and landing operations move from NASA to the
private sector. We have vast sparsely-populated areas in our state that
are very conducive to space launch criteria. We are especially excited
to work with both NASA and private sector aerospace companies to expose
Montana's benefits as a viable spaceport state.
Lastly, I encourage the Administrator to continue his work in new
propulsion technologies. The Ultra Efficient Engine Technology Program
will create a new generation of high performance, operationally
efficient and economical, reliable and environmentally compatible U.S.
air and spacecraft.
I am confident in NASA's abilities and I would like to further
explore the opportunity for NASA to take on an additional role in the
area of general and commercial aviation. That is the direction we are
headed--eventually, it is my vision to see NASA as the primary agency
overseeing not only our nation's space activities, but also our
nation's airspace activities.
Thank you, Mr. Chairman.
Senator Burns. There are a certain amount of things that
Americans have benefitted from with the space program that get
very little attention. I think our work in civilian and
international aviation is important.
I think I mentioned this to you, Mr. Administrator, the
last time, that I would like to see some more propulsion work
being done. I know our new airplane for high speed civilian
application has been sort of put on hold. But I don't think we
should be letting slide new engines and materials--in other
words, in our propulsion work. I want to continue that and also
what we are doing as far as learning things about our own
Earth.
I think up in Montana you heard from some people when you
were up there on a recent visit about how we can serve those
people and the valuation of lands, forests, and this type of
thing. It has great environmental overtones to it and would
help us become better managers.
That is all I wanted to say, basically, because these two,
here, will get the final appropriation. But I do not think this
is a time we should start to cut back on R&D as far as what we
are doing in space and what we are doing as far as space serves
this country and this planet.
We do not hear much about that, but we know it is very,
very significant. So we appreciate that.
I am just going to make the plea not only for our reusables
but also for what we are doing with education and our R&D into
the application to civilian and commercial aircraft here in
this country and abroad.
I appreciate your good work.
I saw your good friend this morning. He is adjusting to the
private sector very well.
That is all I have.
Senator Bond. Was there a question in that?
Senator Burns. No, there was not a question. There was a
statement.
Senator Bond. We appreciate very much your participation.
Senator Burns. Ever since I got married I quit asking
questions. [Laughter.]
Senator Burns. I won't do that again. [Laughter.]
Senator Bond. Okay.
Senator Burns. You will figure that out. Better stand up.
Some of these are going over your head.
Senator Bond. Well, I have a hole in my glove. They are
going just right straight through the webbing. [Laughter.]
russian delivery of space station hardware and services
I want to go back to some of the questions that Senator
Mikulski began.
Considering the difficulty Russia has had funding the
Service Module, do you think that Russia can make timely
delivery of Space Station hardware and services? Why would you
think that they can? If not, in any event, what are your
contingency plans?
Mr. Goldin. First, let me say that there is a real value
added technically for Russia. I leave the political issues to
the foreign policy of this country. One of the major reasons we
went forward with the Russians on the Space Station is we only
have the Shuttle. We have a multi-$10 billion investment that
will be up in space and we wanted to have assured access to
that. The Russians have the Proton, the Soyuz, and the
Progress. To us, that was absolutely essential and still is
essential. So in some way, shape, or form, we believe the
Russians should be in the program.
Second, the Russians, when they have the money, they do
perform. When we got them that $60 million, it was the
difference between day and night. As we speak, the Service
Module is being packed, readied for shipment into the Baikonur
Cosmodrome, and it should be shipped somewhere around April 12.
At that time, we will send a team to Russia to go through the
schedule on the launch preparations at Baikonur. At the present
time, the Russians say they could launch by September 20. We
think it is more realistic that they will launch by November.
But, even at that, it fits within our capacity to accommodate
it. It will also allow us to have a permanent presence by
astronauts early next year. So we think we are on the right
path.
Now, am I frustrated? I am darn frustrated. I come from a
world where people do what they say they are going to do. It
makes a tremendous disruption.
One of the other lessons we learned is I think we may have
done better negotiating with the Russians because we treated
the Russian culture like the American culture. Had we known up
front, I think we would have done it a little bit differently
in terms of our contingency planning.
monies paid to the russian space agency
Senator Bond. I want to get back to this. But one of the
things that Senator Mikulski and I talked about last year that
I believe you are doing is trying to find ways to get money to
bypass what we would call the bureaucracy; to get money and put
our cash right on the barrelhead, where the work is being done.
Now this $60 million, is that one of your first monies?
Mr. Goldin. It was right on the money. That $60 million
made all the difference.
Senator Bond. To whom did you pay that?
Mr. Goldin. We paid it to the Russian Space Agency. But we
did it with a firm fixed price contract, with very set
milestones, with an auditing capability, and we gave them
milestone payments. So they did not get paid until we saw
results occurring.
This is what we learned in our discussions at the request
of Senator Mikulski and a number of other members on how we
should contract. It was a very fruitful contracting approach
and it made a significant difference in getting results.
Senator Bond. Well, I'll tell you. Speaking of that $60
million, we have heard some Russian officials say that with
that $60 million, we have purchased 25 percent of the research
time. Others say we have purchased 75 percent of the research
time.
What did we get?
Mr. Goldin. We got 4,000 hours of research time, which will
allow us to do a significant increase in research as we are
building the Space Station. We also got a significant amount of
on-orbit storage, which is crucial for us to place critical
spares and other equipment for servicing the system.
So we got $60 million in value back for the $60 million we
paid to get this thing off dead center.
Senator Bond. All right.
As a bottom line, what is your estimate on how much more
funding we are going to have to provide the Russians?
Mr. Goldin. We have $100 million in the fiscal year 1999
budget. We initially had thoughts that we might put in $150
million a year for the next 4 years into the out-year budgets.
But on second thought, we reflected and said this would be
a disincentive for the Russian Government to pay their bills to
the Russian Space Agency. So, in preparing the fiscal year 2000
plan, we just left $100 million in fiscal year 1999 to give us
some latitude should we need to make purchases. We will clearly
monitor what is going on and if we do need additional funds,
request it.
But putting the money down there, all it does is the
Russians have a tendency to say the money is there and then we
have to pay less money to the Russian Space Agency. We felt
that would be very, very wrong.
Senator Bond. So we need to continue to figure out ways to
make sure that that money goes to the Space Agency. Can we do
that with any future payments?
Mr. Goldin. We are going to be very frugal in any future
payment to get specific goods and services in return for the
money that we spend in Russia.
Senator Bond. Be frugal versus is the money going to go to
the Space Agency?
Senator Mikulski. That's the question.
Mr. Goldin. The answer is we believe we have a method for
assuring that. We have audited that and we have records for the
monies we sent. We trace the monies from bank to bank, to the
agencies, to the people that get it. We go down on the floor.
We have people in Russia watching how that money is spent.
Senator Bond. But are you sending it to the Russian
Government and then following it? Or do you have a mechanism
for sending it to the bank?
Senator Mikulski. Or agency?
Mr. Goldin. We don't send it to the Russian Government.
Senator Bond. That's a start.
Mr. Goldin. We send it to the Russian Space Agency.
Senator Bond. Okay. All right. So your future money will be
going not to central government?
Mr. Goldin. Not to the Russian central government. It will
go to the Russian Space Agency.
Senator Mikulski. If I might follow up, this is the crux of
what we were trying to get at in our report.
So, instead of now it going government to government, we
want to draw the distinction that it is going agency to agency.
Mr. Goldin. Agency to agency.
Senator Mikulski. Is this, then, new?
Mr. Goldin. It is not new. The other thing we do in
specific cases is sometimes corporation to corporation.
Senator Mikulski. Is this new with the Russians?
Mr. Goldin. Is this new with the Russians?
Senator Mikulski. Yes.
Mr. Goldin. No.
Senator Mikulski. Then I don't get it. I thought the
problem was that it was going to the government.
Mr. Goldin. There was desire a number of times to have it
go to the Russian Government, and we have resisted those times.
Senator Bond. What happened? I thought the problem was that
the money went to the Russian Government and never got to the
Space Agency.
Senator Mikulski. That was my understanding, too, Mr.
Chairman.
Mr. Goldin. No. We never sent money to the Russian
Government.
Senator Bond. Well, you had two of us fooled.
Mr. Goldin. We resisted that. We resisted that. And, in
fact, when we surveyed the other agencies in the Federal
Government and other corporations on how we were doing it, we
felt that we had the right approach to doing that.
Senator Bond. Well, I'll tell you.
Senator Mikulski. Why don't you continue with your
questions, Mr. Chairman, and extend this if you wish. Your
questions were mine on that issue.
Senator Bond. Well, I am about to finish up on the Russian
side. I will then turn it back to you, Senator Mikulski.
I did want to say that Senator Hutchison has been detained
on the floor. She is working on the supplemental
appropriations, which is where Senator Mikulski and I ought to
be. Senator Hutchison does obviously have a very deep interest
in this whole area of operation, and she is going to be
following up with post-hearing questions. I know that you were
looking around. Normally, we would expect to see her here.
I guess my final question is this. Maybe we are just
missing something, but the Russian Space Agency in some ways is
the government. Where did we find the problems that money did
not get to the scientists?
It seemed to me that the money was not getting down to the
people who were doing the job. What happened there?
Mr. Goldin. First let me say that the Russian Space Agency
is not like NASA. The companies, they own interest in the
companies that they do business with. It is not like they give
them contracts.
I know that there are some people from Russian industry who
came to America and said we are not getting the money. That is
where it came from. I know some of those gentlemen. Some of
those gentlemen would love to get their hands on the money and
we, NASA, are not interested in giving the money to those
gentlemen because those gentlemen have not demonstrated the
commitment we would like to see.
I think that is where it came from. There was a lot of
self-interest of Russian corporations coming to America----
Senator Mikulski. I think I need a shot of vodka right now.
[Laughter.]
Mr. Goldin. They'd come and they'd talk to members of
Congress. They'd make statements that they cannot defend.
We were not pleased with some of the things they said
because we did not agree with them.
Senator Bond. I might just ask, has the Inspector General
looked at any of these things? Have you had any comments on
this?
Ms. Gross. We originally were looking at the monies
following from the Johnson Space Center and how they would do
it. But we do not have access rights into Russia. I am very
interested to hear about these access rights because I do want
to follow up on what access rights they are and who has them. I
hope it is the Inspector General, among others, that has those
rights.
Our exposure to that came more in the MIR setting, where we
did a series of reviews, for the MIR. Part of the problem we
had which impacted on the safety of the MIR missions for
Americans had to do with payments by the Russian Government to
its employees, or the RSA to its employees.
The issue was not so much about the American money, but it
was more that the Russian Government was not keeping its
commitments.
Senator Bond. Okay.
Mr. Goldin. What I am trying to say is with the money that
we send, we track the goods and services we buy. I have the
same problem that the Inspector General has, and I plan to
discuss that with the delegation coming, that the Russian
Government keeps saying it is going to pay their people and
then they don't pay their people. That has an impact on 16
countries that are working on the Station. That, in my mind, is
the problem. The Russian employees of the Russian Space Agency
and their contractors do not get paid at times. That is the
issue. It is not American money--NASA money, I should say.
There are other issues, but with the NASA money, we try to
track it to the best of our ability so that we are sure we get
value for it.
It is the Russian money that is not coming and it is this
Russian money not coming that is creating the problems that we
have.
Senator Bond. Senator Mikulski.
meeting with primakov
Senator Mikulski. This, then, takes me to another issue. I
think the chairman has pursued this to the extent that we can
do it here.
The meeting with Primakov is when, Dr. Goldin?
Mr. Goldin. It's next week.
Senator Mikulski. I would like to ask if you think
appropriate in this setting what you intend to press at the
meeting. Number two, I have another question related to the
proliferation issue and what I would like to recommend that we
press.
Mr. Goldin. The details of the discussion I think might be
inappropriate, but as for the general concern, we have one
specific concern. For the last few years, the Duma appropriates
a budget for the Russian Space Agency and that budget does not
get passed down in full value to the Russian Space Agency. When
it does get passed down, it comes a half-year to 9 months late.
It is very difficult for my counterpart in Russia to do
adequate planning. That is the single biggest problem we have.
Senator Mikulski. So, therefore, the issue is not our money
getting to the Space Agency, it is the question of their money
getting to their Space Agency?
Mr. Goldin. That is what has caused all the problems, and
caused us to undertake contingency plans. In this year's
budget, the Administration has programmed $600 million to spend
in America to get contingencies against the Russians not
performing.
The issue comes back to the Russian Government
appropriating money and not having it passed on to the Russian
Space Agency. That is our single biggest concern.
Senator Mikulski. What I am going to suggest is that the
chairman and I write a joint letter to Vice President Gore to
show a spirit of bipartisanship, asking that this also be
pressed at the meeting so that it is clear that we are
interested in essentially a partisan-free zone for you to also
be further empowered to press this. I think it has very
significant questions.
Let me now, therefore, then go to the proliferation.
Mr. Goldin. Before you come to proliferation, there is one
point I again want to make which is a very important one. Every
time the Russian Space Agency gets the resources, they have
performed superbly.
Senator Mikulski. We understand that.
Mr. Goldin. They have the ability to do it. It is the
government not supporting their own space program that is the
problem.
russian proliferation activities
Senator Mikulski. In January, the State Department
sanctioned three more Russian entities for sending technology
to Iran. I don't know if any of those entities are directly or
indirectly involved in the Space Station endeavor. I find Mr.
Primakov a very fascinating individual. He could be a very
important personality in terms of our larger foreign policy,
both in Iran and Iraq.
As a former KGB agent of the Eastern region, he, therefore,
knows the leaders of those countries intimately--up close, and
personal. He has then recycled himself through Gorbachev,
Yeltsin, after and around Yeltsin and back to Yeltsin, and I
believe he is a significant figure in Russian and global
policy.
Therefore, are we going to be talking with Mr. Primakov at
this meeting about enlisting their support--one, to make sure
the Russians themselves are not participating in this
proliferation, and, two, to get some assistance perhaps in
these very troublesome areas of Iran and Iraq?
Mr. Goldin. We, NASA, are a civil space agency, and it is
crucial for us that we work with other space agencies in other
countries that abide by the rules of nonproliferation of
weapons of mass destruction.
Senator Mikulski. That is why we went to Russia in the
first place.
Mr. Goldin. It is.
Senator Mikulski. It's better for them to work with us on
the Space Station than to be working with Iran or such
countries.
Mr. Goldin. We constantly consult with the foreign
community.
Senator Mikulski. Is this going to come up as part of the
NASA deal? I mean, this was part of the NASA deal.
Mr. Goldin. We rely on the foreign affairs community within
the government to advise us on what we should do. We await
direction from the administration and the foreign service
activity within that administration to give us guidance in this
area.
Senator Mikulski. Then let me ask this question. The State
Department sanctioned three more Russian entities for sending
technology to Iran. Were those entities directly or indirectly
involved with the space cooperation with the United States?
Mr. Goldin. To the best of my knowledge, none of those
institutions was involved in NASA activity.
Senator Mikulski. Has NASA, as part of a civilian agency,
been involved with the State Department, essentially been an
advisor to the State Department, on how perhaps to help deal
with the Russian proliferation activities?
Mr. Goldin. First, we always cooperate with the State
Department.
Senator Mikulski. Cooperation is one thing. Being an
advisor is another.
Mr. Goldin. We can't advise on proliferation. That is not
our area. But we certainly can advise on the things we do and
the fact that we cannot operate with agencies that are in this
area.
I want to point out something. Every time I meet with
Koptec, every time I meet with the Russian Ambassador, every
time I meet with a senior official of the Russian Government I
tell them the following: NASA is a civil space agency.
Senator Mikulski. I appreciate all that. But the fact is
that NASA is a civil space agency, but we are involved in a
great deal of international effort. And for part of our
international effort, one was a way of allies to participate in
bold scientific endeavors. The other was to involve the
Russians.
So these are not exactly sharp distinctions.
You--meaning NASA--have a great deal of experience because
what does spread proliferation but the ability to launch. This
is why we are having meetings today on China. This is why we
are going to be having other meetings. It goes to the fact that
other countries now have the capacity to launch.
We don't know what got leaked to China. We don't know what
Russia is selling. At the same time, of course, presumably we
do know--or I hope we know.
My question is because of your capacity, are you involved
in being an advisor on how we can help the Russians stay
between the white lines and not proliferate?
Mr. Goldin. I communicate with the highest levels of the
foreign affairs community in this country.
Senator Mikulski. I don't know what that means. Are you
talking about Secretary Albright? I mean, I go to the Baltimore
community. That's different, between being at Jimmy's Diner and
the Mayor.
Mr. Goldin. My staff attends all appropriate meetings that
take place on the subject.
Senator Mikulski. Are we in a situation where in this
conversation you don't want to be specific for reasons that are
not cranking with the question?
Mr. Goldin. There are things I do not feel comfortable
saying in this open environment that would be a problem.
Senator Mikulski. Then that is a better way than me to
continue to try to pressure you.
My time is up. I have other questions, but I would return
now to the chairman.
commercializing the space station
Senator Bond. I would want to open up another area--
commercialization of space or commercializing the Space
Station. That all sounds really great. But I am not sure
everybody knows exactly what we mean.
When you talk about it as head of NASA, you talk about the
commercial use of the Space Station or turning the keys over to
the private sector.
Can you give us a sort of explanation of what you expect
would happen and when it would happen?
Mr. Goldin. First, when I talk about commercialization, I
don't talk about people who provide commercial services where
NASA is the only customer. There are some entrepreneurs who do
not understand that concept. It is not commercialization if
NASA is the only customer.
We are interested in people who want to commercialize space
where NASA is one of a multiplicity of customers and the
overhead can then be amortized across a broader base.
There are people who come to me and say Mr. Goldin, all I
need is the first $100 million. Then I could send robots and
astronauts to the moon. That is not commercialization because
the first money ought to come from the commercial sector.
We are now looking at running a competition for
nongovernment organizations to run the utilization of the
utilization of the Space Station. We, NASA, would then work
with that organization to purchase some of the utilization
time. We would like to do that so there could be a broad base
of companies spending money in addition to NASA. We don't know
how successful that would be, but that is our first attempt on
the Space Station. We are preparing the documents now. We are
talking to the community about that subject. Our intent is that
commercial activity be real commercial activity and not
shuffling of Uncle Same's money from one pocket to another.
Senator Bond. I guess I am still not clear. I understand
better what it is not. To what extent do you see commercial
operations taking over and supplanting the efforts which this
committee funds to assure space exploration?
Is there an extent to which some of your tasks now being
performed with money that we appropriate to you will be
performed by, more and more by the commercial sector on the
basis of the profit potential that those would entail?
Mr. Goldin. We have set a goal of 30 percent for commercial
usage of the utilization time on the Space Station and have
indicated that, if there are more commercial pressures, we
would cut back on our government time up to 50 percent or more.
I do not anticipate that that activity will kick in in less
than 5 years. And then, once the Space Station is up and
operating and once we could establish user costs and user fees,
and schedule it, we will then be in a better condition. So for
the next 5 years we don't see it.
However, right now, there are about $45 million a year of
commercial money going into utilization of activities that
could be put on the Space Station. That is a far cry from the
30 percent I am talking about of the total utilization of the
Space Station.
Senator Bond. I could assume that if the private sector
were paying 35 percent, or were taking 30 percent of the
utilization, they would pay their allocable share of that
particular operation?
Mr. Goldin. I would hope so. Right now, I don't think we
will have problems with the utilization of the Space Station.
The biggest problem we will have is getting the costs of access
to the Space Station down. I think that is the single biggest
deterrent to commercial utilization of the Space Station.
It is $10,000 a pound to get up there and that is a very
stiff fee. Toward this end, we are working with a number of
different launch vehicle suppliers to see if they could get
lower cost access to that Space Station, which would then make
it more commercially viable for people to use it.
space station completion
Senator Bond. What is your current expected schedule for
completion of the Space Station? How much slippage in both the
schedule and the cost do you expect?
Are you comfortable with the numbers you can give us now?
Mr. Goldin. Well, I will tell you that we are keeping a
very tight schedule because one of the other lessons we find is
whenever we put in too much schedule reserve, it gets used up
by our NASA employees and industrial partners and contractors.
So we are holding a very tight schedule which says completion
of development will occur in September of 2003. That is when we
will put 6 people on board the International Space Station.
We have a 1 year assessment of how much slippage could
occur. This is in rough agreement with the Chabrow report. So
our best assessment today is we could slip about another year
beyond that. That is the best knowledge we have at this point
in time.
Senator Bond. What about costs?
Mr. Goldin. By the way, there is one other point. Assembly
completion, which would be when we brought the habitation
module up, and the centrifuge facility would be July, 2004. If
you put that 1 year slip, it would take it to a year later.
The best estimate of development complete is $22.1 billion
to $23.7 billion, and the assembly complete is $23.4 billion to
$25.3 billion. Those are the best estimates we have to date of
those numbers.
space station operation cost
Senator Bond. What about the operation costs after it is
completed?
Mr. Goldin. The operation cost is estimated to be $1.3
billion a year. And it is in 5 to 10 years from now that we
hope to get commercial utilization of that Space Station. But
it is not 100 percent of that. Our initial goal is 30 percent
of that. That hinges on the ability to bring down the access
costs to getting up there.
upgrades to the shuttle or reusable launch vehicles
Senator Bond. I have a number of questions that we are
going to submit for the record. There is one last one that I
want to discuss here because it is of interest to me, as well
as are all these others.
You at one point said you would make a decision by the end
of the decade on whether to make a major upgrade to the Space
Shuttle or to rely on the private sector to build a new,
Reusable Launch Vehicle, like the Venture Star. Where are we on
that timeframe? What is the status? What are you seeing? What
do you project?
Mr. Goldin. As part of the 2001 budget process, we will
have a firm position on it. Where do we stand now? When we
started the Reusable Launch Vehicle Program, the leaders of the
corporations working with us were very optimistic. They thought
that by 2000 they would be ready to reduce the technical risk
of developing that system and go commercial.
We now have been at it with two different companies, two
different vehicles, and we think it is much tougher--we, NASA,
and the corporations. We also thought that if we flew
successfully the X-33, that would retire enough of the risk.
When we talked to the financial community 3 and 4 years
ago, before it was a reality there was a sense that that would
be okay. We are hearing now that we will have to retire much
more technical risk before the financial community is willing
to take on the business risk. They don't want to take both of
them on.
We think there is going to have to be some more technical
risk reduction and that it will probably be another 3 to 4
years before we could really get at a hard decision. But in
that, another wonderful thing is happening.
The people who have worked on the Shuttle for decades and
felt no competition, and always handed us ever increasing cost
estimates for making upgrades and making changes suddenly feel
the heat of competition. I think this is wonderful. They are
now acting, the USA Corporation is very serious, performing
very well, and they are taking a look at upgrades that we could
make to the Shuttle to keep it safe.
I also want to point out that we are spending a half
billion dollars a year on Shuttle upgrades today and we have
been continually improving the safety. We believe it will be
very worthwhile over the next 2 to 4 years to continue upgrades
to the shuttle--not multi-billion upgrades but upgrades
measured in hundreds of millions of dollars, which are sensible
things to do--and keep the spirit of competition going, keeping
investment from the USA Corporation, from Lockheed-Martin and
Boeing, in the different activities. I think the government
will benefit from this.
In addition, there are new concepts coming to the
marketplace and it gives other people an opportunity to
compete.
So my sense is that we are going to conclude that we need
another 2 to 4 years. Keep the competition going.
Senator Bond. How much are you going to be investing in the
Shuttle in that period of time?
Mr. Goldin. Although the contractors might be interested in
billions, we will be talking of hundreds of millions. Those
hundreds of millions could do some very sensible things. Again,
this has not been worked out with the administration, but I
think some investments measured in hundreds of millions of
dollars over a 3 to 4 year period could do some very
significant safety upgrades to the Shuttle, very significant
productivity upgrades to the Shuttle. It also keeps the
competitive stress going.
But I do not think we should commit to a $5 billion or $10
billion liquid flyback booster at this time because we would
then give one contractor an opportunity to think they have a
sole source position and that would not be healthy for the
agency or the country.
Senator Bond. Thank you very much, Dr. Goldin. I will
submit the rest of my questions for the record.
Now I would like to turn to my ranking member for such time
as she may require.
y2k
Senator Mikulski. Thank you, Mr. Chairman. I know that we
are in the final minutes before a very important vote.
First of all, Dr. Goldin, I would like to thank you and all
of NASA on your hard work on the Y2K problem. Last year, when
we had our appropriations hearing, GAO gave NASA a ``D'',
which, given the fact that you were one of the leading
technology agencies, was distressing.
I understand that that report now gives you a ``B'', which
puts you far ahead of many of the other agencies. I know that
was the result of a tremendous amount of determination and
extra costs that the agency did. So I want to thank you for
that.
Mr. Goldin. You helped inspire me, Senator.
Senator Mikulski. Oh, that makes me feel good, Dr. Goldin.
[Laughter.]
hubble follow-up
There are two issues in writing that I would like to follow
up on. One that we talked about was the follow-up on Hubble and
the impact on other programs so that we have this information
as we work on this--again, together with the administration and
with you.
[The information follows:]
If NASA does not receive supplemental funding for the Hubble
Servicing Mission 3A, the added mission will proceed as now planned and
we will have to find the means to accommodate added requirements within
our current funding level, most likely at the expense of other
activities. We have not yet determined what would be cut to fund SM3A,
but should that become a necessity, we will of course inform the
committee in a timely manner. Consistent with Senate direction, we are
preparing a comprehensive report regarding the HST accelerated
servicing mission, which we hope to deliver on or about July 1.
space hope instructional program
Senator Mikulski. The other thing in writing is I note that
there continues to be a program under discussion at Goddard
called the Space Hope Instructional Program. That was to
establish that information technology facility in Baltimore.
I still do not kind of know what it is, where it is, what
does it mean. Does it mean dislocation of NASA employees and
relocation? Could you give me in writing an actual description
of the real program, not noble goals, in addition to noble
goals. Also, number two is the impact on employees. In other
words, I do not know where we are going with this, what the
status of it is. Also, I understand it would involve possible
relocation of Goddard employees to Baltimore. That often causes
some rather cranky eruptions.
Mr. Goldin. I would be pleased to answer that for you.
Senator Mikulski. Thank you.
[The information follows:]
Background
NASA Goddard and its Maryland based contractor workforce face
serious problems in attracting and retaining skilled Information
Technology (IT) personnel. An analysis of this problem suggests an
approach modeled after the very successful Focus Hope program in
Detroit. This program includes elements similar to the recent and
successful migration of space mission operations to Bowie State
University as well as experience gained in the successful Minority
University-Space Interdisciplinary Network Training Program. ``Space
Hope'' would be a pilot information technology training program. The
approach is to establish a broad public/private partnership with IT
related businesses, academia and local community interests that draw
upon the under utilized segment of our urban populations to address
regional IT needs, as well as those of NASA. It offers core IT
curricula instruction, formulated by local industry partners, combined
with on-the-job training in specific workforce skills. Baltimore,
Maryland was identified as the pilot site because of its strong base of
information related business, public/private sector interest, favorable
community response, proximity to Goddard, and access to a trainable
urban population with immediate employment needs.
Space Hope Status
Goddard initiated preliminary discussions with industry, civic and
academic groups in the Baltimore area regarding the Space Hope concept
and ultimately came into contact with the Greater Baltimore Alliance
(GBA) which took an interest in coordinating a response to this
problem. GBA identified various corporations in the Baltimore area as
potential partners, who we understand are prepared to co-fund core
curricula, fund their individual specialized training component, offer
IT job placements and other support for such a training program. In
addition, we believe an arrangement has been negotiated between GBA and
one of our contractors to manage and implement the core instructional
program. Goddard is evaluating implementation options and plans to make
recommendations to NASA Headquarters.
Over the course of the past six months, Goddard Space Flight Center
management has been preoccupied with an intensive activity to
transition to the new Consolidated Space Operations Contract (CSOC). At
the same time the Center has been dealing with several major on-orbit
issues which caused Center management to review its overall strategy
for mission operations, and to some degree reconsider aspects of the
Space Hope program. However, Goddard management remains convinced that
the Space Hope program could make a contribution to space operation
needs, and therefore has started to refocus attention on this
initiative. In the near future, Goddard plans to outline a definitive
proposal that will serve as a basis for addressing this critical need
in an affordable and sustainable manner.
Does it mean relocation for NASA employees?
Although we have not outlined a specific proposal for Space Hope,
permanent relocation or reassignments are not contemplated.
fiscal year 2000 budget for goddard space flight center
Senator Mikulski. Now let's go to the Goddard budget.
Goddard is scheduled to have $2.4 billion and at the same
time it has been instructed to develop two new starts--Triana
and the University Class Earth System Science Mission, or
UNESS.
Mr. Goldin. UNESS.
Senator Mikulski. Could you tell me if the fiscal year 2000
budget is adequate now for Goddard to conduct its operations?
Again, we have been concerned about the impact on the Space
Station and others. Also, does your budget allow you to begin
these new projects or not?
Mr. Goldin. Yes, it does, and, in fact, the enthusiasm is
contagious at Goddard for some of these new programs. They are
adequately funded and they can do these programs.
Senator Mikulski. Do you believe that to be so?
Mr. Goldin. I believe that to be so. But if there is a
concern, I will be talking to the center director, Al Diaz,
after this hearing, and if there are any concerns that he
expresses to me, I will also let you know.
Ghassem, would you like to say something on this?
Dr. Asrar. Yes, Senator.
On the first subject, Triana, this is a mission of fixed
value, where we have $75 million. We competed that. Goddard is
a partner and Scripps Institution of Oceanography is the lead
institution for that. The budget for that is well laid out in
our budget for 1999, 2000, 2001, and beyond.
The university class experiment that you referred to is a
level of effort. We just started that. We have not actually
announced it. We will announce it in the May timeframe.
We have not received the proposals yet.
Senator Mikulski. So it is just being developed?
Dr. Asrar. It is in the stage of development, the early
stage of development.
Senator Mikulski. Well, of course, we are very proud of
Goddard and its Earth Science effort. We have been reading
their outstanding work on the sun eruption issue. You know,
with the Millennium coming, there is a lot of armageddon type
fear in all kinds of categories.
So we look forward to hearing more about that. But, really,
I think it goes to what Senator Bond was asking about,
commercial activity, whether you talked about working with FEMA
on flood mapping.
So much of what Goddard is doing--everybody sees the
dazzling pictures of Hubble which are more than just pictures.
There is real science information there and all of that.
But what I think is a message that we need to get out is,
really, how the work of NASA is improving the day to day lives
of the American people and even the world.
The more I read these reports I see what we could be doing
in agriculture and flood prediction, helping agencies save
money, and knowing that that could be value added. Once we have
those maps, not only do they help local government, but this is
a market for the private sector to buy and value add to for
specific uses.
Senator Bond. Senator, if I may interrupt for just a
minute, while we are worrying about armageddon, I am faced with
a much more pressing problem. The Budget Committee is in markup
and there is scheduled a series of votes.
Senator Mikulski. Why don't you go and permit me to finish
up with my question.
Senator Bond. I am pleased to present you with the gavel.
Senator Mikulski. I will view this for now as just a loan.
[Laughter.]
Senator Bond. It's a loan. You know, Rush Limbaugh has a
brain on loan from God; you have a gavel just on loan from the
Appropriations Committee.
Dr. Goldin and associates, thank you very much. If you all
will excuse me, I am off to defend against some kind of evils,
I know not yet what. [Laughter.]
Senator Mikulski [presiding]. Okay. We will be there. I am
sure that we will have a full court press knowledge about this
next week. The budget comes up next week and, as you know, this
is why we are going into some of these issues.
When I was in the House, we helped do new product
development in the Great Lakes area in terms of mapping and
scientific information. The private sector then value added to
that in very specific niche markets for maritime and other use.
What we are hoping is that even this information or
knowledge that is being developed would be the same. I just see
that in the flood mapping this would be an incredible endeavor.
What we are trying to do with FEMA is to identify the areas
that are so prone to disaster that we essentially buy them out
now. In some instances we have gone in and rehabilitated 12
times. You see?
That is where we see this work going.
Let me conclude my questions.
Mr. Goldin. May I give you a substantiation of what you
have just said? In 1992, there was a $750 million a year remote
sensing business. As a result of the technologies developed by
NASA-Goddard and used by the value added sector, that industry
is now $2 billion a year. It is projected to be $4 billion a
year by 2005 and $10 billion a year by 2010.
That technology from Goddard in and of itself could be
paying for two-thirds of the NASA budget.
solar stereo mission
Senator Mikulski. Personally, that is great to hear. In
fact, it's fantastic to hear.
One of the reasons I chose to be on this subcommittee and
why I am always so eager to hear what NASA is doing is it
really does look at and has implications for the day to day
needs of our own people, people of the world, and the long-
range needs of our planet. So let me conclude with this.
I would like you to tell me what do we now know about the
sun surges, or whatever the scientific term is? I want to know
how NASA is going to celebrate the Millennium and what are you
doing New Year's Eve? [Laughter.]
I know that James Lee Witt is at the Disaster Center,
Shalala intends to be at HCFA to show Medicare is going out, so
why don't you tell us about these sun surges and NASA's plans,
as we turn the century mark, for how it intends to celebrate
it. Then I want to know where you are going to be New Year's
Eve.
This is not an invitation to come to a party, now.
[Laughter.]
But if NASA is having one, it would probably be one of the
best around--but not more fun than James Lee Witt's, I might
add.
Mr. Goldin. I think it could be.
First, with regard to the sun, we have made some incredible
discoveries about these coronal mass ejections which have a
huge impact on things here on Earth. It disrupts power systems,
it disrupts satellites, it creates all sorts of problems for
space travelers.
We will be able to do a better job in protecting the health
and safety of our astronauts by having a much earlier
anticipation of when these events could occur.
The breakthrough in solar terrestrial physics in the last 6
months has been nothing short of breathtaking. There are a
number of new programs which you have supported that will take
it to the next step.
The Solar Stereo Mission is going to give us three
dimensional images of these phenomena which will lead even to
further understanding and benefit of how our sun works and how
it affects our Earth. We thank you for the support for doing
that.
Senator Mikulski. Will, through your work at NASA, we be
able to give more predictive dates of when these surges or
eruptions will occur?
Mr. Goldin. That is our intention. Now we have tens of
minutes to an hours worth of anticipation and we hope to make
that perhaps a day or two. This would really give people time
to plan. But I think that is a few years off in the science
now.
nasa--the millennium
With regard to NASA, for the Millennium, we intend to give
this Nation 15 additional payloads on orbit. In the last 25
years, we have never launched that many spacecraft. It is an
unbelievable task that we have ahead of us this year. I think
half of them are going to come from your center, at NASA-
Goddard. It is an unbelievable task we are facing, but the NASA
team is up to it.
As for myself, my wife and I are debating if we should go
up to a mountain or should we go to New York City. We have not
resolved that debate. I lean toward New York City.
Senator Mikulski. Well, New York City sometimes goes into
orbit. [Laughter.]
Mr. Goldin. And you're welcome to come with us, Senator.
ranking minority closing remarks
Senator Mikulski. Actually, I think I am going to be in
Baltimore at a program called the Visionary Arts Museum, where
there will be whole Millennium turn. It's right across from the
sign center. I am going to be at a place that is visionary,
scientific, futuristic.
This old century has brought us incredible scientific
discovery. Some have created mass weapons of destruction. Then,
at the same time, we have created massive, new scientific
information that has saved lives and saved communities, and
NASA has been part of it.
Additional committee questions
We thank you for this hearing. We know that there will be a
lot of homework to do between now and the appropriations. I
wish you to thank all the people at NASA for helping bring us a
long way on many of the issues 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 Bond
setting national space goals--nasa's mission
Question. Mr. Goldin, how do we as a nation set goals for the
civilian space program? Does NASA develop a set of plans and then try
to get approval from the White House and Congress, or does the White
House set the plans, tell NASA what to do, and then you both try to get
approval from Congress? How does that process happen?
For example, after the completion of the International Space
Station, what do you expect the next major manned mission to be? Has
this been discussed within NASA and what is the decision-making process
for such a mission? In addition, is NASA looking at manned flights to
Mars or the establishment of a manned base on Mars or the Moon. If so,
have you looked at budgeting issues?
Answer. The sequence by which the Nation's goals in space are
defined can vary, but consistently occurs within the framework of the
Constitutional relationship between the Congress and the White House.
The foundation of any goals enunciated by NASA and the White House is
contained in U.S. law--the National Aeronautics and Space Act of 1958
(as amended, or ``The Space Act'') is the starting point. The Congress
may pass other laws that might limit or stimulate the consideration of
goals above and beyond what is already indicated by ``The Space Act.''
The White House periodically issues a National Space Policy, which
is likely to elaborate on Congressional direction but may also reflect
White House initiatives, and normally addresses policy for military and
intelligence, as well as civilian, activities in space. The last four
presidential administrations have each issued National Space Policy
directives. These directives have been fairly consistent in their basic
objectives and approaches toward reaching those objectives.
Within the legislative and policy framework, planning for the
future of the U.S. civilian space program is, in almost all cases, done
by NASA, in consultation with space program stakeholders, including the
science communities, industry, other Federal agencies, and our
international partners. NASA then seeks approval for its plans from the
Administration. As the White House approves plans, NASA and the
Administration then seek approval from the Congress. Both in current
practice, and historically, this has been the way space program
planning has been done in the great preponderance of cases.
Occasionally, a US Presidential Administration or members of Congress
will propose plans directly to NASA. In cases where this comes as a
suggestion, NASA will investigate incorporation of the specific idea
into current plans, and will either adopt, modify, or reject the
proposal. In cases where an Administration or Congressional proposal
comes in the form of a directive or a mandate, NASA then develops
implementation plans to correspond with the directive, adjusting other
plans and reallocating resources as necessary.
With the advent of the Government Performance Requirements Act and
the establishment of an agency Strategic Plan, the processes described
above have become more codified. NASA has used its strategic planning
processes to establish a series of goals over a 25-year time frame,
documenting them in the NASA Strategic Plan. In most cases, the goals
and objectives for long-term time-frames are less specific then those
in near-term time-frames. The Agency's strategic roadmaps provide a
general framework within which the Agency can develop a greater level
of planning detail for the out-years as current accomplishments,
technology developments, and resource availability issues resolve
themselves in the current time-frame.
NASA's Strategic Plan currently identifies ``Conduct human missions
to planetary and other bodies in our solar system'' as a goal of the
Human Exploration and Development of Space Enterprise in the 2010 to
2023 timeframe, following achievement of the Agency goals that will be
met by the International Space Station. The specifics of what type of
missions would best fulfill this long-term goal have not been
determined. NASA has, of course, had multiple study efforts over the
years that have examined the possibility of a human mission to Mars.
NASA continues to study such possibilities, and we are also attempting
to further improve our long-range planning efforts across the board.
However, none of these preliminary study efforts has reached the point
were specific budget considerations could be considered, except in as
much as the Agency has conducted such efforts in recent years with a
particular focus on ways to achieve various missions at low cost.
national space council
Question. Mr. Goldin, when you first became head of NASA, there was
a National Space Council at the White House to coordinate military,
civil and commercial space policy. The Clinton Administration hasn't
used that structure. Was the making of national space policy better or
worse when the Space Council mechanism was used? Would you recommend
that the Space Council be restored?
Answer. While the Clinton Administration has chosen to address
space policy matters within the framework of a National Science and
Technology Council rather than a National Space Council, it is not
apparent that ``the making of national space policy'' is ``better or
worse'' for it. Certainly the making of National policy in any arena is
improved by the extent to which it responds to the entire National
policy agenda, rather than asserting only the policy claims of special
interest groups--however meritorious those claims.
There is very little that NASA does that does not have
ramifications for many dimensions of the Nation's current well-being
and its future. For example, the civil space program draws from, and
contributes to, the vitality of our industries; the education and
capabilities of our workforce; and the visionary aspirations of our
citizens, young and old alike. Executive Branch discussions of space
policy issues that occur within the framework of the National Science
and Technology Council are more likely to reflect these and other
dimensions. If I were to draw any distinction between the significance
of the two Councils, it might be one of emphasis, but it is impossible
to say whether one produced ``better'' or ``worse'' policy. The
ultimate test of any policy is whether it served its ultimate
objectives, and that judgment can only be made ``in the long run,''
with all the benefits of hindsight.
mission decisions
Question. What are the procedures by which missions are selected
and budgets for those missions determined. Please provide a step-by-
step overview of this process, including oversight review. Also, please
provide a summary of the yearly review and oversight procedures for
missions that are selected and budgeted.
Answer. The NASA Strategic Plan identifies the goals of each of the
Enterprises and provides specific objectives for the near, mid and far
term. Science missions aligned with these objectives are defined within
the scope of the budget allocated to each Enterprise. Announcements of
opportunity or similar announcements such as NASA research
announcements that are provided to the science community and responses
are peer reviewed to select the highest quality science instruments and
investigations that can be accomplished within cost and schedule
constraints. For major programs, oversight responsibilities are
retained at NASA Headquarters. For those programs, an independent
assessment is conducted by the Independent Program Assessment Office
(IPAO) prior to Agency approval of the program. Agency approval must be
granted prior to program transition from formulation into
implementation.
During program implementation, oversight for major programs is
executed by the NASA Program Management Council. In addition to
receiving regular status reviews, the NASA Program Management Council
also receives the report of an Independent Annual Review (IAR) team.
The IPAO also executes the IARs. The IAR team reviews the status of the
technical progress, the schedule, and costs to verify that the program
is meeting its commitments. If cost and schedule thresholds are at
risk, a Termination Review may be required to facilitate the Agency
deliberations on terminating, rescoping, or continuing the program.
For projects or smaller missions, the responsibility for approval
and oversight may be delegated to a Lead Center. The Lead Center will
also utilize an independent assessment to inform their deliberations
prior to approval of the project. Ongoing oversight will also be
delegated to the Lead Center's Governing Program Management Council.
national academy of sciences
Question. What role does the National Academy of Science play in
setting goals and objectives for NASA? For example, how closely do you
follow its recommendations on what space science programs to pursue?
Answer. NASA's science programs solicit National Research Council
(NRC) guidance on scientific goals for their flight and ground research
programs, generally on a decennial basis. During the past five years,
the Office of Space Science has requested and received research
strategy documents from the NRC's Space Studies Board on planetary
exploration, solar and space physics, and astrophysics. In addition,
every ten years the NRC prepares an integrated discipline-wide survey
of priorities for astronomical research supported across the federal
government. These products, based on research community consensus
processes external to NASA, provide valuable guidance to OSS management
in prioritizing missions and programs. NASA follows this research
guidance where possible, subject to constraints of cost, technology,
available infrastructure, risk, program balance, and national policy.
full cost accounting
Question. What is the status of NASA's efforts to implement full
cost accounting?
Answer. NASA continues to progress toward implementation of full
cost management, budget and accounting practices. NASA's full cost
initiative focuses on improved mission and administrative cost
efficiencies by integrating full cost information into all key agency
practices. During the past few years, NASA tested key full cost
concepts, trained key staff, simulated full cost management practices,
estimated and reported basic full cost information to external
oversight authorities, developed full cost budget estimates and
initiated full cost management activities at key Centers. NASA plans to
continue to integrate key full cost practices into agency operations
during the next few years. NASA plans to implement all full cost
practices in conjunction with the implementation of its new standard
integrated financial management (IFM) system in the next several years.
The overall objective of NASA's full cost initiative is to improve
the way NASA achieves its mission by implementing new, improved
management, budgeting, and accounting policies, practices, and
procedures. In its simplest terms, the concept of full cost ties all
Agency costs (including Civil Service personnel costs) to major
activities. All costs must be associated with an activity, commonly
referred to as a cost objective. Based on experience gained in earlier
stages of the full cost initiative, NASA plans to use ``projects'' as
cost objectives for managing, budgeting, and accounting. In contrast to
the current approach in which Civil Service personnel costs and certain
other costs of an institutional nature are not tied to projects, under
the full cost approach all costs will be associated with projects.
NASA has made significant progress in developing, testing and
initiating full cost practices into agency operations during the past
few years. NASA tested key full cost concepts at its Centers. NASA
trained key staff on full cost practices. NASA simulated full cost
management practices at the Center and agency levels. NASA successfully
applied analytical accounting techniques and reported basic full cost
information to external oversight authorities. NASA developed full cost
budget estimates and used key indicators for internal budget
deliberations. In addition, NASA initiated full cost management
activities at key Centers.
NASA's full cost initiative integrates a phased development and
introduction of full cost practices in conjunction with NASA's new,
standard integrated financial management (IFM) system. NASA plans to
continue to use cost finding techniques and to pursue related interim
full cost practice improvements. In addition, NASA plans to operate all
full cost practices in conjunction with the implementation of its
planned new IFM system implementation during the coming years.
Question. What are the five most critical issues that face NASA in
implementing full cost accounting and how has NASA addressed these
issues?
Answer. NASA faces a variety of significant issues in implementing
the full cost initiative. These issues include (1) restructuring NASA's
appropriations, (2) implementing required financial system
capabilities, (3) training on management in a full cost environment,
(4) applying new cost accounting principles in the NASA environment,
and (5) obtaining and integrating agency ``buy-in''. NASA continues to
pursue the effective resolution of these issues.
Appropriations Restructure
NASA requires certain restructuring of its appropriations and
related oversight to optimize the benefits of it full cost initiative.
The integration and synergy of changes in each area (management,
budgeting, and accounting) are critical to the strength and benefits of
NASA's full cost practices.
Full-cost accounting by itself, over time, would likely lead to
gradual budget and management improvements. However, concurrent changes
to full cost practices in the accounting, budgeting, and management
areas can be expected to ensure that NASA optimizes improvements in
each area, as soon as possible. To this end, NASA has pursued key
budget changes as part of the full cost initiative. Furthermore,
certain legislative provisions are being pursued to ensure that NASA
achieves all of the key benefits of its full-cost practices, while NASA
retains its long-standing ability to appropriately and efficiently
assign/reassign its staff to achieve mission requirements.
As part of its fiscal year 2000 budget request NASA proposed that
following language which was adopted by the House of Representatives
and is under consideration by the Senate:
NASA shall develop a revised appropriation account structure
for submission in fiscal year 2001 budget request consisting of
the ``Human Space Flight'' account; the ``Science, Aeronautics,
and Technology'' account; and the ``Office of Inspector
General'' account. The accounts shall each include the planned
full costs (direct and indirect costs) of NASA's related
activities and allow NASA to shift civil service salaries,
benefits and support among accounts, as required, for the safe,
timely, and successful accomplishment of NASA missions.
The eventual enactment of such appropriation language is critical
to optimal full cost benefits.
Supporting Financial System Capabilities
The effective and efficient implementation of the full cost
initiative in NASA requires key management system capabilities. NASA's
current financial systems are out-dated, are not standardized, and lack
cost accounting capabilities. Without such capabilities, detailed cost
accounting support becomes extremely labor intensive. Such labor is
not, and is not expected to be available.
While certain after-the-fact cost finding techniques can be used to
establish a minimal level of cost accounting capability for analytical
purposes, such techniques cannot support NASA full-cost accounting,
budgeting, and management in an operational setting. As a consequence,
NASA has determined that the timely and efficient implementation of
full-cost management in NASA requires new standard system capabilities.
As noted above, NASA is currently implementing a new standard IFM
system that is expected to support completely full cost management,
budgeting, and accounting through the timely production of consistent
cost information. Because Agency-wide implementation of the IFM system
is a lengthy process, NASA is also developing a strategy to pursue
certain full cost practices, to the extent practical, without the new
system with the expectation that the system will follow shortly
thereafter, thereby supporting optimal long-term practices.
Training
Training in full cost management, budgeting, and accounting across
NASA is required to achieve the key mission and administrative benefits
envisioned under the full cost initiative. Technical training in
budgeting and accounting is to be provided to financial/resource
personnel. Further, training in managing on a full cost basis is
needed, particularly for program and project managers.
To meet these needs, NASA has:
--Developed and maintained a written full cost initiative
implementation guide that is available to all NASA staff;
--Held full cost briefings for all Headquarters and Center staff;
--Conducted exercises involving (1) re-casts of budgets into a full-
cost basis and (2) development of estimates of the costs of
program and projects on a full-cost basis, using cost finding
techniques;
--Conducted an Agency-wide full cost management simulation exercise,
focusing on the organizational structures and processes used to
implement full cost practices.
Further, NASA will continue to include full cost practices as a
part of all program and project management training and include full
cost budgeting and accounting as part of the training segment of the
IFM system implementation.
Applying Cost Accounting Principles within the NASA Environment
The basic concept of full costing is typically associated with the
private sector and the economic imperative that mandates that all costs
must be recovered to ensure economic survival. As such, the traditional
accounting discussion of ``absorption'' or ``full costing'' typically
focused on manufacturing operations and related product costing. In
that regard, the approach involved accounting for the direct material
and direct labor costs related to manufacturing a product and involved
assigning a share of other indirect costs, such as maintenance, data
processing, security, and general office costs, to the product. In this
context, the cost objective was the product.
While the private sector has a long history of activity in the cost
accounting area, the Federal government's involvement only recently has
evolved and been refined. In response to significant financial
management legislation in recent years, a wide variety of concepts,
techniques, and approaches have evolved. The challenge NASA faced was
to adapt this emerging body of new Federal cost accounting knowledge to
the NASA environment.
The NASA full-concept integrates several fundamental accounting,
budgeting, and management improvements. The planned improvements
include accounting for all NASA costs as direct costs, service costs,
or general and administrative (G&A) costs, budgeting for all
appropriate program/project (``project'') costs, and managing such
``project'' costs from a full cost perspective. The term ``project'' is
used to represent NASA's final cost objective.
Briefly stated, (1) direct costs are costs that can be obviously
and/or physically linked to a particular project, (2) service costs are
costs that cannot always be initially, readily and/or immediately
linked to a project, but subsequently can be traced to a project
(optimally based on service consumption) and (3) G&A costs are support
costs that cannot be linked to a specific project in an economical
manner. Such costs are typically allocated to cost objectives (or
projects) on a reasonable, consistent manner.
All costs will continue to be controlled and managed within NASA.
Under full-cost management, however, project managers (with the most
direct mission responsibility and most intimate project knowledge) are
expected to continue to control direct costs but are also expected to
have greater influence over service costs and appropriate awareness of
G&A costs. Project management control/influence is not unconstrained.
At the same time, NASA Enterprise and Center management are expected to
continue to guide expenditures related to Center capabilities
consistent with strategic imperatives.
The introduction and integration of the basic private sector
``absorption'' practices has been a particular challenge in a
government research and development (R&D) environment. NASA is
addressing this challenge by adopting the private sector practices and
continuing to train, test, modify and integrate applicable full cost
practices into agency activities.
An additional challenge concerns comparisons of project cost
estimates and actual costs at different time intervals. If a project
were budgeted and funded using the customary NASA basis and
subsequently were accounted for on a full cost basis, there would be a
need to restate the original budgeted amounts into a full cost baseline
in order to facilitate accurate comparisons. The conversion process
will require careful estimates and approximations in order to support
budget to actual cost comparisons.
Need for Broad-Scale Participation
In the development of the full cost initiative, an important issue
was striking an appropriate balance between (1) broad-scale
participation of NASA management in concept formulation, testing, and
implementation and (2) efficient mechanisms for concept development,
prototyping, testing, and implementation. Participation is vital to
achieving ``buy-in'' at all levels; efficiency is needed to achieve
timely accomplishments.
The approach developed involved an organizational structure geared
to the specific tasks at hand. When tasks were completed, the
organizational structure was disbanded. To illustrate, the following
organizational structure was used to support the Agency-wide testing of
the full cost initiative:
--Steering Group, composed of Senior Executives from representative
Headquarters organizations and Centers;
--Policy Group, consisting of representatives of all Headquarters
organizations and Centers (the Steering Group and Policy Group
were basically the same groups that provided oversight during
the concept and prototyping phases);
--Implementation Oversight Group, composed of all Center Chief
Financial Officers (CFO's) and representatives from the agency
Enterprises;
--Issue Teams, ad hoc groups established to develop solutions to
identified issues.
Upon completion of Agency-wide testing, the groups were disbanded.
In the current implementation stage, NASA managers are expected to
implement the full cost initiative within their areas of
responsibility. In addition, key operational matters are being
addressed through related Integrated Financial Management (IFM) system
working groups and committees. Ongoing oversight is provided through
existing agency communication mechanisms, including the agency CFO
Council.
space station
iss overruns
Question. The estimated cost of the International Space Station
(ISS) has grown from $17.4 billion too more than $23.4 billion. Why has
the ISS program encountered such a large overrun--$6 billion to $8,3
billion depending on that of your current estimates are correct?
Answer. The growth in the ISS cost projections through the
completion of assembly have increased for several reasons:
--Lengthened assembly launch schedule,
--Addition of new scope,
--Contractor overruns,
--Make-work changes, and
--Maintaining sufficient reserves.
Although the first element launch (FEL) was delayed only 8 months
since the fiscal year 1994 budget (Mar-98 to Nov-98), the assembly
sequence has stretched out 29 months. Assembly complete has shifted
from Jun-02 to Nov-04 with the recently rebaselined assembly sequence
(Rev-E). Although the lengthened assembly launch schedule has generally
not caused increases in annual funding, it has resulted in planned
operations and research funding for the lengthened time frame.
Much of the additional scope has been added to implement
contingency plans related to potential Russian shortfalls. Both the ICM
and a U.S. propulsion capability have been initiated as part of NASA's
contingency plan. A U.S. developed crew return vehicle (CRV) was added
when analysis indicated that the Russian Soyuz would not meet the
emergency return requirements for the 7-person crew planned for the
duration of the station's operations period. The addition of the U.S.
CRV is estimated to increase funding about $1 billion through fiscal
year 2004.
Overruns by the prime contractor have also contributed to overall
cost growth. Boeing's current overrun estimate at completion is $986
million.
Make-work changes, including impacts driven by accommodation of the
Russian segment, have also contributed to the projected growth. To the
extent that all these changes depleted reserves to a low level, NASA
has increased funding estimates to ensure sufficient reserves.
Question. In what specific areas did NASA underestimate the cost
and why did the underestimates occur?
Answer. The stretch-out of the assembly sequence has not
contributed to increases in annual funding, but the impact runout cost
is estimated to result in about $3 billion of the projected cost growth
included in the fiscal year 2000 budget estimates. The schedule delays
affect operations and research activities already planned and estimated
at a level of approximately $115 million per month. Extension of the
assembly sequence into this operations and research period is
calculated by multiplying the months of schedule slip by the average
monthly costs. This results in a total cost for the delay of assembly
complete of $3.3 billion for the full 29 months.
NASA is committed to minimizing the impact of the schedule problems
and limiting program cost growth, while maintaining the integrity and
robustness of the vehicle for the research opportunities it will
provide for many years to come. U.S. hardware is being held to earlier
delivery dates to avoid excessive contractor costs, while providing for
increased integration, verification and testing activities to enhance
performance on orbit. All hardware and schedules, both U.S. and
partners', are closely monitored so that the agency can continue to
plan and manage the program in an efficient and effective manner.
The contingency planning activities have increased the ISS annual
funding levels. The implementation of contingency plans, while
increasing annual funding levels, provides critical backup, and
possible replacement capabilities, to Russian provided hardware. NASA
has been proactive in contingency planning activities aimed at
mitigating the potential loss of Russian-provided capabilities,
including the initiation of development of U.S. propulsion capability.
The acquisition of the Interim Control Module, development of a
propulsion module, orbiter fuel interconnect modifications, and
additional logistics carriers, and procurement of Russian goods and
services, enhance U.S. segment autonomy and help maintain the assembly
schedule. Funded within the Space Station account as part of the
Russian Program Assurance (RPA) effort, these activities have increased
the Space Station annual funding requirements by about $1.2 billion
between fiscal year 1997-2004.
The current estimate of overrun for the prime contract is $986
million. Over 82 percent of the Prime development contract has already
been completed and this is clearly exhibited by the quantity of flight
hardware already delivered. This level of completion is resulting in a
continued drop off in the development effort work force. Prime
Contractor staffing levels are decreasing, with over 2000 employees
having transitioned off the Program from peak development levels in
fiscal year 1997. Still, the Program continues to be very concerned
with Prime contractor cost management and we have budgeted reserves
accordingly, having also initiated an internal review of cost
management issues and concerns. We expect to implement improved
procedures and processes in the very near term in a number of critical
areas to manage the program's resources.
Question. What lessons have we learned that can be applied to the
next large space project or for any large Governmental initiative like
this?
Answer. When undertaking an unprecedented, multi-year, global
project like the ISS, some lessons learned have emerged that may be of
use to future programs:
--Not all risks are knowable. When pushing the technical boundaries
in so many areas, difficulties and challenges will arise which
cannot be foreseen. Nonetheless, in planning a project, they
should be anticipated as best as possible.
--Preserve resources for unforeseen problems. When problems are
known, they should be prudently addressed as quickly and
economically as possible. When unknown problems emerge, as they
are bound to, they will require resources.
--The global political and economic environment may change. The world
is dynamic, and while not possible to predict what may change,
such changes must be accommodated. To lead globally and gain
from what other nations have to contribute requires
flexibility.
--Integrated system analysis and testing capabilities are critical.
--Communications among domestic and international partners is
critical.
total iss costs
Question. NASA has indicated that the International Space Station
program will grow from a total of $17.9 billion to some $23.4 billion
at completion and likely significantly more. GAO has estimated a life-
cycle cost for ISS through fiscal year 2012 of 95.6 billion. What is
NASA's estimate for total costs, including operational costs, for the
life cycle of the ISS? How does NASA plan to budget these costs?
Answer. NASA's fiscal year 2000 budget estimate through completion
of assembly is $23.4 billion, with a potential range to $25.3 billion.
NASA's estimate for a 10-year operational period is $13 billion. In
addition, about $10.2 billion was funded prior to fiscal year 1994 for
the Freedom program.
GAO's estimate was based on the fiscal year 1999 budget. It
included about $64 billion that the GAO estimated as ``station-
related'' including Shuttle-Mir flights, Shuttle assembly, research and
operations flights, civil service support, research principle
investigators. These activities are funded in other NASA program and
project budgets.
NASA will continue to fund these activities in the appropriate
program and project budgets. When a full cost approach is implemented
for the NASA budget, some costs, like civil service, will be allocated
to the ISS and other program budgets. Other costs, such as
communication support, and agency and center general and administrative
activities, will also be allocated to specific NASA programs.
russian funding problems
Question. The current Space Station is the result of the redesign
of the Space Station Freedom begun in fiscal year 1993. The inclusion
of international partners (such as Russia, Japan, Canada, and the
European Space Agency) was touted as a way to save time and money over
the earlier Freedom program. In particular, Russian participation was
to save $2 billion and 18 months. Nevertheless, Russian funding
problems are continuing in a crisis state and we understand that
Russian funding problems are likely to impact the current schedule of
assembly launches and hardware. In response to previous concerns with
Russia's ability to provide the Service Module, NASA developed a
contingency plan, which included the development of an interim control
module.
What is the current status of Russian funding for its sections of
the Space Station?
Answer. The 1999 Russian Federation budget provides approximately
2.5 billion rubles ($114 million USD at current exchange rates) to RSA.
Of that total, 1.1 billion rubles (approximately $50 million USD) will
be allocated to the ISS program and 600 million rubles (approximately
$27 million USD) to Mir operations through August 1999. RSA may receive
additional revenue from off-budget sources, such as the sale planned by
the Russian Government of frequency spectrum and additional excise
taxes. NASA believes that the projected 1999 budget for RSA represents
a significant shortfall in the funding required to fulfill RSA's
obligations to the ISS program.
RSA believes they can achieve a late-1999 launch of the Service
Module, provided that the fiscal year 1999 budget is disbursed in a
timely fashion. However, the 1999 budget has yet to be disbursed in
full, placing continued budgetary strains on RSA. RSA has received
approximately 524 million rubles (approximately $24 million USD) for
ISS through May 1999.
Question. Considering the difficulty Russia has had funding the
Service Module, do you believe Russia will make timely delivery of
other Space Station hardware and Services? If so, why? If not, what are
your contingency plans? What are the cost implications of those plans?
Answer. The Russian ISS program continues to struggle due to
shortfalls in Russian Government funding for the Russian Space Agency
(RSA). NASA is concerned that continued shortfalls in funding may
threaten progress on Russian ISS elements beyond the Service Module, to
include operation of the Service Module on-orbit and support of needed
launch infrastructure. Continued shortfalls could result in delays in
the program unless full Russian Government funding, or off-budget funds
are received. Of particular concern is the development of follow-on
Soyuz and Progress vehicles and the Science Power Platform.
In attempting to minimize U.S. cost growth, the ISS Program has
taken the approach of incrementally buying down the level of Russian
risk. NASA has laid out a comprehensive contingency plan that allows us
to move the ISS Program forward, maintain the Russian partnership based
upon their economic ability, and achieve greater U.S. backup capability
over the next several years. The objectives of this plan are to contain
U.S. cost growth, protect the ISS schedule, and maintain program
stability, while providing backup capability in the event of further
Russian shortfalls.
A key component of the ISS contingency plan is the buildup of U.S.
capabilities to increase ISS robustness and provide contingency against
possible Russian shortfalls. NASA has developed an Interim Control
Module (ICM) to protect against a Service Module failure to achieve
orbit, with a secondary focus to protect against Progress propellant
resupply shortfalls. The ICM schedule supports a launch on need as
early as 2000 and provides 1 to 3 years of ISS propulsive capability
depending on its usage. Through innovative Shuttle flight planning,
NASA has developed an approach under which NASA can already offset a 30
percent shortfall in Progress vehicle propellant logistics, and the
Agency is taking additional steps, such as the modification of the
Orbiter fleet to enhance Shuttle reboost capability. Development of a
permanent U.S. Propulsion Module is scheduled to be available in 2002-
2003, providing full U.S. propulsive redundancy.
Additionally, the ISS contingency plan seeks schedule stability by
working with the Russian Space Agency (RSA) to meet near-term
objectives and to ensure reliable resupply and crew rescue capability
to ISS. The broad operational capabilities that Russia has committed to
provide for the ISS naturally places requirements upon the other ISS
partners for systems integration. As a result, there are many Russian
goods and services that are of great value to the U.S. for risk
mitigation, operational effectiveness, capability enhancement and
safety. These goods and services are outside of the initial ISS
Partnership agreements because they have only been recently identified
as assembly plans have matured and as we have begun preparing for crew
operations and potential contingencies. The cost of procuring these
goods from Russia is small in comparison to the cost of developing the
same capability in the U.S. Each of the Russian goods that have been
identified are key to meeting ISS schedule requirements.
The total level of funding for Russian contingencies through
assembly complete (funded through the Russian Program Assurance budget
line) is $1.2 billion. This includes funding for last fall's $60
million procurement of Russian research time and stowage, and $100M
identified for Russian goods and services procurements in 1999. It is
possible that NASA may require some specific Russian goods or services
to address currently unforeseen needs in the future, although
additional funds are not budgeted in subsequent years.
nasa's purchase of russian research time
Question. NASA recently transferred $60 million in funding to
Russia in exchange for all the research time (4,000) allocated to
Russia during the assembly period. Nevertheless, I understand that a
Russian official indicated that NASA had purchased between 25 percent
and 75 percent of Russia's research time. What did we actually get for
our $60 million? Please identify what this research time will be used
for?
Answer. NASA purchased 4,000 Russian crew hours, which essentially
doubled the crewtime available for U.S. research during the assembly
period. The availability of crewtime is a significant limiting
constraint on the research program during the 3-person phase. This
additional crewtime will be especially valuable for initiating,
monitoring adjusting and servicing experiments and significantly
advancing research productivity. The hours will be used to enhance
early biotechnology, human physiology, gravitational biology and
commercial product development activities. As crewtime increases, the
productivity of the research program grows commensurately; because it
enables a greater number of experiments to proceed for longer periods
and at increased frequency, thus acquiring many more processed samples,
or empirical data points. NASA plans to begin early ISS research
activities with delivery of the Human Research Facility on flight 5A.1
(STS-102) and two EXPRESS Racks on flight 6A (STS-100). Ongoing
utilization activities will be initiated with the first five
utilization flights, all prior to the 6 person crew capability. NASA is
confident that this Russian crewtime will be very valuable and fully
utilized within the research program.
commercialization of the iss
Question.There is a lot of talk about ``commercializing'' the space
station, but little agreement about exactly what that means. What do
you, as the head of NASA, mean when you talk about commercial use of
the space station or about ``turning the keys over to the private
sector'' as you've said in the past? What is your time frame for the
latter?
Answer. In 1998, the Committee played a pivotal role in the
formulation and ultimate enactment of the Commercial Space Act (Public
Law 105-303) which called for several reports relative to the potential
for commercial opportunities with respect to the ISS. NASA responded
with its Commercial Development Plan for the ISS. We have a vision of
an expanding space program with private investment, international
collaboration, and vigorous economic development. Since the Plan was
released, NASA has begun to receive, for the first time, true
entrepreneurial offers involving private investment in the ISS. We
expect to announce the first agreements soon. These business ventures
will unequivocally demonstrate our commitment to the economic
development of space.
For almost 20 years, the same three barriers have impeded those
seeking to develop commercial space products and services: pricing,
process, and property protection. NASA pledged in the ISS Commercial
Development Plan, to break down those barriers through our ISS
pathfinder initiative, and it is beginning to work.
Pricing Policy
NASA's ISS pricing policy has been formulated using value-based
pricing, with a marginal cost floor. The policy includes provisions to
waive all, or part, of the marginal cost during the short run in order
to stimulate private investment; it invokes full marginal cost in the
long run in order to prevent Government subsidization of profitable
enterprises. In addition, the policy includes a demonstration revenue
reinvestment program that would permit NASA to ultimately recoup value
in excess of marginal cost and apply it directly to the ISS economic
development program. The Administration has agreed that this
legislative authority could be instrumental to ISS commercialization,
and NASA transmitted to the Congress on July 27, 1999, an
Administration-sponsored legislative proposal for a ``Space Station
Commercial Development Demonstration Program.'' Implementation of this
legislative initiative will dispel price uncertainty and create a new
investment engine not dependent on annual appropriations to fuel its
acceleration. Further, it will help free the Government from performing
tasks that the private industry, with some Government assistance, can
assume.
Process Reform
ISS entrepreneurial offers, involving significant private
investment, are now receiving the special treatment they deserve at
NASA. We have addressed the long-standing concerns that NASA have a
single-point-of-entry for entrepreneurs by establishing a new Division
for Space Utilization and Product Development at NASA Headquarters as
well as an executive position of Special Assistant for
Commercialization within the Office of the Administrator to ensure
priority attention. NASA will no longer waste valuable human resources
debating hypothetical business scenarios. If a commercial offer is
real, the NASA response will be real.
Intellectual Property Protection
U.S. law provides NASA with a variety of measures to protect its
own and other parties' intellectual property and proprietary data. In
accordance with these laws, NASA has established policies and
procedures to protect such property and data. Currently, NASA's General
Counsel is completing a guide to explain to private industry in a clear
and comprehensive manner how these laws and procedures, as well as ISS
international agreements, apply to commercial activities on the ISS.
NASA fully intends to uphold its commitment to protect the competitive
position of U.S. industry and the economic growth of the Nation.
These reforms are essential, and all are in the final stages of
completion. The enactment of Public Law 105-303 and NASA's announcement
of intent have already stimulated private investment proposals that are
under review. I am convinced that this momentum will build. In the
future, we believe that a non-Government organization could undertake
management of the ISS Utilization and Economic Development. NASA
outlined this option in our ISS Commercial Development Plan, and a Task
Group of the National Research Council is in the process of evaluating
our reference model for such an organization. While this work proceeds,
we have also initiated a trade study to identify the advantages and
disadvantages of various options such as Government corporations, joint
ventures, direct contracts, or cooperative agreements.
The 21st century holds the promise of an expanded presence both in
Earth orbit and beyond. Through our collective efforts, we will be able
to view horizons previously unseen by human eyes and invest in ventures
unparalleled by prior human experience.
cost for the crew vehicle
Question. I understand that your current estimate for the Crew
Return Vehicle, needed to bring crews home from space station in an
emergency, is just over $1 billion. Why is it so expensive?
Answer. Human safety continues to be of foremost importance in
NASA's manned space programs. To ensure human safety requires high
reliability of vehicles through painstaking design, parts screening,
validation and testing of extremely complex interactive systems. The
CRV is no exception. NASA chooses to set high goals and achieve them at
minimum cost, but will not compromise prudent levels of human safety.
Providing redundancy of critical functions is a key design approach
used to achieve high reliability and safety. Redundancy requires not
only multiple like components which perform identical functions, but
multiple, independent supporting resources. For example, a spacecraft
guidance function requires not only multiple guidance system components
such as gyroscopes and accelerometers, but also requires multiple,
independent sources of electrical power, computer processing, and
thermal cooling. This multiplicity of components capable of performing
identical functions multiplies cost significantly. Additionally,
complex and expensive computer code is required to ``manage'' the use
of redundant systems, which entails fault detection, isolation and
recovery.
A second major cost driver for manned space projects is NASA's
stringent requirements for testing and validation of human-rated
systems. Testing and validation helps to verify that systems will
function as intended in their real operational environment. This
requires the use of test hardware and software for destructive and non-
destructive testing, simulations of operational conditions and
scenarios, and detailed analyses of test results that sometimes lead to
expensive redesign.
Another area of expense not related to vehicle development and
testing is operations. Operations include ground controller and crew
training, logistics and maintenance, sustaining engineering, safety and
mission assurance, and actual real-time mission operations support by
ground controllers. Operations usually require extensive support
personnel, hardware sparing and repair, and software maintenance for
most of the operational life of a system or vehicle.
Most of NASA's missions are anything but routine. Systems and
vehicles typically have unique design and operational requirements.
This leads to the need to develop new technologies and methods never
before attempted. The CRV must remain attached to ISS in a dormant mode
for up to three years, be ready to separate and fly home within three
minutes of recognition of need, and fly without pilot assistance to a
landing site of less than five miles radius in nine hours. NASA's on-
going X-38 ``rapid prototype'' project is providing the design and
technology basis for the CRV.
The CRV will provide a shirtsleeve flight environment for a crew of
seven--this is based on the crew size supportable aboard ISS. If a
catastrophic event occurs aboard Station, or if the Space Shuttle is
grounded for some reason, the CRV must have the capacity to evacuate
the entire crew. The funding estimate in the fiscal year 2000 budget
and runout is about $880 million through fiscal year 2004 for design,
development, test, and evaluation of four production vehicles and
operations estimates of about $161 million. Numerous independent
assessment groups within and outside of NASA have reviewed the CRV
project in its entirety. These groups are comprised of experienced
specialists from all facets of spacecraft development and operations.
They have concluded, without exception, that the CRV budget and
schedule are ambitious but achievable.
NASA believes developing a manned spacecraft with the capabilities
of the CRV at a cost of just over one billion dollars will set a low
cost precedent upon which future human-rated projects will be judged.
The ambitious cost target is being made possible by a non-traditional
paradigm in which NASA performs a large part of the initial concept
development and testing internally. Three atmospheric test vehicles and
one space flight test vehicle are being designed and built for a cost
of around $90 million on the X-38 project. The CRV will benefit from
knowledge gained through the X-38 vehicles and the results of multiple
atmospheric flight tests and one (or two) space flight reentry tests.
After an extensive five month assessment by a panel of 25
specialists from industry and government, NASA's Langley Research
Center Independent Program Assessment Office concluded that the
paradigm employed by the X-38/CRV Project could save over one billion
dollars compared to traditional methods. NASA would have serious
reservations about any proposals claiming to provide the ISS emergency
crew return function at a cost lower than the current CRV budget.
crv
Question. It has been suggested that you are delaying designing the
CRV until the potential to design it as a Crew Transport Vehicle--able
to take people into space as well as return them--has been fully
evaluated. What decisions have you made about building a one-way CRV
that later could be modified as a two way CTV? What are the cost and
schedule trade-offs between building a two-way version from the
beginning versus building a one-way version now and modifying it later?
Answer. Development of requirements and architectural studies on
the CTV are on-going. These studies will assess the most effective
approach to development, and assess cost and schedule tradeoffs
relative to a potential evolution from a CRV design. NASA has not made
any decisions yet regarding the CTV.
crv schedule
Question. You say that you're not certain you can get the Crew
Return Vehicle ready by the end of 2003 as currently planned and
therefore want to buy two Russian Soyuz vehicles in the case it is not
ready. Why is that necessary? Why not simply maintain a three-man crew
size until the CRV is ready? Is the CRV delay likely to be more than a
few months? What is the urgency of increasing the space station crew
size to six or seven?
Answer. NASA has identified funding for the procurement of one
Soyuz, that, along with the Soyuz provided by the Russians, would
provide two Soyuz on-orbit and allow emergency return of six
crewmembers for a period of about six months.
The ability of ISS to perform effective research and
experimentation is dependent on the crew size. The desire to maximize
the research benefits of ISS leads NASA and its partners take full
advantage of on-orbit time. NASA therefore plans to purchase at least
one Soyuz craft that, along with the Soyuz provided by the Russians
will allow emergency return of six crewmembers. If the ISS assembly
sequence is delayed such that the CRV becomes available before ISS can
accommodate six crew (that is, ahead of schedule relative to ISS need),
the U.S. purchased Soyuz will be valuable as a contingency for other
uses.
space station schedule
Question. According to NASA, what is your current expected schedule
for completion of the Space Station? How much slippage in schedule and
cost do you expect?
Answer. NASA has conducted an assessment of the likely cost and
schedule range for ISS, both for development complete (support for 6
crew) and assembly complete (support for 7 crew). The results of this
assessment are summarized below. Minimum values are based on the Rev D
assembly sequence that was the basis for the fiscal year 2000 submit.
Maximum values are based on analytic estimates of delays up to 12
months to development complete, or 15 months to assembly complete.
These potential slip scenarios do not envision significant increases to
planned annual funding levels.
[Dollars in billions]
----------------------------------------------------------------------------------------------------------------
Minimum Maximum
schedule Cost schedule Cost
----------------------------------------------------------------------------------------------------------------
Development Complete (6 crew)................................... \1\ 09/03 $22.1 09/04 $23.7
Assembly Complete (7 crew)...................................... \1\ 07/04 23.4 10/05 25.3
----------------------------------------------------------------------------------------------------------------
\1\ Assembly Sequence, Revision E reflects: Development complete at 05/04 and Assembly complete at 11/04 10.
duplication of russian activities
Question. NASA appears to view all activities performed by Russia
for the ISS to be in the critical path and necessary for duplication.
Provide a list of all activities that NASA intends to pursue that
Russia is expected to complete, provide the cost estimates for each
activity and the time frame for completion of each activity.
Answer. In December 1993, Russia was invited to join the ISS
partnership, bringing a unique and unmatched experience in human space
flight into the Program. Russian participation in the ISS Program
allowed acceleration of the assembly timetable through their provision
of propulsion, navigation and crew habitation capabilities. For
instance: prior to Russia's entry into the program the assembly plan
for achieving permanent crew habitation was September 2003, rather than
March 2000 as it is currently scheduled. Russia stands second only to
the U.S. in its contribution to the final assembly of the ISS,
providing significant on-orbit capabilities. For this reason, despite a
number of NASA actions to reduce reliance on Russia, ISS program cost
and schedule stability is highly dependent on Russia's ability to
deliver on their commitments. Several Russian elements, however, have
independent uses that do not impact overall ISS operations.
A summary of significant Russian dependencies and the U.S.
contingency strategy follows:
Propulsion
Russian partnership responsibilities have included propulsive
guidance, navigation, and control since the inception of the
International Space Station in 1994.
Initial Risk.--Loss of ISS attitude control or reboost capability
resulting from a failure of the Service Module to reach orbit or from a
shortfall in planned Progress resupply flights.
NASA Contingency Actions.--NASA has developed an Interim Control
Module (ICM) to protect against a Service Module failure to achieve
orbit, with a secondary focus to protect against Progress propellant
resupply shortfalls. The ICM schedule supports a launch on need as
early as 2000 and provides 1 to 3 years of ISS propulsive capability
depending on its usage. NASA has developed an approach under which NASA
can already offset a 30 percent shortfall in Progress vehicle
propellant logistics, and the Agency is taking additional steps, such
as the modification of the Orbiter fleet to enhance Shuttle reboost
capability. The Orbiter fleet will be modified during scheduled Orbiter
Maintenance Down periods, with fleet implementation completed by fiscal
year 2003. Development of a permanent U.S. Propulsion Module is
scheduled to conclude in 2002-2003, providing full U.S. propulsive
redundancy.
Remaining Russian Reliance.--NASA ICM requires Russian Pressurized
Dome and integration support to deploy should the Service Module fail
to reach orbit. NASA Propulsion Module requires Russian built docking
system and integration support.
Cost.--Approximately $0.9B from Russian Program Assurance.
Command and Control
The NASA Flight Director, located at Mission Control Center-Houston
(MCC-H), will always maintain the leadership role for commanding.
However, ISS protocol is for Russian and U.S. control centers to
determine and issue commands to their respective on-orbit segments.
This methodology is not expected to change significantly over the life
of ISS. The ISS command and control system is designed to allow both
Russian and U.S. mission control centers to transmit data and commands
to the ISS and between their respective on-orbit segments. Each
partner's segment can also send commands and receive data from its
computer system via the partner's control center and communication
system.
Risk.--Until the arrival of the U.S. Lab, the Mission Control
Center in Moscow (MCC-M) has the only capability for commanding the
primary ISS systems. Although MCC-H gains the capability for commanding
with the arrival of the U.S. Lab, GN&C and other critical Russian
vehicle system expertise remains with MCC-M. Loss of our Russian
partner for any reason, at any time places the remaining partners in a
tenuous position. Unless Russian equipment, Russian FGB and Service
Module technical knowledge, and Russian vehicle operational skills can
be obtained, whatever Russian element exists at the time of a Russian
departure may be assumed lost.
NASA Contingency Actions.--It was determined in 1996, with the
concurrence of congressional leadership that the costs for a Russian
command capability for FGB in Houston were outside of the ISS budget.
NASA is considering purchase of Service Module Control Data and other
operational items for risk mitigation and operational effectiveness.
The purchase of Service Module ground procedure and control data will
assist NASA's mission control to be able to back-up Russian operations
and perform operations in the event of loss of Russian mission control.
This would also help to increase joint ability to work together if off-
nominal flight conditions arise. The Program is reconsidering
implementation of a Russian command capability in Houston.
Remaining Russian Reliance.--The early U.S. communications systems
implementation, which was not implemented as a Russian contingency,
provides a very limited command, control and monitoring capability.
Cost.--$TBD If purchased, Service Module data would be purchased
within the confines of NASA's projected fiscal year 1999 $100M purchase
of Russian goods and services.
Crew Habitation
The Russian-provided Service Module provides environmental control
and life support systems (ECLSS) and living quarters for three crew
throughout the life of the ISS. There is also a requirement for a
Russian Crew Return Vehicle for the life of the program, unless the
U.S. determines to place two U.S. CRVs on-orbit.
Initial Risk.--The Service Module (SM) delivery schedule has
slipped repeatedly due to Russian funding shortfalls. After launched,
should Russia not support operations of the SM, the U.S. would be
unable to maintain the SM without extensive technical insight and
development of operational capabilities. Sustaining engineering and
system spares development cannot be performed without extensive
engineering knowledge of the vehicle. Soyuz crew vehicles are essential
elements of the ISS prior to the arrival of the U.S. CRV. Without
continued Soyuz availability, safety concerns would dictate that the
ISS crew would need to be evacuated and permanent human presence
postponed. Significant disruption in the assembly sequence would occur
due to the unavailability of ISS-based EVA crews, causing postponement
of assembly flights in lieu of logistics and reboost flights.
NASA Contingency Actions.--NASA's $60M procurement of Russian Crew
research hours and stowage provided funding stability for Service
Module in fall 1998. NASA has planned for a $100M (U.S. dollars)
purchase of Russian goods and services for this fall subject to
operating plan approval, which will maintain RSA funding stability. As
a part of this purchase, NASA desires to purchase a Soyuz vehicle for
U.S. CRV risk mitigation to effectively increase crew size and maintain
the ability to perform effective research and experimentation. If the
U. S. CRV becomes available before ISS can accommodate six crew (that
is, ahead of schedule relative to ISS need), the U.S. purchased Soyuz
will be valuable as a contingency for other uses.
Remaining Russian Reliance.--While it appears that RSA is receiving
adequate funding to cover delivery of the SM, NASA remains concerned
that funding may not be sufficient for Russian upgrades to their
mission control center, ground stations, and associated communications
systems. NASA is also concerned with the adequacy of Russian funding
for Service Module, long-term Soyuz support, and spares.
Costs.--Approximately $0.2 billion from Russian Program Assurance.
Logistical Dependencies
Partnership agreements call for the Russians to provide dry cargo
and Russian segment propellant via the Progress cargo ship. One of the
basic tenets of our agreements with the Russian Federation is the
availability of a backup launch capability. Having choices of different
launch vehicles available greatly diminishes the risks when dealing
with unforeseen events.
Initial Risk.--Loss of this important Progress resupply function
would amount to approximately two shuttle flights per year in addition
to or in lieu of assembly flights. The only vehicles capable of
providing fuel to the SM and FGB are the Russian Progress cargo ship
and the European Space Agency (ESA) Automated Transfer Vehicle (ATV). A
provision of the U.S. contingency plan allows for the ICM to be used as
a backup for Progress flight deficiencies.
NASA Contingency Actions.--NASA actions to reduce propulsion
dependencies have direct positive impact. In addition to the activities
noted above, NASA has budgeted funds for logistics support to offset a
reduction in the number of Progress vehicles. NASA's planned $100
million procurement of goods and services would provide funding
stability to maintain long-term production of Progress vehicles.
Remaining Russian Reliance.--Additional Shuttle flights will likely
be required if RSA can not meet their commitments.
Cost.--Approximately $0.1 billion from Russian Program Assurance.
space shuttle
space shuttle safety
Question. Regarding the space shuttle, the Aerospace Safety
Advisory Panel (ASAP) issued a report last month that raised serious
questions about future shuttle safety. Three of them are particularly
troubling:
1. Budget and personnel constraints on the hiring of engineers,
scientists, and technical workers are moving NASA toward a crisis of
losing the core competencies needed to conduct the Nation's space
flight and aerospace programs in a safe and effective manner.
2. Shortfalls in workforce training within both NASA and USA
[United Space Alliance], caused by downsizing and the related
difficulty of hiring new people to fill skill shortages, can jeopardize
otherwise safe operations.
The combined effect of workforce downsizing, the recent hiring
freeze, and the SFOC [Space Flight Operations Contract] transition,
especially at KSC [Kennedy Space Center], has raised the possibility
that NASA senior managers in the future will lack the necessary hands-
on technical knowledge and in-line experience to provide effective
insight of operations.
These findings sound quite alarming. Should Congress be alarmed?
What is your response to these findings?''
Answer. NASA has and will continue to take the appropriate actions
to minimize the combined effects of budget reductions and downsizing.
We will address each of the mentioned ASAP findings below.
With respect to item number one (Finding # 1 in the ASAP report),
NASA has provided our human space flight Field Centers with the
budgetary resources and administrative flexibility needed to strengthen
their human resource capabilities. To accomplish this we have allowed
the OSF Centers to hire additional FTEs through the fiscal year 2000
budget process as follows: fiscal year 1999--153 FTE; fiscal year
2000--110 FTE; fiscal year 2001--103 FTE; fiscal year 2002--59; and
fiscal year 2003--68 FTE. This relief has enabled the innovative use of
temporary and extended term appointments, as well as increasing the
number of permanent hires available to fill critical skill positions.
With respect to item number two (Finding # 2 in the ASAP report),
NASA continues to work with USA to review critical skills training and
certification requirements and institute programs to ensure the full
proficiency of the workforce and the safety of the products being
released. The review for flight controllers, training instructors, and
other key operating positions has already been completed. Training
plans and certification requirements for critical positions have been
documented. Training capacity for new employees, both NASA and
contractor, was increased through intensive simulator training at a new
USA ``training academy.'' In training and orientation programs, NASA
emphasizes and will continue to emphasize the priority of safety and
the responsibility of employees to voice their concerns about
inadequate assurances of safe products.
With respect to item number three (Finding # 3 in the ASAP report),
NASA is intensifying and refocusing its efforts in training and in
support of career development at all levels to ensure that future
managers will possess the range of skills and experience required for
effective insight of the SFOC.
At the operating level, NASA managers are instructed to take
advantage of all opportunities to obtain operational experience
including co-op assignments; direct observation or procedure review of
critical tasks; management of Shuttle launch countdown, launch, and
landing/recovery; etc. Additionally, employees are provided cross
training and specialized training as needed and strongly encouraged to
take advantage of program related training.
Recognizing that the key to developing future generations of senior
managers is to provide hands-on experience, NASA is taking the action
to provide broad training and hands-on operational and technical job
assignments and opportunities for promising candidates for future
senior management positions. Career broadening opportunities with
Boeing, Newport News Shipbuilding, and USA have been implemented.
At the Agency planning level, the training budget has provided for
an increase of 20 percent for the Office of Space Flight from fiscal
year 1997 through fiscal year 2000. Current agency Program Operating
Plan guidelines call for funding training at 2-3.25 percent of salary
levels; levels that rival progressive private sector organizations.
These cumulative measures should ensure competent senior managers
for NASA in the years to come.
minimum number of shuttle flights
Question. In the past, you have said that you need a minimum of 4-6
shuttle flights per year to ensure it can be operated safely and
effectively. Is that still your estimate of the minimum number of
shuttle flights needed each year?''
Answer. Changes in flight rate have not and will not adversely
affect safety. NASA does not have a threshold number of annual flights
required to maintain safety. We will not fly unless it is safe to do
so.
Effective flight rate within any given year has varied dramatically
during the course of the program. Both NASA and United Space Alliance
(USA) have sound processes for vehicle turnaround and flight
certification in place to maintain a robust and safe system. Some
examples are:
--1. Existing Certification of Flight Readiness process is rigorous
and demanding
--2. Testing requirements are well documented and controlled
--3. Personnel qualification standards are high
--4. The Human Space Flight Centers and the SFOC are ISO 9000
compliant
--5. Full action simulations are used to maintain readiness at KSC
and JSC
Payload availability rather than vehicle processing flow or mission
preparation time have driven the recent (fiscal year 1998 and fiscal
year 1999) Space Shuttle flight rate.
Reductions in flight rate affect the program's efficient use of the
workforce, not safety. The Space Shuttle program maintains a highly
dedicated and motivated workforce of both civil servants and
contractors. Additionally, there are checks and balances in the program
structure and processes, as well as individual knowledge, which serve
to stop work, as appropriate, should unusual occurrences arise.
Outside reviews by the Aerospace Safety Advisory Panel and the NASA
Advisory Committee continue to emphasize NASA's commitment to--Safety
First.
shuttle upgrades
Question. What is the status of needed upgrades to the Shuttle?
Have you begun implementing the phase III upgrades? If not, when is
that anticipated? What is the total expected cost of the phase III
upgrades and what impact will that have on the expected safety and
longevity of the Shuttle system?''
Shuttle Upgrades--Phase IV.--Will you proceed with the Phase IV
upgrades only if you decide that a new reusable launch vehicle will not
be available in the next 5 years or so? When will that decision be
made? What would be included in the Phase IV upgrades if they did
proceed, and how much will they cost?''
Liquid Fly-Back Booster.--What decision have you made about
developing a Liquid Fly-Back Booster versus an upgraded version of the
solid rocket booster now in use?''
Answer. NASA is prudently proceeding with necessary safety and
mission supportability (phase II) upgrades. Approval of candidate
upgrades is an on-going continuous improvement process. Specific
measurable objectives are established, followed by an evaluation of
potential candidate upgrades. The selection, approval and
implementation process involves screening against goals and objectives
as well as value/impact analysis. An upgrades control board reviews
each candidate before incorporation into the annual upgrade plan.
Decisions on future Shuttle upgrades will be made as part of
Administration decisions this fall on NASA's long-term integrated space
transportation strategy.
The 1994 National Space Transportation Policy (NSTC-4) calls for
``government and private sector decisions by the end of this decade on
development of an operational, next-generation reusable launch
system.'' To support these decisions, NASA is undertaking industry-led
Space Transportation Architecture Studies to identify private sector
options for reducing NASA's launch costs. These studies incorporate
separate efforts being undertaken by NASA, DOD and industry including:
Space Shuttle safety upgrades; X-33 and other NASA technology
demonstrators (X-34, X-37, and X-38), the Evolved Expendable Launch
Vehicle (EELV); existing and future commercial launch vehicles; and the
Crew Return Vehicle for the International Space Station. As part of the
fiscal year 2001 budget process, the Administration intends to use the
results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning NASA to lower-cost, private-
sector, space transportation. Decisions on future Shuttle upgrades will
be made in the context of this overall strategy. Details will be
provided in the fiscal year 2001 budget submit.
space transportation architecture study
Question. What are the results of your Space Transportation
Architecture study?
Answer. The Space Transportation Architecture Study was conducted
to how best to meet NASA's mission requirement through 2020 with
increased safety and reliability and reduced cost. Industry
participants identified a number of second generation Reusable Launch
Vehicles (RLV) including both an upgraded Shuttle and new RLV's that
could replace the existing Space Shuttle in the 2008-2010 time period.
The results of the study were integrated into a space transportation
architecture with roadmaps that identified a series of decisions
required to select a follow-on system to the current Space Shuttle. The
architecture consists of: a first generation RLV (Space Shuttle with
necessary safety and obsolescence upgrades), a second generation RLV (a
significantly upgraded Space Shuttle or new RLV with significantly
improved safety, reliability, and reduced costs), and a third
generation RLV (operational system beyond 2020 that will further
improve system safety and lower cost).
In the near term, NASA will establish the requirements and
selection criteria for a decision to proceed with the second generation
RLV in 2004-2005. Over the next 5 years NASA will invest in space
transportation technologies to reduce the risk for second generation
RLV's and initiate longer term technology programs for third generation
systems with significantly improved safety and reliability that
approach the levels of commercial aircraft operations.
contract consolidation--space shuttle
Question. In response to recommendations to consolidate activities,
NASA, on September 26, 1996, signed a $7 billion, 6-year contract with
the United Space Alliance to manage the Space Shuttle operations. The
contract consolidates 12 major existing contracts into one. It also
includes two, 2-year extension options that could bring the potential
value of the contract to $12 billion over 12 years. Can you assess the
success of the United Space Alliance contract in managing the Space
Shuttle operations, including the impact on safety? What are the
savings realized from consolidating the space shuttle contracts?''
Answer. United Space Alliance performance in managing their portion
of Space Shuttle operations has been very good. Their overall
performance as reflected in NASA award fee evaluations is very good.
Their scores on safety performance have also been very good. There have
been several initiatives on the part of United Space Alliance which
have resulted in more efficient operations. Relative to fiscal year
1996 performance, United Space Alliance has reduced the cost of their
operations by $125 million per year (about 13 percent). At the same
time civil service workforce reductions have occurred in those same
areas resulting in $40 million per year reductions. Some examples
include consolidation of logistics operations in Florida. Flight
hardware and ground processing hardware logistics are now provided by a
single organization. This has led to cost savings as a result of more
efficient operations. Another example is the Solid Rocket Booster
contract, which was added to the Space Flight Operations Contract
(SFOC) last year. United Space Alliance has decided to perform the
Solid Rocket Booster work within their company. This offers the
opportunity for more efficient workforce utilization in Florida between
Solid Rocket Booster tasks and other flight hardware processing. This
has also allowed the distribution of United Space Alliance overhead
costs over a larger business base and eliminated the overheads from the
Solid Rocket Booster contractor United Space Boosters Inc.
Safety of operations has been a major emphasis of both NASA and
United Space Alliance. There have been numerous independent reviews to
examine the safety implications of United Space Alliance management of
operations. These include a review by the Aerospace Safety Advisory
Panel and two reviews by the NASA Headquarters Safety Office. Each of
these reviews has concluded that operations are safe at the present
time.
privatization or commercialization of the shuttle
Question. Where is NASA in its decision-making process regarding
``privatization'' or ``commercialization'' of the shuttle? How do you
distinguish between the two concepts? If the shuttle is
``commercialized,'' does that mean NASA no longer is involved in any
aspect of its operation--it is just a user? If so, how many years will
it be before that stage is reached? Will the astronauts of the future
be private sector employees?''
Answer. Our definition of ``privatization'' is where the private
sector is performing the vast majority of operations of the shuttle.
However, in that scenario the federal government and NASA in particular
is almost exclusively the customer of the shuttle missions. Therefore,
NASA retains ownership of assets and most of the risks associated with
shuttle flights are carried by NASA.
In the case of commercialization, significantly more ownership and
risk would be assumed by the private sector and the federal government
would be a customer. This is one option that is being considered in
future launch studies (see answer to question 3).
space and earth science
priorities
Question. One mission of the Space Science Enterprise is to ``solve
the mysteries of the universe.'' How does NASA establish priorities for
the science needed to approach this mission? How will your Strategic
Plan update contribute to the priority setting? How do you involve the
space science community in that planning? To what degree do budget
considerations constrain those priorities?
Answer. Guidance on strategic science goals is obtained
periodically from the National Research Council. This guidance is used
by OSS's Space Science Advisory Committee, working with NASA
headquarters program staff and scientific and technical staff at the
field centers, to assemble a portfolio of possible future missions that
will advance knowledge in our science mission areas. Thus, the research
community plays key roles in both goal-setting and identification of
implementation options. The portfolio is then analyzed by Headquarters
management for technical and cost feasibility, probability of success,
program balance, and policy considerations. The resulting provisional
program, constrained to be achievable under prevailing budget
projections, is documented in the enterprise strategic plan and
circulated for additional comment to the research community before its
main features are incorporated in the NASA strategic plan.
follow-up missions
Question. What mechanisms do you have to follow-up on new
discoveries about the nature of the universe such as the one made last
year that its rate of expansion is accelerating? Is it possible to
design space science missions to be more flexible in this context?
Answer. The Space Science Enterprise has a variety of missions,
both ground-based and space-based, that enable us to make new
discoveries and build upon past scientific revelations. Some of these
missions, such as the Hubble Space Telescope and Chandra X-ray
Observatory, are highly flexible in the types and targets of their
observations, thus they have potential for a broad range of discovery.
Other missions, particularly the smaller missions in the Explorer and
Discovery programs, are more focused in scope, but they often produce
results that allow very revealing comparative analyses with data
gleaned from other NASA missions (as well as those pursued by NSF,
academia, and other interested partners). Moreover, Explorer and
Discovery missions are competitively selected on one-to-two-year
cycles, utilizing external peer review; therefore, they enable the
Agency to react to the latest discoveries and new ideas from the
science community. So while we do have flexibility in the design and
scope of some missions, it is the overall layout of the Space Science
Enterprise, with its mix of large and small missions and its
collaborative interaction with other science entities, that affords us
overall flexibility.
In regard to your specific inquiry regarding the expansion of the
universe discovery, we have a variety of mechanisms to follow up and
enhance our initial findings. On the ground we have the Keck
Interferometer and ground-based observatories involved in supernovae
searches. In addition, we have many space-based missions including the
Japanese/American venture ASCA, the Hubble Space Telescope, and the
newest of NASA's Great Observatories, Chandra, launched on July 23,
1999. We continue to look forward to the new science insights this
suite of instruments will provide.
increases in space science
Question. The Space Science budget is projected to increase from
$2.1 billion in the current fiscal year to almost $2.9 billion in
fiscal year 2004. This projected increase is somewhat larger than the
one appearing in the fiscal year 1999 budget request and substantially
larger than previous budget requests. What accounts for this emphasis
on space science? How critical is each mission and what applications
are expected to come out of these missions?
Answer. The emphasis on Space Science reflects Administration
priorities, as outlined in the National Space Policy of September 1996
and other directives to NASA. The largest budget increases are planned
for programs that address the question of whether life has existed or
exists now elsewhere in the universe, including the search for planets
around other stars and the study of Mars. Europa, and other locations
in our solar system that are likely to have harbor extinct or extant
life or the building blocks for life. These programs have broad
support, not only within the Administration, but also in Congress, the
science community, and the general public.
The budgeted growth also reflects the demonstrated ability of the
Space Science Enterprise to deliver cost-effective programs that answer
critical scientific questions while contributing to education and the
public understanding of science through a highly effective and
innovative Education and Public Outreach program. NASA's Space Science
Enterprise gets results and brings those results directly to
schoolchildren and the public.
Without attempting to define the term ``critical'', each mission in
our current plan provides pieces of information that contribute to our
overall understanding of the universe. In addition, many of our
missions work together or build on one another to achieve a set of
research goals by employing simultaneous observations, interrelated
technology development tasks, and/or concomitant science objectives.
Some of our missions even have limited windows of time for launch to a
target, such as an outer planet in our solar a system, that may not
recur for years or even decades. Therefore, each mission is important
for the achievement of our scientific goals.
Most of the non-Space Science applications that will arise from
Space Science missions will be unforeseen. However, we expect to see
important advances in the areas of advanced medical imaging and
miniature biological sensors; JPL has established a joint program in
biosensors with the National Cancer Institute to aid in technology
transfer to medical applications. The forensic sciences will also
benefit; GSFC and the National Institute of Justice have agreed to
investigate applying miniaturized NASA instrument technology to
portable instruments that could be used at crime scenes--starting with
x-ray flouroscopy developed for NEAR instruments--to identify gunshot
residue. In addition, forensic scientists have interest in the Mars
sample return technology to preserve biological crime scene samples
while awaiting trials (which sometimes drag on for years) as well as
infrared sensors (NGST, etc.) for arson detection. Other applications
are likely to arise in high tech manufacturing, which could benefit
from the more precise metrology techniques being developed for NASA
missions; and our robotic rover technology could help automate farming
and nuclear plant cleanup efforts as was demonstrated recently.
use of iss for space science
Question. Does the Space Science Enterprise have any plans to use
the International Space Station as a platform for any of its research
missions?
Answer. It is the policy of the Space Science Enterprise to treat
the ISS as another platform that may be quite useful for certain space
science missions, although it is not appropriate for instruments that
require high fidelity pointing. The ISS will be allowed to compete on
equal footing with all other platforms in our strategic planning
process and within our various Explorer Program Announcements of
Opportunities (AO). The limited number of ISS payload sites are
allocated by the Space Station Utilization Board, which is comprised of
the relevant Associate Administrators, and the Space Science Enterprise
expects to use about 25 percent of the external attached payload sites.
In order to meet the scheduled availability of those sites, they will
be solicited explicitly as Missions-of-Opportunity in timely Explorer
AO's, beginning with the Small Explorer (SMEX) AO to be released in
late CY 1999.
satellites
Question. You seem to have a great number of space science projects
planned at the moment. Exactly how many space science satellites are
you planning to launch in the next five years? What is their collective
cost?
Are you requesting sufficient funds not just to build and launch
these satellites, but to analyze the data from them?
Answer. An exact number of missions to be launched in the next five
years cannot be given because several new Explorer and Discovery
missions will be selected in the next year or two. Approximately 35
Space Science missions are planned for launch from August 1999 through
July 2004. In addition, we will provide major components for about 5
foreign-led international collaborations. The U.S. budget for all of
these missions, including sufficient funds for development, launch
services, operations, and data analysis, is approximately $5.5 billion.
success rate
Question. What is the success rate on your ``faster, better,
cheaper'' satellites? You've had at least two total failures (Lewis and
WIRE), another was canceled because of cost overruns (Clark), and an
engine malfunction on NEAR meant it had to fly past its target and now
must spend a year getting back to it. You've also had problems with the
solar array on Mars Global Surveyor. Is there a common thread to these
failures? Did the need to meet challenging schedules and stay within
strict cost caps lead to these failures?
Answer.
Total faster/better/cheaper missions between 1995 to Present (20)
Successful missions (15)
XTE
MPF
Lunar Prospector
DS-1
MCO
FAST
ACE
TRACE
DS-2
STARDUST
POLAR
SNOE
SWAS
MPL
FUSE
Missions with significant problems (3)
MGS (Solar array deployment damper utilization problem)
NEAR (Engine controller S/W execution problem)
TERRIERS (Attitude Control System S/W problem)
Failed missions (2)
HETE-1 (Launch Vehicle/Spacecraft separation problem)
WIRE (Pyrotechnic circuit design problem)
The 3 spacecraft anomalies and two mission failures are all
unrelated; there are no common threads to these problems.
The problems with MGS, NEAR, and TERRIERS are not mission
catastrophic and we anticipate that all 3 will fully achieve their
mission and science objectives.
The challenging schedules and stringent cost caps were not a factor
in the 2 total mission failures nor were they a factor leading to the
anomalies with MGS, NEAR, or TERRIERS.
No testing was deleted nor compromised in any way for any of the
missions.
Success Rate--18/20 = 90 percent
It is important to note that two of the missions, Lewis and Clark,
referred to in your question are NASA Earth Science missions, not Space
Science missions.
In addition to the above data, as reported in the September 6 issue
of Space News, an independent Aerospace Corporation study recently
confirmed that NASA's ``faster, better, cheaper'' approach to science
spacecraft design and development is paying off not only in terms of
cost and schedule, but also in terms of science returned per dollar
spent. The study finds that the cost effectiveness of NASA's ``faster,
better, cheaper'' approach, as measured in number of operational
instrument months per dollar spent, is about 50 percent better than
NASA's old ways of doing business.
study on smaller, faster, cheaper, better
Question. Last year we directed you to contract with the National
Research Council for a study ``across all space science and Earth
science disciplines to identify missions that cannot be accomplished
within the parameters imposed by the smaller, faster, cheaper better
regimes.'' What is the status of that study?
Answer. The Office of Space Science and the Office of Earth Science
have jointly requested this study by the Space Studies Board of the
National Academy of Sciences. NASA's request asks the Space Studies
Board for their views on: (1) the general criteria for assessing
strengths and limitations of small, medium, and large missions in terms
of scientific productivity; and (2) which science goals in our
strategic plans will require the use of medium and large missions.
NASA understands that this study is already under way, and will be
led by the Space Studies Board in collaboration with the Aeronautics
and Space Engineering Board.
In addition to the National Research Council Study, we have also
reviewed the objectives and accomplishments of application of the
Faster, Better, Cheaper (FBC) approach with the NASA Advisory Council.
Their recommendation was to identify the key attributes of FBC and how
they have been applied within NASA, other government agencies and
Industry, and to focus on adopting an FBC approach that has broad
application across the Agency. We have initiated an effort to establish
an Agency-wide FBC approach that will provide guidelines for the entire
range of NASA missions. This activity is planned for completion by the
end of this calendar year.
data mortuaries
Question. To what extent is the data collected from the Space
Science missions being utilized? Please quantify the amount of data
used in research currently.
Answer. Science data acquired from NASA space missions are analyzed
and interpreted, with results published in scientific journals, as well
as being shared with the public through news media and other forums.
The exciting science results and furtherance of our knowledge and
understanding of the Universe from missions such as the Hubble Space
Telescope, the Galileo mission to Jupiter and its moons, Mars
Pathfinder, Mars Global Surveyor, Solar Heliospheric Observatory, etc.
are the best witness to this.
NASA selects and funds principal investigators, via peer-reviewed
competitions, to build the instruments flown on the missions, to
process and analyze that data, and to archive the data products so that
they can subsequently be accessible to the broader science community
for analysis and interpretation. NASA also funds guest observers and
investigators for its missions; they are also selected via peer-
reviewed competitions to analyze and fully exploit the science data. In
addition, NASA funds peer-reviewed research and analysis using data
from the open archives, including data from missions no longer
operating. All told this involves several hundred investigators.
The space science data archives open to the research community and
general public contain over a million observations and data sets with a
total volume greater than 35 terabytes. These data are available in
several data centers across the country as organized by science
discipline (HST Science Institute for Optical/UV; High Energy Science
Archive Center at Goddard; Planetary Data Nodes at 10 university sites;
National Space Science Data Center at Goddard; Infrared Science Archive
at Caltech, etc.). These archives are accessible via the Internet.
Utilization of these data continues to increase rapidly. A good
indicator of this is the fact that the total volume of data being
downloaded from even active mission archives such as HST for subsequent
use by researchers, educators, and the general public far exceed the
volume of data being ingested into the archive from the principal
investigators. Overall there are nearly 4 million web accesses a month
to space science data archives with approximately 25,000 observations
or data sets downloaded or transferred in response to user requests.
This represents approximately 750 gigabytes of data per month.
hubble repair mission
Question. How serious are the problems with the Hubble Space
Telescope? How much of a priority is this ``rescue'' mission in
October? Why wasn't the cost of these repairs and the mission budgeted
for within Hubble reserves?
Answer. The loss of another of HST's remaining 3 functional gyros
would result in the inability to perform science observations until a
repair could be made. Maintaining HST's scientific productivity is an
extremely high priority for Space Science. The HST program budgets
sufficient contingency to cover ``normal'' problems, which we believe,
is prudent. But the cost of this additional mission has more than
exhausted available reserves.
Question. Assuming the failure of additional gyroscopes, what data
will be lost if we do not send a Hubble repair mission in October?
Please describe the potential data loss and quantify the impact on
research.
Answer. In the event of further gyro failure on HST, all science
operations will cease, although the observatory will be in no physical
danger. The amount and quality of data lost will, of course, depend
upon when a repair mission is sent to replace the failed gyros. If,
hypothetically, such a repair mission follows about a year later, then
an amount of data equal to about 15 percent of all that which has been
obtained to date will be lost. Perhaps most seriously, however, will be
the potential loss of serendipitous or unanticipated observations: rare
events such as comets, planetary storms, or supernova explosions.
Question. How much will the Hubble rescue mission cost and where
will the money come from? What other NASA programs will be adversely
affected by shifting this funding into the Hubble mission?
Answer. The Hubble SM3A mission will cost the Office of Space
Science approximately $26M. We propose to resolve the impact of this
unexpected cost during the fiscal year 2000 Operating Plan process.
Question. Please provide an accounting of reserves for all space
and earth science programs and the priority of each of these missions
or programs within NASA.
Answer. In the fiscal year 2000 President's Budget, total OSS
reserves for are $77.8M. The breakout of these funds is as follows:
[In million of dollars]
SIRTF............................................................. 34.6
TIMED............................................................. 1.3
Genesis........................................................... 7.3
Contour........................................................... 2.5
Mars 01 Orbiter/Lander............................................ 11.0
New Millennium.................................................... 5.2
Chandra........................................................... 4.6
HST O&S........................................................... 11.3
The Space Science Enterprise has missions both operational and in
planning in each of our four science themes. Our prioritization follows
the balanced program presented in our published Strategic Plan. Space
Science programs must compete with Earth Science, Human Exploration and
Development of Space, and Aeronautics and Space Technology programs in
terms of priority. Overall agency priority is established by the
Administrator's office in conjunction with the Administration.
eos program
Question. What is the status of the EOS program?
Answer. The EOS program is proceeding as currently baselined both
programmatically and technically.
Question. Are you still planning to launch the first EOS spacecraft
this year?
Answer. Yes, the first EOS spacecraft, Terra (formerly AM-1), will
be launched no earlier than November 1999.
Question. Have all the problems with EOSDIS been resolved?
Answer. All technical and programmatic problems associated with the
EOSDIS have been resolved. The EOSDIS is currently successfully
supporting pre-launch operations for the Terra spacecraft (formerly AM-
1). Implementation of the EOSDIS to support flight operations and data
archiving for the remaining mission (PM-1, ICESat, and CHEM-1) is also
proceeding without incident.
EOSDIS is a multifaceted, state-of-the-art information system that
will allow free and open access to the Earth Observing System (EOS)
data archives to a diverse national and international user community.
This community includes users from the public and private sectors,
including research scientists, educators, students, users in public
agencies responsible for operational applications such as weather
forecasts and environmental monitoring, policy makers, and the public
in general.
Since 1997, different components of EOSDIS have experienced certain
difficulties.
--The Flight Operations System (FOS), the component that supports
operation and control of satellites in orbit, experienced
significant problems in March 1998 relating to stability and
performance of the system.
--The Science Data Processing System (SDPS), the component that
converts instrument measurements into geophysical parameters,
experienced a schedule slip that threatened the readiness of
the system to meet the EOS schedule.
--These technical problems were exacerbated by multiple
restructurings of the EOS flight system, rapid changes to
information technology and high job turnover rate (i.e., up to
30 percent annually) at the contractor level.
In 1998, NASA worked collaboratively with the contractor, Raytheon,
and the EOSDIS user community to develop a plan that would refine the
EOSDIS approach to meet a basic set of requirements. This plan, also
known as Option A+, outlined the appropriate level of requirements
needed to meet a fundamental set of requirements that support safe
control and operation of satellites in orbit as well as allow efficient
processing, archive, and distribution of the resulting data and
information. The goal was to build a reliable development schedule
while minimizing the remaining cost of implementing the EOSDIS.
Toward this goal, NASA decided to use a commercially available
Flight Operations System (FOS) to support EOS Terra and follow-on
satellites. Option A+ has reduced a number of the lower-priority
requirements. These decisions helped us achieve cost and schedule
goals. In addition, NASA and Raytheon infused new leadership and
processes into the overall management of the system and into the day-
to-day execution of procedures. The result is a functioning system that
is supporting Landsat 7 data processing, archive and distribution, and
is ready to support the launch, control and operation of EOS Terra.
Despite earlier problems, the Science Data Processing System (SDPS)
and the Flight Operations Segment (FOS) are now ready to support EOS
Terra later this year.
Full EOSDIS functionality for Terra is being phased to meet cost
constraints and will not be complete until approximately 18 months
after launch of the Terra spacecraft. This phased implementation
assures that full functionality will be in place to support PM, CHEM,
ICESat, and other EOS satellites in 2000 and beyond. It is important to
reiterate that EOSDIS is presently supporting Landsat 7 data
processing, archive and distribution, and is ready to support the
launch, control and operation of EOS Terra.
While every attempt was made to scope the program within the
available budget, an additional $11.6 million was needed in fiscal year
1999 (already approved and implemented) and an additional $30-50
million is needed in fiscal year 2000. The ECS contract is presently
valued to cost $868.6 million through completion. The transition to
Option A+ in the ECS contract is presently being negotiated. While
negotiations are not yet complete, we anticipate a renegotiated
contract within the next two months. The final amount will be known
once the restructuring of the Raytheon contract to reflect Option A+ is
complete. These funds will better ensure implementation of EOSDIS for
missions following Terra, within the level of requirements specified in
Option A+.
It should be recognized that EOSDIS is providing nearly the same
functionality for a budget that is less than originally proposed in
1996. The savings have been achieved by a more focused use of funds,
reducing or eliminating requirements of limited value (principal result
of Option A+), implementing the adaptive architecture to allow more
economical processing of science data, and management and process
changes to improve performance.
Question. What is the total projected life-cycle cost of the EOS
program?
Answer. The EOS lifecycle cost through fiscal year 2004 for the
first series measurements is $10.0 billion. This amount is the funding
needed to complete the initial set of EOS missions which include Terra,
CHEM, PM-1, QuikScat, Landsat-7, and Special spacecraft (e.g. IceSAT,
Seawinds, Jason, SAGE III, ACRIM). Also included is the funding for
technology infusion, science, algorithm development, and information
systems necessary to support those missions. The development of the
first series will be completed with the launch of the Chemistry
spacecraft in December 2002. Operations of some of these missions will
continue beyond the current budget projections, which extend to 2004.
We are in the process of defining our implementation strategy for the
follow-on measurements concentrating on shortening development time and
the incorporation of instrument technology infusion.
The successful transition to the ``faster, better, cheaper''
approach to implementation of the program will allow a lower total cost
for the EOS follow-on measurements. Our current estimate of the costs
for follow-on missions through 2010 is in the range of $5-5.5 billion.
NASA's Earth Science program will continue to strive to reduce costs to
the taxpayer and to provide policy relevant environmental information.
We will do this through technology investments that reduce future
mission costs, the leveraging of commercial resources and other federal
resources, increased international partnerships, and the use of the
International Space Station as an observing platform.
toms program status
Question. Has Russia definitely decided not to launch your next
TOMS (Total Ozone Mapping Spectrometer) instrument next year as it had
promised?
Answer. Russia definitely will not be launching the TOMS instrument
next year. Russia has put a great deal of support into the SAGE mission
and, consequently, has not been able to meet their goals for producing
a second spacecraft for the TOMS instrument. Because Russia's future
schedule is indefinite and NASA's science requirements preclude a
lengthy development effort, a mutual agreement was reached to cancel
cooperative agreement for the launch of a second instrument.
Question. How is your existing TOMS instrument holding out? Will it
last until you can find an alternative spacecraft to host a new TOMS?
Answer. The TOMS instrument currently in orbit was launched on July
3, 1996 on the EP/TOMS spacecraft. The mission had a design lifetime of
2 years. The instrument is currently performing well. However, the
spacecraft lost all of its reserve fuel last year due to an anomaly in
the control system, and earlier this year the primary transmitter
failed. The spacecraft is performing adequately on the backup systems,
but it has very little redundancy left. Fortunately, the QuickTOMS
mission has been selected as the alternative host to fly the TOMS
Flight Model 5 instrument. There is a good chance that the TOMS/EP
instrument will last at least until the launch of this instrument in
the year 2000.
Question. How seriously would ozone research be impacted if we did
not have a TOMS instrument in orbit?
Answer. TOMS is currently our only source for a total map of ozone,
and our only reliable source for estimating global change in surface UV
radiation. TOMS provides a continuous map of stratospheric ozone
concentrations, clouds, and other constituents which are necessary to
reliably estimate the UV radiation reaching the earth's surface. The
continuous map that TOMS provides is being used in conjunction with the
worldwide Dobson network (an international supported ground-based
network used for ozone measurement and validation studies) to establish
the observed changes in stratospheric ozone for the WMO/UNEP (World
Meteorological Organization/United Nations Environmental Program) Ozone
Assessments. These assessments in turn provide the science background
for Montreal Protocol considerations. The Montreal Protocol has
predicted that around the year 2000 the ozone loss in the stratosphere
will begin a recovery process. The only way to verify this prediction
is to obtain real-time measurements of ozone continuing through the
first part of the century. Without a TOMS mission, the continuity of
the ozone mapping would be lost and it would be extremely difficult to
determine if the ozone layer is recovering as predicted by the models,
and whether this recovery is having the expected effects on the surface
UV radiation.
aeronautics
termination of high speed research
Question. You have requested termination of your high-speed
research (HSR) program. This is the second time in the last 30 years
that the United States has ended a research effort directed at
development of technology for supersonic transport. What are you doing
to ensure that if we start up such research again within the next few
decades, we won't have to start over? Do you have sufficient resources
to archive the knowledge gained in the current program in such a way to
make it readily useable if and when we start another HSR program?
Why didn't NASA propose to continue with HSR at a much reduced
level rather than terminate it altogether?
Answer. Supersonic transport research is continuing at a lower
level in NASA's aeronautics research and technology (R&T) base program.
This level of effort activity will provide the basis for ramping up
supersonic research activities should industry interest in a commercial
supersonic transport revive.
Despite the cancellation of the HSR program, previous work in HSR
can be leveraged to support new initiatives. Two areas in particular
are being directly leveraged to continue work in fiscal year 2000:
synthetic vision system (SVS) and propulsion technology. The SVS was
being developed as part of the HSR program to give pilots forward
vision without incurring a weight penalty on supersonic jetliners
associated with the mechanisms needed to drop the noses of these
aircraft. This display technology is being combined with other
technologies in the Aviation Safety program to augment pilot vision in
conditions of low visibility. The propulsion technology development in
will be leveraged to support the Ultra-Efficient Engine Technology
program. Technology from the HSR program and other programs will be
used to reduce emissions of nitrogen oxides to meet a goal of 70
percent emissions reductions. Similarly, HSR technology development in
the area of turbomachinery (fans, compressors and turbines) will be
leveraged to develop methods to simplify engines by reducing the number
of stages. The result will be improved engine efficiency leading to a
15 percent reduction in fuel use and similar reductions in
CO2. Also, high temperature engine materials development
will be leveraged.
We are, also archiving the knowledge gained in the current program
in such a way to make it readily useable at a future date. $150 million
in fiscal year 1999 will be allocated within HSR so that the efforts to
date can be used in the future. Specifically, these funds will be used
to (in priority order):
1. Archive technology development details and write summary
documents of technology development including lessons learned and
dispose of excess materials, equipment, and tooling.
2. Identify far-term (2025) High Speed Civil Transport (HSCT)
economic and environmental requirements and make recommendations of
technology paths to direct and/or complement future NASA programs.
3. Position HSR technology for transfer to industry near-term
applications, IRAD investments and cooperative agreements.
4. For generic applications, complete tests of models already
fabricated and complete development of engineering tools that can be
fully documented by September 1999.
ultra-efficient engine initiative
Question. What is the rationale behind the ultra-efficient engine
initiative and how does it differ from comparable efforts in the
advanced subsonic research program? Will the initiative carry on any of
the research now being supported by the HSR or advance subsonic
research programs?
Answer. The objective of the Ultra-Efficient Engine Technology
(UEET) program is to address the most critical propulsion issues
related to environmental emissions: performance and efficiency. The
overall objective is to develop technology to enable a dramatic
increase in turbine engine performance and efficiency while reducing
the impact on the environment. High temperature turbomachinery
components, materials and structures, and novel concepts for
significantly improved propulsion airframe integration through advanced
technology concepts will be addressed. The primary benefits to these
technologies will be to improve efficiency and reduce emissions for a
wide range of applications, civil and military.
UEET resources will be used to develop technology to the component
level (combustors, fans, compressors and turbines). System level
validation will be performed using DOD and/or industry test engines. We
anticipate that 80 percent of the resources will be used in support of
in-house research at NASA Centers. The remaining resources will be used
on contracts with the two U.S. aircraft engine manufacturers to ensure
technology transfer. Given the Agency's priorities, we believe the UEET
program represents an appropriate balance.
The propulsion technology development in both AST and HSR will be
leveraged to support the Ultra-Efficient Engine Technology program. In
AST, the use of low emission combustors to reduce emissions of nitrogen
oxides will be continued to meet a goal of 70 percent reduction in
these emissions. Technology from the HSR program in this area will also
be used to support this goal. Similarly, in both programs, technology
development in the area of turbomachinery (fans, compressors and
turbines) will be leveraged to develop methods to simplify engines by
reducing the number of stages. The result will be improved engine
efficiency leading to a 15 percent reduction in fuel use and similar
reductions in CO2. Also, high temperature engine materials
development will be leveraged.
In addition, the fiscal year 2000 budget initiates a new Aviation
Systems Capacity program based on the Advanced Subsonic Transport
program to address issues of crowding in the nation's air traffic
system.
reusable launch vehicles
rlv costs
Question. The budget projection for future space launch development
grows dramatically between fiscal year 2001 and fiscal year 2004. We
have been told that those funds constitute a placeholder for future,
to-be-determined RLV commitments. If those commitments are not
currently defined, how did you arrive at the amounts appearing in the
out-year budget? What do you intend to do in fiscal year 2000 to
clarify the picture?
Answer. NASA spends a substantial portion of its annual budget to
meet its launch needs. To lower these costs, the 1994 National Space
Transportation Policy (NSTC-4) calls for ``government and private
sector decisions by the end of this decade on development of an
operational, next generation reusable launch system.'' NASA has set
aside an outyear wedge of funding to support these decisions. NASA is
also undertaking industry-led Space Transportation Architecture Studies
to identify private sector options for reducing NASA's launch costs.
These studies incorporate separate efforts being undertaken by NASA,
DOD and industry including: Space Shuttle safety upgrades; X-33 and
other NASA technology demonstrators (X-34, X-37, and X-38), the Evolved
Expendable Launch Vehicle for the International Space Station. As part
of the fiscal year 2001 budget process, the Administration intends to
use the results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning all of NASA's launch
requirements, including human space flight, to lower-cost, privately
owned and operated space transportation systems. Decisions on future
RLV funding, the transition from the Space Shuttle to privately owned
and operated vehicles, private sector incentives, and related issues
will be decided this fall in the context of this integrated space
transportation strategy. Details will be provided in the fiscal year
2001 budget submit.
shuttle vs. rlv
Question. Do you still anticipate being able to make a decision
``at the end of the decade'' as to whether to make a major upgrade to
the space shuttle or to rely on the private sector to build a new
reusable launch vehicle (RLV) like VentureStar?
Answer. NASA spends a substantial portion of its annual budget to
meet its launch needs. To lower these costs, the 1994 National Space
Transportation Policy (NSTC-4) calls for ``government and private
sector decisions by the end of this decade on development of an
operational, next generation reusable launch system.'' NASA has set
aside an outyear wedge of funding to support these decisions. NASA is
also undertaking industry-led Space Transportation Architecture Studies
to identify private sector options for reducing NASA's launch costs.
These studies incorporate separate efforts being undertaken by NASA,
DOD and industry including: Space Shuttle safety upgrades; X-33 and
other NASA technology demonstrators (X-34, X-37, and X-38), the Evolved
Expendable Launch Vehicle for the International Space Station. As part
of the fiscal year 2001 budget process, the Administration intends to
use the results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning all of NASA's launch
requirements, including human space flight, to lower-cost, privately
owned and operated space transportation systems. Decisions on future
RLV funding, the transition from the Space Shuttle to privately owned
and operated vehicles, private sector incentives, and related issues
will be decided this fall in the context of this integrated space
transportation strategy. Details will be provided in the fiscal year
2001 budget submit.
cost comparison
Question. NASA's Reusable Launch Vehicle (RLV) program is designed
to reduce the cost of space launches. What does NASA expect the launch
and operations costs of a reusable launch vehicle to be compared to the
launch and operation costs of the shuttle? Does NASA expect to support
both a shuttle program and an operational Reusable Launch Vehicle
program at the same time? If so, how and what are the cost projections?
Answer. NASA spends a substantial portion of its annual budget to
meet its launch needs. To lower these costs, the 1994 National Space
Transportation Policy (NSTC-4) calls for ``government and private
sector decisions by the end of this decade on development of an
operational, next generation reusable launch system.'' NASA has set
aside an outyear wedge of funding to support these decisions. NASA is
also undertaking industry-led Space Transportation Architecture Studies
to identify private sector options for reducing NASA's launch costs.
These studies incorporate separate efforts being undertaken by NASA,
DOD and industry including: Space Shuttle safety upgrades; X-33 and
other NASA technology demonstrators (X-34, X-37, and X-38), the Evolved
Expendable Launch Vehicle for the International Space Station. As part
of the fiscal year 2001 budget process, the Administration intends to
use the results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning all of NASA's launch
requirements, including human space flight, to lower-cost, privately
owned and operated space transportation systems. Decisions on future
RLV funding, the transition from the Space Shuttle to privately owned
and operated vehicles, private sector incentives, and related issues
will be decided this fall in the context of this integrated space
transportation strategy. Details will be provided in the fiscal year
2001 budget submit.
private sector incentives
Question. What incentives do you think would be needed to convince
the private sector to fund an operational RLV? There has been some talk
of federal loan guarantees. Is that necessary? What would be the
budgetary impact of such a proposal?
Answer. NASA spends a substantial portion of its annual budget to
meet its launch needs. To lower these costs, the 1994 National Space
Transportation Policy (NSTC-4) calls for ``government and private
sector decisions by the end of this decade on development of an
operational, next generation reusable launch system.'' NASA has set
aside an outyear wedge of funding to support these decisions. NASA is
also undertaking industry-led Space Transportation Architecture Studies
to identify private sector options for reducing NASA's launch costs.
These studies incorporate separate efforts being undertaken by NASA,
DOD and industry including: Space Shuttle safety upgrades; X-33 and
other NASA technology demonstrators (X-34, X-37, and X-38), the Evolved
Expendable Launch Vehicle for the International Space Station. As part
of the fiscal year 2001 budget process, the Administration intends to
use the results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning all of NASA's launch
requirements, including human space flight, to lower-cost, privately
owned and operated space transportation systems. Decisions on future
RLV funding, the transition from the Space Shuttle to privately owned
and operated vehicles, private sector incentives, and related issues
will be decided this fall in the context of this integrated space
transportation strategy. Details will be provided in the fiscal year
2001 budget submit.
likelihood of success
Question. How do you rate the likelihood that one or more of the
private sector companies now developing their own RLVs will be
successful-companies like Kistler, or Kelly, or Space Access? Are all
of them arguing that they need federal loan guarantees or other
government-based incentives to succeed?
Answer. Several start-up, entrepreneurial launch companies emerged
in recent years that are developing or plan to develop new launch
vehicles, mostly aimed at the commercial launch market using private
sector sources of financing. We know that the fresh ideas and
innovative approaches come from such entrepreneurial activities and
hope that the companies that prove their systems reliable and cost
competitive will be successful. Because each company's business plan is
dependent on non-technical factors, such as launch market forecasts,
NASA cannot rate the likelihood that one or more of these companies
will be successful. NASA is taking steps, however, to support these new
entrants and long-term competition in the U.S. launch market. First,
several of these companies have been contracted as participants in the
Space Transportation Architecture Studies mentioned in the above
answer. NASA is also providing Space Act agreement resources to these
companies, when requested, such as wind tunnel work, airborne testing,
alternative engine designs, and NASA Center expertise. Finally, NASA is
asking for industry comments on a potential future procurement of
launch services on new, untested launch vehicles for those NASA
payloads that can be risked on such vehicles. Because each company has
a different business plan with different market projections, financing
techniques, and payback estimates, some companies are in favor of loan
guarantees as a private sector incentive whereas others are not.
x-33 technical problems
Question. What are the technical problems that have slowed the X-33
program? Are more schedule threatening technical problems likely? Is
single-stage-to-orbit technology simply too immature at this time?
Answer. The X-33 has suffered manufacturing difficulties with two
of its many technologies: the composite liquid hydrogen fuel tank and
the aerospike engine. We considered the composite cryogenic fuel tank
to be the most significant technical challenge from the time that the
program was initiated. The X-33's lifting body shape required that the
tank geometry be complex, with each of the two composite LH2
fuel tanks being assembled in a quad-lobe design. Each tank required
four large lobe skins that were manufactured as sandwich structures
with graphite epoxy inner and outer skins bonded to a phenolic
honeycomb core (trade name ``Corex''). The lobe skins were then bonded
to four longerons (which were themselves composite woven ``y''
preforms) and to small and large Cee-shaped members (also woven
preforms) which join the top and bottom of the lobe skins to the
forward and aft bulkheads, respectively. The first serious difficulty
was encountered when areas were found on the first composite tank where
the lobe skin bonding to the longerons was inadequate. Repairs were
made to the bonds, and manufacturing processes were found that
prevented subsequent problems of this type. The next major tank problem
involved debonding of an inner lobe skin to the core material on the
first of a total of eight lobe skins. The history of the manufacturing
process used for this particular lobe skin (the first) and for the
second lobe skin slightly differed somewhat from that used on the
remaining six lobe skins. Accordingly, a decision was made to
manufacture replacement lobe skins to replace both of these skins. The
other skins were carefully tested and bondline integrity was determined
to be adequate. Manufacturing and assembly of both hydrogen tanks is
now complete, and the starboard tank is now in cryogenic cycling and
loads testing at NASA Marshall Space Flight Center (MSFC). Some leaks
were discovered (as had been expected), but all leaks are repairable in
the field. The left tank will follow the starboard tank into the same
facility for similar testing while the starboard tank is being
installed in the vehicle at Lockheed Martin Skunk Works in Palmdale.
Engineers at MSFC conducted the second pressure test on the
composite tank by filling it completely with liquid hydrogen at -423
degrees Fahrenheit on September 21. One of the objectives of the test
was to pinpoint seepage areas on the composite tank. When the tank was
pressurized to 20m psi, as expected some hydrogen seepage was noted.
Technicians are applying sealant or patchwork to affected areas before
resuming pressure tests. The tank passed an earlier pressure test with
liquid nitrogen and also a 5-psi helium leak test when it was shipped.
Similar patchwork was completed on the X-33's earlier five-foot
composite test tank or the ``Double D'' tank. The five-foot tank has
since successfully completed approximately 30 cryogenic cycles
involving the filling, draining, and filling again of liquid hydrogen
at pressure. As a result of the manufacturing difficulties encountered
on these fuel tanks, we have a better understanding and insight into
this critical technology area. This is consistent with the X-33
Program's overall goal of giving us the opportunity to develop and
prove these cutting-edge, revolutionary technologies.
The linear aerospike engines also encountered manufacturing
problems in three areas: the expansion ramps, the thrust ``ladder'' and
the thrust cells. Bonding high-temperature steel alloy sheets onto a
copper alloy (trade name ``Narloy Z'') core with machined cooling slots
form the expansion ramps. Liquid hydrogen is circulated through the
slots to regeneratively cool the ramps. Manufacturing the cores and
brazing the facing sheets to the cores proved to be a time-consuming
activity. The brazing process itself was slowed by competing with other
applications (e.g., SSME nozzles) for the only available brazing
furnace large enough for this purpose. The thrust ladders to which the
thrust cells are attached proved to be a more challenging design and
manufacturing task than anticipated. Originally the copper ramp was
conceived as a passive thermal design, but multi-cell hot fire testing
and subsequent analysis indicated that it is a more complicated thermal
problem. The ramp had to be redesigned as an actively cooled structure,
and this increased the manufacturing time. The thrust cells, which are
also actively cooled, took longer than originally anticipated to
manufacture. These problems have been overcome, but have delayed the
engine delivery schedule. However, the first of the four engines being
built under the X-33 program--a test engine--is currently in test at
NASA Stennis Space Center, Mississippi. The second engine, a flight
unit, is nearing completion. Both flight engines will be delivered to
Palmdale early next calendar year.
We are confident that the manufacturing difficulties, which have
delayed the X-33 program, are all behind us. It also is important to
note that these were manufacturing difficulties and not design
problems. However, much work remains to be accomplished as the program
has transitioned into its test and validation phase. The very purpose
of the X-33 program is to do things that haven't previously been done
to reduce the technology risk for future operational vehicles. The
first fuel tank and first development engine are still in their
respective test series. We cannot offer assurance that further
difficulties will not be encountered during these critical tests, or in
other areas, that will further delay the program. However, at the same
time, we want to thoroughly test and validate these critical components
before installing them in the X-33.
All of the difficulties that we have encountered to date have been
successfully overcome. We are smarter today as a result of the problems
that we faced. Accordingly, we do not believe that single-stage-to-
orbit is too immature for proceeding with development of an operational
RLV. We still have a lot of work ahead of us, and expect to learn a
great deal from the remainder of the X-33 buildup stage and from the
subsequent flight test program. However, our experiences to date lead
us to believe SSTO is achievable with the United States' current
technology base. Successful test flight of the X-33 next year will go a
long way in proving this assertion.
x-34 technical problems
Question. What are the technical problems that have slowed the X-34
program? Are more schedule-threatening delays likely?
Answer. The X-34 has also suffered from manufacturing delays in its
composite tanks and structures. More recently, the program has been
impacted by an Air Force determination that extra series of
environmental analyses are necessary to launch and land the X-34 at
Holloman AFB.
private investment in the rlv program
Question. Assuming private investment, creation of an operational
space launch system derived from NASA's RLV program, such as the
proposed Lockheed-Martin VentureStar, will require private firms to
fund a follow-up development and construction program estimated to cost
several billion dollars.
Given the large investment required and the Air Force's recent
decision to fund the development two Evolved Expendable Launch
Vehicles, are private firms willing to invest in development of the
VentureStar?
Even though the NASA RLV programs were designed for private
investment, does NASA foresee a need to provide funding, payload
guarantees, loan guarantees, or other government subsidies for a
follow-on development program to produce operational RLVs?
Answer. NASA spends a substantial portion of its annual budget to
meet its launch needs. To lower these costs, the 1994 National Space
Transportation Policy (NSTC-4) calls for ``government and private
sector decisions by the end of this decade on development of an
operational, next generation reusable launch system.'' NASA has set
aside an outyear wedge of funding to support these decisions. NASA is
also undertaking industry-led Space Transportation Architecture Studies
to identify private sector options for reducing NASA's launch costs.
These studies incorporate separate efforts being undertaken by NASA,
DOD and industry including: Space Shuttle safety upgrades; X-33 and
other NASA technology demonstrators (X-34, X-37, and X-38), the Evolved
Expendable Launch Vehicle for the International Space Station. As part
of the fiscal year 2001 budget process, the Administration intends to
use the results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning all of NASA's launch
requirements, including human space flight, to lower-cost, privately
owned and operated space transportation systems. Decisions on future
RLV funding, the transition from the Space Shuttle to privately owned
and operated vehicles, private sector incentives, and related issues
will be decided this fall in the context of this integrated space
transportation strategy. Details will be provided in the fiscal year
2001 budget submit.
aerospace test facilities
nasa and dod cooperation in aerospace investment
Question. In June 1995, NASA and DOD agreed to identify cooperative
actions that could lead to significant reductions in investments and
cost of operations in major aerospace test facilities.
Have you identified any such actions and, if so, what has been the
amount of savings so far?
Answer. In the 1995 timeframe, NASA and the DOD--under the auspices
of the joint Aeronautics and Astronautics Coordinating Board (AACB)--
formed several Integrated Product Teams (IPTs) to assess potential
cooperative efforts in areas of mutual interest. These IPTs made
numerous recommendations aimed at increasing the efficiency and
effectiveness of NASA/DOD activities in research, operations, and
management (including additional personnel exchanges).
In the area of aeronautical research and technology, the IPT
activity has helped lead to increased coordination in several key
research areas. For example, common military and civil turbine engine
technology goals have been identified and responsive technology
development activities were embodied within the complementary DOD, NASA
and industry programs. The Department of Defense's Integrated High
Performance Turbine Engine Technology (IHPTET) program is addressing
technology responsive to the needs of DOD for military aviation
superiority. This program has been closely coordinated with propulsion
technology projects in NASA's Advanced Subsonic Technology and High
Speed Research programs. Although these particular programs are being
terminated in fiscal year 1999, NASA planning for its Ultra-Efficient
Engine Technology (UEET) effort has been coordinated with DOD's IHPTET
program and during implementation of UEET the coordination and transfer
of technology will continue. The strongest collaboration between DOD
and NASA will continue to be in the development of high temperature
engine materials technology. Military and civil engines differ in the
number of stages and configurations, typically the life and durability
of military engines are less, but the underlying materials are similar.
In another example, NASA's Aviation Safety Program began in fiscal
year 1999 and DOD had been involved in the NASA Safety Research
initiative from the beginning. In response to the White House
Commission on Aviation Safety and Security, NASA formed a team
comprised of NASA, FAA, DOD, NWS and industry to define the highest
priority research and technology investment areas to meet the national
safety goal. DOD participated throughout the process to contribute and
to ensure that there was no duplication of effort. Human factors, aging
aircraft, and weather research are among the programs where DOD is
contributing significantly to civil aviation safety. Each of the
resulting NASA safety project managers has an identified DOD focal
point to ensure close collaboration and sharing of information. NASA,
FAA and DOD are currently defining a coordinated safety research
program under the direction of the National Science Technology Council.
The AACB/IPT effort also resulted in the establishment of six NASA/
DOD facility alliances, including the National Wind Tunnel Alliance
(NWTA). (The creation of the NWTA was also spurred by the 1995 release
of the President's National Science and Technology Council report
entitled, ``Goals for a National Partnership in Aeronautics Research
and Technology.'' Among other findings, the report concluded that,
``newer European wind tunnels focused on aircraft development testing
are generally superior to comparable U.S. facilities in overall
capability'' and that, as a consequence, there had been increasing
utilization of European facilities for U.S. commercial and military
aircraft development testing. NASA and DOD shared several concerns
regarding this practice, including facilities access and data security
risks. There have been also been a number of other studies addressing
these and related issues, i.e., the National Facility Study (1993), the
NASA/DOD Cooperation Study (1996), and the DOD Aeronautical Test
Facilities Assessment Study (1997).)
The NWTA as well as the Air Breathing Propulsion Test Facilities
Alliance (ABPTFA) was established, therefore, to identify, study and
implement measures to strengthen the national infrastructure of
aerodynamic and air breathing propulsion test facilities that support
NASA and DOD missions and the domestic aeronautics industry. The
Alliance has been active in identifying and addressing several facility
issues. For example, the NWTA formed a team to develop a common set of
metrics for measuring facility performance, and has conducted a
benchmarking analysis of a typical commercial test in both NASA and DOD
tunnels. These types of ``normalizing'' activities are important pre-
cursors to making comparative investment decisions, and have also led
to a sharing of lessons-learned between the two organizations. The
Alliance has also been successful in addressing specific investment
decisions. For example, the Air Force HyTech program determined that no
existing NASA or DOD facility could meet the program's technical
requirements. Review of the situation by members of the NWTA led to a
decision to invest in a DOD facility, and not a NASA facility, as the
most cost effective approach for the Nation.
In addition, NASA and DOD, under the auspices of the NWTA, are
participating jointly in the planning and execution of wind tunnel test
technology efforts. In particular, the Integrated Instrumentation and
Testing Systems (IITS) element of NASA's information technology program
is working closely with DOD with the objective of leveraging NASA and
DOD funding in wind test technology development. This activity (roughly
$4M per year) is in its second year and both agencies are continuing to
increase the integration of their test technology development efforts.
Most recently, the Alliance has been working in concert with NASA's
Core Capability Assessment to identify future DOD requirements for NASA
facilities.
Based on the activities of the NWTA, NASA and DOD have proposed
that the NWTA and ABPTA be combined and expanded into a National
Aeronautical Test Alliance (NATA). NATA, once established, will provide
strategic management of the Nation's aerodynamic, aerothermodynamic,
and aeropropulsion facilities in the areas of (1) capital investment
planning; (2) test technology investment; (3) operations policies; and
(4) business management. Day-to-day operations and management of NATA
facilities, located at the Ames Research Center (NASA), the Arnold
Engineering and Development Center (DOD/USAF), the Glenn Research
Center (NASA), and the Langley Research Center (NASA), will remain the
responsibility of the respective organizations. The NATA charter is
currently under review by the DOD.
dod subsidy
Question. What activities does NASA conduct with DOD and how are
the costs allocated? Does NASA subsidize any DOD or other agency
activities? Please quantify.
Answer. NASA and DOD cooperatively plan and conduct many Aero-Space
research activities that are pertinent to the objectives of both
agencies. Generally, the terms of the cooperation are governed by a
Memorandum of Understanding (MOU), Memorandum of Agreement (MOA), or
InterAgency Agreement (IAA). For mutual-interest activities such as
Aging Aircraft research, each agency pays its own costs and the results
are shared. Another example is where the military service provides the
wind tunnel model (of a generic configuration) or research flight
hardware and NASA provides the testing and data reduction. For the
Abrupt Wing Stall project, the F-18 configuration is of interest to the
military but the NASA objective goes beyond that to examine the
fundamental physical phenomenon. On the other hand, when a specific
developmental aircraft is the subject, such as JSF, wind tunnel testing
is done on a reimbursible basis.
Other activities, in which NASA and the DOD, DoE, FAA, or other
agencies jointly participate, which would include Steering Committees,
Partnership Councils, Technical Coordination Groups, and Executive
Committees, generally involve only personnel costs, which are borne by
the respective agency. NASA resources are not used to subsidize the DOD
or any other agency.
nasa downsizing.
Question. What is the status of NASA's downsizing efforts at each
NASA center? Has each center met its staffing reduction targets? If
not, why not?
Answer. Thus far, each NASA Center has been able to meet or exceed
the aggressive reduction targets established both internally and by the
Administration and Congress. Furthermore, 7 out of 10 Centers have
reached their outyear FTE targets ahead of schedule. These 7 Centers
can now begin to replenish and rebalance the skills that were drained
during the severe hiring constraints of the last 6 years. The remaining
3 Centers, JSC, KSC, and MSFC, still need to downsize further to meet
their outyear targets as losses have not materialized as planned. (See
attached chart for graphic depiction of outyear targets).
aging physical plants
Question. Through the years NASA has built an extensive physical
infrastructure at its centers located throughout the nation. During
times of budget constraints, the physical plant of agencies is often
neglected.
Does the agency have a plan to maintain the capability of its
physical plant?
Answer. NASA completed an extensive Facility Investment Study in
fiscal year 1997. In this study, we classified our facilities as
mission direct, mission support, and center support. Each field center
used a team of research and mission managers to determine the capital
repair deficiencies of its facilities in each category (from the
perspective of high, moderate, and low risk). This study showed us that
we had, indeed, been underinvesting in our facilities maintenance and
revitalization.
NASA's physical infrastructure exceeds 5,000 buildings and other
structures consisting of roughly 43 million square feet. These
facilities average over 40 years in age with 7 million square feet at
60 years old and 3 million square feet up to 70 years old. To assure
that the highest priority needs relative to accomplishment of NASA's
Strategic Plan are addressed in future facility budgets, NASA is now in
the closing phase of an agency-wide core capabilities study. This study
will enable us to direct our limited facilities maintenance and
revitalization dollars to only those facilities that will be needed
from here on out. The results of this study will be available in time
to incorporate into the fiscal year 2001 budget submission to OMB.
Question. How much is requested in fiscal year 2000 for such
efforts and what are the future year projected costs?
Answer. NASA's fiscal year 2000 budget request includes $141
million in Construction of Facilities (CoF) in fiscal year 2000 and
$140 million per year thereafter for revitalization of some critical
facilities. Considering the potential risk of known facility
deficiencies on Agency research and operations, the investment level is
less than the amount recommended by the Facility Investment Study and
significantly below what is needed to revitalize all of NASA's current
facility inventory. The $140 million, however, will mitigate the most
critical facilities deficiencies and safety risks known to NASA at this
time. The results of the core capability study will likely identify a
greater need for facility revitalization investment. In the meantime,
NASA centers plan to spend over $200 million in non-CoF dollars
annually for routine, day-to-day maintenance of the Agency's physical
plant.
year 2000 computer problem
Question. What is the status of NASA's Year 2000 computer problems?
Answer. As of April 30, 1999, NASA has essentially completed all
Y2K repairs on mission-critical and non-mission-critical systems. We
have one remaining mission-critical system that will complete
implementation in June (we deferred SOHO Y2K repairs until the
spacecraft was recovered) and one mission-critical system left to
retire in August 1999. We have a modest amount of work that we will
complete this summer for non-mission-critical systems, primarily in
ensuring our desktop environments are Y2K compliant.
Meeting the Government-wide goals for Y2K work has required the
most extensive ``top down'' and ``bottom up'' review of the Agency's
information technology assets supporting missions, systems, and common
infrastructure and facilities undertaken to date. No significant Agency
asset has been untouched--we have tested and remediated (where
necessary) our ground control systems, flight hardware and software
supporting human and robotic programs, mission operations support
systems, common infrastructure systems, and institutional systems. The
results of this extensive Agency-wide effort is evidenced by the
following:
--Repaired, replaced or retired 158 mission-critical systems and 350
non-mission-critical systems, representing thousands of complex
hardware and software modules and components (including ground
control systems, flight hardware and software, mission
operations support, institutional systems).
--Validated over 6000 commercial products used on the Agency's
supercomputing, mainframe, midrange, desktop, and network
assets.
--Tested over 52,000 workstations and servers.
--Tested in-flight system software and hardware for NASA's wide range
of spacecraft, satellites, instruments, and aircraft.
--Tested NASA's unique research and development infrastructure--
hundreds of simulators including wind tunnels, testbeds,
computational facilities, and propulsion and flight-test
facilities.
While these accomplishments are significant, NASA is going beyond
stated requirements to ensure we are ready for the new millennium.
Throughout 1999, we will be conducting mission-specific end-to-end
tests to demonstrate Y2K readiness. End-to-end tests will be conducted
for the Space Shuttle Program; the International Space Station; and
NASA's command, tracking, telemetry, and data services supporting all
satellites and spacecraft. Major missions supporting the Space and
Earth Science Enterprises are also conducting end-to-end tests
throughout the summer to demonstrate Y2K readiness. We have also
prepared plans that address operating contingencies for our missions,
programs, and systems to ensure we are prepared for a Y2K-related
failure of internal assets or national infrastructure. Our plans build
on existing and proven flight rules, operations, disaster recovery, and
contingency procedures.
Question. What about the impact on the numerous satellites, which
are currently operational?
Answer. Satellite timers do not keep track of calendar dates, so
there are no date dependent elements provided in most satellite or
spacecraft hardware. However, NASA satellites do have many time-related
functions in onboard flight software. These times related functions are
necessary for many operational activities and include ephemeris
processing, processing of stored commands, and other scheduled
processes. The format of time used by flight software is not stored or
processed as a calendar date, with days or years. Instead, onboard
satellite times are kept via counters that begin to accrue time
starting with a given event or epoch and are thus unaware of calendar
perturbations. As the satellite data is received at the ground station
via telemetry and processed by the ground systems, the relation between
the onboard time and the ``wall-clock'' time is established. I would
like to emphasize, however, that NASA has assessed and tested or
validated that all flight software and hardware is Y2K compliant. As
expected, no changes to flight software or hardware have been required.
I would like to use NASA's Hubble Space Telescope (Hubble) as an
example to highlight actions we have taken to assure the health and
safety of NASA spacecraft relative to Y2K. As you know, Hubble was
launched in April 1990, and is one of NASA's great observatories of
astronomical observations in space. Hubble provides an excellent
illustration of how time is processed for spacecraft. All of the
computers on board the observatory depend only on the Hubble onboard
clock for time information. The Hubble onboard clock is a free running
125 millisecond counter that has been incrementing since launch. This
clock does not contain any date information but expresses time using 32
bits. Rollover to zero occurs after 17.024 years (from launch) and will
occur in the year 2007. Rollovers of stored command time occur
approximately every 24 days and are routine. Embedded systems planned
for installation during servicing missions are designed to be Y2K
compliant. Time correlation to calendar date for all Hubble commands
and telemetry (engineering and science data) is performed in the ground
systems. As we have validated on all NASA spacecraft, the Y2K is not an
issue for the Hubble onboard computers and embedded microprocessors.
Ground systems, the commercial utility infrastructure, the
commercial telecommunications infrastructure, and NASA's data
distribution systems on the ground do, however, use calendar dates and
are potentially affected by Y2K. Let me address briefly how we have
mitigated Y2K risks associated with each of these elements that are so
critical to maintaining the health and safety of NASA spacecraft.
As part of NASA's ongoing Y2K assessment, we have identified Y2K
problems for ground systems primarily in the areas of ground system
operating systems, Commercial-off-the-Shelf (COTS) components, and
mission-unique custom software. Ground systems do rely on calendar
dates, for example, to include date and time labeling of received data
and to make various operational events occur at specific dates and
times. If the applications, computer operating systems, or computers do
not recognize or interpret certain dates correctly, the systems may
produce erroneous data, malfunction, or simply stop working.
NASA established a very aggressive Y2K program in August 1996. Our
program is modeled on the General Accounting Office framework for Y2K
awareness, assessment, renovation, validation, and implementation. We
have established specific Agency-wide requirements and guidelines that
have been consistently followed by all NASA Centers. As part of our
initial assessment, we inspected software code and/or conducted
preliminary testing for NASA systems to determine Y2K remediation
requirements. We have renovated custom-developed code and made
necessary COTS upgrades or replacements for supporting ground systems.
As part of our validation phase, systems have been tested against
specific Agency-wide test requirements and must be formally certified
as Y2K compliant by a NASA employee. Consistent with our rigorous
systems management practices, validated ground systems were run in
parallel with operational non-Y2K compliant systems using ``current
time'' operational data to ensure operational functions were not
impacted by Y2K upgrades. Only after satisfactory operational and
independent test team checkout were systems transitioned to operations.
In addition to these requirements, NASA missions have executed or
will execute end-to-end Y2K test plans that include testing or
simulation of critical mission functions supported by the instruments
on board, the spacecraft itself, and the ground systems. While the
testing details vary from mission to mission, testing involves setting
the clock forward and rolling through the millennium roll-over and
other key Y2K dates. For those missions to be launched in the latter
part of 2000, Y2K compliance tests will be incorporated as a natural
part of routine integration and acceptance testing. An example of an
end-to-end test recently completed was the Space Science/Deep Space
Network test. For this test, we advanced the clocks to February 25,
2000, and tested the data flows from the Cassini spacecraft (a mission
to explore Saturn) to the Deep Space Network-Goldstone Deep Space
tracking station, through the Cassini test bed, and finally to two
participating Cassini Principal Investigators. The Principal
Investigators were at remote sites in Baltimore, Maryland, and the
United Kingdom. The test accomplished all of its objectives and
instilled confidence that NASA will not experience Y2K anomalies in
tracking planetary spacecraft in the year 2000 and beyond.
Let me again use the Hubble Space Telescope as an example. The
Hubble ground system actually consists of 36 mission-critical and 20
non-mission-critical computer systems, comprised mainly of COTS
computer hardware and software, some government off-the-shelf software,
and several million lines of applications software unique to Hubble.
Each of these computer systems contains an internal clock with calendar
date information. Correct time and calendar date capability is vitally
important to Hubble mission-critical operations activities such as the
execution of commands by the observatory; proper and accurate telescope
pointing; communications between the observatory and the Space
Telescope Operations Control Center; and time tagging of science data.
In early 1997, Hubble initiated a comprehensive and thorough effort
spanning the operations, ground systems, and flight software to ensure
operability in the year 2000 and beyond. All systems were assessed,
remediated (where required), and rigorously tested. In addition, Hubble
end-to-end tests were executed to independently verify Y2K compliance
for all mission-critical systems. To conduct this test, we used a
facility that replicates the Hubble electrical and electronics systems
that is comprised of the actual flight spare components used for on-
orbit servicing of the observatory. All final testing of any changes to
flight hardware and software is conducted using this facility because
it is the most faithful and highest fidelity replica of Hubble flight
systems. During the end-to-end testing, all mission-critical ground
system components and Y2K critical dates were exercised using a set of
observation proposals, planned observations, and stored command loads
to accurately simulate the full range of mission operations with the
observatory. Based on these successful tests, Hubble was certified Y2K
compliant in March 1999.
Another example I would like to share relates to NASA's Tracking
and Data Relay Satellite System (TDRSS). TDRSS is a communication
signal relay system that provides tracking and data acquisition
services between low earth orbiting spacecraft and NASA/customer
control center and data processing facilities. Customers which rely on
TDRSS to deliver command and telemetry data include the Hubble Space
Telescope, the Space Shuttle, the Compton Gamma Ray Observatory,
Landsat, the International Space Station as well as other current and
planned low earth orbiting satellites.
The TDRSS is comprised of a space and ground segment. The existing
space segment was developed by TRW, and consists of six on-orbit
satellites located in geosynchronous orbit. These spacecraft are
vintage 1970's design that has a very primitive 8-bit processing
capability that does not maintain or use a clock on-board the
spacecraft. Instead, the ground station sends real-time commands to
configure the spacecraft to support user services and to step the
antennas to track both user spacecraft and the Ground Station at White
Sands, NM.
Currently under development are three replenishment satellites that
are being designed and built by Hughes Space and Communications. These
satellites are based upon their standard HS601 series of satellites.
The first of this series, TDRS-H, is presently undergoing factory test
and integration. Although the launch is planned for the fall of 1999,
the satellite will not be placed into operational service until after
the century transition. Hughes has performed specific testing of the
flight software on the three replenishment satellites to ensure that no
problems exist with respect to Y2K.
The TDRSS ground segment is located in New Mexico and consists of
two functionally identical ground terminals known collectively as the
White Sands Complex. The communications traffic between low-earth
orbiting satellites being supported by the TDRSS--uplink and downlink--
pass through the White Sands facility. Work to remediate TDRSS ground
systems is complete and verified to be Y2K compliant. In summary, the
entire TDRSS--existing satellites, replenishment satellites, and ground
systems--has been successfully verified to be Y2K compliant.
A technical problem similar to but not directly related to Y2K
involves the US Space Command Global Positioning System (GPS). As I am
sure you are aware, GPS is based on about two dozen satellites that
orbit the Earth and send navigational signals. Two upcoming events may
affect civil GPS users and government users of commercially procured
receivers--GPS End of Week rollover and Y2K issues. GPS End of Week
rollover happens every 20 years because GPS system time counted in
weeks started counting on January 6, 1980. At midnight between August
21 and 22, 1999 the GPS week will rollover from week 1023 to 0000. This
could be interpreted as an invalid date in GPS receivers that were not
designed to meet GPS specification. The Department of Defense is the
service provider for GPS and has verified that all generations of GPS
satellites and ground support systems are Y2K and End of Week rollover
compliant. NASA has assessed the impact of this known problem with GPS
receivers, and has replaced or upgraded a small number of GPS receivers
where required, either for this GPS-unique problem, or due to Y2K
reasons. We do not anticipate problems with GPS receivers on August 21,
1999 or on January 1, 2000.
NASA remains confident that the probability of a Y2K-related
failure of NASA-controlled assets and systems is very low. We are,
however, reliant on national and local infrastructure such as
telecommunications and electrical power for spacecraft operations. All
NASA missions routinely develop contingency plans to deal with the
unexpected, including on-orbit anomalies. Each NASA Center has
developed Y2K business continuity plans for NASA operating missions and
supporting infrastructure that are based on these existing and proven
plans. NASA's critical ground systems currently include provisions to
mitigate the impact of short-term failures of the commercial power and
telecommunications infrastructure which occur during day-to-day
operations. Independent power sources such as batteries and generators
exist to support continuing operations in the event of a commercial
power failure. Diverse routing of communications traffic within our
primary commercial telecommunications service provider and the
capability to route data across other commercial telecommunications
service providers exists to support continuing operations in the event
of a commercial telecommunications failure. NASA plans have been used
in actual utility outage conditions, systems failures, and recoveries.
We know these plans work and believe that these contingencies will work
during the Y2K rollover.
As an added precaution, NASA missions are implementing additional
measures during important Y2K dates. Prior to the rollover, we will
backup critical data and ensure that adequate storage exists to save
data that may not be able to be processed in the event a Y2K problem is
encountered. For the most part, missions will be put in a quiescent
state, and we are evaluating strategies to minimize data gathering or
scheduled operations activities. New orbital parameters may be uploaded
just prior to the rollover to allow the mission to proceed with minimal
ground contact during the first few days or hours of 2000. During the
rollover weekend, we will have key operations staff at each NASA Center
to monitor and support critical operations, and resolve and report any
anomaly, Y2K or otherwise, through established operational procedures
and management processes. In addition, we will have extra staff at each
NASA Center to communicate frequent Y2K status of all NASA assets and
systems to my Office at NASA Headquarters, both affirmations of
positive status and problem reporting. To ensure a coordinated, well-
planned, and appropriate response to any Y2K anomaly, priorities for
problem resolution across missions are:
--Health and safety of the spacecraft
--Health and safety of the onboard instruments
--Real-time mission operations (command uplink and telemetry
downlink)
--Non-real time mission operations including spacecraft system
analysis, sequence
--Generation, and navigation
--Science data capture
--Science data product generation and archiving
The impact on NASA if there is a Y2K-related failure depends, of
course, on the nature of the failure and the duration of the failure.
Many of the possible failures would be inconvenient, but would not
necessarily result in permanent loss of data. All NASA operating
missions have standard operational procedures in place to handle ground
contingencies, and would be placed in ``safehold'' status until the
contingency was resolved. The likelihood of a Y2K failure causing
damage to spacecraft or causing an extended period of downtime is
considered to be very remote.
In summary, NASA believes it has taken aggressive steps to assure
the safety and integrity of our spacecraft, satellites, and supporting
ground systems and infrastructure. In addition, we have adequate plans
in place to address operational anomalies due to Y2K problems, and we
will continue to validate and refine these plans throughout the
remainder of 1999. NASA is committed to ensuring that NASA's missions
and programs move smoothly into the new millennium.
russian missile technology transfer problem
Question. A number of concerns have been raised about the
possibility of and continuing risk that Russia is transferring
sensitive missile technology to countries like Iran and Communist
China.
This is critical and what steps is NASA taking to curtail such
activity. For example, what is the scope of this problem? What specific
steps is the Administration taking to modify Russian behavior?
Answer. Over the past three years, the Administration has placed
nonproliferation at the top of the U.S.-Russian agenda and has pressed
an intensive effort at the highest levels in the Russian government to
prevent Russian entities from aiding Iran's missile program. President
Clinton discussed this issue at length with Russian President Yeltsin
and Prime Minister Stepashin at the G-8 Summit in Cologne in June of
this year. The Vice President, also made this matter a major theme of
his recent talks with Prime Minister Stepashin. Members of the Cabinet,
including Secretary of State Albright and National Security Advisor
Berger, all have active dialogues ongoing with their Russian
counterparts about nonproliferation as part of the Administration's
full court press on this issue. Further, the Department of State and
National Security Council staff work closely with NASA and keep NASA
apprised of nonproliferation developments as they relate to Russia.
This effort has achieved results. Russia has taken positive steps
such as enacting a new export control law (signed by President Yeltsin
at the end of July), instituting sweeping export control regulations
(including ``catch all'' provisions), and investigating and stopping
some activities of concern. Russia has not yet succeeded in completely
cutting off the flow of sensitive materials and technology to Iran.
Russian authorities, particularly those with responsibility for law
enforcement and security matters, must now use these new tools to crack
down on violators and to demonstrate that Russia's is building an
effective export control system.
The Clinton Administration continues to mount a strong, high-level
diplomatic effort to urge action by the Government of Russia to end
cooperation by Russian entities with the Iranian missile program. The
key is to find the right mixture of carrots and sticks to convince
entities that there are benefits from avoiding cooperation with Iran
and to apply tough penalties against entities that engage in activities
of proliferation concern.
In the last few months, U.S. and Russian experts have developed an
action plan aimed at curtailing cooperation by Russian entities with
Iran's missile program. The plan includes enhanced export control
measures, including development on a priority basis of internal
compliance offices at several entities of concern, and other
transparency measures. U.S. and Russian experts have met several times
in recent months to discuss implementation of these plans. We have also
offered technical assistance to help Russian entities set up necessary
export control regimes.
While NASA is not directly involved in these important discussions
with the Russian Government on missile proliferation concerns, we are
actively engaged with the Department of State and the National Security
Council staff to ensure that we are vigorously supporting overall U.S.
foreign policy and security objectives. NASA Administrator Goldin has
frequently emphasized to Russian Space Agency (RSA) General Director
Koptev and other senior Russian Government and industry officials the
importance of adhering to Missile Technology Control Regime guidelines
in their activities with other countries. In their interactions with
RSA and its contractors at all levels, NASA officials emphasize that
NASA fully supports and implements the U.S. Government's
nonproliferation and security objectives.
Question. What guidance has the Administration given NASA and what
role do you expect NASA to play relative to its relationship with
Russia?
Answer. NASA will continue to adhere to the established U.S.
Government export control guidelines and regulations in its dealings
with Russia.
The International Space Station (ISS) is one of the most visible
symbols of our engagement with Russia. It has created an opportunity
for unprecedented interaction and cooperation with Russian government
personnel, aerospace enterprises, and academic experts.
Moreover, continued Russian participation in the ISS serves one of
our major nonproliferation objectives by ensuring that key Russian
scientists, technicians and enterprises are productively engaged in
programs that are mutually beneficial to the United States and Russia,
instead of activities that give rise to proliferation concerns. U.S.-
Russian cooperation in ISS helps provide legitimate alternatives to
engaging in activities harmful to world peace and stability.
Question. What steps will NASA take if it is clear that Russian/
Iran cooperation on technology transfer continues?
Answer. We share the concern of the Congress regarding Iran's
efforts to acquire technology and expertise related to its WMD and
missile programs. Hindering Iran's efforts is a top priority of the
Administration's Iran policy and of our wider regional and
nonproliferation policies. NASA is prepared to undertake whatever steps
are deemed necessary by the Administration to address this potential
concern.
contracting
fixed cost vs. cost plus contracting
Question. Please describe the circumstances in which fixed cost
contracting and cost plus contracting are used.
Answer. Two common types of Federal contracts are fixed-price
contracts and cost reimbursement contracts. Federal Acquisition
Regulation (FAR) 16.202-2 provides that:
A firm-fixed-price contract is suitable for acquiring commercial
items (see FAR Parts 2 and 12) or for acquiring other supplies or
services on the basis of reasonably definite functional or detailed
specifications (see FAR Part 11) when the contracting officer can
establish fair and reasonable prices at the outset, such as when--(a)
There is adequate price competition; (b) There are reasonable price
comparisons with prior purchases of the same or similar supplies or
services made on a competitive basis or supported by valid cost or
pricing data; (c) Available cost or pricing information permits
realistic estimates of the probable costs of performance; or (d)
Performance uncertainties can be identified and reasonable estimates of
their cost impact can be made, and the contractor is willing to accept
a firm fixed price representing assumption of the risks involved.
In addition to firm-fixed-price contracts, there are other types of
fixed-price contracts that allow adjustment of the contract price based
on inflationary indices or contractor performance, e.g., fixed-price-
incentive contracts allow for adjusting the profit earned by the
contractor and the final contract price based on a negotiated formula,
or that contemplate redetermination of the contract price, e.g., when a
fair and reasonable firm-fixed price cannot be negotiated for more than
the initial period of contract performance.
Cost-reimbursement contracts (include cost-plus-fixed-fee
contracts, cost-plus-award fee contracts, cost-plus-incentive-fee
contracts) are suitable for use only when uncertainties involved in
contract performance do not permit costs to be estimated with
sufficient accuracy to use any type of fixed-price contract (FAR
16.301-2). For instance, a cost reimbursable contract typically would
be used for research and development contracts, such as the development
of a Space Shuttle.
nasa comments on gao report entitled ``information security: many nasa
mission-critical systems face serious risks''
NASA has reviewed the final GAO report and, as with the draft
report, agrees with many of the findings and all of the
recommendations. We find the final report to be very useful to the
Agency. It reinforces the recommendations made by our recent Agencywide
Information Technology (IT) Security review and provides additional
recommendations which assist in better protecting NASA's IT assets. We
reiterate our appreciation of the professional quality of the GAO
review and the productive working relationship established between the
auditors and NASA officials.
In our response to the draft report we expressed two concerns. The
first was triggered by a statement in the Conclusions section of the
report that, ``NASA's mission-critical systems are vulnerable to
unauthorized access and sabotage.'' We believed that this statement
could have been misunderstood to mean that all of NASA's mission-
critical systems at all of its Centers could be penetrated. We note
that the final report was changed to, ``Many of NASA's mission-critical
systems are vulnerable to unauthorized access and sabotage * * * ''. We
appreciate the change that was made. However, NASA does take
extraordinary steps, not noted in the study, to protect certain systems
and networks prior to events such as launches. We believe that these
steps are very effective, but due to the increasing capabilities and
motivation of those who would harm NASA, we are not complacent and
continue to make improvements. NASA takes very seriously the GAO
findings in the area of IT Security management, and we will correct our
deficiencies. We agree that the Agency must manage IT Security more
effectively, and by doing so will provide better protection for all of
our mission-critical systems.
The second concern we expressed in our response to the draft report
still exists in regard to the final report. Namely, that because the
GAO audit, like any audit, is a snapshot in time, the reader may
conclude that NASA is doing little to improve its IT Security posture.
We are far from indifferent to IT Security which, after the Year 2000
effort, is our highest IT priority. As a result, we are working
diligently to implement the 33 recommendations made in our Agencywide
IT Security review and each of the recommendations contained in the GAO
report. GAO is correct that some of our recommendations will take up to
2 years to implement fully. That is largely because we are making
fundamental improvements in the skills of both our civil service
personnel and contractors. Suitable training curricula in some areas,
for example, are just now becoming available. We believe the result
will be worth the required investment in time and resources, and we are
making that investment.
NASA is also taking near-term action to make the following
improvements:
--In December 1998, we purchased Public Key Infrastructure (PHI)
digital certificates for every NASA employee that will allow us
to encrypt sensitive data, provide digital signature
capabilities, and perform strong authentication. We are
implementing the PKI capabilities Agencywide this fiscal year.
We are the first civilian federal agency to pursue Agencywide
PKI capability.
--This fiscal year, we have purchased and are now implementing
Agencywide a common set of auditing and monitoring tools that
will allow us to better monitor the security status of all our
systems, better detect intruders, and, because the tools are
common, better coordinate our response to attacks against
multiple Centers.
--In October 1998, the NASA Administrator issued a letter to Center
Directors reinforcing the policy concerning reporting of IT
Security incidents to the NASA Automated Systems Incident
Response Capability (NASIRC). Shortly thereafter, the NASA CIO
provided additional, detailed guidance in this regard to the
Center Directors. Incident reporting to NASIRC is improving as
a result, but we continue to require better compliance in this
area.
--We have successfully completed penetration testing of one of our
Centers by another Center to allow us to determine, through
testing much like GAO conducted at one NASA Center, the
effectiveness of NASA's protection of its IT assets. We will
use the lessons-learned from this year's experience to both
better secure our systems and perform independent penetration
tests in succeeding years.
--NASA's IT Security training plan has been approved and is being
implemented. It includes training activities consistent with
recommendations contained in the GAO report. As noted in the
GAO report, in 1998 NASA developed a multimedia CD-ROM which we
believe provides excellent IT Security awareness training. We
have distributed the CD-ROM to all the Centers.
--NASA has completed the review process for its revised, detailed IT
Security guidance, including final legal review, and is
preparing it for signature by the Associate Deputy
Administrator.
--We are conducting IT Security workshops on a regular basis so that
the Center IT Security Managers, network engineering/operations
personnel, and outsourcers can exchange information and develop
approaches to improving NASA's IT Security.
--The NASA Administrator issued a message to all employees in May
1999, entitled ``The Safety of Information Technology Begins
With You'', stating that IT Security is part of the Agency's
safety campaign and that `` * * * I want to emphasize one area
where we can and must improve: assuring that our computer
systems and data are safe and secure.''
--The NASA CIO issued a letter to all Center Directors in May 1999,
giving direction on adherence to IT Security policy. The letter
addressed IT Security plans, IT security training, auditing and
monitoring tools, PKI rollout, assessing Center compliance with
IT Security policy, NASA information made available through the
Internet, and IT security incident reporting.
--The NASA CIO, as part of the Agency's security campaign, has
visited and briefed two of our Centers on the need for IT
Security and the requirement to adhere to the Agency's policies
in that area. The Center Directors at the two Centers mandated
attendance by all Center senior and line management, civil
service and contractor, at the briefings. The NASA CIO will
brief all Centers by the end of the fiscal year.
--The field Center involved in the GAO/NSA penetration test has made
very good progress in repairing the vulnerabilities documented
in the penetration test report. Most of the vulnerabilities
have been repaired or dispositioned. The remaining
vulnerabilities will be repaired by January 31, 2000.
Completing repair of the remaining vulnerabilities earlier
would introduce unacceptable risk to the missions which depend
upon the affected systems.
NASA believes that the actions taken since the completion of the
GAO audit and issuance of the draft report, those that are in process
and planned as a result of our Agencywide review, and those initiated
as a result of the GAO review will make NASA a leading agency in IT
Security. We acknowledge the timely assistance that GAO provided
through the assessment documented in its final report.
Following is our detailed response to the specific recommendations
provided in the GAO final report. Our response is generally the same as
that to the draft report, with a status field added to indicate our
progress since our comments on the draft report.
specific response to gao recommendations
NASA concurs with all the recommendations of the GAO report. The
table below provides our response for specific elements of the first
high-level GAO recommendation: ``We recommend that the NASA
Administrator with support from NASA's CIO, implement an effective IT
security program that is consistent across NASA's field centers and
incorporates the following key elements:''
----------------------------------------------------------------------------------------------------------------
Projected
Recommendation Concur? Corrective actions timeframe for Action status
completion
----------------------------------------------------------------------------------------------------------------
1. Assessing risks and Y.................
evaluating needs which
includes the following.
a. Develop and instituting During the last NPG 2810 issuance: All reviews of NPG
a review process to ensure quarter of fiscal July 30, 1999. 2810, including
that managers conduct year 1998, we Letter to Center legal review
complete risk assessments implemented, and Directors stating completed. In
for all major systems the revised responsibilities preparation for
prior to the systems detailed IT in IT Security signature by the
becoming operational upon Security guidance area: 3rd Associate Deputy
significant change, or at (NPG 2810) will Quarter, fiscal Administrator.
least every 3 years. reinforce the year 1999. Completed. Letter
requirement for by NASA CIO to
reporting of Center Directors
metrics in this issued May 12,
area to the NASA 1999.
IT Security
Principal Center
who presents the
information to the
NASA CIO. Metrics
will be collected
each quarter.
In addition
consistent with
the NASA
management model
we will require
Center Directors
working through
Center CIO's, to
implement a review
process to ensure
that the risk
assessment policy,
as with all IT
Security policies
and procedures, is
adhered to at
their Centers.
b. Formally authorizing all NPG 2810, when NPG 2810 issuance: All reviews of NPG
systems before they become issued, will July 30, 1999. 2810, including
operational and at least include this legal review,
every 3 years thereafter. requirement. completed. In
Metrics will be preparation for
collected each signature by the
quarter. Associate Deputy
Administrator.
2. Implementing policies and Y.................
controls, which includes the
following.
a. Streamlining the Since NPG 2810 has 4th Quarter, On track.
policies-making and taken longer to fiscal year 1999.
standards-setting process implement than we
for IT security so that had planned, we
guidance can be issued and have issued a
modified promptly to number of
address changes in threats management letters
and vulnerabilities giving guidance in
introduced by rapidly specific areas
evolving computer and that required
telecommunication immediate
technologies. attention. We will
develop and
implement a more
streamlined
process for IT
Security guidance
to supplement our
existing policy
process.
b. Developing and issuing NASA will issue 4th Quarter, On track.
guidance that specifies guidance in this fiscal year 1999.
information that is area. Since one of
appropriate for posting on NASA's primary
public World Wide Web missions is
sites and distinguishes dissemination of
this from information that knowledge to the
is sensitive and should be American public,
more closely controlled. our policy must be
carefully crafted
to ensure that we
are excluding,
from World Wide
Web posting, only
that information
that must be kept
from public
dissemination. We
must take the time
necessary to
develop
appropriate
guidance
consistent with
our mission.
3. Developing and issuing Y................. NPG 2810, when NPG 2810 issuance: All reviews of NPG
guidance that identifies issued, will July 30, 1999. 2810, including
critical systems, including include this legal review,
those involved in the command guidance. completed. In
and control of orbiting Consistent with preparation for
spacecraft, that require OMB A-130 and signature by the
strong user authentication. NASA's approach to Associate Deputy
unclassified IT Administrator.
Security, guidance
in this area will
be based on risk
assessments.
4. Monitoring compliance with Y................. Consistent with the Letter to Center Completed. Letter
policy and effectiveness of NASA management Directors stating by NASA CIO to
controls, which includes (he model, we will responsibilities Center Directors
following. require Center in IT Security issued May 12,
a. Developing and Directors, working area: 3rd 1999.
implementing a management through Center Quarter, fiscal
oversight process to CID's, to year 1999.
periodically monitor and implement a review
enforce field centers' process to ensure
compliance with agencywide that all IT
policy. Security policies
b. Ensuring that independent and procedures,
audits or reviews of systems' including those
security controls are related to audits/
performed at least every 3 reviews and
years and that identified correction of
weaknesses are expeditiously weaknesses, are
corrected. adhered to at
their Centers.
Metrics will be
collected each
quarter and
reported to the
Principal Center
for IT Security
and to the NASA
CIO to monitor
Centers'
compliance with
Agencywide policy.
5. Providing required computer Y................. NASA's IT Security
security training, which Training Plan has
includes the following. been approved and
includes
requirements for
training
consistent with
GAO's
recommendations.
a. Developing and Our IT Security 4th Quarter, On track.
implementing a structured training approach fiscal year 2000.
program for ensuring that includes two Intermediate
NASA employees receive components: (1) milestones exist/
periodic training in end-use awareness under development
computer security to and training, for
provide them with the training for implementation of
awareness, knowledge, and program/project portions of the
skills necessary to managers in risk program and
protect sensitive management training
information and mission- (including risk percentages of
critical systems. analysis), and users.
training for
Center IT Security
Managers; (2)
training for civil
service and
contractor system/
network
administrators
which we interpret
to be GAO
recommendation
5.c. The time-
frame for this
recommendation
refers to the
first component..
5. Providing required computer Y................. NASA's IT Security
security training, which Training Plan has
includes the following. been approved and
includes
requirements for
training
consistent with
GAO's
recommendations.
b. Modifying relevant Modification of On track.
contracts to include existing
provisions for ensuring contracts: 3rd
that NASA contract Quarter, fiscal
personnel are similarly year 2000.
trained. Language for
inclusion in new
contracts to be
developed in 4th
Quarter, fiscal
year 1999.
c. Developing and All civil service On track.
implementing a program for and contractor ..................
certifying that NASA civil system/network ..................
servants and contract administrators: On track.
employees are competent to 3rd Quarter,
discharge their IT fiscal year 2001.
security-related 50 percent of all
responsibilities. civil service
system/network
administrators:
4th Quarter,
fiscal year 2000.
6. Coordinating responses to Y.................
security incidents, which
includes the following.
a. Clarifying policy and This action was Clarification of Completed.
procedures for mandatory completed via a policies is All reviews of NPG
reporting of security letter from the complete.. 2810, including
incidents to NASIRC. NASA Administrator Clarification of legal review,
to the Center procedures will completed. In
Directors in be provided in preparation for
October 1998. A NPG 2810, when signature by the
subsequent letter issued: July 30, Associate Deputy
from the NASA CIO 1999. Administrator.
provided more
details in this
regard.
b. Strengthening the role This action is in 4th Quarter, On track.
of NASIRC in disseminating progress as a fiscal year 1999.
vulnerability information result of our
within NASA, analyzing Agencywide IT
threats in real time, and Security Program
developing effective Review.
countermeasures for Improvements will
ongoing attacks. be incremental
with some aspects
of the action in
place before the
completion date
noted.
----------------------------------------------------------------------------------------------------------------
The second high-level GAO recommendation is: ``We also recommend
that the NASA CIO review the specific vulnerabilities and suggested
actions provided to field center officials at the conclusion of our
penetration testing, determine and implement appropriate security
countermeasures, and track the implementation and/or disposition of
these actions''.
The NASA CIO has reviewed the vulnerabilities and suggested actions
GAO provided to field Center officials and has met with the field
Center Director to discuss vulnerabilities and the need for corrective
action. In addition, the field Center has conducted an extensive
internal study of its IT Security and has issued a comprehensive report
and set of recommendations for improvements.
The NASA CIO on June 18, 1999, conducted a review of the field
Center's progress in tracking the resolution of vulnerabilities and
recommendations noted in the GAO study. The NASA Acting Deputy CIO
conducted a follow-up review on July 12, 1999. The field Center
involved in the GAO/NSA penetration test has made very good progress in
repairing the vulnerabilities documented in the penetration test
report. Most of the vulnerabilities have been repaired or
dispositioned. The remaining open vulnerabilities will be repaired by
January 31, 2000. Completing repair of the remaining open
vulnerabilities earlier would introduce unacceptable risk to the
missions which depend upon the affected systems. The NASA CIO is
tracking the implementation and/or disposition of the remaining
actions.
Letter From Roberta L. Gross
National Aeronautics and Space Administration,
Washington, DC, October 18, 1999.
Hon. Christopher S. Bond,
Chairman, Senate Committee on Appropriations Subcommittee,
Washington, DC.
Dear Mr. Chairman: I am responding to written questions from you,
regarding the March 18, 1999, hearing before the Senate Subcommittee on
VA-HUD-Independent Agencies. I apologize for the late response. I did
not receive a copy of your questions until October 6, 1999. The
questions are set forth below. You specifically asked for an Inspector
General assessment of the priority of the following NASA activities:
security actions
Question. In light of recent reports of spying of technology at
DOE, what steps has NASA taken to ensure that sensitive NASA technology
is not being transferred, even innocently, to a foreign country?
Answer. NASA has an active export control program but needs to
establish additional internal controls to prevent unlawful technology
transfer. In order to test the effectiveness of NASA's controls, we
have initiated a series of audits and inspections. Our work has
revealed that NASA has vulnerabilities to improper transfer of
sensitive technologies. We recently published an audit on NASA's
Control of Export-Controlled Technologies. We found that NASA has not
identified all export-controlled technologies related to its major
programs. NASA also does not maintain a catalog of classifications for
transfers of export-controlled technologies in order to provide for
consistency across the Centers. Also, Agency oversight of and training
for personnel in the Export Control Program need improvement.
Specifically, annual Agency audits of each Center's export control
system were not adequately performed and NASA personnel lack training
in controlling and documenting export-controlled technologies. As a
result, NASA may not have adequate control over export-controlled
technologies to preclude unauthorized or unlicensed transfers. The
Agency was fully cooperative and responsive to our recommendations to
correct deficiencies and improve controls.
We also found that NASA does not always observe some basic controls
that could prevent unauthorized transfers of technology. For example,
during a review at a NASA center, we found that foreign nationals were
unescorted and were not properly identified as foreign visitors. We
alerted the Center Director of that issue and he took action to correct
the situation. I also reminded senior NASA management of the Agency's
responsibilities in this regard. We are currently conducting an audit
of contractor control of sensitive technologies and have found
deficiencies in NASA's oversight and contractors' practices. The
objectives of this audit, which is currently in progress, are to (1)
evaluate whether major contractors have established adequate controls
over NASA's sensitive technologies to preclude unauthorized or
unlicensed transfers, and (2) assess government oversight of contractor
processes for control of sensitive technologies. Based on our review to
date, we plan to issue a report to recommend that the Agency improve
controls and oversight. We are also performing an audit of the
Management and Administration of International Agreements. The
objectives of the audit are to (1) determine whether NASA's
international agreements are properly executed and monitored, (2)
appropriate clearances are obtained for foreign personnel with access
to NASA facilities and information, and (3) controls over release of
information are established. We will also be conducting an audit of
deemed export \1\ of NASA Information and Technology. Finally, we are
beginning a review by a team of auditors and inspectors into NASA's
Special Access Program to ensure integrity in security, procurement,
and financial administration. I would be happy to brief your staff on
the purpose and approaches of our ongoing work.
---------------------------------------------------------------------------
\1\ Any release of technology or source code subject to the Export
Administration Regulation to foreign national is deemed to be an export
to the home country or countries of the foreign national. This deemed
export rule does not apply to persons lawfully admitted for permanent
residence in the United States and does not apply to persons who are
protected individuals under the Immigration and Naturalization Act (8
U.S.C. 1324b(a)(3)). Technology or software is ``released'' for export
through: visual inspection by foreign nationals of U.S.-origin
equipment and facilities; oral exchanges of information in the U.S. or
abroad; or the application to situations abroad of personal knowledge
or technical experience acquired in the U.S.
---------------------------------------------------------------------------
My Computer Crimes Division conducts criminal investigations
concerning felonious intrusions into NASA computer systems. Through our
assessments of these intrusions, we observe that NASA is at risk for
loss of sensitive technologies. There are instances in which our
investigators have found poorly administered systems, with improper
configurations and current patches not applied. NASA too often lacks
properly configured firewalls and dedicated skilled security staff. At
some field locations, central direction is lacking and there is poor
intrusion reporting both to NASA's incident response center and the
Office of Inspector General (OIG) Computer Crimes Division.
Loss of sensitive technology may also occur during the process of
excessing computers. My inspections staff has found that NASA has
failed to adequately wipe excess computers clean of controlled or
proprietary data. We have alerted the Agency to this problem over the
last several years and continue to conduct spot-check inspections of
the Agency's practices.
The Agency has taken steps to address many of these
vulnerabilities. For example, the Chief Information Officers, along
with security personnel, have addressed NASA centers on their
responsibilities for network security and sensitive technologies. NASA
has moved forward in its attempts at strong security through the use of
a Public Key Infrastructure (PKI). NASA selected one vendor to meet its
public key encryption requirements. However, the distribution and
training of the PKI has been slow. Also, the NASA Administrator has
requested the FBI conduct surveys at each of NASA's principle field
centers to help assure that the Agency's counterintelligence and
technology transfer postures are sufficient to face the security
challenges of the future. The FBI plans to use the information obtained
from these surveys to make recommendations on how the Agency can
strengthen its counterintelligence programs, ensure consistent high
standards at all centers, and effectively link the programs with
intelligence and law enforcement communities. We provided the FBI with
recent OIG reports that we believe will be helpful to their efforts. I
also wrote to Neil Gallagher, Assistant Director, National Security
Division (FBI), and offered to assist his staffing this assessment.
internet protection
Question. What steps has NASA taken to ensure the integrity and
protection of its computer systems and data banks?
Answer. NASA's missions and programs depend on properly managed
information resources. Moreover, NASA is a significant investor in
Information Technology (IT) ($2.1 billion in fiscal year 1999). To
streamline operations, NASA is consolidating and outsourcing various IT
operations, including local area networks and desktop computers, mid-
range computing, administrative mainframe computer operations, and
supercomputing. Outsourcing may bring fiscal and administrative
benefits, but it also increases risks because of dependency on the
vendor for technological direction; IT security; vulnerability of
strategic information to outsiders; and dependency on the viability of
the vendor.
For the past three years, I have identified IT security as a
material weakness of NASA for inclusion in the Agency's annual Federal
Manager's Financial Integrity Act (FMFIA) Report. NASA, however,
characterizes IT security only as a ``significant concern.'' I also
list IT security as one of the top ten challenges facing NASA
management. This information has been shared with NASA's oversight and
appropriation Chairs and Ranking Minority members, as well as Chairman
Fred Thompson of the Senate Governmental Affairs Committee, Chairman
Dan Burton of the House Committee on Government Reform and Oversight,
and Representative Dick Armey, the House Majority Leader. The top ten
management challenges are also shared with NASA and posted to the
Internet (http://www.hq.nasa.gov/office/oig/hq/reports.html and look
under ``Memoranda and Letters--PDF.'').
Our concerns focus on the fragmentation of the IT security program,
the lack of up-to-date policies and guidance, network physical and
system security weaknesses, the lack of properly trained personnel, and
lack of adequate threat analysis. In May 1998, the Acting Deputy
Administrator, acknowledging significant IT security issues raised by
the OIG, requested a review of NASA's IT security program. The final
report recognized numerous deficiencies. The Agency is committed to
implementing a wide range of improvements but implementation is slow.
Some no-cost and very low-cost steps can be taken but often are not
(e.g., properly configuring networks and firewalls and applying current
patches are inexpensive fixes.)
A synopsis of some of our work in these areas is enclosed as
Enclosure 1. Also, a list of our planned work in these areas for fiscal
year 2000 is also enclosed as Enclosure 2. I will be pleased to meet
with you and your staff to discuss our work and assessments in these
areas.
If you need additional information, or would like copies of any of
the listed reports, please call me at (202) 358-1220.
Sincerely,
Roberta L. Gross,
Inspector General.
Enclosure 1
INFORMATION TECHNOLOGY--PRIOR WORK
------------------------------------------------------------------------
Program area Reports Results
------------------------------------------------------------------------
Audits......................... Disaster Recovery The NASA Automated
Planning at Data Processing
Marshall Space Consolidation
Flight Center's Center (NACC) has
Automated Data implemented a
Processing disaster recovery
Consolidation plan that includes
Center (IG-99- most of the
043). necessary
provisions for
emergency
response, extended
backup operations,
and testing.
However,
improvements are
needed in the
areas of disaster
recovery strategy,
procedures, and
training. The NACC
is addressing the
issues.
Audits......................... Ames Research The NAS Facility at
Center's (ARC's) ARC houses 30 to
Numerical 40 percent of
Aerospace NASA's
Simulation (NAS) supercomputing
Facility Disaster capability. The
Recovery Plan (IG- NAS does not have
99-032). a management-
approved disaster
recovery plan that
meets applicable
federal and NASA
requirements for
emergency response
procedures,
extended backup
operations, and
testing. ARC is
addressing the
issues.
Audits......................... Disaster Recovery NASA has
Planning at established
Kennedy Space appropriate
Center (KSC) (IG- emergency response
99-017). procedures for the
Launch Processing
System and the
Shuttle Processing
Data Management
System. However,
neither system has
an extended backup
capability to
recover from a
local disaster if
the computer
hardware is
destroyed. KSC is
addressing the
issues.
Audits......................... Numerical The overall
Aerospace management control
Simulation (NAS) structure for the
Data Center NAS facility is
Controls at Ames inadequate in
Research Center several areas
(ARC) (IG-99-010). including:
physical and
logical access
controls; computer
security controls;
file retention and
backup and
recovery
management
controls; software
change management
controls; system
accounting and
file auditing
controls; and risk
assessments. ARC
is addressing the
issues.
Audits......................... Disaster Recovery The JPL disaster
Planning at the recovery plan
Jet Propulsion needs
Laboratory (JPL) improvements. The
(IG-99-006). plan does not:
identify the
relative
criticality of
each application
to the mission,
identify when
applications must
be back in
operation, or
address the
restoration of
normal operations.
JPL is addressing
the issues.
Audits......................... Disaster Recovery The Shuttle
Planning at the Software
Johnson Space Production
Center (JSC) (IG- Facility (SPF)
99-005). disaster recovery
plan does not have
a strategy or
procedures in
place for extended
backup operations
in the event of a
disaster. The SPF
application users
have not developed
contingency plans.
JSC is addressing
the issues.
Inspections.................... Assessment of the The Office of
NASA Automated Inspector General
Systems Incident (OIG) assessed the
Response adequacy of NASA's
Capability incident
(NASIRC) (G-99- reporting,
007). response,
handling,
coordination, and
information-
sharing
capabilities. The
OIG found several
weaknesses and
vulnerabilities
and made
recommendations to
NASA management to
correct and
improve
deficiencies. NASA
concurred with all
OIG
recommendations
and identified an
action plan to
implement the
recommendations.
Inspections.................... NASA's The OIG reviewed
Implementation of the manner in
a Public Key which NASA was
Infrastructure implementing PKI
(PKI) (G-99-006). encryption
solutions by
selecting one
vendor's products
to meet key
requirements. The
OIG took exception
to the selection
process and dollar
amounts paid for
the PKI.
Inspections.................... Inspection of The OIG conducted
Kennedy Space an inspection of
Center Computer personal computer
Hard Drives (G-99- hard drives
003). designated for
transfer or
excess. We
discovered
residual user data
and copyrighted
software on the
hard drives
sampled and
determined that
procedures were
not being
followed. We made
recommendations to
improve the
implementation of
data deletion
procedures.
Inspections.................... Dryden Flight We highlighted
Research Center prudent steps that
(Dryden) Network Dryden took
Intrusion--Lesson overcoming an
s Learned (G-99- unauthorized
002). network intrusion.
We shared this
report with NASA
computer and
security officials
to communicate
lessons learned
from the Dryden
experience.
Inspections.................... Flight Termination The OIG conducted a
Systems (FTS) review of NASA's
Assessment (G-98- use of FTS. We
011) CLASSIFIED. found that NASA's
practices do not
conform to
national policy
and decisions are
not based on
appropriate risk-
based assessments.
We made
recommendations
that NASA should
comply with
national and
Agency guidance
and to move to a
more secure FTS.
The Agency agreed
to most of your
recommendations
and we are still
discussing the
remaining issues.
Audits......................... Data Center System access
General Controls privileges were
at Langley not being removed
Research Center in a timely
(LaRC) (IG-97- manner. Physical
035). access privileges
to the data center
were not reviewed
and revalidated.
Computer security
plans were not
prepared and
system security
reviews had not
been performed.
Based on our
recommendations,
LaRC corrected
these problems.
Audits......................... Information The NASA
Technology information
Capital Planning technology (IT)
and Investment investment process
Control (IG-98- does not satisfy
034). Clinger-Cohen Act
and OMB Circular A-
130, Management of
Federal
Information
Resources,
requirements for
post-
implementation
reviews of major,
new, IT
investments. NASA
initiated process
improvements which
should satisfy the
IT post-
implementation
review
requirements.
Audits......................... Improved Controls NASA's CoSMO did
Needed Over not have an
NASA's accurate inventory
Supercomputing of NASA's
Inventory (IG-98- supercomputers and
021). supercomputing
time purchased.
NASA initiated
responsive
corrective
actions.
Audits......................... Data Center We found control
General Controls weaknesses
at Marshall Space associated with
Flight Center the mainframe data
(MSFC) (IG-97- center's physical
039). security,
environmental
security,
technical
standards,
computer security
administration,
and software
change management.
Based on our
recommendations,
MSFC corrected the
weaknesses.
Audits......................... Physical Security The NAS computing
at Ames Research facility did not
Center (ARC's) have adequate
Numerical backup or
Aerospace contingency
Simulation (NAS) procedures to deal
Facility (IG-97- with physical
030). access control
system failures.
ARC corrected the
problem.
Audits......................... Data Center We found that
General Controls physical access
at Johnson Space controls to the
Center (JSC) (IG- Shuttle Software
98-005). Production
Facility needed
improvement.
Additionally, the
facility did not
have an
uninterruptable
power supply (UPS)
as a defense
against power
problems. JSC
corrected the
physical access
problem and agreed
to conduct a
feasibility study
and cost/benefit
on the UPS.
Audits......................... Data Center Physical access
General Controls controls
at Goddard Space associated with
Flight Center the Hubble
(GSFC) (IG-98- Telescope Data
006). Operations Center
(HTDOC) and the
Hubble Telescope
Servicing and
Maintenance System
facility (SAMS)
were inadequate.
Additionally,
computer risk
management plans
had not been
conducted as
required. GSFC
corrected these
deficiencies.
Audits......................... Data Center Computer security
General Controls implementation
at Jet Propulsion plans and reviews
Laboratory (JPL) had not been
(IG-98-009). developed or
conducted for
JPL's
Institutional
Business Systems
(IBS) as required
by JPL policy.
Additionally,
physical access
controls to the
IBS data center
were in need of
improvement. JPL
corrected these
deficiencies.
Audits......................... Data Center Procedures for
General Controls monitoring
at Kennedy Space unauthorized
Center (KSC) (IG- access attempts to
98-018). the Shuttle
Processing Data
Management System
were inadequate.
KSC took
corrective action.
Audits......................... Data Center The physical access
General Controls control system
at Lewis Research used to protect
Center (LeRC) (IG- LeRC's Research
98-039). Analysis Center
had not been
certified as
meeting security
requirements.
Physical access
procedures to the
facility were not
adequate. LeRC is
currently
addressing these
issues.
Audits......................... Disaster Recovery The Solar
Planning at Heliospheric
Goddard Space Observatory
Flight Center Mission Operations
(GSFC) (IG-98- Center did not
036). have computer
contingency
capabilities in
place in the event
of a disaster.
Additionally,
contingency plans
for a data center
associated with
the Tropical
Rainfall
Measurement
Mission were
incomplete.
Finally, computer
risk assessments
did not analyze
the potential
effects of losses
caused by
disasters. GSFC
agreed to
implement
corrective actions
by March 1999.
------------------------------------------------------------------------
Enclosure 2
INFORMATION TECHNOLOGY--PLANNED WORK--FISCAL YEAR 2000
------------------------------------------------------------------------
Program area Assignment Focus
------------------------------------------------------------------------
Audits......................... Deemed Export of Determining whether
NASA Information NASA has
and Technology. appropriate
policies and
procedures in
place to ensure
that technology
and information is
not inadvertently
exported to
foreign nationals.
Audits......................... Review MVS/ESA OS/ Determination of
390 Operating whether the
System Integrity operating system
and Security. environments for
the Shuttle
Software
Production
facility and the
NASA ADP
Consolidation
Center at Marshall
Space Flight
Center have been
implemented to
provide for an
appropriate level
of security and
integrity.
Audits......................... UNIX Operating Determining whether
System Security Kennedy Space
at KSC Center and the
(Carryover). United Space
Alliance have
implemented and
configured the
UNIX operating
system to provide
an appropriate
level of security
and integrity.
Audits......................... UNIX Operating Determining whether
System Security Goddard Space
at GSFC Flight Center has
(Carryover). implemented and
configured the
UNIX operating
system to provide
an appropriate
level of security
and integrity.
Audits......................... General Controls Evaluating the
at JSC's Mission adequacy of
Control Center physical access,
(Carryover). environmental
protection, and
disaster recovery
planning for JSC's
Mission Control
Center.
Audits......................... Implementation of Evaluating whether
Security Software JSC and the United
at JSC's Shuttle Space Alliance
Software have appropriately
Production implemented and
Facility configured logical
(Carryover). security software
to protect Shuttle
Software
Production
Facility systems.
Audits......................... Windows NT Evaluating whether
Security and Headquarters has
Integrity implemented and
Controls at configured
Headquarters selected NT
(Carryover). servers to provide
an appropriate
level of logical
security and
interoperability
for associated
automated systems.
Audits......................... Implementation of Examining policies
the Clinger-Cohen and procedures
Act (Carryover). concerning the
duties and
responsibilities
of the Chief
Information
Officer relating
to information
resources
management,
information
technology
acquisition
including the
performance of IT
programs, and
maintenance of an
IT architecture.
Audits......................... Presidential Evaluating whether
Decision NASA has developed
Directive 63. and implemented a
plan to protect
the Agency's cyber
assets consistent
with the
requirements of
PDD-63.
Audits......................... Certificate Evaluating the
Management. adequacy and
effectiveness of
internal controls
established for
the Agency central
Certification
Authority located
at Ames Research
Center.
Audits......................... Information Determining whether
Technology NASA and its
Acquisitions. contractors are
complying with
applicable IT
acquisition
requirements.
Audits......................... Telecommunications Evaluating whether
Manage- ment. NASA management
controls are
adequate regarding
the use of
telecommunication
services,
including voice,
data, and video
information
technology.
Audits......................... Operating System Determining whether
Controls in Major the operating
NASA Information system environment
Systems. has been
configured and
implemented to
provide for an
appropriate level
of security and
integrity.
Audits......................... Database Controls Determining whether
in Major NASA database security
Information and integrity
Systems. controls have been
adequately
implemented in the
major systems
selected for
audit.
Audits......................... Network Controls Determining whether
in Major NASA controls in the
Information network
Systems. environment are
adequate to
protect against
unauthorized
access and
transmission
risks.
Audits......................... Systems Evaluating control
Development--Chec issues associated
kout and Launch with: (1) project
Control System. management; (2)
systems
requirements
definitions; (3)
security
architecture and
requirements; and
(4) testing and
implementation of
application and
system software.
Inspections.................... Use of COTS Determining the
Software in cost, schedule,
Ground Systems. and operational
impacts of using
commercial-off-the-
shelf (COTS)
software in a
ground system.
Inspections.................... Consolidated Space To determine
Operations whether CSOC has
Contract Security anticipated
(Carryover). potential threats
and risks and has
solicited program
expertise from
appropriate ITS
and COMSEC
experts.
Inspections.................... Computer Banner To determine if the
Inspection requirement that
(Ongoing). banners be put on
NASA computers is
being followed.
Inspections.................... Status of Johnson To determine
Space Center whether NASA
Station Program management has
Implementation of accurately
Communications identified COMSEC
Security (COMSEC) and AIS
and Automated requirements
Information necessary for
Security (AIS) mission assurance
Measures and safe Space
(Carryover). Station
operations.
Inspections.................... Hard Drive 99: To determine
Clearing whether computers
Controlled in the process of
Information from being excessed
Excessed Micro- have been cleaned
computers of all data and
(Ongoing). software.
Inspections.................... Information To determine the
Technology minimum training,
Security (ITS) qualifications,
Staff and experience
Qualifications. necessary to
perform ITS
functions.
Inspections.................... NASA's To determine
Communications whether NASA's
Security (COMSEC) COMSEC program and
Program. its associated
organizational
structure are
adequate to ensure
compliance with
nationally
mandated COMSEC
policy.
Inspections.................... NASA's Compliance To determine if
with the National adequate COMSEC
Policy on the procedures and
Application of safeguards have
Communications been planned and
Security to U.S. applied.
Civil and
Commercial Space
Systems.
------------------------------------------------------------------------
______
Questions Submitted by Senator Shelby
Question. Mr. Goldin, I am pleased that we have a new director at
the Marshall Space Flight Center. Art Stevenson is providing real
leadership and has proven himself an effective advocate for a new space
transportation system that can take the space program beyond the
shuttle era. I believe we must focus now on the future, and I mean the
future beyond the space station. We need to maintain our access to
space after the shuttle wears out. Mr. Goldin, a new space
transportation system requires a strong commitment from the NASA
Administrator and the President. Do you think this country will see
that kind of commitment in the near future?
Answer. NASA spends a substantial portion of its annual budget to
meet its launch needs. To lower these costs, the 1994 National Space
Transportation Policy (NSTC-4) calls for ``government and private
sector decisions by the end of this decade on development of an
operational, next generation reusable launch system.'' NASA has set
aside an outyear wedge of funding to support these decisions. NASA is
also undertaking industry-led Space Transportation Architecture Studies
to identify private sector options for reducing NASA's launch costs.
These studies incorporate separate efforts being undertaken by NASA,
DOD and industry including: Space Shuttle safety upgrades; X-33 and
other NASA technology demonstrators (X-34, X-37, and X-38), the Evolved
Expendable Launch Vehicle for the International Space Station. As part
of the fiscal year 2001 budget process, the Administration intends to
use the results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning all of NASA's launch
requirements, including human space flight, to lower-cost, privately
owned and operated space transportation systems. Decisions on future
RLV funding, the transition from the Space Shuttle to privately owned
and operated vehicles, private sector incentives, and related issues
will be decided this fall in the context of this integrated space
transportation strategy. Details will be provided in the fiscal year
2001 budget submit.
Question. Mr. Goldin, in your vision of the future, do you foresee
a heavy launch vehicle for travel to planets such as Mars and beyond?
What type of propulsion system do you envision for this vehicle?
Answer. Per Section 3(a) of the Civil Space Guidelines in the 1996
National Space Policy, ``the International Space Station will support
future decisions on the feasibility and desirability of conducting
further human exploration activities.'' NASA's human space flight
programs are dedicated to completing development of the International
Space Station before considering in detail systems for potential future
human missions.
Question. I realize the difficulty of trying to look a number of
years into the future, but I think it is fair to ask what role you
anticipate for the Marshall Space Flight Center in the development of
new space transportation systems?
Answer. Marshall is NASA's lead Center for space transportation
technology and will play a central role in undertaking the development
and demonstration of technologies to support continued launch cost
reductions for NASA and other launch system users.
Question. Mr. Goldin, like many others in this country who have an
interest in seeing our space technology provide a boost to the
commercial sector, I am concerned that we may be losing our commercial
launch business to foreign competitors. As you look into your crystal
ball, do you have a vision of how this nation can develop a viable and
competitive low cost launch service to bring space launch business back
to the United States?
Answer. All of today's launchers are either totally expendable or
partially expendable. Such systems require large workforces spread all
over the country for manufacturing, shipment, assembly, test, and
launch preparation. On the international marketplace, our systems are
competitive, but not dominant, in such an environment. NASA's vision is
to transition our human space flight requirements to fully reusable,
privately owned and operated launchers. By opening NASA's human space
flight market to commercial launch vehicles and with such advanced
systems we can change the nature of the competition. We will not have
to maintain the large expensive factories for continuous manufacture,
assembly, and test of vehicles. Rather, our industry will have a huge
advantage because it will only have to turn around a fully reusable
vehicle between flights. Without the need for manufacturing, shipping,
and assembling a new vehicle each launch, our industry will have a huge
cost advantage.
Question. Mr. Goldin, I am concerned that investment in space
science research has been put on hold while NASA devotes its assets to
completing the Space Station. Do you share my view that we need to
continue investment in space science research while we are building the
Space Station?
Answer. The NASA Space Science Enterprise has a robust program
spread across its four science themes: Astronomical Search for Origins
and Planetary Systems, Solar System Exploration, Structure and
Evolution of the Universe, and Sun-Earth Connection. The various
programs in these themes have been extremely productive over the past
few years, have yielded a wealth of new scientific discoveries, and
have captured the imagination and interest of the American public and
people around the world.
NASA definitely believes that it is vital to maintain a robust and
diverse Space Science program, while continuing its commitment to
constructing the International Space Station. In fact, this year, NASA
submitted a budget request that included a modest increase in Space
Science. The favorable Space Science funding included in the Senate-
House Conference on H.R. 2684, the fiscal year 2000 VA-HUD-Independent
Agencies Appropriations Act, maintains the health of NASA's Space
Science program and its ability to deliver the exciting, world-class
science that the American taxpayer has come to expect.
Question. Mr. Goldin, an area of your attention for some time has
been in reducing the cost of going to orbit. Clearly this is an issue
of national significance as we look toward the increased development
and utilization of space. The DOD recently bought launch services from
competing contractors rather than paying to develop and buy the launch
vehicles themselves. Mr. Goldin, do you believe the next generation
operational launch vehicle should be developed by the private sector or
by the government?
Answer. In order to focus our resources on science, technology, and
exploration, NASA must turn over routine launch operations to the
commercial sector. With the shuttle we have taken a first step in this
move with the Consolidated Space Operations Contract. Additionally, we
compete all of our robotic missions in the U.S. commercial launch
marketplace. Both of these experiences have brought NASA savings in
money and workforce. We are working to converge NASA's human space
flight launch requirements with the commercial launch marketplace so
NASA can get lower cost access to space and our commercial providers
will have a larger market to service.
The next generation operational launcher should be developed by the
private sector in order to reap the benefits of this merging of NASA
and commercial launch markets. However, NASA does have unique safety,
reliability, and operational requirements, and we cannot jeopardize
those requirements. Thus, while the launcher should be developed by the
private sector, NASA may have to develop specific elements that satisfy
our specific requirements. These might be a crew module, space taxi, or
service modules for our unique requirements.
Question. Mr. Goldin, to your knowledge will any of the reusable
launch vehicle concepts currently under consideration replace the Space
Shuttle in the next ten years?
Answer. Our technology demonstration projects (X-33, X-34, X-37)
have made immense progress. Depending on the continued success of these
projects, we could see proven technology that could lead to a second
generation Reusable Launch Vehicle within 10 years.
Question. If so, which ones and under what schedule?
Answer. NASA spends a substantial portion of its annual budget to
meet its launch needs. To lower these costs, the 1994 National Space
Transportation Policy (NSTC-4) calls for ``government and private
sector decisions by the end of this decade on development of an
operational, next generation reusable launch system.'' NASA has set
aside an outyear wedge of funding to support these decisions. NASA is
also undertaking industry-led Space Transportation Architecture Studies
to identify private sector options for reducing NASA's launch costs.
These studies incorporate separate efforts being undertaken by NASA,
DOD and industry including: Space Shuttle safety upgrades; X-33 and
other NASA technology demonstrators (X-34, X-37, and X-38), the Evolved
Expendable Launch Vehicle for the International Space Station. As part
of the fiscal year 2001 budget process, the Administration intends to
use the results of these studies and inputs to develop a strategy that
encompasses the decisions, some near-term and some far-term, required
to meet an end-date goal of transitioning all of NASA's launch
requirements, including human space flight, to lower-cost, privately
owned and operated space transportation systems. Decisions on future
RLV funding, the transition from the Space Shuttle to privately owned
and operated vehicles, private sector incentives, and related issues
will be decided this fall in the context of this integrated space
transportation strategy. Details will be provided in the fiscal year
2001 budget submit.
Question. If not, what is NASA doing to maintain and upgrade the
Shuttle to ensure the nation's investment is protected and human space
access assured?
Answer. In the interim, NASA will continue to make the safety
upgrades necessary to keep the Space Shuttle safe and reliable.
______
Questions Submitted by Senator Craig
education
Question. There is currently much interest in education and how to
improve it in our nation, especially in science, math, engineering, and
technology-related fields. NASA has expertise in a number of these
fields, and NASA projects capture the imagination of students. What is
NASA's role in the effort to improve education in those areas critical
to the U.S. maintaining its technological advantage, and how is that
role expected to develop in the future?
Answer. NASA is a mission Agency and uses its inspiring mission,
unique world-class facilities, close working relationship with the
research and development community, and specialized workforce to
contribute to education improvement. Educational Excellence has been
established as one of five national priorities to which NASA makes a
significant contribution. Communicating knowledge to the educational
community is embedded as a crosscutting process in all of NASA's work.
There are three primary leadership strategies that are key
components of NASA's role in educational improvement. These are: 1.
Contribute to educational excellence by making a positive contribution
to the goals of the educational community; 2. Develop alliances with
key external constituencies to define, expand, and leverage our impact;
and 3. Involve the educational community in the NASA mission.
For the future, we have identified seven improvement initiatives.
These are:
1. Focus and Coordinate State-Based Efforts.--NASA's national
Education Program is in one sense composed of 50 individual State
programs. The reform of mathematics, science, technology, and geography
in K-12 schools is inextricably linked to each State's higher education
system and the States' agendas for economic development. Central to our
State-based focus is the need for NASA to understand the State
education agendas and place emphasis on coordinating our assets in a
given State toward meeting that State's needs. By continuing existing
and establishing new alliances, NASA seeks to connect NASA Principal
Investigators, NASA-trained teachers, existing NASA education resources
(for example, Educator Resource Centers and Space Grant Consortia), and
commercial contractors with the State education leadership to determine
how these assets may best be utilized within the State.
2. Enhance Instructional Products and Dissemination.--NASA missions
produce new data, images, and information that may be effectively
included in textbooks, curricula, and supplementary instructional
products. Working with professional education associations, State and
local education authorities, universities, private enterprise, and
other organizations, we will collaborate to develop instructional
products consistent with the national curriculum standards and/or State
or local curriculum frameworks. These products will be developed in
multiple formats, with emphasis on innovative applications of
educational technology and interactive strategies.
3. Improve Education Program Integration and Coordination.--The
NASA Education Program consists of many parts, which, when working
together as a whole, can make a significant and positive contribution
to the education community. The Implementation Plan is designed to
ensure that the design, coordination, and implementation of NASA's
numerous educational projects, programs, and activities achieve this
vision of a single, unified Education Program.
4. Facilitate NASA Research in the Higher Education Community.--
Research relevant to NASA's four Strategic Enterprises is carried out
primarily through NASA Strategic Enterprises, Field Centers, and the
University community. However, some focused higher education programs
are implemented by the Education Division and the Minority University
Research and Education Division. Our goal is to streamline and focus
these latter efforts so that they strongly support Agency research
objectives as determined by the NASA Strategic Enterprises.
5. Support Preservice Education.--Various national reports indicate
that there will be a shortage of K-12 science, mathematics, and
technology teachers over the next 5 years. Concomitantly, institutions
responsible for training the next generation of teachers are aligning
their preservice programs with new certification requirements and
public policy expectations. While NASA's existing inservice programs
need to continue at their present level, it is important for us to
focus on new opportunities to support initiatives in the preservice
area. NASA's significant investments in research and development with
institutions of higher education provide a unique asset to consider in
identifying such opportunities.
6. Target Informal Education.--Museums, science and technology
centers, and similar nonprofit education organizations support the
formal education community and provide significant educational
activities for learners of all ages. Most of these organizations are
major community, regional, or national resources for science education.
In addition, the informal education community has a tradition of
presenting educational experiences using an inquiry, hands-on approach
that is well aligned with the National Science Education Standards. We
will work with and support these organizations.
7. Implement NASA's Comprehensive Data Collection and Evaluation
System.--In carrying out our aerospace mission, NASA strives to involve
students and educators as both participants and partners. In conforming
to the federal Government Performance and Results Act of 1993, NASA is
committed to evaluating the performance of its programs and activities
in order to report to the Congress and Administration and to provide
for continual improvement of such involvement of the educational
community in its missions, research, development, and achievements. To
that end, the NASA Education Division is developing the NASA Education
Evaluation System which includes an on-line, Internet based system for
entry and collection of data from participants and program managers;
follow-up studies; and briefing and statistical presentation materials
to be used for analysis and reporting.
Question. Half of the 20 EPSCoR states have never had a NASA grant.
Idaho is one of the states which is eligible for NASA EPSCoR but which
has never had an award. Our institutions believe that they are ready
for an award and that they can develop expertise in a number of NASA
research areas. Last year, Congress included $10 million to ensure that
all eligible states receive funding, yet NASA persisted in awarding
only limited planning grants to some states. How do you see those
participating at a minimal level becoming more competitive? What is
your vision for the future of this program, which basically helps
nearly 40 percent of the state become more involved in NASA research
activities?
Answer. The $5 million increase in NASA EPSCoR funding enabled NASA
to develop and implement a Preparation Grant Program for all 20 NASA
EPSCoR eligible states, including Idaho. The Preparation Grant program
was established as an interim program to allow all states the
opportunity to initiate contacts, promote collaborative research
programs with NASA Centers/Enterprises, and begin research activities
in areas of strategic importance to the Agency. The Preparation Grant
program was designed to increase the competitiveness of the EPSCoR
states in anticipation of the rollout of the new NASA EPSCoR program in
fiscal year 2001. We have enclosed a copy of the March 1999 EPSCoR
Report to Congress that further outlines our plans for the new EPSCoR
program.
While the specific details of the new NASA EPSCoR program are still
being developed, the program will require more direct connections and
collaborations with NASA Centers than does the current NASA EPSCoR
program.
Question. Researchers at the University of Idaho have expertise
which should be of interest to NASA in a number of areas, including
lightweight materials (titanium) and remote sensing, yet we have found
it difficult to become involved in NASA research. As noted above,
EPSCoR appears to offer only a limited opportunity to do so. What are
you doing and can you do to broaden opportunities for all parts of the
country to participate in NASA missions and objectives?
Answer. A number of NASA programs offer opportunities for states to
become more involved in NASA missions and research activities.
1. Research Opportunities.--NASA supports a comprehensive website
that offers links to NASA Offices and Centers, and current research
opportunities. Information can be found at the following web site:
http://www.hq.nasa.gov/office/procurement/grants/#oss
This is one of the best sources of information about areas of
research that are important to NASA.
2. Summer Faculty Fellowship Program.--Each summer, NASA awards
research fellowships to university faculty through the NASA/American
Society for Engineering Education (ASEE) Summer Faculty Fellowship
Program. This program was designed to stimulate an exchange of ideas
between university faculties and NASA scientists and engineers.
Selected participants in fields of science, engineering, math, and
other disciplines spend approximately 10 weeks working with their
professional peers on research projects at NASA facilities. Addition
information about this program can be obtained from the Education
Division, NASA Headquarters, Code FE, Washington, DC 20546.
Currently, at least one University of Idaho researcher is spending
the summer at the Jet Propulsion Laboratory as part of the NASA/ASEE
Summer Faculty Fellowship Program.
3. Graduate Student Researchers Program.--The Graduate Student
Researchers Program (GSRP) cultivates additional research ties to the
academic community and provides support to promising students pursuing
advanced degrees in science and engineering in areas aligned with
NASA's Strategic Enterprises and Field Centers. Additional information
can be obtained from the Education Division, NASA Headquarters, Code
FE, Washington, DC 20546
4. Reduced Gravity Student Flight Opportunity Program.--The reduced
gravity student flight opportunity program is sponsored by NASA and
administered by the Texas Space Grant Consortium. Through the Reduced
Gravity program, teams of undergraduate students, working with
university researchers, propose, design, fabricate, fly and assess a
reduced-gravity experiment. The experiments are flown on NASA's KC-135
aircraft that can simulate zero gravity conditions for up to 25
seconds.
In 1998 Idaho had two teams selected to participate in the Reduced
Gravity Program, and each has successfully flown experiments on the KC-
135. The Spring, 1998 University of Idaho team was sponsored by a
faculty member in the University of Idaho Department of Mechanical
Engineering. The Fall, 1998 team, also from the University of Idaho,
conducted research in the field of advanced materials entitled
``Combustion Synthesis of Ceramic-Metal Composites in Microgravity''
and was sponsored by the UI departments of Metallurgical Engineering,
Chemical Engineering, and Electrical Engineering.
5. NASA EPSCoR Preparation Grants.--The long term goal of the NASA
EPSCoR Program is to develop research infrastructure in areas of
strategic interest to NASA within states that have historically been
unsuccessful in competing nationally for NASA funds. In 1999 NASA
introduced the NASA EPSCoR Preparation Grant program. Funding from this
program can be used in part to support the travel of State researchers
to NASA field centers to interact directly with NASA engineers and
scientists.
In Idaho the 1999 NASA EPSCoR Preparation Grant program is
currently funding the following projects:
Cluster Grants ($25,000 each)
Electro-Optic Holography and Passive Vibration and Acoustic
Suppression Systems--Jonathan Blotter (ISU), Tony Anderson (UI) and
Michael Anderson (UI)--collaboration with Langley Research Center.
Intelligent Control of Nonlinear Dynamic Systems--Touraj Assefi
(UI), Dean Edwards (UI), Joseph Feeley (UI), Desineni Naidu (ISU) and
James Peterson (UI)--Collaboration with the Jet Propulsion Laboratory.
Catalytic Ignitors for Clean-Burning, Flexible Fueled Aircraft
Engines--Judi Steciak (UI), Dave McIlroy (UI), Steve Beyerlein (UI),
Don Blackketter (UI)--Collaboration with Ames Research Center.
Low Cost Synthesis of TiAl Base Intermetallic Compounds--Keith
Prisbrey (UI), E. Baburaj (UI), S.B. Bhaduri (UI), S. Bhaduri (UI) and
D. Bunnell (BSU)--Collaboration with Glenn Research Center.
Survivability of Computer Systems in Hostile Environments--Deb
Frincke (UI), Jim Alves-Foss (UI), James Foster (UI), Jeff Harkins
(UI)--Collaboration with NASA Ames Research Center.
Collaboration Development Grants ($4,000 each)
Production of Alloys--Sam Froes (UI), V. J. Jabotinski (UI)--John
Glenn Research Center--Collaboration with Glenn Research Center.
Parallel Computing--Amit Jain (BSU), John Lusth (BSU), Robert
Sulanke (BSU).
Determination of Rates of Turbulent Diffusion--Solomon Leung (ISU)
and G. E. Start (ISU)--Collaboration with Langley Research Center.
NMR Imaging and Planametric Analysis of the Corpus Callosum
Comparing Gifted Individuals with Control Groups--Tom McKean (UI) and
Terry Armstrong (UI)--Collaboration with Ames Research Center.
Development of Micropower Devices and Power Management Networks for
Systems on a Chip for Space Applications--Siddhartha Duttagupta (BSU),
J. R. Ferguson (BSU), S. B. Bhaduri (UI), N. I. Rafla (BSU), S. A.
Parke (BSU), and S. Ahmed-Zaid (BSU)--Collaboration with the Jet
Propulsion Laboratory.
6. NASA Space Grant College and Fellowship Program.--The National
Space Grant College and Fellowship Program was authorized by Congress
in 1988 to utilize the nation's universities to help maintain the
United State's capabilities in aerospace Science and technology. In the
area of research the objective of the Space Grant program is to
establish and maintain a national network of universities with
interests and capabilities in aeronautics, space, and related fields,
to encourage cooperative programs among universities, aerospace
industry, and federal, state, and local governments, and to encourage
interdisciplinary training, research, and public-service programs
related to aerospace.
As you can see, Idaho has participated in and benefited from many
of these programs. In particular, over the past four years Idaho has
been represented at NASA Headquarters by two Space Grant Fellows. Both
Fellows are faculty members at the University of Idaho and have had
significant involvement NASA's Education programs, specifically the
NASA Space Grant College and Fellowship Program and NASA EPSCoR.
Currently Dr. David Atkinson is the Space Grant Fellow in residence
at NASA Headquarters, working primarily on the redesign of the NASA
EPSCoR Program.
We would be happy to further discuss these opportunities with
members of your staff or the Idaho higher education community at an
appropriate time.
subcommittee recess
Senator Mikulski. This subcommittee stands in recess until
Tuesday, at 9:30, when we will be listening to the National
Science Foundation and the Office of the Science Advisor to the
President.
Mr. Goldin. Thank you.
[Whereupon, at 11:02 a.m., Thursday, March 18, the
subcommittee recessed, to reconvene at 9:30 a.m., Tuesday,
March 23.]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
TUESDAY, MARCH 23, 1999
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:35 a.m., in room SD-192, Dirksen
Senate Office Building, Hon. Christopher S. Bond (chairman)
presiding.
Present: Senators Bond, Burns, and Mikulski.
EXECUTIVE OFFICE OF THE PRESIDENT
Office of Science and Technology Policy
STATEMENT OF NEAL LANE, DIRECTOR
NATIONAL SCIENCE FOUNDATION
STATEMENT OF RITA COLWELL, PH.D., DIRECTOR
ACCOMPANIED BY EAMON M. KELLY, PH.D., CHAIRMAN, NATIONAL SCIENCE BOARD
OPENING STATEMENT OF CHRISTOPHER S. BOND
Senator Bond. Good morning. The hearing of the Subcommittee
on VA, HUD and Independent Agencies will come to order.
The subcommittee meets today to review the fiscal year 2000
budget request of the Office of Science and Technology Policy
and the National Science Foundation. We welcome back former NSF
Director, Dr. Neal Lane, now the President's Science Advisor
and Director of OSTP. And it is a pleasure to welcome the new
Director of the National Science Foundation, Dr. Rita Colwell.
We are very pleased to have you with us. And we also thank Dr.
Eamon Kelly, Chairman of the National Science Board, for
joining us today.
This is certainly one of the most distinguished scientific
panels that we will have the opportunity in this committee, or
perhaps any other, to listen to. So we are looking forward to
the testimony this morning.
We are happy to have the three of you here today, and we
feel quite fortunate to have your expertise and perspective on
the funding needs and priorities of NSF, as well as your views
on the role of OSTP in formulating the science and research and
development priorities of the Federal Government. I am very
pleased to convene the hearing this morning on the Office of
Science and Technology Policy and the National Science
Foundation. Under both Senator Mikulski's leadership and mine,
this subcommittee has been, we would like to think, a strong
supporter of a Federal commitment and our role in the Nation's
scientific endeavors.
I believe we all agree that research and development is a
positive and critical investment for the economic and
intellectual growth and well-being of our Nation. I have to say
this is one of the most exciting areas that we have to deal
with. And certainly the work that is being done ought to be of
great interest to all Americans who want to see us continue to
make progress in the 21st century.
First, I commend the continuing efforts of OSTP to provide
policy leadership on the important issues facing the scientific
community. And, at the same time, I commend NSF for pushing the
boundaries of scientific research, and acting as the catalyst
for new and exciting cutting-edge research.
It is almost in its 50th year for NSF. And during that
time, it has been responsible for numerous important scientific
advances across many disciplines, ranging from information
technology to biology. Science Magazine recently noted that
NSF-supported research projects led to two of the most
important scientific advances in 1998.
One of those projects helps us better understand the
origins of the universe. Specifically, NSF-supported
researchers discovered that the expansion of the universe is
actually speeding up instead of slowing down, as previously
thought. The other research project uncovered new information
about circadian rhythms, or internal clocks, which helps us
better understand how genes function and react to the
environment. This sort of information can be potentially
applied to health care research. And I am hoping it will
explain why an 18-year-old son of mine just cannot get out of
bed on Saturday morning before 11 o'clock.
NSF has also been a major driver of connecting high-speed
computer networks to our educational institutions, which has
been an area of interest to this subcommittee. I applaud NSF's
recent efforts to fund new high-speed network connections. With
these recent awards, institutions in every State, including
those in remote areas such as Alaska and Hawaii, will be
connected to the Internet. And on this committee, we think it
is a really good idea to connect Alaska and Hawaii. It makes a
lot of sense as far as we are concerned.
As chair of this subcommittee, I will be particularly
interested in exploring the Federal investment in
biotechnology, particularly as it applies to the agricultural
sector. I believe it is imperative for us to maintain the long-
term sustainability and competitiveness of U.S. agriculture.
And I strongly believe that plant genome research is vital to
this effort.
One example of the potential benefits of plant genome
research is work being performed in my home State at the
University of Missouri. Researchers at the University are
looking at the gene selection in maize, and linking new
information to a maize genome database. The benefits of this
research will improve crop yields, reduce fertilizer
requirements and produce better quality food.
And, just incidentally, I was visiting some of the medical
researchers, who were dealing with diseases affecting children.
And they found that soybeans provided apparently some very
beneficial treatment to children suffering from cystic
fibrosis. And we hope when we get the genome mapped, we will be
able to identify what it is that makes the soybean apparently a
beneficial treatment for cystic fibrosis. So there are many
exciting things going on there. And I know Dr. Colwell had the
opportunity to visit the University a couple of weeks ago. And
I want to learn more about your trip. And I thank you for
coming. And I was certainly pleased to have Dr. Lane visit a
couple of years ago.
I am very pleased that the administration is proposing a $5
million increase for the plant genome program. I think it is a
good start. I know that I can count on both OSTP and the
National Science Foundation to provide even greater support in
this important area. Both agencies have requested additional
funding for fiscal year 2000. OSTP's budget request totals $5.2
million, and increase of $175,000 over last year's enacted
level. NSF's budget request for fiscal year 2000 is $3.92
billion, a $250 million, or 7 percent, increase over the fiscal
year 1999 enacted level.
I recognize that we are not far enough along in the budget
process to have an allocation for this subcommittee, so it is
premature for us to discuss absolute levels of funding that may
be available for our science initiatives and efforts.
Nevertheless, I must tell you, the reality is that this will be
a very difficult year for the subcommittee.
As I have told other agencies that have come before us, we
have major funding needs, ranging from medical care for
veterans to housing for low-income Americans, and disaster
relief through the Federal Emergency Management Agency. We also
know that under the budget caps established under the Balanced
Budget Act, the Federal Government will have some $29 billion
less to spend for discretionary activities in fiscal year 2000
than what was available this past year.
Our purpose today is to discuss the funding priorities of
the Nation's scientific endeavors and how these priorities are
reflected in OSTP and NSF's fiscal year 2000 budget request.
The centerpiece of the President's R&D budget is a six-agency
information technology initiative, dubbed Information
Technology for the 21st century, or IT2. We have not
exactly figured out how the IT2 worked in, but I
will work on that.
The President is proposing $366 million for the
IT2 initiative in fiscal year 2000. He has also
proposed to tap the NSF as the lead agency for the effort and,
within the NSF budget, has asked for $146 million in additional
funding. Although the goals of this initiative may be laudable,
I have some questions about it.
First, I need to understand how IT2 fits into
the overall Federal information technology framework, and
particularly how this initiative differs from other information
technology efforts, such as last year's theme of Knowledge and
Distributed Intelligence, and existing programs such as the
High Performance Computing and Communications, or HPCC,
program, the Next Generation Internet, or NGI, initiative. Both
HPCC and NGI are heavily supported already by NSF and other
Federal agencies, and would receive significant funding for
fiscal year 2000 under the President's budget.
Second, I am interested in learning how NSF and the
administration, with OSTP as its lead, will manage this major
initiative. IT2 seems to envision long-term, multi-
researcher, large-sized grants, while the traditional NSF work
has been with short-term, single-researcher, small-sized
grants. That leads me to ask: Does NSF have the internal
capacity to administer this kind of initiative, especially one
that is more complex than what NSF has traditionally funded? I
would be interested to hear how OSTP plans to oversee this
initiative, as well.
Last, I would like to know how committed the agencies and
the scientific community are to the initiative. The President's
5-year budget flat-funds NSF, and raises some serious questions
about its commitment over the long term to IT2 and
NSF. The President's special panel recommended a Strategic
Information Technology Initiative, pointing out that while
IT2 is a vital first step, further increased and
continued oversight are needed to remedy the shortfall in long-
term research investments that have accrued.
Unfortunately, with the tight budgets our subcommittee is
facing, there will be some very difficult choices. And I would
be interested in hearing how the administration plans to deal
with these realities. I am interested in the implementation of
the Results Act, which requires agencies to think strategically
about their goals and to measure performance against the goals
they have set. We have to be responsible for the Federal
dollars that we have.
And I have one further issue concerning the subcommittee,
which is the disparity in Federal research and development
funding between large and small institutions. A recent NSF
survey found that the top 50 recipients of university-based
research received about 60 percent of all available Federal R&D
funds. Many of them also received significant Federal resources
to manage large research and development centers.
I support the work of these large and successful
institutions, but we have to find better ways to invest scarce
Federal dollars throughout the country so that all areas of
America can prosper. I do not want to see just the rich keep
getting richer, even though other areas are being shortchanged.
I recognize and congratulate NSF's attempts to address the
problem with EPSCoR, but its funding is minimal compared to the
budget of NSF. And I think that the initiatives are not enough.
I look forward to working with you in addressing this problem.
I am now going to turn the microphone over to my
distinguished ranking member, Senator Mikulski. And, with some
trepidation, I will turn the gavel over to my colleague,
Senator Burns.
Senator Burns. What does that mean?
Senator Bond. That means I am nervous about it, Conrad.
Senator Burns. Fear not.
Senator Bond. And I have to do a brief interview and I will
return very shortly. As always, we accept your full written
statement. We will look forward to having the summaries that
you wish to provide us. And we will obviously have an
opportunity in the question-and-answer part of the program to
discuss these further.
So, with that, Senator Mikulski.
STATEMENT OF Senator BARBARA A. MIKULSKI
Senator Mikulski. Thank you very much, Mr. Chairman. My own
remarks are going to be brief, so we can move quickly to the
witnesses.
I want to, of course, welcome once again Dr. Neal Lane, now
in his new position as the Science and Technology Advisor to
the President. And a really warm and affectionate welcome to
Dr. Rita Colwell, who was the lead at the University of
Maryland in marine biotechnology.
Senator Burns, you might find it interesting that our
relationship goes back to the mid-1980's. I was on the Merchant
Marine and Fisheries Committee, and chaired the Oceanography
Subcommittee. And we held a hearing on the oceans and its
future in a very new, emerging field called marine biotech. And
now here we are, a decade later, where the United States of
America is really the lead in the world in terms of
biotechnology. And, of course, we rival our intellectual
competitors around the world in marine biotechnology. Dr.
Colwell comes with strong administrative skills and excellent
idea.
And, Dr. Kelly, of course, we are looking forward to
hearing from you in terms of what the Science Board would
advise us in terms of policy and direction and how we can set
the priorities in our funding.
Dr. Lane and others in the scientific community are long
familiar with my comments that I have always been concerned
that the United States of America wins the Nobel Prize and that
other nations win the markets. And that is why I have
encouraged the National Science Foundation and other agencies
to focus on strategic national interest--not to have winners
and losers in industrial policy, but to see where we were
going.
And I recall that there was a report called ``Losing
Ground,'' by the National Competitive Council, which outlined
the 20 technologies that would drive the 21st century, and
where the United States of America was. And, of course, we were
leads in infotech at the time, long before the world, and also
in biotech. Well, I want us to continue to stay up there. But
in order to maximize our resources, I do believe that we will
be effective through interagency cooperation. And this is why I
am so excited to learn more about the President's initiative
for the Infotech 2 initiative. Because it will be a multi-
agency and then, ultimately, a multi-disciplinary approach
between Department of Defense, Energy, NASA, NIH, and NOAA.
And, quite frankly, ladies and gentlemen of the panel and
also in the audience, if I had my way on appropriations, we
would have a separate subcommittee just on science and
technology. Because it is what my dear colleague, Senator Bond,
has said--while we are looking at the educational and work
force needs of the future, we are also going to be foraging for
how to change the very nature of public housing and meet our
commitments to the veterans. And while we want to move ahead on
your biodiversity initiative, or certainly consider it very
carefully, we have EPA that, through this Congress, cannot even
get its Superfund legislation authorized.
But the idea of interagency work really appeals to me. And
what I want to hear is will the new initiative--are the funding
request, number one, adequate? Number two, will we end up
starving other programs that are already funded at a basic
level, so that new initiatives, with glitz and promise, are not
funded at the expense of those things that are part of our
traditional must-do list? And then, what this will also mean in
terms of work force readiness.
I really want America to come up with the new ideas that
the private sector can develop into new products that create
new jobs. But everywhere I travel in my State, and as we meet
with national leaders, there is a work starvation, if you will,
a work force deficit, in terms of people who are ready for the
new economy. And of course I think everyone knows my own
longstanding, life-long work about the concern about people who
are always left out and left behind.
And I am concerned that as we move ahead into the dazzling
future of information technology and how it will help even
other science that, as Bill Gates says, we will create a
digital divide between those who are either in it or those who
are not. And I want to be sure that Americans are not left out
or left behind, and that no group of Americans is left out or
left behind.
So, we will be interested to see what that coordination
means. And we will be able to ask more of those questions, and
then, even specific things related to interagency coordination.
Both NOAA and FEMA have talked about the need for new maps.
FEMA wants to map the vulnerable areas of the United States,
particularly in flood-prone areas. Dr. Colwell, you know what
happened in western Maryland and the task force I have with
Governor Glendening. But there are certain areas of our
country--Missouri has faced it too--where because of flood-
prone, we have already literally and figuratively, financially,
and through engineering, bailed out communities, only to have
them re-flooded again.
So FEMA came in, wants money to fund it, and we said, Well,
cannot you get this from NASA? Then NOAA is going to also do
mapping. And what we are saying is, Gee, we have got LANDSAT,
we have got all this, are we creating data mortuaries or are we
creating data opportunities? And how can there be cross-work,
say NASA with FEMA, NASA with NOAA? Because those products,
that mapping, you know the genius of the private sector, they
will value-add it. They will be able to perhaps sell it. We
have the Great Lakes model as an example.
We are looking at how to get more bang from our buck
through interagency cooperation, meet compelling human need,
fund the basic programs, and get ready for the future. So we
are interested in hearing from your testimony on how we can do
it.
So, with that, Mr. Chairman--Senator Burns is still holding
the gavel, but I will yield the floor.
Senator Bond. Senator Burns, would you like to use the
gavel?
Senator Burns. I wonder, we walked through that whole thing
over there, Senator Mikulski. Do you need some wolves? I am
trying to sell wolves this morning.
Senator Mikulski. You have to know, Senator, I grew up in
Baltimore, and there is a neighborhood called Fells Point. Now,
the interesting thing about Baltimore is I represent more Nobel
Prize winners than Teddy Kennedy. But I also have more bars in
it than Boston. So I know all about wolves. [Laughter.]
Senator Burns. Do you want to trade? We balance it out.
[Laughter.]
Senator Mikulski. Well, they are a little bit bigger than 3
feet, anyway.
STATEMENT OF Senator CONRAD BURNS
Senator Burns. Thank you, Mr. Chairman. And I was listening
with quite a bit of interest to Senator Mikulski's statement.
I want to review a few things as we work on this
appropriation. Thank you, Drs. Lane, Colwell and Kelly, for
coming this morning.
I want to talk about a little program that has been around
a long time, and that is EPSCoR. It is between $43 million and
up to $63 million, I suppose, that is divided among 18 States.
And if there is a success story about a program that has come
of age, it is this one. Let me tell you some exciting things
that happened in my State, because EPSCoR allowed smaller
States to invest in their R&D and their infrastructure in which
to perform R&D.
And most of ours has been done in the area of dinosaurs,
Senator Mikulski. Jack Horner, one of the leading researchers
on dinosaurs and how they behaved and survived over 140 million
years ago, is internationally known. And that is at Montana
State University.
But also EPSCoR has helped to attract several other
neuroscience researchers, who have researchers, who have
created a Center on Computational Biology, and recently won the
Integrated Graduate Education Research and Training Award from
the NSF. Several young faculty, initially supported by EPSCoR,
have gone on to be recognized around the world and have started
new careers through those awards.
With EPSCoR funding, we have started an exciting program to
examine life in the extreme thermal environments of Yellowstone
Park. Not only can this research tell us about the origins of
life, but also about how it may lead to new pharmaceuticals and
new industrial chemicals. This is an especially exciting
project.
I encourage you to make a special trip to Montana just to
review what they have done. From beginning to end, I think you
will agree with me that it has been sort of one of those things
that we have gone into not knowing really what was ahead of us
and found out that there is quite a lot. We did not know what
was in those boiling pots or those hot pools and how it may
sustain life under very, very difficult conditions.
In 1998, four students from Montana State University won
the Goldwater Scholarships, America's premier undergraduate
science award. Each was involved in MSU's undergraduate
research programs supported by EPSCoR. So, if we are looking
for a place where we get a lot of bang for the buck, it is this
tiny, little program administered by NSF that has really done
the job.
We have believed in that program from the very first.
Montana and other rural States have been included in the VBNS
connections program, also provided by EPSCoR supplement. High-
speed Internet connectivity is critical to States with
dispersed populations, like Montana. With these connections, we
can be full partners in the research community in the Nation
and provide our students with full access to educational
materials and opportunities.
Laser Products, in Bozeman, Montana, now employs over 200
people. And those industries have grown up around Bozeman
because of the collaborations with MSU. These are contributing
to economic prosperity in the community and also providing jobs
for graduates. In fact, Bozeman is quickly becoming recognized
as one of the Nation's emerging research regions.
So I am very proud of what EPSCoR has done. And just like I
say, it is a tiny, tiny, little part of what you do, but it has
had huge impacts on States like Montana, Wyoming, the EPSCoR
States, which before had never gotten any recognition for the
work they have done in research and development. And so I am
very proud of how that program has grown. We have kept tight
control on it. It is not that expensive. But the impact on
smaller States has really been something. So, I thank you for
that.
Mr. Chairman, that is the only statement I have. I welcome
our guests today. And as Senator Mikulski was alluding to, we
do have--over on the Commerce Committee, it was my privilege
and honor to serve on Science and Technology and NASA, on the
authorizing committee. So it has been really, really something
to watch as we have taken these small products and have done
great things. So I appreciate the opportunity of visiting with
Dr. Lane. We have been friends a long time. And I do not think
there is anybody in this country more dedicated to research and
development and the well-being of our investment in those
fields than the folks we have before us today.
I thank you, Mr. Chairman.
Senator Bond. Thank you, Senator Burns. I can tell you, it
is a real pleasure for us to have someone with your expertise
from the authorizing committee to be on this subcommittee with
us. And I would certainly second your comments about Dr. Lane,
Dr. Colwell and Dr. Kelly. And we look forward to hearing from
them now.
We would ask that you try to summarize your statements in
10 minutes or less. You can take less if you wish. And we will
make the full statements a part of the record.
Dr. Lane.
statement of neal lane
Dr. Lane. Thank you, Mr. Chairman, members of the
committee. I am pleased to appear before you today. My written
testimony describes the Office of Science and Technology
Policy's, OSTP's, budget request for fiscal year 2000, and also
provides some highlights of the national science and technology
enterprise during 1998, and the administration's fiscal year
2000 R&D budget request. And I would ask that it be included
for the record.
Senator Bond. Without objection, it will be.
Dr. Lane. I also wish to thank the committee for its strong
support of science and technology, and NSF, which I have
particularly appreciated during the time I have been privileged
to serve as Director.
As you know, OSTP plays a vital role in leveraging the
government's S&T investments for broad national goals. Support
for such investments has traditionally been a matter of
bipartisan agreement. And I believe it is imperative that we
build common ground to support a shared vision, the commitment
to keep America the world's leader in science and technology.
OSTP has four main functions. We advise the President and
other senior Administration officials about the impacts of
science and technology on public policy and vice versa. We
coordinate the work of the R&D agencies to ensure we get the
biggest bang for the science and technology buck. We promote
strategic partnerships among science and technology
stakeholders--State and local government, industry, academia,
and various international players. And we report on what we
have learned through all these efforts. Last year, OSTP
shepherded 11 multi-agency reports through the National Science
and Technology Council, and seven reports and letter reports
through the President's Committee of Advisors on Science and
Technology.
An example that provides a sense of the breadth of OSTP's
influence is our work on the Administration's Initiative on
Information Technology for the 21st century. And, Mr. Chairman,
IT2 is a little confusing and we maybe overreached
with that title, but the second ``t'' is the ``t'' in twenty-
first.
Senator Bond. What is the second ``i''? That is what
bothers me.
Dr. Lane. We do not have a second ``i.'' [Laughter.]
Senator Bond. Okay.
Dr. Lane. We just have one ``i.''
Senator Bond. Okay. [Laughter.]
Dr. Lane. The initiative, we believe, responds to a wake-up
call from the congressionally chartered President's Information
Technology Advisory Committee, known as PITAC. OSTP was
instrumental in getting PITAC established. We also work closely
with members of PITAC to make sure that its work was useful to
the Federal agencies, while also challenging those agencies to
think outside the box about their responsibilities and the
possibilities for information technology research.
Once we had the recommendations from PITAC, OSTP pulled
together the Federal agencies to develop a response. And we
ultimately concluded that information technology is so
important that we are proposing a new Federal R&D investment of
$366 million in fiscal year 2000, a 28-percent increase above
and beyond our ongoing research programs.
Out of this total, Mr. Chairman, $184 million--half of the
initiative--comes through your subcommittee. To develop this
initiative, we worked with the agencies to examine the existing
information technology research programs--of which there are
several--to determine just how we could leverage them for the
best returns of this new investment, particularly responsive to
this advisory committee's recommendations.
We decided to make these new investments in three major
areas. First, about two-thirds of the new funding--$228
million--will support long-term, fundamental research, aimed at
fundamental advances in computing and communications.
The second element is $123 million to support advanced
computing infrastructure--the machines and the software and the
capability--as a tool to facilitate important scientific and
engineering discoveries of national interest. The resulting
supercomputer infrastructure will be orders of magnitude more
powerful than that currently available to the civilian science
community.
Third, $15 million in new funding will greatly expand
research into the social, economic and work force impacts of
information technology, including the transformation of social
institutions, the impact of legislation and regulation,
electronic commerce, the barriers to information technology
diffusion, and the effective use of technology in education.
This element will emphasize finding ways to ensure that all
Americans have the education they need to take advantage of the
large numbers of high-wage jobs created in the new economy.
One area that highlights the importance of these three
areas is our ongoing work on the human genome. By providing
fundamental advances in computing, the initiative will enable
progression from sequencing of the human genome all the way to
the design of new drugs. It will also enhance our ability to
address the important social issues that are raised by these
breakthrough discoveries, such as genetic privacy.
IT is our largest R&D initiative for fiscal year 2000, but
OSTP also played a critical role in developing coordinated
interagency budgets and policies in the area of plant genome,
food safety, emerging infectious disease, sustainable
development, critical infrastructure protection, education
research, and others.
I ask you today, Mr. Chairman, for your continued support
of OSTP's role in coordinating science and technology policy
for the executive branch and for our Nation at large. OSTP's
budget request of $5.2 million, and 40 FTE's, for fiscal year
2000 represents an increase of budget authority of less than
3.5 percent, and an increase of one person--one in the FTE
level. These additional resources are essential to continue to
provide the highest quality of work across our broad spectrum
of responsibilities.
Mr. Chairman and members of the committee, I hope this
brief overview, combined with my written statement, has
conveyed to you the extent of this Administration's commitment
to advancing science and technology in the national interest
and the importance of OSTP's role in that enterprise.
Regardless of party affiliation, in the end, we can all agree
that investments in science and technology are investments in
the Nation's future.
I look forward to achieving bipartisan support for a
national science and technology strategy that will combine the
resources of industry, academia and nonprofit organizations,
and all levels of government to advance knowledge, to promote
education, to strengthen institutions, and to develop human
potential. I ask not only for your support for OSTP's fiscal
year 2000 budget request, but I also want you to know how much
I appreciate the longstanding bipartisan support of the
committee for OSTP and for the science and technology research
enterprise.
prepared statement
I will be happy to answer your questions. Thank you very
much.
Senator Bond. Thank you, Dr. Lane.
[The statement follows:]
Prepared Statement of Neal Lane
Mr. Chairman, Members of the Committee, I am pleased to appear
before you today to discuss the Office of Science and Technology
Policy's (OSTP) budget request for fiscal year 2000.
I very much welcome, and am encouraged by the current efforts in
Congress in support of science and technology (S&T) funding. As you
know, funding for S&T, like funding for education, is a high leverage
investment in our continued quest for peace and prosperity. Support for
such investments has traditionally been a matter of bipartisan
agreement. It is imperative that we build common ground in support of a
shared vision--a commitment to keep America the world's leader in S&T.
As we approach the turn of the century, it seems appropriate to
take stock of the Nation's S&T enterprise, and to look to the future--
to the opportunities that lie ahead as well as the challenges that we
face. The Information Age, driven by rapidly advancing S&T, is bringing
changes to our society that are only beginning to unfold. Already, new
communications technologies are transforming the way we work, where we
work, and what we need to know to be successful in tomorrow's
competitive environment. Six years ago, ``Internet'' was still a word
known mostly to those in S&T. Today, this offspring of federal research
activities is the backbone of a new industry and a window to a
tremendous world of information for all segments of our society, from
business executives to school children.
The rapid economic growth of other nations means a future with
greatly expanded markets for U.S. goods and services. Our ability to
move our ideas, our goods, and ourselves swiftly to any place on the
planet, with the help of new technologies, enhances our ability to
share in the growth of global wealth. On the other hand, the increasing
availability of these same capabilities throughout the world also means
greater competition; it means increasing pressures on our shared
environment, health, and natural resources; and it means more diverse
dangers to our security from threats such as terrorism and the spread
of nuclear and other materials of mass destruction.
driving economic growth and improving quality of life
Sustaining U.S. leadership in science and technology has been a
cornerstone of President Clinton's economic and national security
strategy. Investments in science and technology--both public and
private--have driven economic growth and improvements in the quality of
life in America for the last 200 years. They have generated new
knowledge and new industries, created new jobs, ensured economic and
national security, reduced pollution and increased energy efficiency,
provided better and safer transportation, improved medical care, and
increased living standards for the American people.
Our economy has never been more driven by science and technology
than it is today. Over the past three years, information technology
(IT) alone has accounted for more than one-third of America's economic
growth. More than 7.4 million American's work in IT today--and those
jobs pay, on average, sixty percent higher than the average job. Alan
Greenspan recently stated that rapid technological change has greatly
contributed to eight years of record peacetime expansion, and is one of
the forces producing what he called ``America's sparkling economic
performance.''
Investments in research and development are among the highest-
payback investments a Nation can make. Over the past 50 years
technological innovation has been responsible for as much as half of
the nation's growth in productivity.\1\
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\1\ Supporting and Development to Promote Economic Growth: The
Federal Government's Role The Council of Economic Advisers, October
1995.
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We see the fruits of this innovation every day. Many of the
products and services we have come to depend on for our way of life in
America--lasers, computers, magnetic resonance imaging (MRI), teflon
and other advanced materials and composites, communications satellites,
jet aircraft, microwave ovens, solar-electric cells, modems,
semiconductors, storm windows, human insulin, and others--are the
product of U.S. science support and technology policies.
These innovations also mean jobs and economic prosperity for
America. They've built some of these key industries:
Computers and Communications.--A creative partnership among the
Federal agencies, industry, and academia led to what has become the
Internet, the backbone of a global electronic communication system. The
Internet has driven the evolution of a $590 billion domestic
telecommunications and information technology industry, which supports
millions of high-paying American jobs. In just the past 10 years,
American employment in the computer and software industries has almost
tripled. Market capitalization of the top five companies alone is over
$600 billion.
Biotechnology.--Discoveries in biology, food science, agriculture,
genetics, and drugs upon which the private sector has been able to
build and expand a world-class industry today support $13.4 billion in
annual sales and more than 150,000 American jobs.
Aerospace.--Aerospace leads all other industry sectors in net
exports. The latest figures show the U.S. Aircraft industry shipped
nearly $40 billion worth of commercial aircraft and employed more than
half a million people.
Environmental Technologies.--Almost unheard-of 10 years ago, more
than 30,000 environmental technology and services businesses employ
over 1.3 million Americans in high-growth, high-wage jobs. The
environmental technology industry has annual sales over $186 billion, a
number that is expected to grow to $214 billion by the year 2002.
Energy Efficiency.--Technology advances, developed in part through
public-private partnerships, have cut refrigerator energy consumption
from 1900 kWh/year in 1974 to an average today of less than 650 kWh/
year, reducing consumer electricity costs by $100/year per
refrigerator. A partnership with the glass industry led to the
development of the oxygen-fueled glass furnace, which in just 8 years
has captured 30 percent of U.S. glass production and provides annual
net energy savings of $11 million. Geothermal heat pumps (GHP) reduce
energy consumption by 63-72 percent compared to electric resistance
heaters/standard air conditioners. Some 400,000 GHPs are now in use in
the U.S., with estimated annual savings of $120 million to $160
million.
Every one of these industries has been built on federal investments
in R&D, and they are not isolated occurrences. From satellites, to
software, to superconductivity the government has supported--and must
continue to support--exploratory research, experimentation and
innovation that would be difficult, if not impossible, for individual
companies or even whole industries to afford.
Recent Advances in Science and Technology
Over the past year there have been numerous scientific and
technological advances, reminding us of how much there is yet to know,
and of the potential of S&T to further enrich and improve our lives. It
is important to note that federal funding was a key to virtually all of
the scientific breakthroughs of 1998, which included:
--The accelerating universe.--Evidence of a rapidly expanding
universe and the resurrection of Einstein's ``cosmological
constant'', has transformed our view of the universe and posed
fundamental new questions for physics.
--Detailed workings of the cellular clock.--A number of discoveries
revealed the remarkable universality of the clock workings:
across the tree of life, from bacteria to humans, clocks use
oscillating levels of proteins in feedback loops to keep time.
Even more remarkable, fruit flies and mice--separated by 700
million years of evolution--share the very same timekeeping
proteins. By understanding the clock better, scientists can now
begin to manipulate it, working on curing jet lag to
brightening winter depression.
--Analyzing and comparing whole genomes.--Researchers for the first
time finished a complete sequence of a multicellular organism,
as well as several feared microbes, bringing the total number
of fully sequenced genomes to nearly two dozen. This year's
newly completed microbrial genomes include those of some of
humankind's worst enemies: the bugs for syphilis, tuberculosis,
and typhus, as well as a Chlamydia, which causes venereal
disease and blindness. The genomes reveal proteins unique to
these pathogens, molecules that may be targets for drug or
vaccine development.
--A new look at space.--This year scientists provided the first image
of a planet outside our solar system; evidence of ice on the
moon; measurements of the largest explosion since the Big Bang;
detailed study of Mars; and images of sun quakes and matter
being consumed by black holes.
--New insight into the nervous system.--A landmark discovery reveals
for the first time physical characterization of the membrane
protein responsible for the selective movement of potassium
into and out of cells. This finding provides new insight into
understanding the workings of the nervous system.
--Evidence that neutrinos have mass.--Research showed that the
subatomic particles known as neutrinos, long assumed to lack
both charge and mass, do indeed have mass.
--Quantum teleportation.--Physicists boldly went where no one has
gone before, turning teleportation at the quantum level into
lab reality by teleporting quantum information from the nucleus
of a carbon atom to that of a neighboring hydrogen atom. This
transmission of information between ions lies at the heart of
quantum computing, which offers the prospect of lightning-fast,
superparallel calculations.
--Microchips make advances.--Researchers created a DNA-processing
micromachine which may one day be able to sequence DNA.
Researchers also developed a biochip that can screen a blood
sample for cancer cells, bacteria, or other cell types and
remove their DNA for analysis. Researchers are also using DNA
chips themselves, where arrays of immobilized DNA snippets are
used to search out small genetic variations in genes or to
detect RNA messages from the genes turned on in cells. Such
chips could one day screen for genetic disease.
--Cancer prevention and treatment.--The war against cancer goes on,
but physicians now have a few new weapons to fight with.
Tamoxifen, an estrogen-like molecule, already in use as a
breast cancer treatment, won approval for prevention in high-
risk women, and researchers announced that the antibody
Herceptin significantly slows the growth of metastatic breast
cancer.
--Infections and autoimmune disorders.--Scientists convincingly
linked infections and autoimmune disorders, paving the way to
better understanding and treatment of diseases such as diabetes
and multiple sclerosis.
--Hydrogen.--Scientists developed a device to turn water and sunlight
into hydrogen. This simple new device holds great promise for
producing a non-polluting fuel to run internal combustion
engines. Fuel cells using hydrogen can be used to power
vehicles, and provide heat and electricity for commercial and
residential buildings.
President Clinton's Fiscal Year 2000 R&D Budget
The President and the Vice President remain unwavering in their
support for science and technology as crucial investments in our
future. They maintain that such investments enable our nation to
compete aggressively in the global marketplace, protect our environment
and manage our natural resources in a sustainable manner, safeguard our
national security from emerging threats, and spur the technological
innovation that has contributed so much to our economic prosperity and
quality of life. They have brought the budget into balance. They have
increased the investment in science and technology. We all, but
especially our children and our grandchildren, will reap the rewards.
President Clinton has submitted a balanced budget request to
Congress for fiscal year 2000. Despite the tight constraint on
discretionary spending, fiscal year 2000 is the seventh year in a row
that the President has proposed increased investments in civilian
research and development--to a total of $39.8 billion. Civilian R&D now
constitutes 51 percent of the overall R&D budget of $78.2 billion.
The fiscal year 2000 budget continues the important R&D trends
established by this Administration. It boosts funding for basic
research to $18.2 billion, an increase of 4.2 percent ($727 million)
over fiscal year 1999. The budget also strengthens university-based
research, which increases by $353 million, and reflects an effort to
reestablish an optimum balance between health care research and other
scientific disciplines.
The 21st Century Research Fund continues to be the centerpiece of
the President's R&D investment strategy. This year the Research Fund
includes DOD basic and applied research programs, further evidence of
the Administration's commitment to effective integration of the
Nation's university-based research portfolio. The $38 billion Research
Fund grows by 3 percent in fiscal year 2000 and provides for overall
stability and for growth in the highest priority research programs.
The proposed R&D investments will enable the S&T agencies to
achieve the President's goals for science and technology: promote long-
term economic growth that creates high-wage jobs; sustain a healthy,
educated citizenry; harness information technology; improve
environmental quality; enhance national security and global stability;
and maintain world leadership in science, engineering, and mathematics.
For example:
--National Institutes of Health (NIH).--Keeping pace with the
Administration's ambitious goal last year for progress in
biomedical research, the budget includes a 2 percent ($320
million) increase. These investments will allow continued
progress on diabetes, brain disorders, cancer, genetic
medicine, disease prevention strategies, and development of an
AIDS vaccine.
--National Science Foundation (NSF).--The budget provides $3.92
billion (a 7 percent increase) for NSF's broad base of support
to all fields of scientific study. The budget provides $146
million for NSF to lead the Administration's Information
Technology in the 21st Century (IT\2\) initiative and also
increases funding for biocomplexity research on biological,
physical, chemical, and social interactions in Earth's
ecosystems.
--Department of Energy (DOE).--The budget provides $2.84 billion (a 6
percent increase) for basic science programs at DOE. The budget
includes resources for basic research as well as continued
support for construction and operation of large scientific user
facilities, including the Spallation Neutron Source. DOE's
participation in IT\2\ ($70M in fiscal year 2000) will help to
accelerate scientific discovery and research.
--Department of Defense (DOD).--The budget provides $1.1 billion in
basic research, $3 billion in applied research, and $3.3
billion in advanced technology development. Research on
counter-terrorism and on improvements in the safety and
security of the Nation's physical infrastructure and
information and communications systems receives a targeted
increase.
--National Aeronautics and Space Administration (NASA).--The budget
provides $2.48 billion for the International Space Station (an
8 percent increase). NASA's budget also includes $2.2 billion
for Space Science (a 4 percent increase over fiscal year 1999);
and $1.46 billion for Earth Science (a 3 percent increase).
--Department of Agriculture (USDA).--The budget provides a 3.5
percent increase, $837 million, for the Agricultural Research
Service. The Cooperative State Research, Education and
Extension Service National Research Initiative--which provides
competitive grants in areas of national concern such as food
safety, the environment, plant and animal research, and human
nutrition--receives a 68 percent increase to a total of $200
million. Funding for the Forest Service increases 19 percent to
$235 million in support of ecosystem and global change
research.
--Department of Commerce (DOC).--The budget includes $918 million in
the 21st Century Research Fund at DOC. It provides $239 million
(an 18 percent increase) for NIST's Advanced Technology Program
to promote unique, rigorously competitive, cost-shared R&D
partnerships. It also provides $283 million to NOAA for
research to support decisionmaking on climate change, air
quality, and ozone depletion.
--Department of the Interior (DOI).--The budget provides $838 million
(a 5 percent increase) to USGS for science that supports
national resource and environmental decisionmaking. The budget
also supports research and technical assistance on the
scientific needs of land managers and local land use planners.
Interagency Initiatives
The budget increases investment in national priorities requiring
multi-agency investments. For example:
--High Performance Computing and Communications (HPCC) and the
Information Technology Initiative (IT\2\).--The budget provides
a total of $1.8 billion for these programs. IT2, which responds
to the recommendations of the President's Information
Technology Advisory Committee to increase funding for
fundamental, long-term research, advanced applications, and
research on the economic and social implications of information
technology, is funded at $366 million (a 28 percent increase)
in fiscal year 2000.
--Climate Change Technology Initiative.--The budget provides a 34
percent increase for this initiative, which includes $1.4
billion in R&D on energy efficiency, renewable energy, carbon
sequestration, and improvements in nuclear and fossil
technologies. The initiative also provides $400 million in tax
credits to stimulate adoption of energy efficiency
technologies.
--U.S. Global Change Research Program.--The budget provides $1.8
billion (a 6 percent increase) to observe, understand, predict,
and assess the state of the Earth and how it changes in
response to natural and human-induced forces.
--Partnership for a New Generation of Vehicles (PNGV).--The budget
provides $264 million (a 10 percent increase) for this cost-
shared, industry partnership. PNGV aims to develop affordable
cars that achieve up to three times the fuel economy of
comparable vehicles and meet all applicable emission and safety
standards.
--Education Research Initiative.--The budget provides $50 million
($25 million at NSF and $25 million at ED) to support large-
scale, interdisciplinary research in three key areas: school
readiness for learning reading and mathematics; K-3 learning in
reading and mathematics; and education of PreK-12 teachers in
mathematics, reading, and science.
Private Sector Stimulus
The budget provides $2.4 billion to extend the Research and
Experimentation (R&E) tax credit until June 30, 2000. The R&E credit
helps stimulate additional private sector investment in research and
development which encourages technological advancement, leading to
higher productivity, and helping to generate new American jobs.
the ostp mission
In support of our Nation's science and technology priorities, OSTP
has two primary responsibilities: advising the President on S&T; and
providing leadership and coordination for our government's role in the
national S&T enterprise.
In the 1950's, in response to Soviet advances, highlighted by the
launch of Sputnik, President Eisenhower saw the need for expert S&T
counsel, and he invited James Killian, then president of MIT, to
Washington to serve as the head of the first President's Science
Advisory Committee, an OSTP predecessor. Since then our Nation's
Presidents have drawn on the expertise of our office for S&T policy
advice, and I see this as a contribution that will continue to grow in
value as the challenges we face become increasingly complex.
Within our agency, a small staff of professionals analyzes
developments at the frontiers of scientific knowledge, and aids the
President in shaping policy. OSTP also provides scientific and
technical information and recommendations to the Vice President, the
White House Offices, the Executive Branch Agencies, and to Congress.
A second responsibility of OSTP is to provide leadership and
coordination across the Administration. OSTP plays this role for a
range of Administration priorities, including national security and
global stability, environment, science, and technology. The National
Science and Technology Council (NSTC) has been an invaluable partner
with OSTP in developing interagency evaluations and forging consensus
on many crucial S&T issues.
OSTP Budget Request
I ask today for your continued support of OSTP's role in
coordinating S&T policy for the Executive Branch and for our Nation at
large. OSTP's budget request of $5,201,000 for fiscal year 2000
represents an increase in budget authority of less than 3.5 percent and
an increase of one in the FTE level from 39 in fiscal year 1999 to 40
in fiscal year 2000. This request will allow OSTP to fulfill its
responsibilities in a White House that emphasizes the importance of
science and technology in national and international affairs.
After freezing our requests at the fiscal year 1996 enacted level
for two consecutive years, this increase is essential to continue to
provide quality support to the President and information to the
Congress. Since personnel costs constitute the largest portion of
OSTP's budget, our fiscal year 2000 budget request reflects our
commitment to operate more efficiently and cost-effectively without
compromising the essential element of a top caliber science and
technology agency--high quality personnel.
National Science and Technology Council
To meet the Administration's priority S&T goals we must combine the
efforts and the expertise of multiple agencies. OSTP personnel support
the work of the NSTC, a Cabinet-level Council that sponsors interagency
initiatives to advance key S&T objectives.
Our distributed system of research funding also places a premium on
coordination between complementary agency programs. The NSTC, now in
its fifth year, is improving such coordination.
NSTC membership includes Cabinet Secretaries, heads of science and
technology agencies, and key White House officials with significant S&T
responsibilities. In the process of generating specific budgetary and
policy recommendations, NSTC routinely reaches beyond the federal
government to seek input from a wide spectrum of stakeholders in the
public and private sectors.
An important objective of the NSTC is to guide individual agency
budget priorities for R&D and to orient the S&T spending of each
Federal mission agency toward achieving national goals. To meet this
objective, the NSTC has established five goal-oriented committees, each
of which is chaired jointly by a senior agency official and an OSTP
Associate Director. These standing committees, along with ad hoc
working groups within the NSTC, provide an effective forum to resolve
cross-cutting issues such as the future role of the U.S. national
laboratories, or providing a program guide to federally funded
environment and natural resources (see Appendix A for a full list of
NSTC generated reports from 1998.)
The President's Committee of Advisors on Science and Technology
As Assistant to the President for Science and Technology, the
Director of OSTP co-chairs the President's Committee of Advisors on
Science and Technology (PCAST) with John Young, former President and
CEO of Hewlett-Packard Co. The PCAST, which consists of distinguished
individuals from industry, education, and research institutions, and
other non-governmental organizations, serves as the highest level
private sector advisory group for the President and the NSTC. (see
Appendix B for a full list of PCAST generated reports from 1998.)
President Clinton established the President's Committee of Advisors on
Science and Technology (PCAST) at the same time that he established the
NSTC to advise the President on matters involving S&T and to assist the
NSTC in securing private sector involvement in its activities.
Mr. Chairman and Members of the Committee, I hope that this brief
overview has conveyed to you the extent of this Administration's
commitment to advancing S&T in the national interest. We are delighted
that the fiscal discipline exercised over the past six years has put in
reach the opportunity to place more emphasis on investments that can
assure future economic progress, environmental protection, and other
national priorities which depend so heavily on strong and sustained
R&D.
Regardless of party affiliation, in the end we can all agree that
investments in S&T are investments in our Nation's future. I look
forward to achieving bipartisan support for a national S&T strategy
that will combine the resources of industry, academia, non-profit
organizations, and all levels of government to advance knowledge,
promote education, strengthen institutions, and develop human
potential.
I ask not only for your support for OSTP's fiscal year 2000 budget
request, but also want you to know how much I appreciate the long-
standing bipartisan support of the committee for OSTP and for the S&T
research enterprise. I would be happy to answer any questions that you
have.
Appendix A.--Reports
National Plant Genome Initiative, January 1998
Program Guide to Federally Funded Environment and Natural Resources
R&D, February 1998
Our Changing Planet: The Fiscal Year 1999 U.S. Global Change
Research Program, An Investment in Science for the Nation's Future,
March 1998
National Science and Technology Council 1997 Annual Report, April
1998
A National Obligation/Planning for Health Preparedness for and
Readjustment of the Military, Veterans, and Their Families after Future
Deployments, August 1998
Fiscal year 2000 Interagency Research and Development Priorities
(Jones-Lew Memorandum), June 1998
Networked Computing for the 21st Century/Supplement to the
President's Fiscal Year 1999 Budget, August 1998
Transportation Technology Plan, November 1998
Air Quality Research Strategic Plan, November 1998
Public/Private Partnerships: Implications for Innovation in
Transportation, December 1998
Endocrine Disruptors: Research Needs and Priorities, December 1998
Reports and further information may be obtained by calling: 202-
456-6100 (phone) or 202-456-6026 (fax).
Reports are Also Available on the NSTC Home Page via Link from the
OSTP Home Page at: http://www.whitehouse.gov/WH/EOP/OSTP/html/OSTP--
Home.html
Appendix B.--Activities of the President's Committee of Advisors on
Science and Technology (PCAST)
In 1998 PCAST provided the following reports:
Teaming With Life.--Investing in Science to Understand and Use
America's Living Capital (June 1998). Over the last few decades, a new
paradigm has emerged: Improving and protecting our environment is
compatible with growing the nation's economy. As part of this paradigm,
we have come to recognize the essential linkage between the economy and
the environment. We now understand that the sustained bounty of our
nation's lands and waters and of its native plant and animal
communities is the natural capital on which our economy is founded. We
also realize that a sound forward-looking economic strategy requires
that we protect this natural capital, rather than damage it and then
spend millions or billions of dollars attempting to recreate what
nature has already given us. To protect our natural capital, our
Nation's biodiversity and the ecosystems within which it thrives, we
need to have an extensive and frequently updated environmental
knowledge base. This knowledge base is required to evaluate alternative
plans for managing biodiversity and ecosystems as we work to optimize
the union between the environment and the economy. The report offers
strategies as to how to amplify our knowledge that will allow us to
accomplish these goals.
PCAST issued the following letter reports:
Letter Report on R&D Partnerships, released March 6, 1998, reviewed
the effectiveness of Federal technology partnership programs based on
three studies and noted areas for improving programmatic effectiveness
and efficiency.
Letter Report on Global Cooperation to Develop and Commercialize
Energy Technologies to Meet the Global Challenge of Climate Change,
released May 15, 1998. The report advised that the issues of climate
change presents the United States and the world with one of the
greatest challenges of the 21st century. The report recommended
development of a plan to address the challenge of global impact of
human activities through technology and development of a global
collaborative framework in greenhouse-gas reductions.
Letter Report on the Education Research Initiative, released June
8, 1998. The report advised that the quantity, quality, and
organization of education research in this country need renewed
attention. The report recommended that the fiscal year 1999 spending
constitute an initial investment in building the methodological human,
and institutional resources that will move the United States to a $1.5
billion annual program of peer reviewed, politically independent,
reliable, and cumulative research in education that draws on a broad
base of expertise.
Letter Report on the fiscal year 2000 Budget, released November 4,
1998. The report urges the President to strongly support a broad S&T
portfolio in the fiscal year 2000 budget. PCAST advised the President
to continue to focus Federal resources on strengthening the U.S.
research capacity through an approach such as the 21st Century Research
Fund and to broaden this concept to encompass the basic research
programs of the DOD.
Senator Bond. Dr. Colwell.
Dr. Colwell. Mr. Chairman, Senator Mikulski and Senator
Burns, I thank you for allowing me the opportunity to testify
on the budget request for fiscal year 2000 for the National
Science Foundation. This being my first appearance before this
subcommittee, I also thank you for the very kind remarks.
Before I begin my presentation, I would like to turn to Dr.
Kelly for the National Science Board's views on the NSF budget
and a little bit of information about the current state of
science and engineering in the United States.
Dr. Kelly.
Senator Bond. Dr. Kelly, thank you.
statement of Eamon M. kelly
Dr. Kelly. Thank you, Mr. Chairman.
Mr. Chairman, Ranking Member Mikulski, Senator Burns, I
appreciate the opportunity to testify before you, and request
that my written statement be entered into the record.
Senator Bond. Without objection.
Dr. Kelly. First, let me thank the subcommittee for its
strong and consistent support of the National Science
Foundation. Your continuing commitment to NSF programs and
activities is vital to our Nation's future. Guided by the
creative and energetic stewardship of my colleague, NSF
Director Rita Colwell, your investment in NSF's research and
education portfolio has been and will continue to be handsomely
rewarded.
Second, on behalf of the National Science Board, I want to
endorse the Foundation's request for $3.95 billion for fiscal
year 2000. The investment represented in this budget extends
across the frontiers of science, engineering and technology,
and reflects the Administration's strong commitment to
fundamental research. Moreover, it reflects my personal
conviction that scientific research is the keystone of our
economy. NSF's support for research has a multiplier effect. It
is the foundation for other investments, governmental and
nongovernmental alike, in research.
It is worth noting that R&D funding patterns have changed
substantially. Total national R&D funding has never been
higher. It now amounts to more than $200 billion annually.
However, long-term research investments, sponsored mainly by
the Federal Government, have been steadily losing ground to
short-term investments supported mainly by private industry.
This decline is significant. Because, as the Council of
Competitiveness points out in its recent report, ``Going
Global,'' and I quote: Investment in discovery research creates
the seed corn for future innovation. Government at all levels
is the mainstay of the Nation's investment in science and
engineering research. Unquote.
The Council concluded that increased public investment in
fundamental research and education is a vital need. Yet the
long-term trends in national investment in research tell us we
are underfunding fundamental research and, in the process,
eating our seed corn.
In 1997, the Federal Government provided 30 percent of all
R&D funds in the U.S., down from 60 percent three decades ago.
Other numbers tell a similar story. Of the $70 billion Federal
investment in R&D, only $17 billion goes to fundamental
research.
Speaking as an economist, it is a fundamental economic
error to underfund the basic research, either a total of $17
billion or NSF's $4 billion, that underpins much of our $8.5
trillion economy. Even the $17 billion level represents 2 one-
thousandths of 1 percent of our total economic activity.
Clearly, the creation of knowledge has become a driver of
our economy that we almost take for granted. Commercial and
medical breakthroughs in understanding and product development,
from terascale computing systems to genomics, to laser surgery,
are all rooted in the support of past NSF research investments.
Today, four of the top 10 companies of the Fortune 500 are
high-tech companies. None of these four was even in the Fortune
500 a decade ago.
Mr. Chairman, the payoffs flowing from our Nation's R&D
system result from a balanced portfolio of research
investments. Moreover, this system depends on the intertwining
of research and education. So, while NSF investments spur the
creation of new knowledge, they also help to educate the next
generation of scientists and engineers.
As we look beyond this budget year, the National Science
Board is committed to the same wise investments and priority-
setting in science and technology that this committee seeks. We
thank you for your support of the Nation's investment in
research and education, especially at the National Science
Foundation. And we look forward to working with you, Mr.
Chairman, and the entire subcommittee, to help sustain the U.S.
world leadership in science and engineering in the next
century.
prepared statement
That completes my statement, Mr. Chairman, and I turn now
back to Dr. Colwell.
[The statement follows:]
Prepared Statement of Dr. Eamon M. Kelly
Mr. Chairman, Ranking Member Mikulski, and members of the
Subcommittee, I appreciate the opportunity to testify before you. I am
Dr. Eamon Kelly, Chairman of the National Science Board and President
Emeritus of Tulane University.
Since the founding of NSF in 1950, the National Science Board has
exercised two roles that of a national policy body, and that of a
governing board for the National Science Foundation (NSF). The latter
role is similar to that of a corporate board of directors, but as a
Federal entity we operate within the framework of policy guidance
established by the Congress and the Administration.
The Board conducts an annual NSF long-range planning and budget
review and approval to assure the health of the human, disciplinary,
and infrastructure base for science and technology (S&T); to support
new opportunities for the advancement of knowledge; and to make the
process of priority-setting responsive to such opportunities.
I am here today first to thank the Subcommittee for its strong
support of NSF. Your continuing commitment to NSF programs and
activities in research and education is vital to our Nation's future.
Second, on behalf of the National Science Board, I want to express
our strongest support for the Foundation's request for $3.95 billion
for fiscal year 2000. The investment represented in this budget extends
across the frontiers of science, engineering, and technology and is
part of the 21st Century Research Fund. It reflects the
Administration's strong commitment to fundamental research.
Moreover, it reflects my personal conviction that research is the
keystone of our economy. And NSF's support for research has a
``multiplier effect'' : it is the foundation for other investments
agency and nongovernmental alike--in research.
Three themes are priority-setters in the Foundation's budget
proposal, which Director Colwell will elaborate:
--NSF has been designated the lead agency for a six-agency initiative
on Information Technology for the Twenty-First Century (or
``IT2'');
--Biocomplexity in the Environment represents a set of coordinated
activities in environmental science, engineering, and
education; and
--Educating for the Future: A 21st Century Workforce seeks to improve
access to quality educational opportunities from elementary
through higher education.
As NSF's priorities suggest, science and engineering are becoming
more international, multidisciplinary, and collaborative in character.
These trends guide the National Science Board as well. As context for
today's budget discussion, let me say a word about some recent NSB
activities.
The Board is in the midst of a six-month examination of research,
education, and assessment on the environment. A public hearing was held
in Portland in January, a symposium in Los Angeles in February, and a
town hall meeting earlier this month at NSF headquarters in Arlington.
This process is assisting the Board to provide policy-level guidance
for the NSF's environment portfolio.
The Board also recognizes the need for better understanding of the
nature of the return on the entire Federal investment portfolio and for
increased accountability for research investment choices by the
agencies. The Government Performance and Results Act of 1993 requires
that scientific investments, like all others, be subject to strategic
planning and measurement of performance as a basis for resource
allocation.
As part of its national policy role, the Board is responsible by
law for a biennial compilation of ``indicators of the state of science
and engineering in the United States.'' Science and Engineering
Indicators serves as the authoritative source of data on the health of
the science and engineering research and education enterprise,
presenting not only a domestic profile, but international comparisons
as well.
Science and Engineering Indicators is a valuable analytical tool
for policy professionals in all sectors and the Board in particular. As
the demand for accountability has grown, Indicators data have become
increasingly useful for characterizing key trends in the scope,
quality, and vitality of U.S. research and education.
In the 1998 Indicators volume, the Board reported quantitative
trends in U.S. science and engineering, concluding that ``The Nation's
S&E enterprise is undergoing changes in structure and priorities as we
prepare to enter the next century.'' This is all too clear when we look
at the national picture, for example:
--R&D funding patterns have changed substantially. The good news is
that total national R&D funding has never been higher. It now
amounts to more than $200 billion annually.
--The not-so-good-news is that long-term R&D investments--sponsored
mainly by the Federal government--have been steadily losing
ground to short-term investments, sponsored mainly by private
industry.
--In 1997, the Federal government provided 30 percent of all R&D
funds in the U.S. A decade ago, the Federal share was 46
percent. Three decades ago, the federal share was 60 percent.
This decline is significant because, as the Council on
Competitiveness points out in its September 1998 report, Going Global:
``For the past 50 years, most, if not all, of the technological
advances have been directly linked to improvements in fundamental
understanding. Investment in discovery research creates the seed corn
for future innovation. Government at all levels is the mainstay of the
nation's investment in science and engineering research. . . .''
The Council concluded that increased public investment in
fundamental research and education is a vital need. Yet the trend is
away from long-term research. It makes NSF investments in fundamental
science and engineering more important than ever.
Speaking as an economist, Mr. Chairman, it would be a fundamental
economic error to underfund the fundamental research that underpins
much of our $8.5 trillion economy.
The payoffs flowing from our Nation's R&D system result from a
balanced portfolio of research. At the same time, the U.S. S&T
enterprise depends on the intertwining of research and education. NSF
investments spur the creation of new knowledge across the disciplines
of science and engineering, while helping to educate the next
generation of scientists and engineers.
This creation of knowledge--especially at institutions of higher
learning across the U.S.--has become one of the primary drivers of our
economy. Commercial and medical breakthroughs in understanding and
product development--from terascale computing systems to genomics to
laser surgery--are rooted in the support of past fundamental research
investments.
One only has to look at four of the top 10 companies of the Fortune
500 are high-tech companies. None of these four was even in the Fortune
500 a decade ago. Many grew from ideas nurtured by American
universities. As Fed Chairman Alan Greenspan recently noted: ``In a
global environment in which prospects for economic growth now depend
importantly on a country's capacity to develop and apply new
technologies, the research facilities of our universities are envied
throughout the world * * *. The payoffs in terms of the flow of
expertise, new products, and start-up companies, have been
impressive.''
Future economic prosperity, gains in our standard of living and
overall well-being are increasingly dependent on innovations that
emerge, in often unpredictable ways, from a bedrock of Federal
investments in science and technology.
One other area of recent NSB activity demonstrates both payoffs and
continuing needs. The Board stated in its 1997 report on The Federal
Role in Science and Engineering Graduate and Postdoctoral Education,
that ``The education of graduate and post-doctoral students in a
discovery-rich university research environment is at the heart of the
post-World War II compact between the Federal government and
universities.'' In the last fifty years, stresses on higher education
institutions have increased and should be addressed in a comprehensive
manner.
As the Board continues to examine these stresses, a major concern
is the preparation of an increasingly diverse student body for the
workforce of a global economy. That concern originates with the quality
of education at the K-12 level.
The Board has considered the disturbing implications of the Third
International Mathematics and Science Study, or TIMSS, which showed an
alarming decline from 4th to 8th to 12th grade among U.S. students
relative to their international peers.
Earlier this month, the Board released a report, ``Preparing Our
Children,'' that will be of interest to this committee. I ask
permission to submit a copy of the report for the record. The report
calls on scientists and engineers to assist teachers and schools in
preparing students for higher learning and the 21st century workplace.
For a mobile student population like ours, local schools are de
facto a national resource. It is therefore a national imperative to
improve, through local strategies, student achievement in mathematics
and science. I would add that some of the most encouraging signs of
educational improvement can be found in the cities supported by NSF's
Urban Systemic Initiatives program, notably Detroit, El Paso, and
Memphis.
In closing, Mr. Chairman, I want to assure you that the National
Science Board is committed to same wise investments and priority-
setting in science and technology that this committee oversees. We
thank you for your support of the Nation's investment in research and
education, especially at the National Science Foundation. But we
clearly see unmet needs.
Today's research opportunities are simply breathtaking. The amount
and breadth of funding needed to exploit those opportunities motivates
the National Science Board's conviction to make the case not just for
the NSF budget, but for the knowledge and products that will be
returned to the Nation on this investment.
It is my personal pleasure to collaborate with NSF Director Rita
Colwell in explaining to all our citizens the value of these long-term
investments in research, education, and the future. Thank you.
biographical sketch of eamon m. kelly
Eamon Michael Kelly was born in New York City and attended Columbia
University from 1960 to 1965, where he earned the master and Ph.D.
degrees in economics. Following graduation from Columbia, he joined the
Penn State faculty at University Park, Pennsylvania.
In 1968, Kelly was appointed to U.S. government service by the
President, serving as Director of Policy Formulation with the Economic
Development Administration of the U.S. Department of Commerce. He was
later named Special Assistant to the Administrator of the Small
Business Administration, where he participated in planning and
initiating the federal government's first minority economic development
program. Kelly joined the Ford Foundation in 1969 and served as
Officer-in-Charge for the Office of Social Development, the
Foundation's largest domestic and civil rights division.
In 1977, Kelly served as a special consultant to the U.S. House of
Representatives where he participated in drafting legislation that
provided a $1.7 billion guarantee to prevent the insolvency of New York
City. Later that year he was appointed Special Assistant to the
Secretary of the U.S. Department of Labor. In that position, he
successfully directed a government-wide investigation of the Teamster's
$1.4 billion Central States Pension Fund and led negotiations resulting
in the Fund being transferred to private management. After leaving the
Labor Department, Kelly returned, at the request of the Secretary of
Labor, to direct efforts that led to the end of a nationwide coal
strike.
In 1981, he was chosen to serve as the 13th president of Tulane
University. In July 1998, Kelly retired as president of the university.
Currently, Kelly, whose area of specialized interest is international
urban and rural development, holds the rank of professor in the
departments of Economics, Latin American Studies, and International
Health and Development at Tulane. He is also a founding member of the
Payson Center for International Development and Technology Transfer.
Kelly is active on the boards of many professional, philanthropic,
civic, and corporate organizations. In 1995, he was appointed by
President Clinton to serve on the National Science Board (NSB), the
governing body of the National Science Foundation, which sponsors
scientific and engineering research, develops and sponsors educational
programs, and helps guide national policy. In 1998, Kelly was elected
chairman of the NSB.
Senator Bond. Thank you, Dr. Kelly.
We now turn back to Dr. Colwell, and start the clock anew.
statement of rita colwell
Dr. Colwell. Thank you. Mr. Chairman, I do have a statement
which I will summarize very briefly. With your permission, I
ask that my full statement be part of the record.
Senator Bond. Without objection, it will be.
Dr. Colwell. Thank you.
Mr. Chairman, Dr. Kelly has touched on some very important
trends in fundamental R&D in recent National Science Board
reports. Over the past 25 or so years, Federal research
investments have steadily increased in nearly all fields. And
that is good news. However, the overall mix of Federal
investments in science and engineering has changed
significantly and very dramatically, primarily through gains in
the biomedical fields, at the expense of physical sciences and
engineering. And the very sharp nature of the shift in funding
toward the biomedical fields has taken a few people by
surprise.
Now, I would be the first to tell you about the very
exciting things that are happening in the biomedical field.
Some of that funding has gone to my own research. But I do know
that society really cannot live by biomedical bread alone. This
trend, in fact, concerns many in the medical sciences. NIH
Director Harold Varmus discussed it in a speech last year. Dr.
Varmus--and I think to his credit--addressed this directly, and
talked about the dependence of biology and medicine on other
fields of science.
So, this brings us to the fiscal year 2000 request for NSF
and the need for increased investment in research and
education. As you know, the NSF is the only agency whose
mission covers research in all fields of science and
engineering, as well as education at all levels--essentially
from cradle to grave. We support the fundamental work that
benefits the mission agencies, like NIH, right down the line.
And so for this reason, it is important that NSF continue to
support the investments that reach all fields, all disciplines.
And that is the governing philosophy of our fiscal year 2000
request.
For this request, NSF is closing in on the $4 billion
milestone. The fiscal year 2000 request comes to $3.95 billion,
which represents about a 5.8-percent increase over the current
level. And I think this is an outstanding request, given the
constraints that you have already stressed, imposed by the
discretionary spending caps. And the headliner in the budget is
the new initiative in information technology. And the
rationale, I think, is quite clear. As Internet growth has gone
through the roof, IT has become the essential fuel for the
Nation's economic engine.
And the numbers speak for themselves. The latest estimates
show that IT has generated about a third of the recent growth
in the U.S. economy. It now accounts for about 7.4 million
jobs, and it pays wages that are about 60 percent higher than
the private sector average.
And I think the challenge is to sustain this record of
success. And so this has led to the government-wide initiative,
the Information Technology for the 21st century, the
IT2. And across the government, as Dr. Lane has
pointed out, IT2 will total about $366 million
across six agencies.
Now, 60 percent of this will go to support university-based
research. And I think that is the real win-win for our country.
The academic research investment serves double duty. It armors
and enables students with advanced IT skills. And Senator
Mikulski has addressed the work force issue, which is critical.
This is more than just a national initiative. It is a
national imperative. It is a classic example of a long-term
investment in fundamental research that works for the common
good--in fact, for the global good.
This same sense of imperative comes through in a second
initiative presented in the request for NSF. And this one is in
the area of biocomplexity. Biocomplexity is a multi-
disciplinary approach to understanding our world's environment.
For generations, scientists have studied parts of our
environmental system--individual species, individual habitats--
in isolation. Now it is time for a better understanding of how
those parts function together as a whole, as Senator Mikulski
has called for. One reason it is time to tackle this task is
that we now have the ability, the technologies, to grasp the
complexity of our environment.
And, finally science and math education remain a priority
in this budget, as it must. Last year, we got the not very good
news about how our schools compared to other nations. By 12th
grade, our students are near the bottom. We can and we must do
better. The request sustains our current base of innovative
activities and plants a few new seeds as well.
prepared statement
Well, that covers the basics of the budget request. I would
like to close by saying that, once again, over the past 25
years, we have seen a major realignment of the Federal research
portfolio. And this makes it an ideal time to look ahead and to
align our investment priorities with the needs and
opportunities of tomorrow's information economy. I look forward
to working with all of you to meet those needs and to
strengthen our Nation's investment in the future.
Thank you.
[The statement follows:]
Prepared Statement of Rita Colwell
Mr. Chairman, Senator Mikulski, members of the Subcommittee, thank
you for allowing me the opportunity to testify on the budget request
for fiscal year 2000 for the National Science Foundation.
Before I turn to details of the NSF budget request, I'd like to say
a few words about how NSF fits into the overall R&D environment of our
country.
My good friend and colleague Dr. Eamon Kelly--Chairman of the
National Science Board--has touched on some important trends in
fundamental R&D in recent NSB reports. Let me mention one other long-
term research trend that is causing concern among many in the science
community.
NSF's Division of Science Resources Studies has taken a close look
at the mix of Federal research funding across different fields of
science and engineering.
First, some good news. Over the past 25-plus years, federal
research investment research has increased significantly in most
fields. Overall, federal research investments have grown about six-fold
in current dollars since 1970.
However, the mix of investments has changed significantly and
dramatically--primarily through gains in biomedical fields and declines
in the shares for physical sciences and engineering.
--In 1970, the life sciences accounted for 29 percent of Federal
research spending. By 1997, their share had risen to 43
percent. Put another way, the share increased by half.
--Engineering, by contrast, saw its share decline by 12 percentage
points over the same period, falling from 31 percent to 19
percent of the Federal research portfolio.
--The share going to the physical sciences dropped by more than 5
points--from 19 percent to 14 percent of the total portfolio.
The combination effect is just as significant. Engineering and the
physical sciences--taken together--accounted for 50 percent of federal
research spending in 1970.
That's down to 33 percent today--a drop from half of the total to
just one third.
The sharp nature of the shift in funding toward the biomedical
fields has taken more than a few people by surprise.
I'd be the first to tell you about the great things that are
happening in biomedical fields. Some of that funding has gone to my own
research. But, I also know that society cannot live by biomedical bread
alone.
This trend in fact concerns many in the medical sciences. NIH
Director Harold Varmus discussed it in a speech last year. Dr. Varmus,
much to his credit, took the bull by the horns and talked about the
dependence of biology and medicine on other fields of science. In his
words: ``Most of the revolutionary changes that have occurred in
biology and medicine are rooted in new methods. Those, in turn, are
usually rooted in fundamental discoveries in many different fields.''
He then went on to cite laser surgery, CAT scans, fiber optic
viewing, ECHO cardiography, and fetal sonograms as examples of these
revolutionary advances.
This brings us to the fiscal year 2000 request for NSF, and the
need for increased investment in research and education. NSF is the
fulcrum for all of science and engineering.
NSF is the only agency whose mission covers research in all fields
of science and engineering, as well as education at all levels--cradle
to grave. We support the fundamental work that benefits the mission
agencies right down the line.
For this reason, it is important that NSF continue to support
investments that reach all fields and disciplines, which is the
governing philosophy of our fiscal year 2000 request.
Let me turn now to the budget. NSF is fast closing in on a $4
billion milestone.
The fiscal year 2000 request comes to $3.95 billion, which
represents a 5.8 percent increase over the current level. This is an
outstanding request given the constraints imposed by the discretionary
spending caps.
The Administration agreed with us when we said loudly and clearly
that research investments deserve the highest priority. The positive
response we got is reflected in an 8 percent increase for research
project support.
The headliner in this budget is the new initiative in information
technology. The rationale is clear.
As Internet growth has gone through the roof, IT has become the
essential fuel for the nation's economic engine.
The numbers speak for themselves. The latest estimates show that IT
has generated one-third of the recent growth in the U.S. economy. It
now accounts for 7.4 million jobs * * * and it pays wages that are 60
percent higher than the private sector average. The challenge now is to
sustain this record of success.
You may be familiar with the recent report by the President's
Information Technology Advisory Committee--PITAC for short. PITAC
concluded that federal support for long-term research on information
technology has been ``dangerously inadequate.'' In its words ``support
in most critical areas has been flat or declining for nearly a decade,
while the importance of IT to our economy has increased dramatically.''
This has led to the government-wide initiative: Information
Technology for the 21st Century--IT\2\ as it's called.
Across the government, IT\2\ will total $366 million across
six agencies.
60 percent of this will go to support university-based research.
That's the real win-win for America. The academic research investment
serves double duty, as it armors and enables students with advanced IT
skills.
NSF is the lead agency for IT\2\. This was recommended
last fall by PITAC, and we are glad to accept this responsibility and
challenge.
We'll be putting $146 million into our part of IT\2\,
which will cover three sets of activities.
--First is fundamental IT research--at $100 million. This will focus
on a key assessment from PITAC's report.
For all of our ability to push the high-end in computing, no one
really understands how all the pieces work together. The need right now
is to improve both reliability and performance. We can achieve this by
understanding how systems interact and gaining new knowledge of the
working whole.
--The request also includes $36 million for a terascale computing
system. This will serve computer scientists and the entire
science and engineering community.
--Finally, we'll take advantage of the fact that NSF's portfolio
includes both the information sciences and the social,
behavioral, and economic sciences. There is $10 million for
research on the societal, ethical, and workforce impacts of
emerging technologies.
When people ask me, why NSF and the United States should invest in
information technologies--and why now--I say it is an absolute must.
It's not a national initiative, it's a national imperative. It's a
classic example of a long-term investment in fundamental research that
works for the common good, in fact, for the global good.
IT\2\ is an investment that will strengthen the entire
research and education enterprise. It will deliver tools and
capabilities that will benefit every field, every discipline, and every
level of education.
When we bring faster computers to weather forecasting, we save
lives, we protect buildings and crops, and more--by getting better
advance warning of El Nino's, tornadoes, hurricanes, and other severe
events. My own research on climate and infectious diseases (El Nino and
cholera) has made this dramatically clear to me.
The possibilities are limitless. We tackle the toughest challenges
in science and engineering, and we put high octane fuel in this great
engine of job creation and growth.
This same sense of imperative comes through in a second initiative
presented in the request. This one is in the area we call
biocomplexity.
Biocomplexity is a multidisciplinary approach to understanding our
world's environment. For generations, scientists have studied parts of
our environmental system--individual species and habitats--in
isolation. Now it is time for a better understanding of how those parts
function together as a whole.
This will not be easy. Taken separately, these parts are very
complex. Biocomplexity is about looking at phenomena, whether they be
weather or proteins or human society, at many scales. Such a viewpoint
will let us identify the principles and patterns that operate at
multiple levels of organization in the earth's systems, and across time
and space.
Because of our planet's biocomplexity, organisms and entire
ecosystems in one region can be influenced dramatically by physical and
chemical changes occurring thousands of miles away. For example,
wildfires in the western U.S. affect fisheries half a world away.
Mercury from very hot wildfires can be blown aloft by high level winds
and fall into rivers and lakes far away. Fish consume food contaminated
by the mercury, presenting a human health hazard.
This is just one aspect of biocomplexity. There are many more.
Around the globe, scientists in many disciplines collect and analyze
environmental data on the stability of the polar ice caps, the
temperatures of tropical oceans, and the health of species, forests,
lakes and rivers in the United States.
Biocomplexity is about combining these efforts in a comprehensive
way. It is an ambitious concept, but one that could have enormous
payoffs in the years ahead.
One payoff would be better environmental decision-making on the
part of governments, industries and individuals. ``Ecological
forecasting''--as some call it--could have far-reaching benefits for
agriculture and other industries dependent on changes in the
environment.
Another payoff could be a better handling of the difficult problem
of non-native or invasive species.
One reason it's time to tackle this task is that we now have the
ability, the technologies, to grasp the complexity of our environment.
From computational algorithms to mathematical models, from remote
sensing to new kinds of sensors, and of course to genome sequencing and
the molecular basis of metabolism and heredity * * * the technologies
have arrived, as have the opportunities in research.
Finally, science and math education remains a priority in this
budget, as it must. Last year we got the not-so-good-news about how our
schools compare to other nations.
By 12th grade, our students are near the bottom. We can and must do
better. The request sustains our current base of innovative
activities--and plants a few new seeds as well.
One of those promising seeds is the new Graduate Teaching Fellows
program. The program may seem small at only $7.5 million, but it is an
important beginning with a potential impact well beyond the dollars. It
will broaden graduate education, and boost the science, engineering,
and technology content in K through 12 classrooms.
I'll just mention a few other highlights before closing.
The Plant Genome Research Program will continue to increase. Its
funding will increase by $5 million to a total of $55 million.
This builds on an existing research base of $20 million--bringing
the total investment to $75 million. This will provide the scientific
underpinning in the future to improve nutritional content of our food
crops, both in quality and yields.
A new start in the budget is the Network for Earthquake Engineering
Simulation. We are providing $8 million in fiscal year 2000 toward a
total investment of $82 million over the next five years. This is
modeled after the highly successful nanofabrication network NSF began
several years ago. This will lead to a national, fully-interconnected
network of major earthquake research facilities.
Finally, we will be continuing investments in a number of major
infrastructure projects. One is the modernization of the South Pole
Station, which remains on schedule and on budget, thanks in large part
to the forward funding provided by the subcommittee in past years.
That covers the basics of the budget. Let me conclude by adding
that by its very timing, a budget for the first year of a new
millennium takes on added significance.
That applies doubly so to NSF. The year 2000 marks the 50th
Anniversary of the National Science Foundation.
Given the increase we have received in this very tight budget
environment, it is clear that this is a ``golden anniversary''
investment. This is also an appropriate time to step back and think
about the long-term importance of investments in science and
engineering.
Unfortunately, our fast-paced world makes it hard for us to focus
beyond today's problems and concerns. It's a challenge to make a case
for investment in our children's future.
Thankfully, the VA/HUD subcommittee has taken a more long-term
view, even though the payoffs from some basic research may come ten or
twenty years from now.
You have consistently supported NSF's investments over the years in
a bipartisan manner. For this, let me thank you again. I look forward
to working with all of you to strengthen our nation's investment in the
future as we approach the next millennium.
Thank you.
overall funding priorities
Senator Bond. Thank you very much, Dr. Colwell. I
congratulate you on your ability to receive such strong support
from the White House in your first budget request. But we need
to talk a little reality and cold water here. We could be
facing a very tight budget. And we really do not know just what
the constraints will be.
In the worst-case scenario, assuming we are not able to
provide any funding increase for NSF overall, what would you
recommend in funding priorities? And then, what would you have
to forego?
Dr. Colwell. We would make every effort to pursue the
Information Technology Initiative and Biocomplexity and
Educating for the Future. These are priorities. They are
critical. And what we would try to do is invest as best we
could.
I think the biggest challenge that I face as the Director
of NSF is to sustain and maintain our strength and leadership
in the basic disciplines, while at the same time reaching out
for the opportunities, the strategic opportunities.
priority of information technology funding
Senator Bond. Where would you cut if you pursued
IT2?
Dr. Colwell. Fortunately, the roots of IT2 are
embedded in the past initiatives--High-Performance Computing,
the Second Generation Internet and the KDI--which have all been
brought together to encompass the next evolutionary step. Being
a biologist, I can see how this evolved quite nicely.
Senator Bond. So you could take that, you could shift the
focus from those into your new IT2?
Dr. Colwell. We would make every effort to keep Information
Technology going.
plans for information technology
Senator Bond. Where does the Information Technology fit in
with the KDI and the other things? Is that a logical extension?
Is it going in a different direction? That is the thing I
really have trouble understanding.
Dr. Colwell. It is clearly a logical extension. Several
years ago, the investment was made in High-Performance
Computing to get the supercomputing together. Then partnerships
were developed to bring computing to every part of the system.
That is critical. And what the IT Initiative will allow us to
do is to expand that further.
In fact, nominee Deputy Director Joe Berdogna and I have a
commitment to go the last mile, to make sure that every part of
the country is connected to the computing infrastructure and
that science and engineering is brought to every part of the
country.
The Internet has done that. The Next Generation Internet
will allow even speedier communication and connection.
So all of this has built on each other. The KDI recognized,
from the proposals coming in from the field, from the
constituents, that there was a need to bring computing into
biology, into chemistry, into behavioral and social and
economic sciences. So that has been an evolutionary step. And
now with our focus on information technology, we will be able
to maintain our leadership and bring all of this from the past
into a coherent whole.
Senator Bond. Dr. Lane, we do note some major shifts in the
President's fiscal year 2000 budget and their research and
development priorities, a shift toward more civilian R&D
funding, and a much greater emphasis on information technology,
which seems to be a departure from some of the past focus on
health sciences. What is the rationale for the changes? And as
the President's Science Advisor, what do you foresee in the
near future in terms of Federal R&D policy, what direction is
it going to go?
funding nih
Dr. Lane. Mr. Chairman, with regard to the funding that the
President is requesting for biomedical research--NIH in
particular--the request that the President has sent over for
fiscal year 2000 is consistent with the plan that he presented
last year for the outyears.
As you know, Mr. Chairman, I think the President requested
just below the order of 8 percent for NIH for fiscal year 1999,
but the Congress appropriated roughly twice that amount. And so
the 2-percent request that the President sent over for NIH this
time around puts the funding actually slightly above what the
President had originally planned. So it in no way suggests that
biomedical research is not a high priority. It remains a very
high priority for the administration.
information technology
The Information Technology Initiative, as Dr. Colwell has
indicated, is really a grassroots need that has been developing
over a number of years. It crystallized, I think, in the
recommendations of the President's Advisory Committee, that
represents experts from universities and industry, who came
together and said, Look, you do have to set priorities. Given
that information technology is critically important to the
economy of the Nation and to people's lives in so many
different ways, having tripled the jobs available--we are
talking about a $600 billion piece of the overall economy--the
Nation must remain at the cutting edge in information
technology. And now, how do we do that?
Well, you do that by making an investment early on in the
research that is going to guarantee you stay there 10-15 years
down the road. And what the committee said was that the current
programs are very important, and they do not question the
wisdom of the past, it is just that we are not investing
sufficient dollars in the fundamental, long-range questions--
software, for example.
And so we need to add money to the Nation's R&D investment
in information technology, and we need to do it in specific
areas. The committee laid those areas out and the initiative is
responsive to those committee recommendations.
Senator Bond. Well, I would like to ask you and Dr.
Colwell--I remain puzzled about what distinguishes this from
the HPCC initiative and the NGI initiative. Last year you were
telling us KDI was the greatest thing since sliced bread and
canned beer. And we thought this was the wave of the future.
And it seems that KDI has kind of dropped out of the scene. Is
this IT2 just the new flavor of the day? Are you
just continuing along with the same thing and just gave it a
new name? And has KDI disappeared and NGI? Are they all
encompassed in this new IT2?
Dr. Lane. Mr. Chairman, the High-Performance Computing and
Communication Initiative, of course, is a mature initiative. It
was a very wise choice at the time, and it continues, as one
can see in the budget. The purpose of that initiative was to
make available the computing infrastructure to tackle very
important problems in science and engineering. It has been
very, very successful.
The NGI was to get the networking infrastructure out across
the country that is needed for R&D and that ultimately gets
picked up by the private sector and contributes to the economy.
The explosion we have seen in e-commerce derives from the
investment the Federal Government has made in networking all
the way along--most recently in NGI, which was authorized in
1998.
So those two programs remain very important. What the
President's Advisory Committee said is now you need to look 20
years down the road. Now you need to be sure that you are
investing enough money in fundamental questions about software
that are not being addressed right now. Right now we are
talking about 150 million people or machines on the Internet
all around the world. But what if you have 10 billion devices
connected to the Internet, how do you deal with that?
We do not know the answer to that question. That is a very
fundamental research question. But the numbers are, in fact,
realistic. Because what we see down the road is all kinds of
sensors--not just people interacting with one another, but
sensors--on systems, on airplanes, in transportation systems,
interacting through the Internet. We have to know how to handle
those. That is a very basic research question. And the
committee said: You need to do more to answer that question.
Senator Bond. Dr. Colwell, anything you want to add?
funding breakdown within the IT2 initiative
Dr. Colwell. Yes. I would like to add to that. The way the
NSF will be spending the money is $100 million will be in basic
research in new computer languages, new ways of linking, let us
say, 1,000 processors for higher-speed computing, databases.
Senator Mikulski mentioned large databases. We need to
interpolate those databases so that the information from
atmospheric physics and atmospheric chemistry, along with
ecological databases and also demographic databases--to bring
the social aspect of it together--can help us to understand how
the complexity of our planet really works. This will come from
the new investment in software research that is very important.
Ten million dollars will go to understanding the human/
computer interface. The fact is, when we walk into our homes
now, we probably have minicomputers, tiny computers, doing a
variety of things. Eventually these will be connected, so that
we may be able to ``talk to our coffeepot'' and ask it to turn
on. These are the kinds of things that are coming in the
future.
And then, $36 million would be for the system, to expand
high computing capability, so that every part of the country--
every part of the country--is tapped into this very-high-
capacity computing. It is really a look into the future and
very, very important.
Senator Bond. Well, Dr. Colwell, that is all very
interesting, but please spare me from talking to my coffeepot.
[Laughter.]
There are a lot of exciting things that I would like to do,
but that is not one of them.
Dr. Colwell. Okay. Thank you.
Senator Bond. Senator Mikulski.
funding R&D
Senator Mikulski. Thank you, Mr. Chairman.
Dr. Lane, I want to ask a few questions about scientific
funding and then go to both the new initiatives and yet NSF's
core program. When I came to the Senate and this committee, the
way science, and particularly R&D, was funded was 65 percent
went into defense and about 35 percent went into civilian. That
was a decade-plus ago. What now is the proportion between the
DOD R&D and then what goes to civilian? And has that increased
substantially?
Dr. Lane. Senator Mikulski, I think for the first time the
balance has shifted, that it is now 51 percent civilian R&D and
49 percent defense R&D. I believe that is correct.
Senator Mikulski. And a substantial amount of that--or,
according to Dr. Colwell's testimony--there has been an
increase in the biomedical; is that correct?
Dr. Lane. That is correct, Senator.
distribution of funding across scientific disciplines
Senator Mikulski. Though NIH still is--well, let us see,
when we started out, it was $8 billion; it is approximately
double now, over a decade, at $15 billion. NASA has stayed
steady state at $13 billion. NSF has moved ahead just with what
we have tried to do with modest incrementals, et cetera. So
could you tell us where most of the money is going and how that
works out?
And, Dr. Colwell, did you want to elaborate on that, and
where we are falling behind and what we need to keep in mind?
Dr. Colwell. Yes. What I think is a concern is the
reduction in engineering and the physical sciences. We know,
for example, that the advances in laser surgery for cataracts
comes from basic research--chemistry, computer sciences,
physics. We know that imaging--CAT scans and so forth--all
traces back to basic research in physics and chemistry.
Now, what is happening of course is that physics and
biology are converging, so that there is a great deal of
physics to be contributed to.
Senator Mikulski. Well, it is not converging in the
Congress--what I am trying to get at--as we looked at the
funding of these programs and these old categories. So, would
you say that that would give you--and when I say ``you,'' I
mean jointly----
Dr. Colwell. Yes, Senator. I think that we do need a
balance in the physical/biological/behavioral sciences. This is
a concern.
maintaining U.S. leadership in the future
Senator Mikulski. Well, this is an issue that is really--
not to go into the details at this subcommittee--but it comes
to--well, let me ask this question--you see, I believe, first,
that the initiative to raise biomedical research, of which I
have been one of the movers of that, is indeed a worthwhile
endeavor. However, a lot of this is congressionally driven. And
all of Congress knows what NIH does. Am I correct in that? But
all of Congress does not know, nor necessarily support, what
the other scientific agencies do.
For example, over at Commerce, no matter how able Secretary
Daley is or his predecessors, even in the other party, nobody
kind of gets NOAA. They certainly do not get NIST. And we can
just look over there.
And in our own Congress, you have the Commerce
Subcommittee, you have Labor, HHS, with all that they are
dealing with, you have us. So, I believe that what we need and
what the Congress needs is really not only a State of the Union
Address, with bells and whistles and ruffles and flourishes,
but really for the science community within the Federal
Government, the leadership, really I think to present on a
bipartisan basis and a bicameral basis where we need to go and
where there are glide paths down which give one pause. Because
it is in the practical engineering we solve--practical
engineering helps us clean up those brownfields, helps us clean
up those Superfund sites, waste water treatment and clean
water.
We cannot have an EPA without engineering. Otherwise we are
just like a regulatory agency with no tools. So that I think is
something really to be considered for the administration. And I
note that, with your crosscutting initiative here and the
private sector councils, was really what we had worked to
establish under President Bush and your predecessor. So this is
something we have been working on for some time and I know
talking about this.
But I think this country needs a millennium agenda. And I
think we need a millennium agenda that both parties support,
that all presidential candidates can embrace with fiscal
prudence and so on. And I think there needs to be some type of
presentations. Because I have got colleagues that are now
scrambling to learn high tech.
Anyway, I could elaborate on this, but it is a source of
great concern to me. And the synergistic and cumulative effect
of that I think is also inspirational to our American people
and to our young people who need to get into it. Because all of
a sudden I think geek is becoming fashionable and geek is
becoming profitable.
Dr. Colwell. Senator, I could not agree with you more.
Senator Mikulski. Geeks are in. [Laughter.]
Dr. Colwell. I really agree, because we are working at NSF
to put together a list of what we call ``unmet opportunities''.
There are things that we are not able to do because we are not
able to explore in the directions that will maintain a highly
competitive economy. In fact, a report from the Competitiveness
Council was just published in Science Magazine this week that
showed the United States has now dropped from first place in
innovation, and Finland is ranked at the top, using a variety
of measures, including international patents and that sort of
thing.
So it is a great concern that we really maintain leadership
and that we have a balanced portfolio and that we move in these
directions.
availability of information on science in the federal government
Senator Mikulski. Let me ask this, because my own time is
going and I have other questions that are a little bit more
targeted. Is there a one-stop-shop book or booklet or something
that says what every scientific agency does in the Federal
Government?
Dr. Lane. Senator, there is a biannual report that OSTP
puts out. And that report does in fact offer, in my view, a
pretty good description of what each agency does, what the
administration's priorities are, what the national program is,
and then the role of each agency. But I think we should have a
look at that and see whether it, in fact, satisfies the
requirements that you lay out.
Let me also say that the President's Committee of Advisors
on Science and Technology, PCAST, is right now in fact working
on putting together particularly good examples to illustrate
the impact of the Federal investment in science and technology
on people's lives in order to get the story out and help
everyone understand the points that you just articulated so
clearly.
Investment in biomedical research is important. We do care
about that.
Senator Mikulski. Absolutely. And I am for it. And we do
not fund FDA. FDA is very skimpy. And, therefore, we are
running into problems. And I am not so sure it is the
regulatory environment.
Dr. Lane. My own view is that all of the agencies need an
appropriate investment in R&D, including basic studies. But
every agency cannot do all of the research that is necessary.
So the interagency coordination that you talked about earlier
is critically important. And that is done through the
President's National Science and Technology Council. I think
that does follow on to the FCCSET process that was begun under
President Bush.
Senator Mikulski. Well, my time is up. I will come back to
my more specific questions.
Senator Bond. Thank you, Senator Mikulski.
Senator Burns.
funding for the experimental program to stimulate competitive research
Senator Burns. I have got just three areas. Thank you, Mr.
Chairman.
I was sitting there listening, and said, Okay, we have got
some redundancy that we should root out to save some dollars
maybe and to maybe increase dollars in some areas. And then you
come back and say, Well, maybe that redundancy is okay, that
every agency should be doing some things. I happen to think
that we have got a little too much redundancy. I can see it. I
can see it in FAA and NASA, some of those areas on R&D and
engineering, but, nonetheless, we will deal with them later.
epscor
I have a couple of concerns, Dr. Colwell. You did not ask
for any more money in EPSCoR in your initial request. And I
think we should. High-performance computing and high-speed
networking are vital to rural areas. We have taken several
steps to help our States, but connections remain costly. And I
think we should be looking into that and maybe relieving some
costs there, to where our rural areas can participate,
especially in high-speed computing.
I know you are trying to include more researchers from the
EPSCoR States on advisory and peer review committees, and I
would suggest that we continue making some progress in that
way.
And, Dr. Lane, I look forward to working with you on the
Next Generation Internet. We think that is very important.
Those are areas where I have concerns in your request,
which I think we can address. And I look forward to working
with you on this appropriation. And I just commend you, and
keep up your good work.
Dr. Colwell. Thank you, Senator. I would like it to be a
hallmark of my time at NSF that we brought science and
engineering and technology to every part of the country. And we
are looking at ways of moving to the next stage for EPSCoR. And
we think that one direction might be strong partnerships with
the States to leverage investments.
Senator Burns. Those funds are meshed by State funds.
Dr. Colwell. Yes.
Senator Burns. And I think what I am concerned with is a
little, when we get into allocating dollars out to institutions
and this thing, I do not like the idea of the haves and the
have-nots. And, of course, EPSCoR was designed to sort of
spread that out across the country. Because I do not think all
the brainpower in America is found between here and Boston. End
of story.
I have got another appointment. [Laughter.]
Dr. Colwell. Thank you, Senator.
Senator Burns. And I thank you. Those are the areas of my
concern, and I look forward to working with you on that.
Dr. Colwell. Yes, sir. It will be a pleasure.
geographic distribution of funding
Senator Bond. I share your concerns, Senator Burns. And I
was going to follow up and ask, I would like Dr. Colwell and
Dr. Kelly, as well as Dr. Lane, to address the question
specifically. There is no more money in the budget, do you
share the concern that Senator Burns and I have? Not that we
are against the corridor between here and Boston. Would you
address that question? And what specific steps can you take?
What is happening?
funding for epscor
Dr. Colwell. Well, actually, we are doing quite a lot. It
does not appear in the line that says EPSCoR, but we are making
every effort--for example, through the science and engineering
centers--to link minority institutions. We are making a very
strong effort in the IT Initiative to ensure that funding will
also include other than the top 100 or the top 50 universities.
In fact, the trend--I did an analysis before I came here--
and the trend is that more institutions are involved in
research funding.
Senator Bond. And that will happen in IT2?
Dr. Colwell. Yes. We are making a very strong effort.
distribution of support for plant genome research
Senator Bond. And on Biocomplexity, will there be that
opportunity as well?
Dr. Colwell. Yes, indeed. As a matter of fact, I do think
the plant genome has been an ideal demonstration of how we can
use a large sum of money. We have 400 institutions involved.
And we have been building on the strength of an institution--
the University of Missouri. Many people do not know it, but
historically the really exciting work in understanding genes
was done by Louis Stadler and eventually also his son, David
Stadler, working in Missouri. Through corn genetics, tomato
genetics--agricultural research--they developed an
understanding of just what a gene is and how transposons move
genetic information around in the chromosome.
So we are building on that historical strength, including
partnerships among many universities. This is the way to go--
partnerships within the community and also partnerships among
the agencies.
distribution of r&d funding across the united states
Senator Bond. Dr. Kelly, would you like to comment on the
question of the smaller institutions, the area that Senator
Burns raised?
Dr. Kelly. This has been discussed at the Board level
fairly extensively. And I think the Board is committed to an
effective distribution of our science and research funds across
the United States. From my earlier comments, you know there is
a strong belief that not only does science, engineering and
technology have a tremendous impact on the quality of life, but
it is key to economic development.
So, in terms of the economic development capacity of all of
the different States, we see that science and engineering is a
driver there. And therefore, the effective distribution of
those funds is critical. And we support what the Director has
just said in terms of the distribution of our intellectual
firepower across the country.
However, part of the question you have with all of the
various initiatives going on is the question of resource
allocation. And right now we have dropped behind Germany, Japan
and France in terms of the percentage of our R&D that is going
into research--not just basic research, but research totally.
As that develops--and, as you mentioned, information
technology--that is going to become very important both in
terms of international as well as domestic competitiveness.
You know, Moore's Law that information technology
productivity would double every 18 months started in 1980.
Everybody thought it would last for 10 years. We are now
projecting that Moore's Law will be maintained for another 15
years. So, the Information Technology Initiative is critical to
our international competitiveness. And our proportion of
resources going into research and development is declining. It
is critical internationally and it is critical domestically.
And it is critical for all of the States in the United States.
plant genome research
Senator Bond. Dr. Colwell, to follow up on the plant genome
research, as I indicated, we appreciate the support for it. You
have had an opportunity to look at it. Where do you see the
research going? And can you give us any thoughts from your own
professional background as to the benefits or to the potential
breakthroughs you see coming if you can move forward and
progress on this initiative?
Dr. Colwell. I think it is an extraordinary initiative--
very, very important. And if it had not already been started,
it is one that I would have started, because I think it is one
of the top priorities for the country, especially for
agriculture. I see some directions that we should be going in
understanding the genomes of the pathogens that infest and
affect wheat and corn and soybeans and also the genomes of the
insects.
Because if we are going to devise a workable, sustainable,
sensible method for improving agriculture, it is necessary to
understand how these interact and how genes move amongst them.
Thus, we need to progress in understanding the genetic basis of
our productivity in agriculture.
benefits and dangers of biotechnology
Senator Bond. As I discussed with Dr. Colwell, I have a
great example of the pathogens, a great testing laboratory in
what I thought was going to be a chestnut orchard. But let me
ask a broader question that is of concern to us. And I would
welcome the comments of all of you.
We are seeing, even in the Midwest, growing concern about
attacks on biotechnology generally. There are organized groups.
There are very well-publicized individuals who, in my
unprofessional opinion, are modern-day representatives of the
Flat Earth Society, who think that any genetic engineering or
biotechnology advances are bad. We know that in all of these
things, whenever you are making progress, there have to be
parameters.
And I also note, I believe the National Academy of Sciences
has made this a sufficiently high priority to fund their own
study on it. Because we have major newspapers, unfortunately,
who are flogging the dangers without understanding the
benefits.
Can you comment on the benefits versus the dangers, the
best way of responding? How do we develop an accurate and
adequate scientific response to the attacks that, frankly, have
become widespread in Europe and are raising their heads
throughout the United States, as well? And I would like to have
the comments of all of you on that.
Dr. Colwell. This is a manifestation of the serious
problems we have in science and math education. It is critical
that we have public education, as well. And NSF will be focused
on this.
In fact, one of the programs that we are launching--and it
is a very exciting one--involves graduate students in
elementary, middle and high schools. We have a program that
just started which was going to be a pilot program, but the
response was so positive we have gone ahead and gotten it
started. And as part of our budget, it is only a modest
amount--$7.5 million.
The approach is to have a school system and the university,
together as partners, propose an educational initiative,
whereby graduates students receive a stipend and their tuition
and fees are covered, but they will do their teaching in the
elementary, middle and high schools under the pedagogical
oversight of the expert teacher. In this way, it will bring
content and excitement into the classroom, along with the
mature experience of a teacher.
So these kinds of things are really very, very important in
educating the public.
Now, with respect to biotechnology, I have been involved in
that for a long time and I will try not to be too long-winded
in this answer.
Senator Bond. It is extremely important, I think, to all of
us.
Dr. Colwell. I chaired the BSAC, the Biotechnology Science
Advisory Committee for EPA for several years. And I have been
on the NIH Policy Board for Biotechnology and also FDA.
I realized when I was on the FDA Food Committee, and the
FLAVR-SAVR tomato was brought up for discussion, that it was
very obvious that here a very tiny change that allowed just a
deletion in the DNA, that allowed slow ripening naturally, was
somehow viewed as being dangerous, when, in fact, the current
method was to classically select tomatoes, for example, that
would remain hard--sort of like golf balls, if you will--bring
them into the supermarket and then spray them with chemicals to
fast-ripen. And it seemed to me that there was a disconnect
here in understanding that, in one instance, you were working
with natural processes, and regulating them, and in the other
you were more or less artificially treating the product.
So we have an educational problem that is absolutely
critical and one that we have to address.
Senator Bond. Dr. Lane.
biotechnology
Dr. Lane. If I may add a comment, Mr. Chairman. I certainly
agree with Dr. Colwell's points here: it is fundamentally an
educational issue. We also have similar issues in the area of
human health and what we would do at the genetic level there.
But you made the point about the international side of
this. There are many countries--many of them in Europe--that
take a very strong view about biotechnology, and where the
public attitude I think is, in fact, far less supportive of
genetically engineered foods than has been the case in this
country.
As you know, there is this biodiversity treaty that we have
not yet put in place. And under that treaty is the Biosafety
Protocol. And this last year, since we are not at the table to
formally be a part of those discussions, we barely missed some
serious problems that would have major implications for trade
in the area of food because of restrictions that would be
placed on our exports to other parts of the world of
genetically engineered foods. This is a serious matter
domestically, but also very serious in terms of international
trade.
And I think it is very important in the future to try to
ensure that the United States is at the table at those kinds of
discussions. Because this is going to be of growing importance
to our country. As you say, Mr. Chairman, it is a very
important issue. It is both education, but it is also, in terms
of international relations, a challenge to us.
Senator Bond. Dr. Kelly?
need for public education in science
Dr. Kelly. I would agree with everything that has been
said, especially the emphasis on education. We really have not
done as good a job as we could in terms of science and
education in this country, starting with public education. We
have seen some preliminary but very encouraging public
education results, in terms of the statewide systemic
initiatives and the urban systemic initiatives at NSF, in terms
of the science and math education of public school children.
But it is too early really to do full-scale evaluations of
that. But it has been encouraging.
We also have the education of the--and the National Science
Board has taken on as a specific task--public education in
general. The Nation has really a very, very limited
understanding of the impact of science on its quality of life
as well as its economy.
As Dr. Lane said, from an international standpoint, it also
has become a singular world. And we have developed an
international task force to see how we can address the problems
that Dr. Lane has described in terms of the international
ramifications of science.
Finally, there are, especially in the life sciences,
serious ethical questions that we have been discussing in terms
of gene therapy. But that really is more in the life science
than it is in the agricultural and biocomplexity areas. But
these are issues that the Board is addressing. But the central
one from our vantage point really is the public education
issue.
Senator Bond. Senator Mikulski, if you do not mind, I want
to just ask a follow-up, and then I will allow you to conduct
your questions.
Senator Mikulski. Sure, why do not you go ahead. I think
this is a very interesting conversation.
educating the public on biotechnology issues
Senator Bond. I am very much worried. We talk about public
education and getting the information into schools. That is
vitally important, and I am concerned about the education. But
we have a major public perception problem that is being, in
many instances, spawned on the network news at night. And
somebody has got to be there to give a sound scientific
response. And I do not know the responses. But we need somebody
who is speaking up and saying, This is a legitimate concern;
that is not a legitimate concern. This is a real danger; that
is not a danger.
What is the right institution to do that? Where do we send
these naysayers when they come--they come after us and they
say, We do not believe you because you are elected politicians.
That is probably not a bad assumption. But to whom do we refer
them? What is the right locale to get this information, to get
a sound scientific answer?
Dr. Lane?
Dr. Lane. Well, I think you mentioned the National Academy
of Sciences on this. The Academy has come forward in many
questions of this kind that are quite controversial in order to
put the credibility of the scientists behind those answers.
But I actually think this is an area where credibility on
the part of the public is going to come by hearing a consistent
story from all sides that they trust, including government. So
I think we have to speak out on this kind of scientific
subject, but I also think the nongovernment side, which has
much to lose if we continue to go down this road of
misinformation, also has to speak up. And I think that is an
area where we can do this in partnership.
Senator Bond. The NSF, is this something that you can
provide us a script and step out in front of the cameras and
lay out an appropriate scientific description of the benefits,
the potential dangers and the necessary controls?
Dr. Colwell. This is actually part of our educational
effort. For example, we are providing funding to the American
Society for Microbiology for a four-part series on
microorganisms, to understand the fundamental basis of
microbiology and the genetics of microorganisms, and how that
has provided for the extraordinary explosion and revolution in
the biosciences. Oregon Public Broadcasting has been the key
television station that has been involved.
It is these kinds of presentations that are public service
kinds of activities that are a very, very important part of the
educational process to get that story, that message, in its
full scientific veracity and authenticity, to the public.
Senator Bond. Thank you very much, Dr. Colwell.
I will submit the rest of my questions for the record.
I now turn the questioning over, and the gavel, to Senator
Mikulski. I am going to have to leave for a meeting with the
Attorney General here shortly. But I will allow you to run the
meeting.
Senator Mikulski. Well, you know you have constitutional
protections. [Laughter.]
And I will be there for you.
Senator Bond. I really appreciate that.
managing public fears related to science
Senator Mikulski [presiding]. Thank you, Mr. Chairman.
I think the chairman--this is just by way of a comment, but
then I am going to get to my questions--we raised this with
FEMA. There were other issues that we have raised in hearings
on terrorism, and also a recent one on bacteria-resistant
disease that Dr. Frist had. And here is the point that I am
saying. Very often we have a bigger problem in managing the
fear than we do in managing the problem.
And, Dr. Colwell, you remember when we had the terrible
outbreak of pfisteria in our Maryland rivers, for which there
was great pause and concern. And the media kept showing the
same three dead fish that looked like they had been mutilated
by an X file creature. And it was serious. And it was real. And
we then had almost a rapid plummeting of the Maryland seafood
industry and Maryland tourism, for which we then did not know.
Now, your Federal elected officials said we need scientific
inquiry. And the day we announced that it was going to be done
through responsible agencies, and CDC was going to come to see
about public health consequences, where I said, you know, where
there is a killer, you need a detective, and who is better than
the medical sleuths. But just once the community heard that CDC
was going to come, things calmed.
Now, the point I think that Senator Bond is making in all
of this is there needs to be I think a realistic approach.
There will be problems in the United States of America, some
because of other countries, some because of other groups, some
just because of accidents, some whatever. But we need to have,
I think, a relationship that the administration needs to lead
with the media, that on a volunteer basis, they do not
exacerbate the fear.
That does not mean you do not report the news. That does
not mean that you do not provide the public education and
information. But just now that we have gone through a pretty
rigorous hearing on Y2K, we are not only concerned about the
functioning of the United States of America and the world, but
we are worried about exacerbating the fear even now.
So, we are not going to go into it in this committee, but I
think this is all part of an initiative. And I know my own time
will go, but there has to be some voluntary code of conduct
among the media, where they report the news, but they do not
become participants in exacerbating the panic.
Dr. Colwell. I agree with you. And part of the problem is
the ignorance of the distribution of the organism. That is, the
lack of information. We do not have--or we are just beginning
to get--a fundamental understanding of the molecular
composition of pfisteria. That is, what it is.
Senator Mikulski. They did not need a science lesson,
though, Doctor. They did not need to know the molecular
composition. What they needed to know was do not panic when you
drank a glass of water in Bethesda.
Dr. Colwell. Yes, I understand that. But, you see, we were
not able to actually detect where it was. And we will be able
to do that in the future--close the gap. But I understand your
point and I agree with you. There needs to be a mechanism for
bringing this information to allay the fears.
Senator Mikulski. No. I think that there has to be a White
House summit on really a way that where there are issues that
occur at a national level that could produce panic, that there
is a voluntary--and I stress the word ``voluntary''--code of
conduct, where news and information is given to the American
people, but not also in a way that exacerbates hoarding, panic,
evacuation. That is what I am talking about.
Dr. Colwell. I agree. I agree with you. Indeed, it is a
very, very powerful point.
food safety council
Dr. Lane. Senator, let me also mention that the President
has put in place a Food Safety Council, which I am pleased to
co-chair with Secretary Glickman and Secretary Shalala. Of
course, the focus is on ensuring that our Nation's food, which
is the safest in the world, continues to be, and is even safer,
and to recommend the steps to be taken to make it safer. But
this issue that you raise relates to food safety----
Senator Mikulski. It is broader than a particular segment.
It could be food. Then it could be the water. It could be an
accidental chemical spill--an accidental chemical spill, not
even a terrorist attack of a weapon of mass destruction.
Dr. Lane. I will raise the issue at the Council.
preparing tomorrow's work force
Senator Mikulski. Let me come back to what my own questions
are, because we are moving beyond this committee. And, of
course, it points out that in the Senate we do not have a
science committee. We have a series of committees that work on
it.
Now, I want to talk about the President's initiatives and
programs, but, first, I really want to talk about education.
And what I so like about science and technology is that it has
none of the traditional barriers. It does not matter if you are
black or white. It does not matter if you are blind or cannot
see. It does not matter if you are male or female. That,
essentially, in the information technology world, there should
be none of the old, often prejudicial, barriers that stop
people from participating in the work force. It really should
not matter anymore.
And this, to me, is one of the greatest opportunities that
this coming century will be able to provide. And, again, I will
reiterate that I am deeply concerned, though, that we are
already beginning to segregate out. And it is usually on the
basis of social class, and then race and ethnicity. So, the
``same olds, same olds'' are occurring for circumstances that
are not necessarily the old bigotry barricades, but other
barricades.
Now, my question is, one, generally for our country, what
are the cross-cutting--you have cross-cutting on research--but
what are the cross-cutting initiatives on literally I will call
it work force readiness, not only at the elementary school,
but, even more specifically also, if you could talk about the
community college, which is often a gateway to higher
education, particularly for new populations where no one has
been to college? I have a great passion for the community
college, and I think they might be overlooked or undervalued in
this.
Could I just hear those thoughts, and then where they might
fit into this appropriation?
Dr. Colwell. Absolutely. As you know, the H-1B visa funds
are targeted for scholarships. And we have allocated more than
70 percent to the 2-year community colleges and 4-year
colleges, because that is where the work force issue really is
highlighted. And in every one of our science and engineering
technology centers, we have a linkage with the minority
institutions and other than the research I institutions.
Within every directorate there is an educational component
in the major research funding that is given. That does not
appear as part of the education budget, but it is there. It
permeates all of the directorates. It is critical. And I am
very pleased to say that the Assistant Directors for each of
the seven directorates understand this. And so the focus on
work force is a major one. In fact, $10 million for the IT
Initiative is focused on the interface and work force issues.
As you say, the IT Initiative is critical in many, many
ways because----
Senator Mikulski. Let me rephrase this, because we will
come back to the IT Initiative.
Dr. Colwell. Okay.
Senator Mikulski. I know that we have the Urban Initiative.
Dr. Colwell. Yes.
Senator Mikulski. We have had other initiatives. We have
initiatives, et cetera. My question is, just as you have this
really very exciting multi-agency approach on IT2,
is there a parallel one in education?
Dr. Colwell. There are partnerships developing. As you
know, the Department of Education----
Senator Mikulski. They are developing, but there is not one
like existed here?
education research initiative
Dr. Lane. Well, there is, Senator, in the fiscal year 2000
budget, the Educational Research Initiative, between NSF and
the Department of Education. This is the second year of the
initiative and a request to double the funding. The initiatives
purpose is to address issues of whether our kids are ready for
school and, in particular, what can technologies do to ensure
there are not the barriers that are in place right now, to help
kids learn to read and help kids learn mathematics. So that is
one example of an interagency education initiative.
educational research
Senator Mikulski. Well, do you feel that that has really
got an ``umph'' to it--I mean, that it has energy, commitment
and vitality? Or is it a lot of people meeting, processing and
they will tell me that the process is the journey?
Dr. Colwell. No, I think it is genuine. And let me say that
one of the emphases that we will be placing in education will
be on learning. I think we have spent a lot of time and money
on teaching, but I think we need to do research on how children
learn. And one of the partnerships we are developing is with
NIH, where research has been done, and the Institute for Child
Development. The NSF and NIH have a brain research program
going. That kind of information can be brought to bear.
graduate teaching fellows in k-12 education
Senator Mikulski. Well, I think that all sounds very good
in terms of the basic research. But probably one of the most
interesting things I heard in all of this, this morning was the
fact that graduate students and undergraduate students were
going into the classroom. Because particularly at the
elementary school, where their emphasis has been on basic
reading, which we really need our teachers to be able to do,
but they do not have degrees necessarily in biology or some of
these new, advanced programs. How does that happen? Does
somebody pay for them to do that?
Dr. Colwell. Well, normally graduate students--who have
teaching fellowships--would spend 20 hours a week as a lab
instructor in the undergraduate classroom. But it seemed to us
that this is an extraordinary capability that could be brought
into the elementary, middle and high schools. So that 20 hours
a week that would be spent in the undergraduate laboratory
teaching can now be spent working with children in the
elementary, middle and high schools. But the partnership is
critical between the university and the----
Senator Mikulski. So it is like a teaching fellow program?
Dr. Colwell. Yes, Senator.
Senator Mikulski. Do they go into middle schools?
Dr. Colwell. Yes, Senator.
Senator Mikulski. Do the middle schools have a priority?
Dr. Colwell. We have not set priorities. We have gotten a
large number of responses, and we will see how that sorts out.
But if it turns out that it needs to be----
Senator Mikulski. Well, Dr. Colwell, let me just say this,
again, just to move along. I do not want to be prescriptive in
terms of programs, but I would say this. All of the research
indicates--all of the data we have, from the CDC and NIH, NIMH,
and child development, et cetera, says this, that it is in the
middle--that by the third grade, if you cannot read, you leave.
And particularly the little boys already start to do their
truancy and so on, and little girls start to kind of mentally
drop out, but they hang in there.
Where little girls definitely start to drop out, if not
intellectually, is in the middle school. That is where they
decide they do not want to learn math. Or that is why they
really begin an intellectual withdrawal, if not a truancy
problem. Boys have a different variance of that, but, again, if
they make it to the sixth grade, that is determinative of
whether they go on to high school and what a lot of their focus
is, also, in high school, where a high school related to
vocational training would still need science and math.
So, again, I would really like you to explore the
deployment where you are most needed, where children are making
their most decisions. Children make decisions along the way,
and a lot depends on what is happening in the classroom,
because unfortunately the classroom is becoming their new home.
Dr. Colwell. I accept your suggestion, and I am delighted--
--
innovations for middle school learning
Senator Mikulski. And there is a great body of knowledge on
that.
Now, I am going to go to one other point, which goes to
your informal learning budget, and I will come back in terms of
its adequacy. The Centers for Disease Control--and, again, the
Drug Czar and Justice says--that children are most--you know,
our old channel 11, ``It's 11 o'clock, do you know where your
children are?''--most people know where their children are at
11:00; they do not know where they are from 3:00 to 8:00, or
where they are gives them pause. It is the structured after-
school activities. It is in the structured after-school
activities where some of the biggest gains can be made.
Because to go to another great American, General Colin
Powell said, in order for children to learn, they have to be
involved with a caring adult, either in the home, the classroom
or in some other activity. I visited a PAL program, some of
these programs, in Baltimore. These structured after-school
activities are where kids are learning computers. They are
doing their homework. And they love it, because they are
working on little projects and things like that.
And, again, if we are talking about deployment of defined
resources, I think you need to go where you are most needed,
not where the teaching fellows of the university thinks they
should go. I think there should be guiding principles. And I
would really encourage, then, conversations with not only the
Department of Education, that has a great body of knowledge on
this, but also CDC, Justice and so on. Because I think what we
are talking about here is not only work force readiness, but it
could be one of the sources of enormous prevention to either
dropouts or not engaging in the basics that will take them to
these new fields.
And they might not go on to be a Ph.D. at the University of
Maryland, but we want them to be a lab tech at the University
of Maryland. Or even if you are going into fire technology, I
mean the construction industry, you know, we need lab techs, we
need a multilevel work force. But all will be based on science,
technology and a grasp of information technology.
So this is what I really urge you--really urge you--to
really take a look at so that we maximize some of these new
innovations and that we also then take a look at what our
initiatives have produced--like the Urban Initiative and so on.
Dr. Colwell. Believe me, Senator, I am resonant to what you
are saying. In fact, that is part of the focus on learning.
Because it is where and how you can have the most impact on
children and their capacity to learn and to enable them to
become productive citizens. Your suggestions are very well
taken.
Senator Mikulski. See, there is already a body of knowledge
of when young people make decisions.
Dr. Colwell. Yes.
Senator Mikulski. And we can go on into that in another
detail.
importance of community college
Dr. Lane. Madam Chair, let me also comment about the
importance of community colleges. I think that is a very
important observation. And the program that NSF and the
Department of Education work together on with the community
colleges has done an extraordinary amount I think to pull
together those colleges, with the universities on the one hand
and high schools on the other hand, to try to remove those
holes that the kids fall in at that critical stage. It is a
different critical stage, but it is also very important to
allowing people to get the education that give them the jobs
that they deserve and that they need.
addressing future education needs
Senator Mikulski. I could go on about this, but they are
questions that I would like to discuss with you privately
because of the time of the hearing and so on. It is just a
really straightforward one.
Just as our response to Sputnik and so on, which was a
national emergency and a threat to the security of the United
States, we passed something called the National Defense Act,
which was really the building block of getting teachers ready
to go into the classroom and people ready for the future. It
served the Nation well.
And my question now is, on the brink of the new millennium,
do we need a new version of that, like a Universal Digital
Education Act? I am not saying what it should be. I would like
to have your thoughts on it, to see about this. But, again,
everything is going into piecemeal. But let us do that later.
Dr. Colwell. Yes, I would love to do that.
adequacy of funding for nsf programs
Senator Mikulski. I would like to now just return to the
President's initiative, which I find enormously exciting. And
let me say this. As everyone knows, my whole strategic
initiative idea--but this is what I was talking about--this is
exactly what I was talking about--organizing around national
goals and everybody being best at what they are most needed for
and best at what they do. And this is exactly the conceptual
framework. It was not industrial policy and winners and losers
and everybody learning--it was not an occupational research
program.
Now, let me, though, go before to the new initiative, this
question. In the President's budget, do you feel that the
existing programs are adequately funded, or are there some that
are more spartan that you would like that we have to really
ensure that are the core NSF funding in the directorates, as
well as very important programs like EPSCoR, and also the
academic research and facilities? I cannot go anywhere in
Maryland to any higher education facility without being hustled
for a building, a laboratory or laboratory equipment.
Dr. Colwell. I understand very, very well.
Senator Mikulski. Yes. I mean, really.
Dr. Colwell. Yes. We are very busy putting together, our
2001 budget, as we discuss here the 2000 budget. And the unmet
opportunities that we have got to address in order to remain
competitive, to have a vibrant work force, to have a very
strong, successful educational system, are the kinds of things
that we are considering.
And I would say that we have tried very, very hard in this
budget to maintain balance. For example, I think the IT
Initiative is critical for the social and behavioral sciences,
because the databases that can now be mined through the IT
Initiative are extraordinary. We are addressing some of this in
the fiscal year 2000 budget because of the crossover into all
the disciplines that the IT Initiative provides.
Even though it appears as a budget item in the computer and
information science and engineering science budget,
IT2 really is an initiative within NSF that has been
developed by discussions with all of the AD's, including
participation--strong participation--by the math and physical
sciences AD and the education AD. So that permeates throughout
the agency. It is a very important cross-disciplinary
initiative.
I should also say that it is a very powerful interagency
initiative, because indeed, as the designated lead agency, we
have been working with the other agencies.
Senator Mikulski. I am going to come back to that. But I
asked you, do you have enough money to keep the other programs
going at the level that they should?
Dr. Colwell. Well, spartan, but yes.
Senator Mikulski. You are scrapping, but yes. But where are
you scrapping?
Dr. Colwell. I think that, as we said earlier----
Senator Mikulski. Because, I tell you, the scientists and
your wonderful people who work at the Science Foundation and
how this is also out in America--it is not an institute of
science, it is a Foundation of Science--the only way you can
attract and maintain people is ``show me the money.''
Dr. Colwell. Right.
Senator Mikulski. And if they think we go from one glitz
and one glory to another----
Dr. Colwell. I am concerned about the disproportionality in
engineering, in the physical sciences--physics, math,
chemistry, engineering. I am concerned about that.
Senator Mikulski. The ones that were outlined in your
testimony?
Dr. Colwell. Yes, Senator.
increasing nsf award size and duration
Dr. Kelly. Senator, from a national perspective and policy
standpoint, it relates to what I was talking about before, in
terms of the general, overall funding for research in the
country. And people do not like to talk about it because it is
not attractive, it is not sexy. But the fact of the matter is,
with the underfunding, the amount of the average NSF grant and
the duration of the average NSF grant is much too low to create
the kind of stability that will make for good science and for
improving the science in the field. We also do not have
appropriate equipment and facilities budgets for the
institutions.
But those are--it is just a basic question right across the
entire science, where, in the basis sciences, you do have that
kind of underfunding and short-duration, low-amount grant,
where most of our faculty spend most of their time developing
proposals.
Dr. Colwell. The average principal investigator-driven
grant at NIH is about $250,000. The average investigator-driven
grant at NSF is about $83,000.
overall science budget
Dr. Lane. Madam Chairman, may I add a comment about the
overall science budget?
I think that if you look at the President's fiscal year
2000 budget, he really submitted a very aggressive research
budget, given the constraints on the fiscal year 2000 budget.
He submitted a balanced budget. In fact, we have this wonderful
situation of a surplus. The President has made clear that
surplus is off the table until we deal with social security and
medicare and other important issues. But it was a very good
budget for science and technology. He would like to do more.
I think one way to think about the Federal investment in
science and technology is to what extent are we failing to
utilize the extraordinary talents and capabilities of the
people who are out there, the young people who are going to be
the next generation, but also the existing scientists--
scientific and engineering researchers in the country?
My sense is we are significantly underutilizing this
extraordinary resource. We are, in some sense squandering some
of our earlier years' investment in higher education, because
we have so many talented scientists who cannot get their
funding from NSF and cannot get their funding from NIH just
because the competition is so incredibly stiff. The grant
sizes, we hear from all directions, are too small on the
average. And there are many kinds of programs that simply do
not exist at all. And the initiatives are there to try to help
address those kinds of things.
So these initiatives are very important or the President
would not be bringing them over here. But there is only so much
money. And so something has to give.
valuing higher education
Senator Mikulski. Well, that is exactly right, and this is
in no way to throw water on the initiative. I happen to think
the initiative is crucial. I like the fact that it is
interdisciplinary and the fact that you have NIH, NASA, the
Department of Energy, NOAA, and the Department of Defense
involved. It is like uniquely American. You have Defense and
NOAA, NIH working. This is really extraordinary. And each
working, hopefully, on maintaining the national security
interests of the United States.
So I am for it. But I do also worry about the basic
sciences that essentially were outlined in your testimony. And
I think it gives us pause about how we do the new initiatives,
and yet are able to sustain the others at a level.
And I think we, again, with candor, when one thinks that a
recent graduate from a land grant college in software
engineering could make $67,000 a year and no sweat, and being
recruited with a subsidized lease for a BMW and all the other
little Gucci things that--you know, Starbucks for life,
vouchers, all of those kinds of things, and then you think of
someone graduating, again, from the University of Maryland, or
Hopkins, or the University of Missouri, and then that they are
going to have to go through more debt to go for a master's and
a doctorate, and then once they get it, forage for funds to
pursue research. And if they are young, they have to stand in
line because--just like at NIH, there are senior people who
tend to be able to also garner that.
So it is the young, the innovative, exactly what you said,
Dr. Colwell, the innovation index. And so I worry about that.
And I worry about how to recruit them and encourage them to go
on for their advanced education and to do the type of research.
And, at the same time, while they are working and feeling like
a temp at many of our colleges--and many of our young people
feel like temps at college--they are making $38,000 a year, or
something like that, and say ``Why?'' And I am not talking
about where they would leave and go to law school and
intellectual property or something; they leave and go into
other science fields.
information technology initiative
Dr. Lane. Madam Chair, I think one thing that makes me feel
particularly good about the Information Technology Initiative,
even if it is in a tight budget, is that it indeed is going to
impact virtually every area of scientist and engineering
research and education. I cannot think of an initiative that is
as far reaching in terms of the broad spectrum of scientific
and research activities, but also in getting at some of these
very important social work force issues.
There is no rule that says somehow our young people cannot
have better jobs, more fulfilling jobs, happier and healthier
lives than their parents did. That is what we all want to see.
I think these kinds of technologies, if properly used and
consistent with our societal values, are precisely the kind of
things that are going to make people's lives better. So I feel
very good about it and believe that it is going to provide
precisely that incentive to get the best minds focused on such
critically important national issues.
Senator Mikulski. I believe lives will be better. But, at
the same time, if we are talking about learning at a community
college, someone has got to be in that classroom. The question
is, who is that somebody going to be? And maybe they do not
worry about research, but how are they going to get into that
classroom. And I think these are really big issues,
particularly the education of the master's degree person, who
often does find their way into the assistant and associate
professor at community colleges or geographic areas that are
sparsely populated that have a difficult time in recruiting.
So we have got to think about this and how we are going to
encourage people to go on for their graduate degrees. Yes, the
private sector is alluring, and I think it is wonderful, but
there could not have been a NASDAQ without infotech. I mean we
could go to Wall Street. We could go to the New York Stock
Exchange. And what do we see at the New York Stock Exchange?
Everybody at a computer.
Look at what the New York Stock Exchange did a few weeks
ago. They had their own Y2K drills. It was phenomenal, with
Wall Street really working several Saturdays in a row,
everybody at their computers, making sure that the financial
services will be fit for duty at the turn of the century.
But all of that exists because of information technology,
not only science and savings lives and MRI's. At the same time,
we need people who are willing to go into scientific research
and stay there. And we cannot undervalue them or underfund
them. And the competition now is so great, I think that is one
of your biggest challenges. That is one of your biggest
challenges for minorities going on to higher education. Am I
correct?
Dr. Colwell. You are absolutely correct.
Senator Mikulski. I mean just the level of recruitment is
phenomenal for the bachelor's degree. And I think it is great
that, if you are the first in your family and you have got an
engineering degree, you go back into that neighborhood and you
can show that education does lead to prosperity, I think it is
fantastic. But then I worry also about them going into science,
advanced degrees in science research.
education of foreign individuals in the united states
Dr. Lane. Madam Chair, there is no more important issue for
our country, I think. This discussion also underscores our very
real dependence on foreign people coming to this country for
their education and to stay. And thank God they did. Otherwise
we would not be a leader in science and technology, I believe,
at this time in our history.
But many of those young people are not going to come to the
United States for their education in the future. The whole
world is developing its educational system and its own niche in
science and technology. We have got to find a way to ensure
that all of our citizens from all communities, all cities, all
family backgrounds are able to participate in this
extraordinary career in science and technology. We have got to
find a way to do that. And our administration is committed to
making those efforts.
Senator Mikulski. I want to thank you for this hearing. As
you can see, there is no end to the interest and certainly no
end to the interest that Senator Bond has. You might note that
there were not many colleagues here, but the President, as we
spoke, was holding a 60-member briefing on the Kosovo
situation. Many of our members--in fact, most of our members--
were participating in that, on both sides of the aisle. And so
do not view the attendance as an interest index. It was really
because of the pressing emergency with the Kosovo situation.
I will conclude this hearing by saying that I think that
there needs to be an education of the Congress itself about
what the Federal agencies do, and then their synergistic and
cumulative effect with one another.
Additional committee questions
We want to thank you. We want to thank you for the ideas.
We look forward to what happens on the budget debate, if we can
operationalize these good intentions. And we look forward to
working with you.
[The following questions were not asked at the hearing, but
were submitted to the Agencies for response subsequent to the
hearing:]
EXECUTIVE OFFICE OF THE PRESIDENT
Office of Science and Technology Policy
Questions Submitted by Senator Bond
pitac report
Question. I understand that the IT2 initiative was
developed in response to the President's Information Technology
Advisory Committee (PITAC) report to the President. In addition to the
panel's concerns about managing the initiative, the report also states
that new modes of research support and new implementation strategies
will be required. PITAC also recommended that the Federal government
``must not subsidize activities left to the private sector.''
Is the private sector investing in long-term, high-risk information
technology research?
Answer. The IT sector has more than doubled its annual R&D
investment over the past 10 years. But this private investment is
largely focused on the near-term development needs of a intensely
competitive marketplace--only 5 percent to 10 percent of industry's R&D
expenditures go toward non-product research, and a substantial share of
that investment is for applied, not fundamental, R&D. Industry
recognizes that their investment is insufficient to cover many critical
long-term research needs. In addition, the market rarely provides
industry with incentives to make substantial investments in basic
scientific and engineering knowledge, whether derived through
application of advanced computing tools, as proposed by IT2
, or through other means of scientific discovery. In both cases, the
compelling national interest to ensure adequate R&D investments
justifies a continued and strengthened Federal role.
Question. Do you expect the private sector to be involved in the
IT2 initiative?
Answer. We anticipate that industry will compete to supply the
high-end computing and communications infrastructure that will be
procured under the advanced computing component of the initiative. This
would not be possible without industry contributions (in-kind or cost
share) to the research effort to build and operate the new
infrastructure. Also, industry has a strong track record of partnering
with government and academic researchers in order to speed the
development of fundamental breakthroughs into commercial applications.
A rather dramatic example of this is the collaboration between the Next
Generation Internet's (NGI) research partners at universities, who are
engaged in basic networking research, and the manufacturers of advanced
network equipment, who contributed $500 million in equipment for use in
NGI partner testbeds. Clearly beneficial to both researchers and their
industry partners, such collaboration also accelerates bringing the
benefits of basic research to the economy.
Experience strongly indicates that these two kinds of industrial
participation--vendors and industry partners--will carry over into
IT2 activities.
Question. How will NSF and OSTP determine which activities should
be funded by the public and which ones should be best left to the
private sector?
Answer. The research agenda outlined for the IT2
initiative corresponds to the priority fundamental research areas--and
specific research topics within those areas--identified by the
President's Information Technology Advisory Committee (PITAC) as
requiring increased and sustained Federal support. The IT2
is a multi-agency effort. Although NSF and OSTP have leadership roles
in coordinating the initiative, each participating agency will
determine which research it will fund. Agency expertise and agency
mission will be important determining factors in selecting research
that contributes to the goals of the initiative.
it2 management
Question. I would now like to discuss how the IT2
initiative will be managed. NSF has been designated as the lead agency
for this major initiative and I understand that OSTP will play a
significant role in the oversight of its implementation. With five
other agencies involved, managing this initiative will be a major
challenge to NSF. Both the NSF Inspector General and the President's
Information Technology Advisory Committee (PITAC) have raised this as a
serious management challenge and recommended that NSF needed to ensure
that adequate resources would be devoted to programmatic oversight. I
also recall from last year's hearing that Dr. Lane expressed his
concern about the Foundation being asked to take on larger challenges.
As Director of OSTP and Science Advisor to the President, do you
still have the same concerns you expressed last year about NSF's
capacity for taking on larger initiatives?
Answer. NSF has a sound track record of leadership in major multi-
agency programs that support information technology R&D. It has
maintained a leadership role within the High Performance Computing and
Communications (HPCC) program since its inception in 1991. NSF also
consistently has been one of the top funders of information technology
research and infrastructure development supported through that program.
Because the IT2 initiative builds on past and ongoing R&D
activities in the HPCC program, we currently are merging coordination
of IT2 and HPCC into an integrated management structure in
which NSF will continue to have a leadership role. I am confident that
NSF will continue to ably exercise its leadership in the integrated
programs.
Question. Is the issue related to NSF's management resources been
an area of discussion for the Administration? How is the Administration
addressing this matter?
Answer. Although the NSF enjoys a leadership role in the planning
and implementation of the IT2, the initiative is a multi-
agency effort. Therefore management of the initiative is being assured
through mechanisms that draw on multi-agency resources and provide
coordination across all participating agencies.
The IT2 initiative will be coordinated through the NSTC
as part of an integrated program that incorporates related ongoing
Federal information technology R&D programs. A Senior Principals Group
has been established to provide policy guidance and leadership. I chair
that senior management team, whose members currently include the NSF
Director, NASA Administrator, Under Secretary of Energy, Under
Secretary of Commerce for Oceans and Atmosphere, NIH Director, Under
Secretary of Defense for Acquisition and Technology, and senior OMB and
NEC officials. Once the IT2 and HPCC program have been
merged, the Senior Principals Group may be expanded to include
appropriate senior policy officials from other participating agencies.
An operational Working Group chaired by the NSF Assistant Director
for Computer and Information Science and Engineering will coordinate
research and infrastructure planning while promoting full and open
competition policies. The Working Group includes members with ties to
related ongoing multi-agency research programs. I have tasked the
National Coordination Office (NCO) for Computing, Information and
Communications R&D, which assures coordination of the HPCC programs, to
support the Working Group during and after the transition to integrated
coordination of IT2 with the ongoing programs.
indirect costs
Question. I want to raise some concerns about the amount of scarce
federal R&D dollars that are not going directly to researchers--namely,
indirect costs or overhead. I am concerned that the federal government
pays a significant amount of money for indirect costs at universities
and other research institutions. I am also troubled by the numerous
examples of inappropriate or questionable charges for indirect costs
that have been uncovered in recent years. This reinforces my fear that
the federal government is not able to do as much oversight when costs
are being defined as indirect rather than direct. And despite numerous
attempts to contain indirect costs, a lot of funds are still being
spent on non-research purposes.
Last year's NSF authorization act mandated an OSTP study and report
to Congress on indirect costs. Can you please tell us about the
progress of the study and your preliminary findings?
Lastly, what recommendations do you have regarding the payment of
indirect costs?
Answer. Much attention has been focused in recent years on the
indirect costs paid to universities for the conduct of research. These
costs are a real and necessary part of the total costs of research, but
it is in the interest of both the universities and the Federal
government to ensure that these costs are not excessive.
OSTP is on schedule to deliver the indirect cost study to Congress
as required by last year's NSF authorization bill. Our preliminary
findings show that since 1991, universities have reduced indirect cost
rates significantly. I look forward to forwarding the completed report
to you later this year.
policy issues at ostp
Question. I have read articles that indicate a growing interest in
the field of nanotechnology. I also understand that the administration
is reviewing this area and may recommend a major strategic initiative
on nanotechnology similar to the information technology initiative.
Do you view nanotechnology as an emerging field of interest for the
federal government? Are you indeed planning a major nanotechnology
initiative for fiscal year 2000? If so, what funding amount are you
projecting to propose in the budget and does this mean that the
information technology initiative will not be a major emphasis next
year?
Answer. Nanotechnology is a very exciting new realm of scientific
discovery that has the potential to impact chemical processes,
electronics, biology, information technology and advanced materials. I
stated in my April 1, 1998 testimony to Congress that `` * * * if I
were asked for an area of science and engineering that will most likely
produce breakthroughs of tomorrow, I would point to nanoscale science
and engineering often called simply ``nanotechnology * * * ''
Nanotechnology has the potential to be a very big economic engine for
the 21st century. As such, the Administration has been coordinating an
effort with key federal activities to assess where the federal
government is currently investing in nanotechnology and where it might
make sense to expand funding to put the United States in a competitive
position to exploit discoveries that could emerge from nanotechnology
research.
Question. Besides nanotechnology, what do you see as the primary
issues facing OSTP over the next few years and what are the major
science policy issues, as well as R&D funding priorities, that face the
Nation over the next few years?
Answer. I have attached, for your information, a copy of a joint
memo from OMB and OSTP prepared for the fiscal year 2000 budget process
that highlights the Administration's goals for science and technology,
the principles that guide our investment decisions, and specific
funding priorities. A similar memorandum is being prepared for fiscal
year 2001, which I will be happy to share with the Committee when it is
complete.
infrastructure
Question. Are there any particular federal programs or activities
that are available to help research institutions with research
infrastructure needs such as laboratory equipment, growth chambers,
greenhouse space, modernization of existing laboratories and other
necessities?
Answer. There are a few programs that are available, but they tend
to be directed at research sponsored by particular agencies. For
example, the NSF has a program for acquisition, renewal, and
development of shared laboratory equipment, but its selection criteria
requires the associated research be of the sort sponsored by NSF. NIH
has a joint program with NSF for similar purposes, but to be eligible,
investigators must be funded by both agencies. There is funding
available for modernization of laboratories from NIH, but only for NIH
sponsored activities. In general, most agencies provide some money for
laboratory equipment for their sponsored researchers.
Question. Do you believe there is a substantial unmet need for
infrastructure purposes? Do you have any cost estimates on these unmet
needs?
Answer. Yes, there is a widespread need for such funds, both as
regards research equipment and conventional infrastructure
(refurbishments of buildings, roofs, sewers, etc.) across many
agencies. There is no good estimate on research equipment needs, but
the estimate on conventional infrastructure needs have been estimated
in various reports to be higher than $10B when looked at across all
agencies. The 1998 NSF ``Science and Engineering Indicators'' estimates
$7B for unmet conventional infrastructure needs at universities and
colleges and another $1.4B in research equipment at those institutions.
Question. Do you have any suggestions on how we can meet these
unmet needs?
Answer. The NSF report cited above and two reports from the
National Research Council and the GAO have stated that as budgets have
gotten tighter infrastructure fixes have been postponed so that
operations could continue. Thus an obvious solution to modernize
research equipment is increased funding. The solution to conventional
infrastructure needs could also be met in that way, but there may be
other solutions. In this latter case there may be a broader array of
funding scenarios such as third party financing, GSA or private
parties. We should add that one component of the indirect costs
assessed on federal grants to research institutions addresses ongoing
costs for maintenance and refurbishment of the infrastructure. In
general, however, these charges do not provide the capital needed for
major infrastructure development and renewal.
development of it2
Question. While the goals of the initiative seem worthy, I am
concerned that this idea may have been driven by the White House and
not something that was developed in response to the demands of the
scientific community.
Can you describe how this proposal was generated and to what extent
the scientific community was involved in its development?
Answer. The PITAC was established in February 1997, pursuant to
Congressional authorization in the HPC Act of 1991. Over the past year,
the PITAC has undertaken an evaluation of Federal research programs to
support development of advanced information technology.
In a letter to the President in early June 1998, the PITAC urged
that public investments in computer, communication, and other
information technology research be significantly expanded to ensure an
ever-increasing standard of living and quality of life for our people.
Their findings were subsequently detailed in an Interim Report to the
President, released in August 1998.
The President asked me to prepare a detailed plan that addressed
the PITAC findings. Following the release of the PITAC interim report,
I held a meeting of the principals from our key R&D agencies. I
requested that they help me craft an initiative which not only
strengthens our investment fundamental research, as recommended by the
PITAC, but which also provides the strongest possible computational
support for advancing applications in science and engineering. We
convened an interagency working group to develop the initiative.
Throughout the fall, as the initiative took shape, we looked to the
research community for guidance. This included soliciting feedback on
the PITAC interim report and the appropriate Federal role to address
its findings, through: briefings to the Congress; briefings to major
scientific advisory boards (e.g., the National Science Board and the
President's Committee of Advisors for Science and Technology); speeches
and presentations to major national and international scientific
associations (e.g., AAAS and NAS conferences, the Town Hall meeting at
``SC98,'' an annual international supercomputing conference, meeting of
the G-8 science ministers); and consultations with major computer
industry leaders.
We also drew upon the results of a widely attended July 30-31
workshop, co-sponsored by DOE and NSF at the National Academy of
Science, on the potential for a high-performance computing initiative
to address large-scale scientific problems. DOE and NSF had already
begun working with the scientific community to propose a program in
this area, and those ideas were incorporated into the overall planning
for an initiative.
Finally, we asked the PITAC to convene working panels to flesh out
more detailed research agendas within the priority areas that they had
identified.
______
Questions Submitted by Senator Burns
Question. In helping put together the fiscal year 2000 request for
the Next Generation Internet (NGI), how were decisions made as to which
federal department or agency would have which responsibilities and how
were responsibilities divided among the agencies?
Answer. NGI agency roles and activities are set forth in the NGI
Implementation Plan issued in July 1997. These basic roles and
activities remain unchanged in fiscal year 2000, although there have
been some adjustments to milestones due to Congressional funding
decisions for the fiscal year 1998 and fiscal year 1999.
Question. In putting together the fiscal year 2000 request for the
NGI, was any consideration given to which parts of the proposal would
be especially useful or applicable to rural/EPSCoR states and if so
what are the results?
Answer. NGI is a research and development program to provide the
technologies and applications required as foundations for the next
generations of the Internet. Institutions with fundable research
proposals must not be disadvantaged in competing for NGI awards merely
because of their location. In fiscal year 2000, some NGI funds will
continue to be used to help rural/EPSCoR institutions connect to the
NSF's high speed network, the vBNS, which is part of the NGI testbed.
NSF already has expanded the High Performance Connections program to
cover all 50 states and has made 33 grants in 18 EPSCoR states.
Question. What portions of the fiscal year 2000 NGI program would
be most helpful to rural states? Which parts of the NGI budget do you
believe the rural states would be most competitive in?
Answer. Eventually, NGI research on wireless, hybrid, and satellite
technologies may reduce the cost and improve the services available to
all users including those in geographically remote areas. In the
meantime, associated funding to expand the reach of the NSF's High
Performance Connections program in rural states will greatly enhance
opportunities for rural/EPSCoR institutions with fundable proposals to
compete for NGI awards.
Institutions that will be most competitive for NGI awards will be
those where research is emphasized and where there are fundable
proposals in advanced networking research or applications. These
qualifications are not necessarily linked with the geographic location
of the institution.
In the annual review of the NGI which was submitted to Congress on
April 28, the President's Information Technology Advisory Committee
(PITAC) noted that the NGI program is not an infrastructure program,
and therefore cannot directly address reach to rural, inner-city,
minority, or small institutions. The PITAC has recommended that
Congress consider additional funding for a program where the NGI
research institutions act as aggregators and mentors for these
institutions. Since this is an infrastructure issue, and not research,
it is not covered by the NGI or the proposed Information Technology for
the Twenty-First Century (IT2) initiative.
______
NATIONAL SCIENCE FOUNDATION
Questions Submitted by Senator Bond
commitment to it2
Question. The Administration's information technology initiative
was proposed in response to the President's Information Technology
Advisory Committee's (PITAC) recent report and recommendations. PITAC
specifically recommends additional funding for information technology
of $4.743 billion over the fiscal year 2000--2004 period and over $2
billion annually thereafter.
Is the Administration budgeting the PITAC-recommended amounts? If
not, what exactly is the Administration budgeting for this program in
the outyears?
Answer. The PITAC Report recommended a multi year funding plan. NSF
believes that this is necessary to expeditiously realize the PITAC
goals, recognizing that more than one year is needed to provide and
maintain both the needed fundamental research and high-end computing
capabilities in the outyears. Future year requests are dependent on the
fiscal constraints that are in place at the time, and program plans by
the participating agencies will be adjusted to meet their appropriated
budgets.
Question. If the requested funding amounts are not provided for
IT2, will NSF use existing resources within its Computer and
Information Science and Engineering account or other accounts such as
the Integrative Activities account?
Answer. The planned IT2 program is integrated with and
expands upon ongoing research, adds new emphases, and changes the
balance of ongoing activities. NSF plans to address the IT2
initiative's priorities as closely as funding levels permit, even if it
means reducing attention in some currently supported areas.
development of it2
Question. While the goals of the initiative seem worthy, I am
concerned that this idea may have been driven by the White House and
not something that was developed in response to demands of the
scientific community.
Can you describe how this proposal was generated and to what extent
the scientific community was involved in its development?
Answer. The science and engineering research community was actively
involved in identifying needs and recommending research priorities for
the IT2 initiative. Prior to and early in the fiscal year
2000 budget development process, NSF funded studies to identify
research opportunities and challenges, and how best to take advantage
of the rapidly developing computational capabilities in high-end
computing in cutting edge research. A series of workshops were held in
which members of the external scientific and engineering community
identified many important problem areas requiring attention and
important scientific problems whose computational needs are not met by
computational capabilities currently available to the general science
and engineering research community. At roughly the same time, the
Department of Energy (DOE) was developing a plan to implement high end
computing for their mission related applications. In addition, a joint
NSF/DOE workshop was held at the end of July 1998 to study these latter
issues.
A significant outcome of all of these efforts was the
identification of major research opportunities and needs in computer
science and engineering. The President's Information Technology
Advisory Committee (PITAC), working independently, drew many of the
same conclusions. Specifically, these parallel activities noted that
there was a pressing need for considerable expansion of federal
investments in basic research, information and computing
infrastructure, and the development of human resources if the nation's
leadership in this field is to be maintained. Consequently, several
agencies joined together to develop a broad fiscal year 2000 response
to the PITAC recommendations. Further planning for the IT2
initiative has taken place through an intensive interactive process
involving, among others, the President's Science Advisor and the
National Science and Technology Council.
pitac report
Question. I understand that the IT2 initiative was
developed in response to the President's Information Technology
Advisory Committee (PITAC) report to the President. In addition to the
panel's concerns about managing the initiative, the report also states
that new modes of research support and new implementation strategies
will be required. PITAC also recommended that the Federal government
``must not subsidize activities left to the private sector.''
Is the private sector investing in long-term, high-risk information
technology research? Why or why not? Do you expect the private sector
to be involved in the IT2 initiative (e.g., cost-sharing)?
Answer. In general, the private sector does not invest heavily in
long-term fundamental research in information technology because of
short term market pressure, the need to develop new products, the
highly competitive nature of the industry, the high risks associated
with long-term basic research, and an inability to exclusively capture
the results of basic research. As a result, the federal government has
been the principal source of funds for basic research in information
technology. There is considerable evidence that this governmental
investment in fundamental research on communications and computing
technologies has led to U.S. domination in the information technology
industry sector, and to the creation of multi-billion dollar
industries.
NSF has a long-standing practice of partnering with industry in a
variety of ways, including significant cost-sharing involving either
direct funding or in-kind contributions. This practice will continue in
IT2 activities. Joint efforts may include participation in
research centers and projects, prototyping and real world testing of
advanced computers, training for industrial researchers in new high-end
technologies, research sabbaticals, and training of graduate and post-
doctoral students.
Question. How will NSF determine which activities should be funded
by the public and which ones should be best left to the private sector?
Answer. NSF is the only Federal agency mandated to promote the
health and vitality of research and education in science and
engineering across all fields and disciplines. NSF emphasizes the
initiation and support of basic scientific research and research
fundamental to the engineering process. Past experience indicates that
the majority of this research will be carried out at the nation's
colleges and universities.
The determination of research priorities in information technology,
as well as the other areas supported by the Foundation, will be based
heavily upon advice received from experts in the relevant external
academic, industrial and governmental research communities. One of the
hallmarks of NSF is its merit review system. The Foundation relies on a
system of merit review by independent experts to judge the quality and
impact of research being considered for support. Community input on
overall priorities is also received through a variety of mechanisms,
such as informal discussions, workshops, special studies and
Directorate Advisory Committees.
Research planning for IT2 will be coordinated through a
National Science and Technology Council interagency process in order to
minimize overlap and duplication of effort among all the federal
agencies involved. In addition, where appropriate, industrial
scientists and engineers will take part in the review and evaluation of
proposals not only to help assess scientific merit but also to help
preclude the funding of proprietary research.
evaluating it2
Question. The goals of the IT2 initiative seem laudable,
yet broad in some respects.
How will we be able to assess whether the program, if funded, has
achieved its objectives? Would an audit and evaluation of the
IT2 initiative be undertaken by the executive branch or an
external source?
Answer. Active monitoring and progress assessment are important
elements of IT2, both on the individual project and broad
initiative scales. PITAC recommends that an annual review of the
research programs be carried out to insure that the investment
portfolio is properly balanced, comprehensive and well-coordinated.
Such a review would be carried out under the NSTC, with high-level
external advice provided by PITAC. In addition, progress under
IT2 would be part of Government Performance Results Act
(GPRA) reporting procedures. Impact evaluation over a longer time frame
would be carried out through a commissioned independent study, similar
to the National Research Council evaluation of the HPCC initiative--the
1995 ``Brooks-Sutherland Report''.
it2--management
Question. NSF has been designated as the lead agency for this major
initiative and I understand that OSTP will play a significant role in
the oversight of its implementation. With five other agencies involved,
managing this initiative will be a major challenge to NSF. Both the NSF
Inspector General and the President's Information Technology Advisory
Committee (PITAC) have raised this as a serious management challenge
and recommended that NSF needed to ensure that adequate resources would
be devoted to programmatic oversight. I also recall from last year's
hearing that Dr. Lane expressed his concern about the Foundation being
asked to take on larger challenges.
First, please explain how NSF as the lead agency will manage this
initiative from an interagency perspective. For example, will NSF
direct NASA's activities? How will NSF work with the other agencies to
coordinate, set priorities, and implement the program?
Answer. NSF has been designated as the ``lead'' agency for this
initiative in keeping with the President's Information Technology
Advisory Committee (PITAC) finding that basic research in information
technology is critical to maintaining U.S. leadership in information
technology. Each agency will be responsible for establishing the
priorities required to carry out its mission. NSF's role is to
coordinate individual agency efforts so that they complement each other
to meet the overarching goals of the IT2 program. In
addition, NSF is also responsible for maintaining the basic research
emphasis in IT2.
Management of the IT2 initiative is coordinated through
the National Science and Technology Council (NSTC). A Senior Principals
Group has been established that includes the NSF Director, NASA
Administrator, Under Secretary of Energy, Under Secretary of Commerce
for Oceans and Atmosphere, NIH Director, Under Secretary of Defense for
Acquisition and Technology, and senior OMB and NEC officials. This
group assists in establishing overall priorities and ensuring balance
in the national information technology portfolio. An operational
working group, which meets weekly and is chaired by the NSF Assistant
Director for Computer and Information Science and Engineering (CISE),
coordinates research and infrastructure planning while promoting full
and open competition policies. Subsidiary working groups organized
around appropriate focus areas of IT2 research and
development will coordinate research activities, propose new
initiatives, and address programmatic objectives related to their
research focus areas.
Question. Second, does NSF have the staff resources and management
structure to manage this effort in addition to its current workload?
Have you discussed these management issues with the IG and will you ask
the IG's office to provide advice?
Answer. At present, the Foundation does not have believe that it
has sufficient staff resources to manage the increased level of
activity resulting from the IT2 initiative. Additional staff
will be needed, with the number depending on the funding level and the
proportions of the particular activities that are implemented, e.g.,
the type and number of research projects supported and the
implementation of the terascale computing system.
We believe that, given the proper resources, NSF has the experience
to successfully meet the management challenges listed by the Inspector
General in the case of the IT2 initiative. NSF is presently
developing the internal management structure for the IT2
initiative that draws upon prior Foundation experience in the selection
and management of research carried out by individuals, teams, and
centers, and interagency efforts in the High Performance Computing and
Communications (HPCC) and the Next Generation Internet (NGI) programs.
The Inspector General participates in policy discussions among senior
management in which many of these issues are considered. NSF's
demonstrated ability to establish quality merit-reviewed research
programs in coordination with other federal agencies, such as the NSF/
EPA partnership, will help ensure quality management of this effort. We
have also gained considerable experience from partnering with agencies
such as the Defense Advanced Research Projects Agency (DARPA), the
National Library of Medicine, NASA and the Library of Congress in the
Foundation's expanding digital libraries program. Other examples of
NSF's ability to establish a productive management structure include
our management of networking research, building NSFNET, and focusing on
new research challenges after the Internet was established.
performance measures
Question. This subcommittee has been concerned about the
Foundation's failure to provide a budget justification that meets the
requirements of the Government Performance and Results Act. We believe
that it is important for all NSF initiatives and programs to be
identified with specific funding as well as quantifiable goals and
milestones. The goal statements for much of the fiscal year 2000
performance plan--especially in the areas of research investments and
training--appear to be as general and nonquantitative as last year.
How does NSF propose to comply with our concerns?
Answer. NSF has expressed its performance goals for results as
descriptive standards under the Government Performance and Results Act
(GPRA) option for use of the ``alternative format''. NSF's use of the
alternative format, approved by the Office of Management and Budget,
allows the agency to express its performance goals for results in
descriptive terms, rather than in quantifiable and measurable form. The
descriptive standards in NSF's Plan include definitions for
``successful'' or ``minimally effective'' performance outcomes. This is
permissible under Section 1115.b.1.A of the Results Act. NSF's level of
success in achieving these results-oriented goals will be determined
through external assessment processes. This approach allows for a
responsible and comprehensive assessment of the continuous flow of
results from NSF-supported activities. These results will be
highlighted in NSF's annual GPRA performance reports. Since both the
substance and the timing of outcomes from NSF-supported activities are
unpredictable, performance standards for the results of NSF's
investments in research and education cannot be adequately expressed in
quantified, annual performance goals. Further, the discrete alignment
of program funds with specific performance goals is difficult to
attain, because NSF investments generally work toward more than one of
the performance goals simultaneously. Also, because research results
are unpredictable in a given year, it is not possible to tie resources
in a given year to outcomes obtained in the same year. Nevertheless, as
we gain experience from application of the GPRA process, we will
continue to seek techniques to more closely tie resources to the
categories of investment presented in our performance plan.
math and science education
Question. This month the National Science Board released a report
on math and science education. I understand that this report and its
recommendations are in response to the so-called ``TIMSS'' report that
basically said our middle and high school students are not doing well
in math and science education compared to their international
counterparts.
How is NSF responding to the Board's report and recommendations?
Are there any related IT2 activities that will benefit
science and math education at grades K-12?
Answer. The National Science Board (NSB) report underscores NSF's
commitment to providing national leadership in K-12 science and
mathematics education. Over the last decade, NSF has pursued a
comprehensive strategy for developing standards-based curricula,
instructional strategies, and assessments. To promote their
implementation, NSF has created innovative strategies for reforming
entire education systems (i.e., state, urban, rural, district levels).
The NSB report also highlights the critical role of partnerships. Most
of our programming requires meaningful collaborative working
relationships with major stakeholders that bring the broad ownership
critical to success. Current NSF priorities include: education
research, teacher education, systemic reform, efforts promoting
diversity in science and engineering, and applications of learning
technology.
The NSB report focuses on two components of NSF's K-12 program
portfolio critical to improving student performance--curriculum
development and teacher education. NSF has supported the development of
exemplary, comprehensive instructional materials that promote inquiry-
based learning, are rigorous in content and age appropriate, and
improve the education of all students. All curriculum materials embody
the essential principles of the National Council on Teachers of
Mathematics (NCTM) standards and the National Academy of Science (NAS)
science standards. All supported materials now include embedded
assessments to guide classroom instruction, and go through extensive
pilot and field-testing. Standards-based, large-scale assessments are
in demand by states and districts. We are focusing increased attention
on development and implementation of these assessments since they are
critical in strengthening science and mathematics education, as well as
determining the effectiveness of NSF programming.
A growing body of evidence documents that teachers more
knowledgeable in content and effective in teaching practice improve
student performance. Our teacher education programs--preservice and
inservice--strengthen both content and pedagogy. We are developing new
components within our teacher education programs, examining needs at
different career stages--especially at the start of a teaching career
when so many talented individuals are lost to the classroom--and
strengthening the infrastructure necessary to train new generations of
effective science and mathematics educators and administrators. We walk
a fine line in this arena, balancing long-term and short-term needs.
As part of the IT2 initiative, NSF will support research
aimed at investigating pipeline issues that affect the participation of
underrepresented populations (e.g., women, minorities) in these fields.
In addition, NSF does support related activities in K-12 mathematics
and technology education, including the National Science, Mathematics,
Engineering, and Technology Education Digital Library (NSDL). Further,
within the Computer and Information Science and Engineering (CISE)
Directorate, a new initiative, Teaching Experiences for CISE Students,
introduces graduate and upper-level undergraduates into K-12 learning
environments.
The Senate VA-HUD Appropriations Committee has asked NSF to develop
a strategic plan that can help address the deficiencies in U.S. student
performance identified by TIMSS. We will share this plan with the
Committee.
indirect costs
Question. I want to raise some concerns about the number of scarce
federal R&D dollars that are not going directly to researchers--namely,
indirect costs or overhead. I am concerned that the federal government
pays a significant amount of money for indirect costs at universities
and other research institutions. I am also troubled by the numerous
examples of inappropriate or questionable charges for indirect costs
that have been uncovered in recent years. This reinforces my fear that
the federal government is not able to do as much oversight when costs
are being defined as indirect rather than direct. And despite numerous
attempts to contain indirect costs, a lot of funds are still being
spent on non-research related purposes.
Dr. Colwell, how much and what percentage of NSF dollars are going
towards indirect costs? Please provide this data for the last 10 fiscal
years. What sort of things are we paying for under the indirect cost
heading? Lastly, what recommendations do you have regarding the payment
of indirect costs?
Answer. The amount and percentage of NSF dollars which funded
indirect costs for the last 10 fiscal years are shown in the table
below:
------------------------------------------------------------------------
Indirect $ (in Percent of
Fiscal year millions) total
------------------------------------------------------------------------
1998.................................... $639 19.7
1997.................................... $668 21.2
1996.................................... $578 18.9
1995.................................... $527 16.9
1994.................................... $481 17.0
1993.................................... $456 17.6
1992.................................... $457 18.8
1991.................................... $414 17.9
1990.................................... $366 18.8
1989.................................... $342 19.1
------------------------------------------------------------------------
Indirect costs, as defined in OMB Circular A-21 for colleges and
universities, include the following cost categories: (1) facility costs
such as depreciation and use allowances, interest on debt associated
with certain buildings, equipment and capital improvements, operation
and maintenance expenses, and library expenses; and (2) administrative
costs such as general administration and general expenses, departmental
administration, sponsored projects administration, and student
administration and services. The percentage of indirect cost dollars to
total dollars funded by NSF is significantly below the average indirect
cost rate negotiated on a government wide basis (which is close to 50
percent of modified total direct costs).
NSF considers indirect costs legitimate costs of doing business.
All research projects benefit from the expenses categorized as indirect
costs. For example, research is conducted in buildings and laboratories
that generate costs which should be shared by all users and
beneficiaries of the facility. Indirect costs simply allocate these
shared expenses to the appropriate research projects or users. In
addition, some of the indirect costs incurred by research institutions
are the direct result of their compliance with Federal mandates, e.g.
environmental requirements.
The area of indirect costs, particularly those of colleges and
universities, which are negotiated by the Department of Health and
Human Services and the Office of Naval Research, has been studied and
reviewed over the last decade by numerous groups. These studies have
resulted in several major revisions to the cost principles, some of
which NSF believes may have gone too far in limiting reimbursement of
indirect costs. For example, OMB Circular A-21 currently places a 26
percent cap on administrative costs for educational institutions; this
area may need to be reevaluated as to its fairness relative to other
research performers, such as non-profit organizations, and the effect
it has had on the federal/university research partnership. Another
example is the reclassification of certain personnel costs in A-21 as
``Organized Research,'' which, by effectively lowering the
institution's indirect cost rate, may have created disincentives for
institutions to contribute effort to Federally supported research. This
issue was noted in the recent report in response to the Presidential
Review Directive on the Government-University Partnership. Except for
those issues, NSF believes the cost principles are reasonable and
suggests they be allowed to remain stable and constant for the
foreseeable future.
merit review process
Question. Last December, the NSF Inspector General submitted a
report to the Congress outlining the 10 most serious management
challenges facing the Foundation. one of those challenges relates to
the merit review process, which this subcommittee has also been
concerned about. We have asked for an outside group to evaluate the
impact of the new merit review criteria that NSF adopted at the start
of this fiscal year.
What do you see as the most serious challenges facing the merit
review system? How do you intend to broaden the representation of the
panelists selected to review proposals?
Answer. Merit review is critical to the way NSF conducts business.
NSF believes the merit review system is essential for maintaining high
standards of excellence and accountability in the proposal decision
process.
From NSF's perspective, the most serious challenges facing the
merit review system are: (1) engaging the scientific community in the
use of the new electronic system for submitting reviews, to ensure
quality and consistent reviewer input; (2) reducing the burden on the
reviewing community; and (3) reducing the complexity of a process which
has become quite complicated due to potential conflicts of interest, as
partnering and/or collaborations increase. Both NSF staff and the
scientific community are receiving training in the use of the new
electronic system.
NSF's policy on the selection of peer reviewers stresses the
importance of wide representation--including characteristics such as
geography, type of institution, and underrepresented groups. NSF's
advisory system involves approximately 50,000 scientists and engineers
a year, about 20 percent of whom have not previously served as a
reviewer at NSF. NSF is constantly looking for and identifying new
reviewers in the merit review process. Broadening the reviewer base is
accomplished by having NSF staff identify potential new reviewers. This
is best done by NSF staff meeting the potential reviewers at their
institutions or at scientific meetings, and also by asking for
recommendations from existing reviewers.
biocomplexity in the environment
Question. Biocomplexity in the Environment has been described as a
priority in the NSF budget request. In the past couple years, NSF
emphasized a similar theme called ``Life and Earth's Environment.'' The
increased level and emphasis on Biocomplexity in the Environment also
appears to be in contrast to the National Science Board's position of
not establishing a National Institute for the Environment in NSF.
First, does the Biocomplexity priority mean that you will be
revisiting the establishment of a National Institute for the
Environment?
Answer. NSF is very much aware of the importance of a sound
environment to the United States and to the world. NSF's initiative on
Biocomplexity in the Environment seeks to enhance our understanding of
the complex dynamics of environmental systems. It will facilitate
interdisciplinary research that spans temporal and spatial scales,
considers multiple levels of biological organization, crosses
conceptual boundaries, uses and fosters the development of new
technologies, and links research to societal application.
With respect to a National Institute for the Environment (NIE),
NSF's report to Congress outlined our belief that the most appropriate
way to implement the goals of the proposed NIE is through an
interagency partnership coordinated by the National Science and
Technology Council with significant NSF involvement in associated
fundamental research and education activities. We continue to believe
that this approach is the best way to advance the overall environmental
research agenda and that the creation of a stand-alone NIE is not an
effective means of achieving the proposed intellectual goals of an
environmental institute.
Question. Second, are the activities under Life and Earth's
Environment (LEE) now included in Biocomplexity in the Environment
(BE)? To what extent is LEE different from BE? Please explain.
Answer. NSF activities formerly included in Life and Earth's
Environment (LEE) are now included in Biocomplexity in the Environment
(BE). However, BE goes beyond LEE, including the new biocomplexity
initiative which emphasizes integrative and interdisciplinary work in
environmental areas that capitalizes on the extraordinary advances in
related technologies including genome sequencing, new computational
algorithms and mathematical methods, sensors and monitoring devices,
and remote sensing. The scope of Biocomplexity in the Environment
includes both focused initiatives and core research programs aimed at
fostering research on the complex interdependencies among the elements
of specific environmental systems and the interactions of different
types of systems. It reflects the evolution of NSF thinking about how
NSF-supported research on the environment can best take advantage of
opportunities provided by advances throughout science and engineering
and, at the same time, be most valuable to the developing program of
federal activities related to the environment.
graduate education support
Question. The fiscal year 2000 budget request provides an increase
for science and math education at the pre-college level, but a decrease
at the undergraduate and graduate level. While I applaud the increased
funding request for the pre-college level, it seems especially strange
to reduce the graduate education budget when Congress just went through
a major rewrite in the immigration area and increased the number of
visas for foreign high tech workers due to a shortage in American
trained workers.
What is the rationale for reducing support for graduate education?
Answer. Programs which benefit graduate education cut across the
spectrum of activities within the Education and Human Resources (EHR)
account. In fiscal year 2000, these programs are supported out of two
Subactivities within EHR: (1) Graduate Education funds individual
fellowships and research traineeships; and (2) Undergraduate Education
funds the NSF Graduate Teaching Fellows in K-12 Education (GK-12),
which involves both undergraduate and graduate education, and the
National Science Mathematics, Engineering and Technology Education
Digital Library (NSDL) initiatives. Summing all of these efforts,
overall support for graduate level education actually increases by $3.5
million.
Question. What is NSF going to do differently to address the needs
of U.S. students at the K-12 level?
Answer. NSF continues to maintain a comprehensive portfolio of
programs that address the needs of K-12 education, including systemic
reform, instructional materials development, teacher education, and
informal science education. New K-12 efforts include: (1) the NSF
Graduate Teaching Fellows in K-12 Education, initiated as a prototype
in fiscal year 1999, that supports graduate and advanced undergraduate
SMET majors as content resources for teachers, and (2) the National
Science, Mathematics, Engineering, and Technology Education Digital
Library (NSDL) that will be a national resource for increasing the
quality, quantity, and comprehensiveness of internet-based K-16 SMET
education.
Several efforts explicitly address growing needs of the high-
technology workplace. The Advanced Technological Education (ATE)
program will continue to strengthen the science and mathematics
preparation of the high technology workplace through large-scale Center
efforts and special projects targeted at the secondary grades and
community college levels. A number of these efforts link academic and
industrial partners and, in fact, focus on information and
communication technologies. In addition, NSF--with support from the H1-
B Nonimmigrant Petitioner Fees collected under Title IV of the American
Competitiveness and Workforce Improvement Act of 1998 (Public Law 105-
277)--will provide scholarships to low-income individuals pursuing
degrees in computer science, engineering, and mathematics; establish
academic enrichment opportunities for K-12 students; and support
systemic reform activities, especially for projects that seek to link
K-12 reform with technical workforce development.
Question. Does NSF plan to collaborate with the Department of
Education?
Answer. NSF and Department of Education (DoED) staff interact in
programmatic areas of complementary interest. The agencies are
currently collaborating on the Interagency Education Research
Initiative (IERI) that focuses on the use of information and computer
technologies to promote improvements in the teaching and learning of
mathematics, science, and reading. In addition, NSF is developing and
field testing materials to train undergraduates who will receive DoED
Work-Study support for tutoring students in middle-school mathematics.
Among other recent collaborative efforts are projects to promote parent
engagement in standards-based education, as well as jointly sponsored
survey and analysis efforts under the Third International Mathematics
and Science Study (TIMSS). DoED has also been supportive of the
leveraging of its Eisenhower, Title I and Title II funds by NSF
systemic reform and teacher education projects.
antarctic program
Question. In fiscal year 1998, NSF initiated the modernization of
the South Pole Station with an appropriation of $70 million. The fiscal
year 2000 request of $5.4 million continues this work and we expect to
spend $127.9 million over the fiscal year 1998-2001 period. NSF is also
requesting $12 million to complete upgrades for its fleet of polar
support aircraft.
First, how is the modernization of the South Pole Station going?
What major challenges do you expect to face this year and expect to
continue to face as the modernization progresses? I would especially be
interested in the status of the major logistics support contract.
Answer. South Pole Station Modernization (SPSM) is currently on
schedule and within budget. The acceleration of funding ($70 million in
fiscal year 1998 and $39 million in fiscal year 1999) has made it
possible to move up procurement of materials and construction of the
Dark Sector Lab, a 3000 square foot building which will support
astrophysics research. The accelerated funding will make it possible to
combine previously separate procurements for major components--
structural steel, wall panels, and other construction materials--into
several large purchases instead of a greater number of smaller
purchases. In addition to providing for consistency of materials for
the station, simplifying long-term maintenance, this approach will
likely result in saving procurement labor costs and inflation. Also,
perhaps most importantly, the acceleration helps guard against possible
procurement-associated delays in the future, and thus against schedule-
driven cost increases.
Future challenges include the extreme weather conditions under
which the project will be completed; the short period (100 days per
year) for exterior construction; and the possible transition to a new
support contractor. Uncertainties in the weather are mitigated by
transporting as much material as possible during favorable weather. The
shortened construction season is offset by scheduling exterior work
during the austral summer (November through January) and subsequent
interior work during the austral winter.
The major risk associated with the possible transition to a new
contractor during South Pole Station Modernization is increased labor
costs due to lost time as a result of a new contractor's lack of
familiarity with the project or the unique requirements and conditions
of working in Antarctica. This risk is mitigated by the following:
--Continuity.--The design and review responsibilities are vested in
separate architectural and design contractors. These
responsibilities will not be affected by any contractor
transition.
--Procurements.--NSF is currently discussing with Antarctic Support
Associates (ASA), the current contractor, a procurement option
that would substantially accelerate (by two years) the
procurements associated with SPSM. If this is determined to be
feasible, a majority of the procurements will have been
completed by the end of the possible transition between the old
and new contractor.
--Contractor selection.--The selection of a new contractor will be
based on technical expertise and cost pricing to ensure that
the contractor selected has the experience necessary to
complete the project and that the cost will be reasonable.
--Phase-in period.--The phase-in period provides 6-months for the old
and new contractors to work together, on-site, in order to
bring about a smooth transition. Several key NSF staff
participated in the most recent contractor transition and will
bring valuable experience to the next transition, if needed.
--Retention of experienced labor pool.--It has been NSF's experience
that when contractors change, a significant portion of
personnel, from mid-management to skilled labor, is retained by
the new contractor.
--Planning and oversight.--All documentation, including designs,
planning and project management software, and other project
documents, belongs to NSF and would be available to a new
contractor. NSF has been conducting quarterly SPSM project
audits during which ASA and NSF staff discuss engineering
activity schedules, procurement and construction plans and
schedules, cost accounting for the project, and other
administrative matters. This ensures that NSF staff are as
knowledgeable as ASA staff on the status of the project.
--On-site management.--During recent Antarctic summer seasons, NSF
has placed several of its experienced managers at McMurdo
Station and the South Pole to provide oversight and management,
both for logistics and operations, and for facilities
management. These managers have an average of nearly 20 years
of Antarctic and construction management experience and are
thoroughly familiar with the project.
A Request for Proposals (RFP) for recompetition of the Antarctic
support contract was issued on September 14, 1998, and proposals
submitted in response to the RFP are currently being evaluated. A
contract will be awarded in October 1999.
Question. Second, with the Air National Guard in control this year,
how are they doing?
Answer. The New York Air National Guard (NYANG) met all mission
requirements this season and exceeded expectations with respect to
delivery of materials for South Pole Station Modernization. NSF
continues to work with NYANG on the management relationships among the
various parties involved in providing support to the U.S. Antarctic
Program. These relationships are important for the smooth operation of
the program. NSF is also working closely with NYANG on developing
procedures and training for remote field operations.
``fastlane''
Question. The IG has expressed concerns about NSF's implementation
of its electronic processing proposal and award information system
called FastLane.
How is the implementation of FastLane progressing and what
challenges do you face? To what extent are grantees having difficulties
in implementing the new system?
Answer. The implementation of FastLane is progressing on schedule.
As of February 1999, there are over 1,500 registered institutions.
These institutions account for over 90 percent of the proposal and
award activity at NSF. In fiscal year 1998 NSF received over 5,000
proposals, 21,000 proposal reviews, and 3,400 post-award administrative
requests and notifications via FastLane, and FastLane was used to
disburse 94 percent of NSF's research budget. As of December 1998, over
85 percent of NSF's grantees used FastLane to submit their Federal Cash
Transaction Reports (which represents 95 percent of the dollar value of
all active NSF awards).
We do, however, face a number of challenges as we continue to
implement FastLane:
--Electronic signatures.--NSF is receiving many business transactions
electronically, but there are documents that for legal reasons
require a signature on paper. The resolution to this issue must
be an inexpensive, rapid-response, widely available system. NSF
is working as a participant with the Federal Commons project on
pilot projects to satisfy this requirement.
--Printing of proposals in color.--The electronic submission of
proposals (many of which contain color images) does not
immediately eliminate the need for paper copies. Printing in
color is both slow and expensive. To address this issue and be
consistent with our long-term vision of eliminating the
printing of proposals, NSF is exploring a variety of possible
resolutions to this problem such as conducting a pilot with our
reviewers in which we would only provide proposals to them
electronically.
We think the research community is rapidly accepting the use of
FastLane. Based on feedback we have received from our grantees, we
believe that the primary difficulties our grantees have in implementing
FastLane are:
--Concern about Federal research funding agencies developing their
own systems.--As a member of the Federal Demonstration
Partnership (FDP), NSF works with other Federal research
funding agencies and member grantee organizations on a variety
of issues. A common concern is that each agency will develop
its own independent ``FastLane-like'' system, thus forcing the
grantees to learn a variety of systems. In response to this
concern, NSF is participating in the development of the
``Federal Commons'', an internet-based electronic ``commons''
providing access to grant availability, status, award and other
key grant administration functions that will be accessible to
the entire federal grants community, including federal
agencies, state and local governments, universities and other
grant recipients and stakeholders. The Federal Commons is now
in its early stages of planning, design, and development.
--Internet response time.--Depending on how a grantee is connected to
the Internet (firewall architecture, Internet service provider,
equipment speed, etc.), grantees may experience slow response
times when using FastLane. Generally the response time is
excellent in the morning, and then begins to deteriorate as
activity increases. In the late afternoon (about 6:00 PM
Eastern time), response time begins to improve again. Although
the grantee's Internet connection is largely responsible for
the response time that he/she experiences, NSF has made every
effort to build a solid FastLane architecture to avoid
contributing to the problem and we continue to look for ways to
provide even better, faster access.
travel funds
Question. The NSF Inspector General has expressed concerns about
the lack of sufficient support for oversight by NSF program staff. One
of the cited causes for this problem is the lack of sufficient travel
resources. In your fiscal year 2000 request, $1.2 million is being cut
from your travel account yet you are requesting authority to use
research and education funds for ``award related travel.''
Are these changes designed to respond to the IG's concerns? How
much total funds to you expect to allocate for travel? Please give us a
breakdown in terms of how much you propose to spend out of your
salaries and expenses ``general operating'' expenses and how much would
come out of your other program accounts.
In regard to the $1.2 million travel funds cut from your general
operating expense category, are these funds being reallocated? If so,
for what purposes?
Answer. The request to fund oversight and outreach travel in the
research and education program accounts is designed to respond to the
IG's concerns. Inspector General reports continue to cite the lack of
travel funds for oversight of NSF awards as a major management
challenge. If the request is approved, all award-related travel will be
funded in the program accounts. Staff travel for training and
participation in conferences will continue to be funded in the Salaries
and Expenses (S&E) Account.
The increase of $1 million in award-related travel is requested to
maintain a reliable merit review process and to provide additional
oversight to implement GPRA goals and new program initiatives.
Reallocated funds of $1.2 million in the S&E account will be used
to support planned investments in information infrastructure. The
Foundation continues to make major investments in new technology to
support improved business operations and to keep pace with an
increasingly complex workload.
TRAVEL BY ACCOUNT
[In millions of dollars]
------------------------------------------------------------------------
Fiscal year
-----------------
1999 2000
------------------------------------------------------------------------
Salaries and Expenses................................. 4.0 2.8
Research and Related Activities....................... 5.5 7.1
Education & Human Resources........................... 2.4 3.0
Major Research Equipment.............................. 0.1 0.1
-----------------
Total........................................... 12.0 13.0
------------------------------------------------------------------------
outreach efforts
Question. I understand the NSF conducts regional outreach or grant
seminars periodically. I think it is critical, especially for smaller
institutions, to receive some sort of technical assistance training so
that they are able to develop competitive research proposals of their
own.
Do you have any outreach efforts planned for fiscal year 1999?
Please describe these plans. Beyond those outreach efforts, what other
steps is NSF taking to better inform and involve faculty and students
about your programs?
Answer. NSF conducts a number of outreach efforts to assist all
parts of the research and education communities. For example, NSF
Regional Grant Conferences provide ``outreach'' information on
proposal/grant requirements; the merit review process; policies and
issues such as conflict of interest, cost sharing, etc.; NSF electronic
initiatives such as the NSF FastLane System; as well as NSF's purpose,
programs, budget trends and emphases. For the past several years, NSF
has conducted two regional grants conferences annually, in conjunction
with host universities. Attendees are principal investigators and
research/sponsored project administrators, primarily from educational
institutions. NSF regional conferences have been well received and the
demand for such events continues.
In fiscal year 1999 NSF conducted two Regional Grants Conferences.
In October 1998 a conference was hosted by the University of Kansas in
Lawrence, Kansas. This was the first NSF Regional Grants Conference
held in an Experimental Program to Stimulate Competitive Research
(EPSCoR) designated State. Given the success of this conference, NSF
plans to routinely incorporate visits to EPSCoR States in these
outreach events. In March 1999 a second conference was held in Los
Angeles, co-hosted by the University of Southern California, the
California Institute of Technology, University of California, Los
Angeles, and University of California, Santa Barbara. In fiscal year
2000, NSF plans to hold conferences at the Colorado School of Mines in
October and at Louisiana State University in March.
NSF has also been actively engaged in other outreach activities.
For example, in October 1999, NSF will host an all day training event
at the Society for the Advancement of Chicanos and Native Americans in
Science. We have also hosted ``NSF Days'' in connection with the last
five annual meetings of the National Council of University Research
Administrators (NCURA) which has a membership of approximately 800
institutions.
NSF also has an active information dissemination program to provide
the latest information about funding opportunities, deadline dates,
program contact information and award information. NSF relies on
electronic dissemination as the principal method of distributing
information about the agency. NSF's web site (http://www.nsf.gov) is
accessed by about 9,000 visitors each weekday. Web-based systems such
as the ``Online Document System'' and the ``NSF E-Bulletin'' let our
community know about funding opportunities.
In addition, NSF has developed the ``Custom News Service,'' a free
subscription service that alerts subscribers to information of
interest. Introduced in early 1997, the e-mail and web-based system
allows subscribers to sign up for specific types of information (for
example, news about new programs). This popular service has nearly
17,000 subscribers and has helped enormously with our outreach efforts.
NSF also conducts an expanded outreach initiative for EPSCoR
states. In the last two years, more than 230 trips to EPSCoR states
have been made by administrative and program officers from all around
the Foundation. Generally, NSF program staff describe their program's
requirements and make themselves available to researchers for advice
and guidance. These visits are made in addition to the regular site
visits for existing projects. The EPSCoR program also awarded a grant
to the American Association for the Advancement of Science (AAAS) to
assist EPSCoR institutions and researchers planning to submit proposals
for the high performance computing and networking connections program
at NSF. Working closely with NSF and EPSCoR state Project Directors,
AAAS also conducts regional conferences where technical assistance is
provided to individual researchers.
earthquake engineering research
Question. The fiscal year 2000 request includes $7.7 million to
start a new earthquake research activity called Network for Earthquake
Engineering Simulation (NEES). NSF is estimating that the total cost
will be $81.9 million over a five-year period.
Will NSF bear the entire cost of creating and operating NEES or
will cost-sharing from other entities be involved? If other sources of
funds will be leveraged, please provide an estimate of the funding
amounts and sources that you expect to receive these funds from.
Answer. NSF does not plan to require cost sharing by awardees
during the creation of NEES. No support is anticipated from other
agencies for NEES development and implementation. However,
approximately 50 percent of operating costs will be supported by user
fees.
Question. Please detail how these funds will be used for purposes
such as new construction of facilities, equipment purchases, and
infrastructure.
Answer. NSF plans to spend fiscal year 2000 funds on:
--Developing the network that will link and integrate the various
NEES facilities.--The network will provide the capability to
remotely operate and view experiments, to collaborate on
research, to store and analyze data, and to perform
simulations. Further planning has indicated that it would be
most efficient to implement the network first to ensure a
uniform platform for all facilities.
--Selected Facilities.--Fiscal year 2000 funds may be used to support
facilities that can be brought on-line most quickly. This may
include facilities requiring only minor upgrades and mobile or
field facilities. Making support available for these facilities
early in the project life allows NEES to provide benefits
throughout the construction period.
Question. What sort of entities do you expect to operate and
maintain NEES?
Answer. In fiscal year 2000-2004 while facilities are being
constructed, each component of NEES will be operated by individual host
institutions, which are expected to primarily be academic institutions.
After this period, the entire network will be operated and maintained
by a consortium of host institutions and users that has been selected
through a competitive process.
Question. Who will have access to NEES?
Answer. Proposals to conduct experimental research at the NEES
facilities will be accepted from all sectors of the earthquake
engineering community. These proposals will be competitively evaluated
by peer-review. It is expected that NEES will be accessed primarily by
academic researchers. However, the results of NEES experiments will be
available to a wide range of users. NSF expects the network to promote
the development of research tools such as integrated databases and
user-generated software and to be a major resource for government
agencies--including the National Earthquake Hazards Reduction Program
(NEHRP) agencies, the professional engineering community, hazard
response managers, K-12 educators, and the general public.
infrastructure
Question. Are there any particular programs or activities at NSF
that are available to help research institutions with research
infrastructure needs such as laboratory equipment, growth chambers,
greenhouse space, modernization of existing laboratories, and other
necessities?
Do you believe that there is a substantial unmet need for
infrastructure purposes? Do you have any cost estimates on these unmet
needs?
Answer. NSF supports a variety of programs that help research
institutions with the type of instrumentation needs you have described.
For over a decade, NSF has annually invested approaching 10 percent of
its research funds in instrument development and acquisition. In fiscal
year 1998, this investment totaled nearly $200 million.
In addition to supporting instrumentation on individual research
and education grants, the Foundation supports instrumentation through
more than 15 targeted programs. In fiscal year 1999, for instance,
funds for instrumentation will be provided through programs including:
--Major Research Instrumentation (MRI). This program, supported at a
level of $50 million, is a large-scale instrumentation effort
designed to improve the condition of scientific and engineering
equipment for research and research training in our Nation's
academic institutions. The MRI program allocates funds in the
range of $100,000 to $2,000,000 for instrumentation that is not
readily available from other NSF programs.
--Advanced Technological Education (ATE) program, initiated in 1995,
which provides instructional equipment to technician education
programs, principally in two-year colleges.
--HBCU Program, which was initiated in 1998 and supports
instructional equipment within the context of curriculum and
faculty development activities.
--Course, Curriculum and Laboratory Improvement program, which builds
on the former Instrumentation and Laboratory Improvement
program and provides support for instructional instrumentation.
It is clear that there is a substantial unmet need for
infrastructure purposes. In 1992, an NSF survey asked the heads of 300
science departments and facilities in U.S. research colleges and
universities for their single highest priority need for
instrumentation. The requested items cost a total of more than $1.2
billion. This need for instruments extends far beyond these research-
intensive institutions into the teaching-intensive four-year colleges,
community colleges, and K-12 school systems.
Despite efforts to address the issue, the pace of technological
change implies a continuing need for revitalization of laboratories and
instrumentation. A recent NSF workshop, Information Technology: Its
Impact on Undergraduate Education in Science, Mathematics, Engineering,
and Technology (NSF 98-82), found that both faculty and students will
require high-speed connectivity to access educational innovations and
broader information essential to a modern education, and gives an
indication of the cost challenges posed by establishing and maintaining
an information technology infrastructure for education.
______
Questions Submitted by Senator Burns
Question. As you know, Montana is an EPSCoR state and EPSCoR has
been very important to developing our state's research infrastructure
and capabilities. I was disappointed that you did not recommend any
increase in the budget for the EPSCoR program. Does this mean that
developing a nationwide science R&D capability is not a high priority
for NSF?
Answer. The commitment to developing science and engineering
capabilities in all regions and states is a high priority for NSF, and
NSF's budget request for EPSCoR for fiscal year 2000 reflects that
priority. In addition to the $48.4 million that is requested for the
EPSCoR program itself, the program will leverage $15 million from
research programs across the Foundation to support meritorious
projects. The co-funding effort between EPSCoR and NSF research
programs enables EPSCoR researchers to participate more fully in NSF
research activities. In the last two years, NSF has increased the level
of co-funding from NSF research programs from approximately $10 million
to $15 million.
Question. High performance computing and high-speed networking are
vital to rural areas such as Montana. NSF has taken a number of steps
to help our states but connections remain costly and we need to insure
that our institutions are included in applications use of this
infrastructure. What is NSF doing to address these issues?
Answer. Many academic institutions have questions regarding how and
when to integrate advanced networking resources, including how to
develop financial and technical plans to integrate these new
technologies into their ongoing research and education activities. As a
result, the Foundation has put into place additional support, outreach,
and planning capabilities for such institutions. A special project
funded by NSF will help institutions obtain technical information,
planning assistance, and communications/networking analysis needed for
integrating advanced networking functions into their operations.
More specifically, NSF is considering a series of planning
workshops designed to enable:
--campus Chief Information Officers, researchers, and partners to
provide advice on the nature of programs and requirements
following the period of the vBNS cooperative agreement;
--institutions and regions to evaluate their readiness for advanced
networking, and to plan and provide input regarding their
related requirements; and
--the Partnerships in Advanced Computational Infrastructure and the
leading edge supercomputing sites to evaluate and make
recommendations regarding future networking resource needs, and
means for enhancing education, outreach and training activities
and broadening the spectrum of institutions involved.
NSF is also in the early stages of exploring how best to more
deeply involve these institutions in collaborative research in
universal libraries.
In addition to bringing computing and high speed networking
connections to the EPSCoR states, NSF has undertaken two actions that
will allow EPSCoR researchers to understand the potential uses of this
infrastructure and to compete more effectively for awards that
capitalize on earlier investments. First, the American Association for
the Advancement of Science (AAAS) is assisting EPSCoR institutions and
researchers who plan to submit proposals that will utilize the
networking infrastructure. Working closely with NSF and EPSCoR state
Project Directors, AAAS is conducting regional conferences that will
provide technical assistance to individual researchers. In addition,
NSF has expanded outreach efforts to EPSCoR states. In the last two
years, program officers from NSF research directorates have made more
than 230 trips to EPSCoR states to describe research opportunities and
explain NSF policies and procedures that govern proposal submission.
Question. I know that NSF has been trying to include more
researchers from EPSCoR States on advisory and peer review committees.
What progress are you making?
Answer. Participation in NSF review and advisory panels provides
familiarity with NSF programs, characteristics of successful proposals,
and contacts across the national research community. In fiscal year
1996, the EPSCoR program distributed its first list of over 1,900
highly qualified EPSCoR scientists and engineers to NSF research
programs with the objective of increasing their involvement in these
important activities. By the end of fiscal year 1998, the most recent
year for which NSF has complete data, a total of 385 EPSCoR scientists
and engineers had been used by NSF programs as reviewers and panelists.
This number is approximately 16 percent above the fiscal year 1996
benchmark.
______
Questions Submitted by Senator Craig
Question. As you know, Idaho participates in the Experimental
Program to Stimulate Competitive Research (EPSCoR). This program has
been very helpful to the state in developing its research capacity. We
are making progress, but we need to make more. How can we expand EPSCoR
in order to become competitive for some of the larger research and
center grants at NSF?
Answer. NSF is undertaking a number of efforts to improve the
competitiveness of EPSCoR states. In fiscal year 1998, NSF expanded
outreach activities in EPSCoR states, increasing opportunities for NSF
program staff to meet on-site with institutions, researchers, and
administrators. These outreach visits provide information on funding
opportunities across NSF research programs. EPSCoR states report that
meeting directly with NSF staff provides important insights into the
requirements for submitting proposals to NSF. Several EPSCoR states
share Idaho's interest in the large-scale research and center grant
programs and have asked relevant NSF staff to attend state EPSCoR
meetings, make presentations, and/or meet with selected researchers. We
strongly encourage those research faculty interested in becoming
competitive for such awards to contact cognizant NSF program officers
to request outreach activities; EPSCoR staff can assist in making
appropriate contacts. To date, more than 230 program staff have
participated in the EPSCoR outreach effort, including six outreach
visits to Idaho.
Question. What steps can NSF take to insure that EPSCoR states such
as Idaho participate fully in new NSF research initiatives?
Answer. In addition to numerous NSF outreach efforts, the American
Association for the Advancement of Science (AAAS) has received an NSF
award to assist EPSCoR states in increasing participation in new
program initiatives at both NSF and other federal agencies. For
example, AAAS conducted a workshop in Coeur d'Alene for individuals
interested in applying to Small Business and Innovation Research (SBIR)
programs administered out of a number of federal research and
development (R&D) agencies. Following this workshop, AAAS provided
technical assistance to Idaho small businesses to aid in preparation of
their proposals. Currently, AAAS is planning a similar effort that will
assist Idaho researchers in gaining an increased understanding of
emerging opportunities in environmental science research.
Question. Telecommunications and networking are very important to
the University of Idaho and other institutions in our state. The
University has received a BNS award from NSF, which will allow it to
connect to the high speed network. How can we ensure that our
institutions will now participate in the research and applications for
the high speed networks?
Answer. Many academic institutions have questions regarding how and
when to integrate advanced networking resources. These institutions
need to develop financial and technical plans to integrate these new
technologies into their ongoing research and education activities. As a
result, the Foundation has put into place additional support, outreach,
and planning capabilities for such institutions. A project funded by
NSF will help institutions to obtain technical information, planning
assistance, and communications/networking analysis needed for
integrating advanced networking functions into their operations.
More specifically, NSF is considering a series of planning
workshops designed to enable:
--campus Chief Information Officers, researchers, and partners to
provide advice on the nature of programs and requirements
following the period of the vBNS cooperative agreement
--institutions and regions to evaluate their readiness for advanced
networking, and to plan and provide input regarding their
related requirements; and
--the Partnerships in Advanced Computational Infrastructure and the
leading edge supercomputing sites to evaluate and make
recommendations regarding future networking resource needs, and
means for enhancing education, outreach and training activities
and broadening the spectrum of institutions involved.
NSF is also in the early stages of exploring how best to more
deeply involve these institutions in collaborative research in
universal libraries.
In addition to bringing computing and high-speed networking
connections to EPSCoR states, NSF has undertaken two actions to
increase EPSCoR researchers' understanding of potential uses of this
infrastructure and to strengthen their ability to compete effectively
for awards. First, NSF has expanded its outreach efforts to EPSCoR
states. Site visits by NSF program officers provide a good opportunity
for EPSCoR researchers to talk to NSF program staff about potential
networking applications. Second, the AAAS is assisting EPSCoR
institutions and researchers who want to submit proposals utilizing the
networking infrastructure that has been extended to EPSCoR
institutions. Working closely with NSF and EPSCoR state Project
Directors, AAAS has conducted regional conferences and provided
technical assistance for individual researchers.
______
National Science Board
Questions Submitted by Senator Bond
development of it2
Question. While the goals of the initiative seem worthy, I am
concerned that this idea may have been driven by the White House and
not something that was developed in response to demands of the
scientific community. What are the
Board's views on IT2? What kind of feedback have you
heard regarding this initiative?
Answer. Increasing the Federal investment in information
technology, as proposed by the Administration, has received the support
of the NSB in a resolution (NSB 98-212) passed on November 19, 1998.
The Board thoroughly reviewed NSF's IT2 proposal, was
briefed by PITAC on its findings, and concluded that the proposed
increase represents a solid investment in a rapidly changing area. In
specific terms, Moore's Law holds that the productivity of computer
information technology doubles every 18 months. That's been the rate
since 1980. Projections suggest that this rate of growth will continue
for another 15 years. Such a scientific record of productivity growth,
combined with the prospects of continued change, was a critical element
in the NSB discussions and resolution.
As for community feedback on the initiative, I can report that
communications to Board members have been enthusiastic. In addition,
witnesses before the Subcommittee on Basic Research, House Committee on
Science March 16, 1999, expressed support for the initiative, with
PITAC Co-chairman Ken Kennedy stating ``Our initial response to the
program is positive.'' Speaking at the National Research Council,
former NSF Director Erich Bloch applauded the increased investment but
urged that to be effective it must be sustained for the long term. And
Stephen S. Wolff, of Cisco, strongly supported the principal findings
and recommendations of the PITAC report, lauding the Administration's
responsiveness in the form of the IT2 initiative.
performance measures
Question. This subcommittee has been concerned about the
Foundation's failure to provide a budget justification that meets the
requirements of the Government Performance and Results Act. We believe
that it is important for all NSF initiatives and programs to be
identified with specific funding as well as quantifiable goals and
milestones. The goal statements for much of the fiscal year 2000
performance plan--especially in the areas of research investments and
training--appear to be as general and nonquantitative as last year.
What are the Board's views on our concerns?
Answer. The Board supports NSF reliance on quantitative and
qualitative indicators as appropriate for capturing outcomes associated
with basic research goals. For all parts of the NSF portfolio,
quantitative performance measures are being developed where sensible. A
Board committee reviewed the development of NSF's strategic and
performance plans. It continues to work, through its Committee on Audit
and Oversight (A&O) and in conjunction with NSF staff, to improve the
quality of GPRA planning and review. I would note that the recent
COSEPUP report, Evaluating Federal Research Programs, supports
qualitative indicators as consistent with GPRA. This is reinforced by
the finding from numerous studies that the long-term rate of return on
investment in R&D exceeds 30 percent.
math and science education
Question. This month the National Science Board released a report
on math and science education. I understand that this report and its
recommendations are in response to the so-called TIMSS report that
basically said our middle and high school students are not doing as
well in math and science education compared to their international
counterparts. Would you please highlight the key findings and
recommendations of the Board from this report?
Answer. Triggered by the disturbing TIMSS results, the National
Science Board report, ``Preparing Our Children: Math and Science
Education in the National Interest'' (NSB 99-31, March 3, 1999),
outlines what can be done to improve math and science achievement.
TIMSS helped us calibrate what our students were getting in the
classroom relative to their age peers around the world. We learned that
U.S. textbooks, teachers, and the structure of the school day do not
promote in-depth learning.
To reduce what the TIMSS analysis discerned--a diluted, ``mile-
wide'' range of material taught at each grade--the Board report
recommends local community action in the national interest to:
--Adopt rigorous content standards in math and science that reflect a
consensus on skills and knowledge that guides classroom
teaching and learning;
--Ensure that teachers are well-prepared in the subjects they
ultimately teach; and
--Develop accountability mechanisms that tests students on what they
are taught, teachers on the content that prepares students for
admission to higher education and the workforce, and schools on
their success in educating all students.
Above all, the Board report suggests how scientists and engineers,
both individually and through their institutions, can assist in
creating a more seamless K-16 system for the teaching and learning of
math and science. Scientists and engineers represent a special resource
for improving local schools, supporting teachers, and boosting student
achievement.
biocomplexity in the environment
Question. Biocomplexity in the Environment has been described as a
priority in the NSF budget request. In the past couple years, NSF
emphasized a similar theme called ``Life and Earth's Environment.'' The
increased level and emphasis on Biocomplexity in the Environment also
appears to be in contrast to the National Science Board's position of
not establishing a National Institute for the Environment in NSF. Does
the Biocomplexity priority mean that you will be revisiting the
establishment of a National Institute for the Environment?
Answer. The Board carefully considered the NIE and expressed its
views clearly in a resolution (NSB-98-65, March 1998). While the Board
concluded that it would not be beneficial to establish an NIE, it
concurred on the need for expanding research, education, and assessment
on the environment. Consistent with this view, the Board created (NSB-
98-161, August 1998) a Task Force on the Environment. Its purpose is
twofold: to assist in defining the scope of the Foundation's role in
environmental research, education, and assessment, and in developing
policy guidance that NSF will use in designing an appropriate portfolio
of activities, consistent with the overall National Science and
Technology Council strategy. The Task Force report will be submitted to
the Board at its May 1999 meeting.
subcommittee recess
Senator Mikulski. This subcommittee stands recessed until
April 15, when we will take testimony on the VA budget.
Thank you very much.
[Whereupon, at 11:30 a.m., Tuesday, March 23, the
subcommittee was recessed, to reconvene subject to the call of
the Chair.]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
THURSDAY, APRIL 15, 1999
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:33 a.m., in room SD-138, Dirksen
Senate Office Building, Hon. Christopher S. Bond (chairman)
presiding.
Present: Senators Bond, Burns, Craig, Hutchison, Mikulski,
Leahy, and Harkin.
DEPARTMENT OF VETERANS AFFAIRS
STATEMENT OF HON. TOGO D. WEST, JR., SECRETARY
ACCOMPANIED BY:
KENNETH W. KIZER, M.D., M.P.H., UNDER SECRETARY FOR HEALTH,
VETERANS HEALTH ADMINISTRATION
JOSEPH THOMPSON, UNDER SECRETARY FOR BENEFITS, VETERANS
BENEFITS ADMINISTRATION
ROGER RAPP, ACTING UNDER SECRETARY FOR MEMORIAL AFFAIRS,
NATIONAL CEMETERY ADMINISTRATION
MARK CATLETT, DEPUTY ASSISTANT SECRETARY FOR BUDGET
OPENING STATEMENT OF CHRISTOPHER S. BOND
Senator Bond. Good morning. The subcommittee will come to
order.
Today we meet to consider the fiscal year 2000 budget
request for the Department of Veterans Affairs. We welcome
Secretary Togo West; Under Secretary for Health, Ken Kizer;
Under Secretary for Benefits, Joe Thompson; Acting Under
Secretary for the National Cemetery Administration, Roger Rapp;
Deputy Assistant Secretary for Budget, Mark Catlett; and other
VA officials here this morning.
VA's appropriation request totals $42.5 billion, including
$23.3 billion in mandatory entitlements and $19.2 billion in
discretionary funds. Overall, discretionary spending for VA
programs would be $56 million below the current level under the
request submitted to us by OMB.
The request includes $17.68 billion, a freeze at the
current level for medical care, research and other programs
within the Veterans Health Administration.
The budget also includes $912 million for general operating
expenses, $296 million for construction program, and $97
million for the National Cemetery Administration.
At the outset, let me say that the budget situation that we
face this year will be incredibly tough. The caps on
discretionary spending are roughly $30 billion below the fiscal
1999 level. And there is a general agreement on the need for
significant additional resources for defense and education
spending.
These priorities could further reduce the pot of funds
remaining for other discretionary spending items.
Unfortunately, the President's budget has made the situation
more difficult by increasing spending by almost $25 billion
above the budget caps for various Administration priorities,
raising expectations that we simply will be unable to fill.
Sadly, veterans programs were not among those priorities.
Compared to many other departments and agencies, VA has fared
quite poorly in the Administration's fiscal 2000 budget
proposal.
Mr. Secretary, I have to say I am deeply troubled by the
budget before us.
While many other programs are proposed for increases in the
President's budget, VA would be held at current levels. While
we are committed to maintaining the caps, you must set
appropriate priorities within those caps.
VA medical care should be among the priorities. The
Disabled American Vterans call the budget horribly inadequate,
and I think they may not be far off the mark.
The conference agreement on the budget resolution, which is
based on assumptions only, assumes an increase of $1.7 billion
for VA medical care. Unfortunately, that is not likely to wind
up in terms of dollars available to us for the VA.
Unfortunately, given that these funds are not in the
President's budget, and given that the caps represent a real
cut below current levels, it will be extremely difficult for us
in the Appropriations Committee to find the funds to come
anywhere close to what is assumed in the budget resolution.
va's medical care program
Today, we hope to ascertain with more precision what the
needs are in the medical care program.
The Veterans Health Administration recently identified
several new critical requirements such as treating veterans
suffering from Hepatitis C with a new and very expensive
treatment regimen; increasing the emphasis on alternatives to
institutional long-term care, which is extremely important in
view of the aging veteran population; and the provision of
emergency services in non-VA hospitals; not to mention normal
inflationary requests.
These requirements top $1 billion, and most of them are
really what we would consider must-do requirements, not
discretionary items. Yet, there are no new funds in the
President's budget to accommodate these needs. Further
exacerbating the problem is the fact that the VA will have less
carryover funds next year than it does in the current year.
VA was able to carry almost $500 million in medical care
cost recovery funds from fiscal year 1998 into fiscal year
1999, thus easing the budgetary situation. Yet, less than half
of this amount is projected to carry into fiscal year 2000.
VA's budget is predicated on its ability to come up with at
least $1.1 billion in so-called management efficiencies. Yet,
no details of these management efficiencies are provided in the
budget. I am very much concerned about this objective and about
the lack of detail.
Where are the management efficiencies going to come from?
How many hospitals will close their in-patient services? How
many additional consolidations will there be? Are these
management efficiencies really going to result in better care
to more veterans?
In this instance, I have to say: I am from Missouri, and
you are going to have to show me.
One has to question whether the goals VA has set for itself
are realistic. VA's budget assumes the reduction of about 8,500
FTEs. Last year, VA reduced 3,600 FTEs, but fell short of its
own target by about 300 FTEs.
GAO, which submitted testimony today that I will refer to,
tells us VA will also fall short of its 1999 target of 2,598
FTEs. The reason is simple: The staff reductions, particularly
if they are accomplished through reductions in force, are
tremendously difficult even if fully justified.
Despite the downward trend line for staff reductions, VA
assumes it will achieve employment reductions more than three
times greater than the 1999 estimate. GAO in today's testimony
submitted for the record, indicates if the Department fails to
meet its savings goals, ``VA may need to use less desirable
management actions, including large scale employee furloughs
that could adversely affect veterans quality of care,
especially waiting times.''
GAO believes that the VA's transformation is losing
momentum and that targets may not be met. Furloughs and other
management actions which impact quality of care are not
acceptable.
Let me be clear about one thing: I do have a great deal of
confidence in the VA medical system. VHA has been engaged for
the last three and a half years in a dramatic reorganization
and has managed to provide care to more veterans with fewer
resources. It discovered there were a lot of wasteful practices
in the system and has sought to make better use of the
resources at hand.
VA has been moving successfully toward meeting at least two
components of the 30-20-10 initiative announced in the fiscal
year 1998 budget to decrease per-patient cost by 30 percent and
increase the number of patients by 20 percent, by the year 2002
from the 1997 level.
The changes VA has implemented have been remarkable,
including a new emphasis on ambulatory services, which involved
closing tens of thousands of unneeded in-patient beds and
opening up hundreds of outpatient clinics; reducing unneeded
administrative staff; establishing primary care case management
teams; smarter procurement practices for pharmaceuticals and
supplies; and merging the management of many medical
facilities.
However, since VA has already implemented scores of major
realignments including a reduction of about 18,000 personnel in
the past few years, I am just not confident that there are
significant opportunities for additional savings without
jeopardizing the quality of care for veterans or--dare I say
it--closing under-utilized facilities which VA has not
proposed.
I understand, Mr. Secretary, you have vowed there will not
be closures. GAO in its testimony says, ``This decision
seriously threatens the continued progressed of VA's health
system transformation.''
Mr. Secretary, your announcement was perplexing in view of
the fact that according to GAO, VA is spending hundreds of
millions of dollars operating unneeded VA buildings. These
dollars can and should be put to better use for veterans. VA
should not be about maintaining buildings, but about providing
the best care for veterans.
I am also troubled about whether VA is making promises it
cannot keep. Last year, VHA implemented an enrollment system as
mandated by the 1996 eligibility reform law. VA chose to allow
all veterans, not just the service-connected disabled and low
income whom VA is mandated to care for, to sign up for care.
GAO projects that by the end of the year, there will be 4.4
million enrollees, while VA projects to provide care to only
3.6 million veterans.
While we know that not all enrollees will actually use VA
medical services, each of them will be entitled to a full
benefits package. And while we know the enrollment is only for
one year, it creates an expectation that care will be available
next year.
The other critical concern that we have in VA's budget is
its reliance on collections from third parties. VA's budget is
predicated on its ability to collect $749 million in third part
reimbursement and co-payments. Collections are to be the only
source of increased revenues for VA.
Yet VA has consistently performed quite poorly in this area
and probably will fall below its fiscal year 1999 budget
target.
The Veterans Service Organizations, in their independent
budget, said, ``We have lost our faith in the ability of the
VHA to collect an adequate amount to make up for any budget
shortfalls or to even reach their goal.''
Improvements in this area are clearly essential, and VA
ought to give strong consideration to privatizing or at least
centralizing this function.
Other critical concerns in the medical care program include
whether VA is adequately managing its affiliations with medical
schools as it continues its transformation to an outpatient-
based system of care; and whether VA is providing adequate
support to its special care programs which are so fundamental
to VA's mission, such as spinal cord injury, blind
rehabilitation and post-traumatic stress disorder.
veteran benefits administration
On the benefits side, VA's budget includes an increase of
roughly $50 million for the Veterans Benefits Administration
and would provide 440 additional staff in the compensation and
pension program.
Additional resources are needed to address the unacceptable
backlog of more than 400,000 pending claims and to improve the
timeliness and quality of claims processing. While VBA recently
implemented a reorganization similar to that in the Veterans
Health Administration, and has underway numerous initiatives
aimed at improving the processing of veterans claims, there
continues to be an unacceptable length of time to process
original disability claims, and it is getting worse, not
better.
VBA is lagging far behind its own target of 99 days to
process rating-related claims this year, and it is taking more
than 190 days to process an original disability claim. And
apparently, next year's targets will not be met either. Forcing
a veteran to wait more than six months for decisions on a claim
is just not acceptable.
We understand there have been some improvements in the
quality of claims processing and that you have deemed this a
higher priority than timeliness. Clearly, making the right
decision on a claim is critical, and this should be of equal if
not greater importance than timeliness. But when only about
two-thirds of the claims are adjudicated right the first time,
there clearly is tremendous room for improvement here as well.
Mr. Secretary, the mission statement of the Veterans
Benefit Administration is to provide benefits and services to
veterans and their families in a responsive, timely and
compassionate manner in recognition of their service to the
nation.
I wonder, however, whether a sign which apparently hangs
above the desk of an employee of the Washington, DC, Regional
Office is more reflective of reality. I understand that that
sign reads, ``I can only please one person a day, and today
ain't your day, and tomorrow isn't looking too good either.''
VA claims that customer service is one of its top
priorities; yet, according to a recent Washington Post article,
a VA review of the Washington, DC, Regional Office found an
abysmal state of affairs including a backlog of 10,000 pending
cases, many of which were more than six months old. VBA's
national objectives of timeliness, quality and customer
service, apparently, have not filtered down to this regional
office.
I am concerned, Mr. Secretary, despite all of the
initiatives that are being undertaken, that the DCRO may not be
just one bad apple but reflective of the system generally. This
is extremely troubling.
other concerns in va's budget
Other concerns in the VA's budget include VA's decision to
slash the state home construction program. This, in our view,
is a cost-effective program with a proven record and a backlog
of more than $100 million in priority projects.
Before I close, I also need to say I am very disturbed
about what has been reported to us as a pattern of questionable
practices at the highest level of the Department. We are not
going to go into specific details, but there have been
allegations that have come to us from within the Department and
elsewhere about waste, excessive travel expenditures, the
hiring of limousines, chartered aircraft, lavish parties in
honor of non-VA officials financed by the Representation Fund,
and other actions which may not be illegal but certainly raise
eyebrows.
We have a lot more important issues to discuss than these
allegations, and we know the Inspector General is investigating
them. We have referred these to the Inspector General. I am
troubled about what we have heard because there is a perception
of abuse and morale problems that have been created.
That leads to questions about the commitment of the VA
leadership to the mission of the Department. And we will await
the review of the Inspector General as to whether there is any
basis to these allegations.
We have asked the General Accounting Office to provide a
written statement for the record, which I have referenced
today, and which provides an excellent overview of some of the
critical issues VA faces in its medical system.
I ask unanimous consent that it be included following
Secretary West's testimony.
[Pause.]
Senator Bond. Hearing no objection, it will be so ordered.
I will now turn to my ranking member, Senator Mikulski, for
her opening statement.
Senator.
STATEMENT OF BARBARA MIKULSKI
Senator Mikulski. Thank you very much, Mr. Chairman. And in
the interest of time, I ask unanimous consent that my full
statement be placed in the record.
Senator Bond. Without objection.
Senator Mikulski. Mr. Chairman, since the VA was founded,
we have fought two World Wars, a Cold War, a Gulf War, and now
our troops are engaged in both peacekeeping operations as well
as a war in Yugoslavia.
And this really shows that the conflicts, new conflicts are
producing a new generation of people who will be veterans with
unique needs.
Today I want to say just simply that we have promised our
veterans, our military that if they place themselves in harm's
way, that we assure them, when they come back, a grateful
nation will have a Veterans Administration that will help them
have an education, be able to buy a home, and health care that
is deemed necessary.
We want to make sure that promises made are promises kept.
And as we look at the budget this year, we want to look at
particularly the veterans organization--VA generally, but I
believe, as always, focus on VA medical because it is one of
our largest areas of spending.
VA set for its goal the 30-20-10 policy objectives, and we
will be looking forward to a status report on the 30-20-10
objectives. In addition to that, we want to be sure that issues
related to the management of VA are being addressed. I have
been concerned for some time about our ability to recoup from
third parties or other parties a payment for our medical care.
There are substantial questions that have come up about our
ability to recoup essentially what we feel are bona fide areas
of collection. VA collections are running behind projections,
and there is a need for timely collections.
The medical care budget assumes $740 million in private
insurance collection for fiscal year 2000. This is a $124
million increase over 1999. And the GAO has expressed
skepticism about the VA's ability to recoup this. This will be
essential in terms of our ability to recoup to really be able
do the services we want.
In addition to that, in the area of medical care, I hope
through the questioning that we can talk about, of course, the
unique needs of women and how that is being addressed,
particularly in primary care facilities, and also long-term
care.
VA is a cameo of what the entire private sector health is
facing: The excess beds in acute care; the need to decentralize
and make more efficient primary care; and then with people
aging in this country, the issues for long-term care; and then
how we would meet the needs of veterans through long-term care
facilities and even innovative thinking like home health care
and assisted living. And we welcome your thoughts on innovative
approaches that would meet compelling human need and yet be
cost effective.
Also, another area that I am concerned about is the long
waiting time for disability benefits. And when I was chair, it
took 180 days. We deemed that unacceptable. That was now--gee,
Carrie, you were my staffer then--a decade ago, and we have
reduced by 12 days. I understand it is 168 now.
At this rate, I am going to have to sign up to be Strom
Thurmond's----
Senator Bond. It is 190.
Senator Mikulski. Either way, I am going to have to sign up
as Strom Thurmond's protege if we are going to do this one day
a year--[laughter] aAnd be able to reduce this. However,
really, veterans should not have to be in long waiting lines
for disability claims. And either we have too many rules, too
many regs, or we do not have the modern technology to be able
to process the claims in a timely way.
There are other issues that I would like to also raise, but
let me say: We are very proud of the VA and that we are
grateful for the facilities that are in Maryland. We have
flagship institutions, our acute care facility in Baltimore
that also does outstanding research. We have Fort Howard that
has done an outstanding job in Perry Point that serves
emotionally disturbed veterans or those with dementia.
The community-based outpatient clinics that have grown are
also meeting needs.
And on another note, you know, I am a big believer in VA
medical research because it is practical patient-care research.
And what I like about VA medical research is it goes directly
to practical patient care, but it also quickly moves into the
civilian community. Like at University of Maryland, there is VA
and it is staffed by professors and medicine from the
University of Maryland.
My recent gall bladder surgery that was all over CNN--so
much for medical privacy. [Laughter.]
But it was--the technique, that not only I but others have
benefitted from, this laparoscopic approach, was developed by
Drs. Zucker and Bailey in Baltimore using an aging veteran
population that had so many medical complications traditional
surgery would have placed them further at risk.
That has now moved into the entire civilian population,
saving lives, a quicker, faster return to private sector
marketplace. And this is the kind of way where we can just see
what the VA is doing that benefits not only veterans but all of
America.
So I look forward to pursuing these lines of questioning.
Thank you very much.
Senator Bond. Thank you very much, Senator Mikulski. We
share your pride in the VA medical research. At the Truman VA
in Columbia, we work very closely with the University of
Missouri at Columbia.
Senator Mikulski did mention the GAO report. And for my
colleagues who have not read it, I do commend it to your
attention because it gives a broader perspective on some of the
issues that we will be dealing with here today.
Senator Leahy, do you have an opening statement?
STATEMENT OF PATRICK LEAHY
Senator Leahy. Thank you, Mr. Chairman. I will make it
brief, because we are also having a markup in Judiciary, and I
have to go to that.
I think it is clear VA is facing a financial crisis. The
balanced budget agreement of 1997 has flatlined VA health care
funding at a time when health care needs of aging veterans has
never been greater.
Now, Mr. Secretary, you have been very good to meet with I
think just about any member of Congress who has asked you to of
either party. You know well the situation the Northern New
England veterans are facing. You met with Senator Jeffords and
myself and Congressman Sanders at some length on that. I do
appreciate that.
We Vermonters appreciate the time and effort you have been
giving to our particular situation, the VA Hospital in White
River Junction. I still want you up there at some time, so we
can show you that.
But, Dr. Kizer, I am so delighted you are coming on Monday.
And I think that people are very much looking forward to that
meeting. We will try to provide nice weather for you. If it is
bad weather--remember, we are very close to New Hampshire, and
sometimes the weather comes over to our side. [Laughter.]
But if it is good weather, it is all Vermont weather.
[Laughter.]
I know the story of the problems we face in Vermont is
being duplicated in a lot of the states around the country. I
think--sometimes, I think of you as the fire fighter. You know,
you get to the raging fire, you turn on the hose, and a little
bit of water comes out. And then we say to you, ``Why haven't
you put out the fire?''
We have--you need resources. I hear from veterans who have
to wait months for medical appointments or have to travel long
distances for care. VA doctors are telling me they are leaving
the system, very good doctors that are trained well through the
system, that we have a lot of time and effort invested in them.
But they are leaving the system because they worry about the
future viability of it and all.
But an anesthesiologist who left the VA, he was then hired
by a private hospital and then was contracted back to the VA at
twice his original salary, and that is--you know, that is not a
way of doing it either.
I do not think the Administration's medical care request of
$17.3 billion is adequate. I hope that we can do something
about that, we in Congress, and we can consider some of the
areas outlined in the independent budget created by veteran
service organizations.
Mr. Chairman, I know you and Senator Mikulski struggle with
this each year, and I--if I had to figure out how you get that
through, I would have probably even less hair than I have now,
as I tear it out. [Laughter.]
I will leave, if I might, Mr. Chairman, some questions
especially regarding computerized medical records and data
control. I will leave those to be submitted for the record, if
I might.
Senator Bond. Without objection.
Senator Leahy. And I ask that my whole statement be put in
there.
Senator Bond. Okay.
Senator Leahy. But I did want to--I did want to express my
appreciation of the Secretary's time--the amount of time he has
spent with those of us who have concerns.
prepared statement
And I want to express my appreciation to you and to Senator
Mikulski for the amount of time you have spent and the amount
of time you have spent listening to individual members of this
committee.
[The statement follows:]
Prepared Statement of Senator Leahy
Mr. Secretary, as we enter the new millennium, it seems clear to me
that VA is facing a financial crisis. The Balanced Budget Agreement of
1997 has flat-lined VA health care funding at a time when the health-
care needs of aging veterans have never been greater.
Mr. Secretary, you know well the situation that Northern New
England veterans are facing. We in Vermont appreciate the time and the
effort that you have been giving to our particular situation at the VA
hospital in White River Junction. I still want to invite you to come
visit us in the near future.
But I know that the story in Vermont is being duplicated in many
states around the country. I cannot help but liken your situation to
the fireman who turns on the hose only to find a trickle of water
instead of a stream. I hear from veterans who have to wait months for
medical appointments. I hear from veterans who have to travel long
distances for care. I hear from VA doctors who are leaving the system
because they are concerned about its future viability. In one case, I
know of an anesthesiologist who left the VA, was hired by a private
hospital, and then was contracted back by the VA at twice his original
salary. I hope that is not indicative of VA's larger efforts to become
more efficient.
I do think that the Administration's medical care request of $17.3
billion is not adequate and I hope that we in Congress can consider
areas of concern as outlined in the Independent Budget that was created
by veterans service organizations.
Senator Bond. Thank you, Senator Leahy.
As is the practice in this committee, the record will be
kept open for seven days for questions from other members of
the committee or statements that they wish to add to the
record.
And the statements that are--the questions that are
submitted, we would appreciate, Mr. Secretary, you responding
within five days, five working days if you can, for the record.
We will, of course, welcome any additional statements or
comments you wish to make.
Let me turn now to Senator Hutchison for any opening
statement that she wishes to make.
STATEMENT OF SENATOR KAY BAILEY HUTCHISON
Senator Hutchison. Yes. Thank you, Mr. Chairman.
And I do want to say that I noted the distinguished ranking
members story of her gall bladder surgery and was pleased that
she did not emulate a distinguished former President by showing
us her scar. [Laughter.]
Senator Bond. Now, I am out of that. You all can handle
that. [Laughter.]
Senator Mikulski. Lyndon Johnson.
Senator Bond. Yes.
Senator Hutchison. Yes, it was. It was a great Texan, as
you know. [Laughter.]
Let me say that I do appreciate the efforts that you are
trying to make. And I know that many of your problems are a
bigger veteran population and budgets that perhaps, you
believe, do not meet the increase in your requests.
But I also want to say that when I see veterans who are--
feel that they have not had the promises kept to them that were
made to them, it makes me feel like sometimes we are doing new
programs and new things for people that have not yet been able
to experience these programs. And we are not fully keeping the
promises that we have made to people who have already served.
And I would like to think that our priorities are not that
skewed, that we do, in fact, keep the promises because so many
of these people did serve, they have kept our country free and
secure, and I want to make sure that we are a country that
keeps its word, even though the people have already done their
part.
So with that in mind, I want to say that I think there are
some good things you are doing with your budget requests, and
then I think there are some problem areas. So I hope that all
of us will work together to make sure that we are keeping the
promises that we make.
And I would say the biggest is medical care. The veterans
expected to have good quality medical care. And I think we
ought to be continuing to look for innovative ways to keep that
promise. And as we have closed active duty medical facilities
or downsized them, the veterans are the ones that have been
squeezed out. So I think it is important that we keep as many
of the veterans facilities as possible.
My state has almost 2 million veterans. And we have a very
active state program. And one of the things that I appreciate
that you are doing is sharing in costs where our state is
adding to veterans medical care state facilities. You are
contributing so that it is less cost for you than having to
serve those people without state help, and it is also helpful
to the state to have that encouragement.
So the extensions that you are doing in Floresville and
Temple with state help, I think, is a good and innovative
approach perhaps, which might be helpful in other states as
well.
But our state is more veteran supportive than most states,
as you know. So we are happy to make the contribution and it
helps to have the federal donation to go with that.
But there is one--there are two particular areas in Texas
that I want to leave as questions, and I am going to have to
leave as some of my other colleagues are, but I would like to
have answers. One is the veterans hospital in Kerrville about
which Senator Gramm and I wrote to Dr. Kizer in February and
the severe downsizing that we are looking at for that facility
which serves 17,000 veterans for South Texas. So I hope that we
will get a look at that and, hopefully, not see that kind of
severe cut with that kind of service.
Second, Texas with its very large number of veterans is
broken up into three veterans integrated service networks. The
centers controlling these areas are outside the state, and many
veterans have said they have a lot of difficulty in getting
service through these out-of-state centers.
And I would leave the question with you for an answer on
how we are going to improve the integration of these services
and if there is any possibility that we could consolidate
perhaps into one integrated service so that they would not have
to go to separate places out of state where they do not feel
that they are able to get as hands-on treatment.
So those are the specific questions that I would like to
have written answers for, and in general I share my colleagues'
concerns about the number of days that it takes to get medical
care.
And I think we must be going in the wrong direction, and I
hope that we will try to reverse that knowing, of course, that
you do have severe budget constraints, but necessarily I think
we have to put the priorities to keeping our word to these
people.
Thank you.
Senator Bond. Thank you Senator Hutchison.
Senator Craig.
STATEMENT OF SENATOR LARRY CRAIG
Senator Craig. Mr. Chairman, thank you very much for the
welcome and letting me spend a few moments sharing some
concerns that are not unlike what you have heard from my
colleagues.
Let me focus on the budget you have brought to us against
our Boise VA Hospital and Center. And I do that--and I do it
annually to try to see what current budgets do to ongoing
operations in an area that I know something about, because this
is a veterans hospital that I visit at least twice a year, and
just came away from visiting with that hospital and its
director and medical staff a few weeks ago.
So the thing that catches my eye most of all when we lay
that facility against your budget are some of these figures.
For example, the budget does not provide any money for about a
4.8 percent pay increase, inflationary increase, and the
increases in the mandatory workloads.
What your budget does do to a facility that has already met
the standards of downsizing and reshaping--and this is also a
facility that has been building at our request, building a new
outpatient facility, pharmaceutical facility, building a
facility to expand another primary care team.
The budget will force a reduction in staff of 5 to 10
percent of the 1999 levels, and that is 2856 full-time
employees, and eliminate programs such as substance abuse,
potentially, post-traumatic stress disorder, and long-term
care.
Now, the reason these are important figures is because of
this headline. Mr. Chairman, I want to put this in the record.
Senator Bond. Without objection, it will be so admitted.
Senator Craig. It says ``600 Idaho Veterans Await Care,''
not ``are not getting care,'' but are being put on a primary
care list, saying--they come because they need help, ``But we
cannot give you help, so we will put you on a list. You just
wait until we get to you,'' except, of course, for the very
extreme cases.
I am not sure that I can figure any way of finding that
acceptable. And yet, it is strange that we have modernized this
facility. We have made--it is a regional facility by definition
in that region of the country, serving almost all of Idaho--
except the north end that goes toward Wallawalla--and part of
Nevada, parts of eastern Oregon, clear to almost over to the
Blue Mountains of Oregon.
So it is a very large facility, serving a regional
population. And I am not sure what the numbers are as to that
population base.
But we now have created a facility for a fourth primary
care team and cut the budget at a time when we knew these
demographics were turning on us because of our aging veterans
population. And why we have done what we have done there at
that facility to expand its capabilities, expecting that 70,
80-plus-year-old World War II vet to be soon coming--well, they
are there, and they are standing in lines waiting.
I am not going to let that happen. I cannot let that
happen. I do not think this committee is going to let that
happen.
So we will work together because I appreciate your
challenges. I am not disputing them in any sense of the word.
And I am all for downsizing, and I am all for wringing out
inefficiencies.
The last at least two budget cycles, and maybe three--and I
have watched it happen because of my regular visits to that
facility. I have watched the inefficiencies come out. I have
watched the leaning up and the cleaning up of those staffs. And
now, I see a waiting list growing. That is just not acceptable.
And so we will work together to see if we can resolve that
because we must for the sake of that facility and all that it
does, like others. It has a wonderful working relationship with
the University of Washington Medical Center for geriatric care,
and it is leading the region, if not the country, in a lot of
marvelous work as was reflected by the Senator from Maryland as
our VA hospitals and centers do.
But when I am faced with headlines and when I am faced with
veterans who are standing in lines that produce those headlines
that some 600 are now waiting to be served, then we have a
problem. And I hope we can solve it.
Mr. Chairman, I have several questions that I would ask--I
am going to have to go to another hearing. And I will submit
those for the record. But those questions will be: Where are
the efficiencies to come from, reflecting your budget and our
cuts and our need to change?
And I have submitted for the record, of course, the news
article that really speaks to the hub of the issue and is
probably reflective of many centers around the country and how
we monitor and handle that situation because I want to go home
after this budget cycle and say that--what I would really like
to say is that we have put enough in the budget to establish
the fourth primary care team as planned, as designed and built
for because of the aging populations we knew were coming.
And that is not what we are saying, and that is not what
this budget says. That is what I would like to say at the end,
and that is what I am going to work for, Mr. Chairman.
Thank you very much.
Senator Bond. Thank you very much, Senator Craig. We will
submit your questions for the record.
I would refer you to, as I have all members of the
committee, the GAO report on where possible savings might be
adopted.
Senator Craig. Yes.
Senator Bond. And also we have attempted in each year to
provide more funds than requested in the President's budget,
but there is still very, very extreme stress throughout the VA
system.
With that, Mr. Secretary, we are ready for your testimony.
We will, of course, have the full statement that you have
submitted as part of the record, and would ask, if you could,
to summarize for perhaps about ten minutes. And we will have
some questions, orally. And then it appears that you will have
a bounty of questions to answer for the record.
So, Mr. Secretary, welcome to the committee.
Statement of togo d. west, jr.
Mr. West. Thank you Mr. Chairman. You have already
identified the members seated at the table with me.
Mr. Chairman, members of the committee, I thank you for the
opportunity to appear before you to present and discuss the
President's proposed budget for the Department of Veterans
Affairs for fiscal year 2000.
The total budget authority is $43.6 billion. It is devoted
to continue to provide high-quality care and services for our
veterans and their families. It is a commitment, as you have
also pointed out, and other members of the committee, within
the broad principles of fiscal responsibility to which both
this body and this Administration are committed.
Statutory caps on spending have undeniably affected this
budget request, as they have to a greater or lesser extent, for
every other department or agency in the Executive Branch.
On the other hand, that discipline has, to the credit of
both the Congress and the President, produced a level of
economic performance that benefits veterans and Americans, I
might also add, to the credit of Americans everywhere.
Nonetheless, the improvements that VA has accomplished in
recent years and that we produce in this budget are based on
our continued mission of providing the highest quality of care
and service.
Our goal, Mr. Chairman and members of the committee, is to
provide full enrollment of veterans for health care. And then
to provide to those veterans the quality of treatment to which
they are entitled.
Transformation, as has been noted several times by this
subcommittee, of VA health care, that is the Veterans Health
Administration, is well underway. And we are now beginning to
turn our attention to the transformation of the benefits
delivery system.
For veterans health care, the Veterans Health
Administration's emphasis will continue to be to improve both
its quality and its access; to continue to bring more health
care to more veterans, closer to where they are and in
circumstances that are conducive to the treatment they require.
The budget provides $18.1 billion for health care, which
includes $749 million in medical collections, to support
174,420 FTE to provide medical care to eligible veterans. This
is an increase, when added together, of $200 million over the
1999 enacted amount. We plan to provide for 3.6 million
patients, 54,000 more than in fiscal year 1999.
We intend to support more than 673,000 inpatient visits to
VA medical centers and 40 million visits to outpatient clinics.
We are proposing $50 million in additional funding for
homeless veterans, $40 million in health care, and $10 million
in mandatory transitional housing subsidies.
We are continuing our aggressive response to Hepatitis C
infection among veterans by increasing the $114 million set
aside in 1999 to $250 million in fiscal year 2000.
The budget also proposes to increase spending by $106
million in VA's long-term care alternative programs, and offers
continued support for our goal that has been mentioned several
times here, to decrease the cost of caring for each patient by
30 percent from the 1997 baseline; to increase the number of
patients treated by 20 percent; and to increase alternative
sources of revenue to augment our budget by 10 percent of the
direct appropriation.
This budget of $316 million will support more than 2,104
high-priority research projects. This level of funding, Mr.
Chairman and members of the committee, will maintain operations
in VA medical research centers in the areas of Gulf War
illness, diabetes, Parkinson's disease, spinal cord injury,
prostate cancer, depression, environmental hazards, women's
health issues, and VA rehabilitation centers.
We view this research effort as an opportunity to continue
our focus on VA's core competencies and to insure that we
maintain our leading edge in treating our veterans with special
needs. We believe that by continuing to research illnesses
associated with our veterans' experience in the Gulf War, for
example, we will be better able to address their health care
concerns, and we will also generate confidence in our
commitment to that important veterans population.
Our research efforts on behalf of women veterans should
move us forward in caring for a traditionally under-served
population. The fact is, as more women serve in our military,
they must be certain, they must be assured, that they, as
veterans, will receive the same high-quality treatment our male
veterans have long enjoyed. We intend to provide that
certainty.
Last year, the Administration proposed a three-year
demonstration program to collect reimbursement from Medicare
for health care services provided to Medicare eligible
veterans, upper income veterans without compensable
disabilities. We make that proposal again this year, Mr.
Chairman. Beginning in fiscal year 2000, it is the Department
of Veterans Affairs' top legislative priority.
Funding generated from this program is not included in our
fiscal year 2000 budget proposal, however. If it is enacted, VA
will accrue some additional revenues in fiscal year 2000.
I point out, that Medicare subvention is budget-neutral and
adds no additional costs to the overall budget. It will allow
us to bill Medicare at rates lower than those in the private
sector and provide veterans with additional options in
selecting high-quality health care.
Our current emphasis in the Veterans Benefits
Administration is to ensure that we are on a path to improve
our system, so that it ensures veterans that we are handling
their claims quickly, and more importantly, that we are
handling them correctly.
Our budget for the discretionary portion of VBA budget is
some $860 million, supporting 11,437 FTE. That amount
represents a $49.6 million increase over the 1999 budget, and
an additional 164 FTE. With that increase, combined with
transferring FTEs from other areas within VBA, we will be able
to move 440 additional claims decisionmakers into the claims
process in fiscal year 2000 for the purpose of bringing
improvement to timeliness and quality of claims processing.
And we propose in this budget to invest $30 million in
information technology; a down-payment, if you will, to re-
engineer our regional offices and move us toward an
electronically based claims processing system; perhaps one of
the single best promises of long-term permanent improvement in
the timeliness and accuracy of processing.
We ask for $21.6 billion to provide compensation, pension,
and burial allowances for more than 3 million veterans and
their families.
In fiscal year 1998, Mr. Chairman and members of the
subcommittee, some 550,000 veterans died. That's a rate of
approximately 1,500 a day. We are told by the estimates of the
National Cemetery Administration that those numbers of deaths
will increase until the year 2008, when they will peak.
We are responding to this continuing increase by building
new national cemeteries, by extending the service life of
existing cemeteries, and by encouraging states to build state
veterans cemeteries.
The request this year for operating our cemeteries, $97
million, is $5 million more than the 1999 enacted level. It
includes $153,000 and 23 FTE for the activation of four new
national cemeteries and their initial operation in Ohio, New
York, Texas, and Illinois; more openings than at any other time
in the history of the system.
With the opening of these four new cemeteries, we
anticipate that 77 percent of the nation's veteran population
will live within a reasonable distance of a veterans cemetery,
reasonable distance being defined as roughly 75 to 80 miles.
In grants, we requested $11 million for the state veterans
cemeteries program. We have requested $40 million for the state
extended care program. We have requested $31.6 million for the
homeless grant and per diem program, an increase of $12 million
over last year's budget. Of that latter amount, $7 million will
be targeted for grants and $24 million will be for per diem.
Mr. Chairman, we believe that in delivering to you and to
the committee, the fiscal year 2000 budget, it is a workable
budget. Though, as you and others have pointed out, it is
admittedly challenging. It is a budget that we intend will
provide for continuing increases in access to primary health
care for our veterans.
It is a budget that will continue to maintain the specialty
programs our veterans rely on VA for which they know that VA
can provide, when other medical facilities may not always be
able to meet that need.
It is a budget that provides assurances that there will be
improvements in claims processing, especially in accuracy, but
we will not neglect timeliness, as well.
And it provides assurances that when our veterans' lives
have ended, they will be treated honorably. They will find
their final resting place, a place of honor, located within a
reasonable distance of their families.
prepared statement
We believe these are worthy objectives, Mr. Chairman. We
seek your support for this budget, and of this committee.
We are ready to answer your questions.
[The statement follows:]
Prepared Statement of Togo D. West, Jr.
i. introductory remarks
Mr. Chairman and members of the Subcommittee, the President's
budget for fiscal year 2000 reflects a sincere effort to meet the
Nation's obligations to its veterans in a fiscally responsible way.
There is no question that the statutory caps on spending, as agreed
between the Administration and Congress, constrain the request for
funding for this Department as they do for every other department and
agency. On the other hand, it is also undeniable that this fiscal
discipline has produced economic performance that benefits veterans as
well as all other Americans.
Nonetheless, the accomplishments we have achieved and the
improvements we propose with this budget represent strides in our
mission of providing top-quality care and services. The transformation
that is well underway in our health-care system, and just beginning in
our benefits-delivery system, is powered by an absolute dedication to
that mission. Fundamental change in our service-delivery systems is a
prerequisite to dramatically improve performance.
This change in where and how we provide care and services is
difficult and sometimes controversial. It has been and must continue to
be accomplished in full consultation with veterans and other
stakeholders. We have found that many of the health-care changes
questioned a few years ago are now applauded as significant steps
toward better care. Better access through Community Based Outpatient
Clinics (CBOCs), primary care, and improved quality are results of the
changes we have made. Approval of ``Buy-Out'' legislation and Medicare
Subvention would better enable us to accomplish our mission. We expect
the same transformation of our benefits-delivery system. Our
comprehensive approach to benefits processing strives for accuracy and
real-time information on the status of veterans' claims. Timeliness
will get better when we process claims correctly the first time, and
claimants' satisfaction with our system will improve as they are kept
better informed throughout the process.
ii. highlights of department of veterans affairs (va) fiscal year 2000
budget submission
Our budget request builds on VA's previous accomplishments and
positions us for the future. Here are some of the highlights of our
request.
For the Veterans Health Administration (VHA)
The budget provides $18.1 billion, including $749 million in
medical collections, to provide medical care to eligible veterans. VA
will open 89 new outpatient clinics and treat 54,000 more patients in
2000 than in 1999, a 1.5 percent increase.
We are proposing $50 million in additional funding to help homeless
veterans, including $40 million in medical care and $10 million in
mandatory transitional housing subsidies. We are asking for a $136
million increase in VA's efforts to combat Hepatitis C and an increase
of $106 million in VA's long-term care alternative programs.
While not included in the budget, the Administration will continue
to seek authorization of a pilot program whereby VA could receive
reimbursement from Medicare for covered services provided to certain
Medicare-eligible veterans. This program will help us to increase
alternative revenues.
The budget includes a legislative proposal to authorize VA to cover
the cost of out-of-network emergency care for enrolled veterans with
compensable disabilities related to military service. This legislation
would ensure that these veterans have access to emergency care when
treatment in VA facilities is not an option.
For the Veterans Benefits Administration (VBA)
For benefits processing, the budget provides $860 million, $49
million more than the funding level enacted in 1999. This is a six
percent increase and will ensure that compensation, pension, education,
and housing benefits to veterans will continue to be delivered while we
continue the process of reengineering the way we deliver benefits. Four
hundred and forty FTE will be added to help us process disability
claims more efficiently.
For the National Cemetery Administration (NCA)
The budget requests $97 million, $5 million more than the fiscal
year 1999 enacted level, for the operations of the National Cemetery
Administration. This increase will provide funding for the activation
and first year operations of four new National Cemeteries.
In other areas (Construction, the Capital Asset Fund, and Smoking
Cessation)
We are requesting new budget authority of $296 million for the
Department's construction programs. Our request provides funding for
four major construction projects and provides resources for minor
construction, a proposed new Capital Asset Fund, and grants for State
veteran's nursing homes and cemeteries.
The Capital Asset Fund is a proposal that would authorize the
establishment of a five-year pilot program allowing VA to sell,
transfer, or exchange its excess properties and keep 90 percent of the
proceeds. VA would then reinvest those proceeds into non-recurring
capital needs to benefit veterans.
A significant portion of the money from the fund would be retained
by the local area or network in which the property has been disposed.
This proposal would also direct ten percent of the net proceeds from
sales to local continuum of care for the homeless through the
Department of Housing and Urban Development. That money would include
assistance to local homeless veterans. We are asking for authority to
spend $10 million in fiscal year 2000 to fund the administrative start-
up costs of the program.
We're also asking for $56 million to establish smoking cessation
programs for veterans who began to smoke during military service. This
program will be designed to reach veterans throughout the country by
using contractors.
iii. improved va strategic planning processes
As a Department, we are placing greater focus on the outcome of our
actions and policies. As we develop our long-term vision for the
Department and our goals, we are placing greater emphasis on
understanding the impact our programs have on veterans and their
families. We believe this will help us to better link our resources to
programs that benefit our veterans.
iv. additional information
Mr. Chairman, those are the highlights of our fiscal year 2000
budget request. Let me now provide you with some additional details.
On VHA's Budget
In the area of health-care for veterans, our fiscal year 2000
request recognizes the dramatic changes that have occurred in the past
four years. In that time, we have changed the organizational structure
of the Veterans Health Administration. We have found new ways to help
fund our medical programs. We have gotten rid of conflicting and
confusing rules on eligibility. And we have changed the culture of VA
health-care.
In addition, we have increased the number of veterans treated,
improved the quality of our care, and improved customer satisfaction.
At the same time, we have reduced the per-patient cost of providing
care.
The goal of our Department is to provide world-class quality
health-care to as many veterans as possible. We will continue to insure
that taxpayers receive full value for the funds they entrust to us. Our
resources will continue to be shifted from inpatient specialty care to
primary care delivered on an outpatient basis.
VA has successfully organized a system of coordinated health-care
delivery focused on continuous quality improvement that is patient-
oriented, ambulatory care-based and results driven. We now treat
patients in the most appropriate settings for their problems. Veterans
have embraced the use of primary care providers and care teams for
their health needs.
These strategies will assure the viability of the health-care
system well into the next century. They will also prepare VA to
continue to meet the diverse health-care needs of the veteran
population. We believe that the new VA system should serve as a model
for future integrated health-care systems, both public and private.
In 1998, our Department committed to the goals of reducing per-
patient cost for health-care by 30 percent, serving 20 percent more
veterans, and increasing alternative revenue sources to 10 percent of
all Medical Care funding. VA is still committed to meeting these goals,
while assuring that quality of care is maintained in our system.
VA is on track towards its long-range goals of 30/20/10. Compared
to the 1997 baseline, we project the following results in fiscal year
2000: reduce per-patient cost by 18 percent, serve 16 percent more
veterans, and increase non-appropriated funding to 5.1 percent of the
Medical Care budget.
This will be accomplished in large measure by continuing to shift
excess acute inpatient resources to expand and enhance outpatient care
and other types of care in the most appropriate setting.
Medicare subvention would allow VA to collect funds from Medicare
for health-care services provided to Medicare eligible, higher income
veterans without compensable disabilities. Adoption of this
demonstration program is VA's top legislative priority.
We urge you to work with us this year to ensure Congress passes a
demonstration project as soon as possible.
We will not be able to obtain 10 percent of our funding from
alternative revenue sources in the future if Congress does not pass the
Medicare subvention pilot legislation. If this pilot proves successful
in improving outcomes and lowering costs, our goal would be to open up
VA reimbursement throughout the system. I ask for your support of the
Administration's proposal in this area.
I have already highlighted some of the major aspects of VHA's $18.1
billion budget. The $106 million we requested for additional long-term
care will allow us to expand our home and community-based care programs
for our older veterans. The $50 million for homeless programs will
allow us to support 1,385 new community-based beds and treat 12,000
more homeless veterans.
VA is also proposing a change in appropriation language. It would
provide for two-year spending availability for up to 5 percent of our
resources, excluding those funds set aside due the required deferral of
funds medical equipment.
We support this proposal because it promotes more rational spending
decisions and recognizes the need for management flexibility during
this period of significant change for VA health-care.
As I mentioned earlier, the Administration is requesting
authorization of a new smoking-cessation program for any honorably
discharged veteran who began smoking in the military. The program would
be delivered by private providers on a per capita basis. Any veterans
who began smoking in the military would be eligible for this new
program, to the extent resources are available. The Administration will
seek authorization of this program in the near future.
Once this program is authorized, the Administration will submit a
budget amendment requesting an appropriation of $56 million for this
new activity. It is estimated that between 500,000 and 600,000 veterans
would avail themselves of this valuable program over the next five
years.
For Medical and Prosthetic Research, a total of $316 million and
2,838 employees will support more than 2,100 high priority research
projects to enhance the quality of health-care of the veteran
population. This level of funding will allow us to maintain the
operation of research centers in the areas of Gulf War veterans'
illnesses, diabetes, Parkinson's disease, spinal cord injury, cancer,
prostate disease, depression, environmental hazards, women's issues, as
well as rehabilitation centers and Health Service Research and
Development field programs.
In these areas, no other federally supported clinical or research
entity can initiate or complete such critical and ambitious research
activities on behalf of America's veterans. Our Department will
continue to increase the amount of non-appropriated research funding we
receive from the private and public sectors.
The Balanced Budget Act of 1997, Public Law 105-33, allows VA to
retain all collections from third parties, copayments, per diems, and
certain torts after June 30, 1997. These collections are deposited in
the Medical Care Collections Fund and are available for transfer to the
Medical Care appropriation. The funds remain available to VA until they
are expended.
For fiscal year 2000, VA estimates that more than $761 million will
be collected through this effort-and revenues will grow to over $1.2
billion by 2004. To accomplish this growth, we are in the process of
changing our billing rates to reasonable charges for inpatient and
outpatient procedures; identifying more patients having insurance; and
improving our debt collection efforts.
The Medical Administration and Miscellaneous Operating Expenses, or
MAMOE, activity is requesting $61.2 million in appropriations to fund
573 employees who will support VHA operations in fiscal year 2000.
Transfers of $415,000 and $7.1 million in reimbursements will
supplement these funds.
This request is somewhat different from past years in that it
includes reimbursement authority for activities related to the
Facilities Management Service-delivery Office. Facilities Management
will begin to receive reimbursement from VHA, VBA and NCA for field-
related project management.
This reimbursement will allow VA to use appropriated funds to hire
additional staff in the areas of quality management and performance
measurement. Capital policy activities will continue to be funded by
the appropriation.
on vba's budget
For five years, I have traveled throughout this country, first as
the Secretary of the Army and later as the Secretary of Veterans
Affairs, talking with servicemembers and veterans. I never fail to hear
from veterans about issues of veterans benefits. And, every veteran
applying for benefits is concerned about the length and quality of the
decision-making process. I am a lawyer, and my profession has a saying,
``Justice delayed is Justice denied.'' This means that, in effect, for
every day a decision is delayed, that benefit is, in fact, denied.
Yet, timeliness is not the only criteria. It is of no use to our
veterans for us to process their claims with record speed if we get it
wrong. Accuracy is also critical. The number of appeals and remands for
additional information take up too much staff time, and, more
importantly, too much of our veterans' time.
This budget emphasizes a commitment to restoring the Veterans
Benefits Administration's credibility and trust. Through several
leadership initiatives, VA seeks to reverse negative perceptions and
make the goal of ``world class customer service'' a reality.
The Veterans Benefits Administration has developed four overall
themes that it intends to address. These include: restoring VBA
credibility and trust; achieving dramatic progress in improving
performance; building knowledge regarding program outcomes; and
establishing a rational resource acquisition and investment approach.
The Balanced Scorecard is VBA's centerpiece for establishing a
clear process for setting strategic objectives and priorities and for
measuring the progress they have achieved. VBA's fiscal year 2000
budget request is $860 million and 11,437 full-time equivalent
employees or FTE. This represents an increase of $49 million and 164
FTE above the 1999 level. By combining this increase in the number of
employees with positions available due to efficiencies in other areas,
VBA will be able to increase its number of benefits adjudicators by
440.
Demographics indicate that many of our experienced employees will
be retiring within the next five to eight years. In order to avoid a
two to three year skill gap, which will exacerbate our service-delivery
challenges, we must stabilize the Compensation and Pension workforce
for the future by hiring and training additional resources immediately,
before the actual losses occur.
Our compensation and pension objectives include working towards the
goals of completing rating-related actions in 74 average processing
days, completing non-rating actions in 17 average processing days,
achieving 96 percent national accuracy rate for core adjudicative
rating work, and attaining 90 percent overall satisfaction among
veterans with the way claims are handled.
Besides the electronic claims processing pilot project I mentioned
earlier, here are some other initiatives we are taking to meet these
goals:
We have developed a multi-year initiative, which requires funding,
for four comprehensive training, performance support, and certification
systems for service-delivery positions. The four systems are for new
rating specialists; veterans service representatives; advanced rating
specialists; and decision-review officers.
We are currently developing formal partnership agreements with
veterans service organizations, both at the national and local level.
The partnership agreements will allow us to train service organization
representatives to properly submit fully developed claims and will
allow them to access VBA information systems. This will allow VBA
employees to devote their time to decision-making, not claims
development.
We are asking for funds to continue an initiative that will provide
claims development, disability examinations, and rating decisions for
service persons awaiting discharge from active duty. VA plans to have
transition teams present at each of the 20 largest military separation
points in the U.S. and to support, on a part-time basis, about 30
additional sites. This should allow VA to reach about 80 percent of all
DOD separatees.
Our Systematic Technical Accuracy Review, or STAR, program will
improve the accuracy of C&P claims processing by implementing a new
national accuracy review program to provide current and diagnostic
information about the accuracy of the work being produced at VA
regional offices. We have requested funds for additional staffing, the
creation of a database, and administrative expenses to aggressively
implement this program.
VBA intends to merge Adjudication and Veterans Services Divisions
in all of its regional offices. Through this program, called the
``Conversion to Service Center'' initiative, veterans will interact
directly with the VA employees processing their claims. They will
receive more specific information on their claims' status, and they
will also know what evidence is needed for decisions and what they can
do to expedite action.
Funds requested for the enhancement of education activities include
providing for expanding imaging technology. Imaging technology now in
use for claims processing in Atlanta and St. Louis will be extended to
Muskogee and Buffalo throughout fiscal year 2000.
The budget request for the housing program assumes that, if it is
cost effective, VA will join other Federal housing loan guaranty
programs and eliminate the in-house home-loan property management and
disposal activities of foreclosed homes by using discretionary
authority current law grants the Department.
VBA will contract for an A-76 study in 1999 to ensure the most
cost-effective approach for disposing of foreclosed properties. This
study will include a comparative analysis of selling foreclosed
properties for cash versus direct VA financing.
Funding has also been included in this budget to provide for
financial accounting improvements the housing program needs. When
completed, these improvements will enable the Loan Guaranty general
ledger system to meet Federal Financial Management Integrity Act
requirements. This is necessary in order for VA to achieve an
unqualified audit opinion on their annual financial statements.
Administrative expenses to support the insurance program are made
available from excess earnings from the National Service Life
Insurance, United States Government Life Insurance and Veterans Special
Life Insurance programs.
Also included for this program is a new initiative to promote
insurance self-service. The insurance program has experienced
significant success with its interactive voice response system. This
initiative will be the next step in expanding veterans' direct access
to their insurance records and benefits.
In this budget, we are requesting $10 million to expand a current
on-going pilot program on electronic claims processing. VBA is working
with a consortium of five companies to develop an electronic work
environment through imaging and other technologies. We expect to see
improvements in customer service, processing timeliness and accuracy as
a result. If successful, this demonstration project will pave the way
for a significant reengineering of how claims are processed.
VA's benefits programs provide assistance to veterans in
recognition of their service to their country and to aid their
transition to civilian life. The Administration is requesting $21.6
billion to support fiscal year 2000 compensation payments to 2.3
million veterans, 300,000 survivors and 633 children of Vietnam
veterans who were born with spina bifida, and to support pension
payments to 381,000 veterans and 268,000 survivors.
We propose to provide a cost-of-living adjustment, or COLA, based
on the change in the Consumer Price Index, to all compensation
beneficiaries, including spouses and children receiving dependency and
indemnity compensation. The percentage of the COLA is currently
estimated at 2.4 percent, which is the same percentage that will be
provided, under current law, to veterans pension and Social Security
recipients. The increase would be effective December 1, 1999, and would
cost an estimated $293 million during 2000.
If Congress approves, VA will pay full disability benefits to
Filipino veterans residing in the United States who currently receive
benefits at half the level that U.S. veterans receive. The cost of this
legislation is estimated to be $25 million over five years.
VA also proposes to charge a fee to lenders participating in VA's
Home Loan Program. The fee would give VA the authority to charge
lenders a fee of $25 for each VA loan that is guaranteed. The fees
would be earmarked for use in developing, maintaining, and enhancing a
VA Loan Information System that would interact with the information
systems used by lenders.
Also relating to benefits, an appropriation of $1.5 billion is
being requested for the Readjustment Benefits program. The money will
provide education opportunities to veterans and eligible dependents and
for various special assistance programs for disabled veterans.
Education benefits will be provided for about 450,000 trainees in
fiscal year 2000 including 281,000 training under the Montgomery GI
Bill. This request includes funds for the annual Consumer Price Index
adjustment, which is estimated to be 1.8 percent effective October 1,
1999, for education programs.
On NCA's Budget
In fiscal year 1998, approximately 550,000 veterans died-nearly
1,500 a day. The National Cemetery Administration estimates that the
annual number of veterans' deaths will peak in the year 2008 before
beginning to decrease. NCA is preparing for this increase by building
national cemeteries, extending the service life of existing cemeteries,
and encouraging states to build state veterans cemeteries.
Our request for the NCA continues to position VA to meet these
future requirements. The request includes funding and new employees to
address the fiscal year 2000 growth in interment workloads at existing
cemeteries, including anticipated growth at the new Tahoma National
Cemetery. This cemetery will experience the accelerated workload
increase typical of a new cemetery, which is far in excess of the
annual growth rates of mature cemeteries.
It includes additional funding and FTE to continue the activation
of the new Cleveland-area national cemetery, and for the first full
year of operations at the new Abraham Lincoln National Cemetery near
Chicago, the new Dallas/Ft. Worth National Cemetery, and the new
Saratoga National Cemetery near Albany, NY.
It also includes funding to replace some cemetery equipment that
has exceeded its useful life, for customer service initiatives, and to
cover the increased cost of an integrated data communications project.
v. additional funding requests
For General Administration
VA is asking for $206 million in funding for the Office of the
Secretary, six Assistant Secretaries and three VA-level staff offices.
This request, along with $4.7 million associated with credit reform
funding, will provide a total resource level of $210.7 million.
When compared to the original fiscal year 1999 appropriation, the
fiscal year 2000 request is $7 million higher. The budget authority,
along with $117 million in estimated reimbursements, will provide for
an estimated total authority for obligations of $323 million in fiscal
year 2000. FTE will increase by 111 in fiscal year 2000 from the 1999
current estimate of 2,490. This increase occurs primarily in the
reimbursable activities.
Here are some of the areas where we will use this increased funding
and number of employees.
For the Board of Veterans' Appeals
We are requesting $41.5 million in funding for the Board of
Veterans' Appeals for fiscal year 2000. The Board's marked improvement
in timeliness, increase in productivity, and reduction of the appeals
backlog in fiscal years 1995 through 1998 exceeded our most optimistic
expectations.
This level of funding will give us the opportunity to continue to
improve our timeliness in this area. BVA and VBA have adopted a joint
performance indicator that is a system-wide measure of how long it
takes to resolve an appeal made by a veteran. In fiscal year 2000, we
project that it will take an average of 545 days--45 fewer days than we
anticipated it to take in 1999.
For the Office of Information and Technology
This is the first budget request since the reorganization of the
Office of Financial Management that resulted in the information
management function being moved to the newly created Office of
Information and Technology.
VA's newly created Office of Information and Technology is
requesting budget authority of $21.3 million and an average employment
of 217 to support VA Information Technology policy and program
assistance, the VACO Campus Office Automation Platform and Local Area
Network, and other efforts. The Austin Automation Center is separately
supported by the Franchise Fund. Budget authority and $43.1 million in
net reimbursements will provide an estimated obligation availability of
$64.4 million in fiscal year 2000.
The Department is on schedule in meeting the Y2K challenge. In
fiscal year 1999, we have met the timeframes for bringing all of our
systems into production by March. This gives us nine months to address
any remaining issues.
For the Office of Human Resources and Administration
The Office of Human Resources and Administration (HR&A) is
requesting $105.4 million in total obligation authority and an average
employment figure of 806. The requested budget authority is $48.7
million. Included in this figure is $450,000 for program oversight of
the arming of VA police officers.
The total figure for HR&A reimbursements is $56.7 million. This
includes $28.3 million and 235 FTE for HR LINK$ and $27.7 million and
260 FTE for the Office of Resolution Management (ORM). In fiscal year
2000, the Department is again requesting that the operations of ORM and
Office of Employment Discrimination Complaint Adjudication (OEDCA)
located in the Office of the Secretary be funded through reimbursement
from its customers.
In summary, a total appropriation of $912.4 million is requested
for the General Operating Expenses (GOE), $706.4 for VBA and $206
million for General Administration in fiscal year 2000. This funding
level, combined with $158.1 million of administrative costs associated
with VA's credit programs, which are funded in the loan program
accounts under credit reform provisions; $10.7 million in
reimbursements from the Compensation and Pensions account for costs
associated with the implementation of the Omnibus Budget Reconciliation
Act of 1990 as amended; and $36.8 million from insurance funds' excess
revenues, together with other reimbursable authority, will provide
$1.255 billion to support operations in the GOE account.
On the Office of the Inspector General's Budget
To support the Office of the Inspector General in fiscal year 2000,
$43.2 million and an average employment of 374 FTE are requested. This
represents an increase of $7.2 million and an increase of 12 FTE from
the 1999 resource level. The increase in budget authority is primarily
due to contracting out of financial audit functions and, increases
associated with acquiring additional FTE. Contracting out the financial
audit will free up 39 FTE. These actions will enable the OIG to staff
new initiatives and focus on several priority audits and
investigations.
vi. other issues
The VA Capital Investment Board
The Department formally established the VA Capital Investment Board
(CIB) in July 1997 and produced the VA's first Capital Plan in 1999.
The CIB's membership consists of top management from throughout the
Department. The CIB was established primarily to ensure that all
significant capital investments are based on sound business principles
and also support the VA's strategic and performance goals.
Recognizing the need to enhance capital asset planning for fiscal
year 2000, we have initiated a new capital investment planning process
to improve the selection methodology for all significant capital
assets, including construction, equipment, and information technology,
in support of the budget request.
Capital investment proposals that meet specified thresholds (such
as major construction projects, equipment, leases and information
technology) are scored on how well the project application addresses
the 20 sub-attributes of five major criteria.
The five major criteria are: One-VA Customer Service, Return on
Taxpayer Investment, High Performing Work Force, Risk, and Comparison
to Alternatives. The first three criteria relate to the Department's
strategic goals, while the last two address improved business
practices.
All significant capital investment proposals that are requested in
the fiscal year 2000 budget have been scored and ranked by the board to
ensure that they meet the VA's strategic goals and are sound
investments.
The Department capital planning process will be continually refined
in order to meet the constantly changing needs of the Department.
Major and Minor Construction
I am requesting new budget authority totaling $60 million for the
major construction program. The major construction request includes
funding for a surgical suite project at Kansas City, MO; a spinal cord
injury and rehabilitation project at Tampa, FL; a patient environment
project at Murfreesboro, TN; and a facility rightsizing and gravesite
development project at Leavenworth, KS. Additional funds are provided
to remove asbestos from Department-owned buildings and to support
advanced planning and design activities.
We are also requesting new budget authority totaling $175 million
for VA's minor construction program. The request will be used to make
improvements to ambulatory care settings, patient environment, and VA's
aging infrastructure. Funds are also requested for nursing home care,
clinical improvements, correction of code deficiencies in existing
facilities, and the elimination of fire and safety deficiencies.
Funds requested in the minor construction budget would also support
VBA construction requirements and NCA gravesite development and
improvements to existing National Cemetery Administration roads and
buildings.
State Extended Care Facilities and State Veterans Cemeteries
The fiscal year 2000 request of $40 million for the Grants for the
Construction of State Extended Care Facilities will provide funding to
assist States to establish new, or renovate existing nursing homes and
domiciliaries; and the fiscal year 2000 request of $11 million for the
Grants for the Construction of State Veterans Cemeteries will provide
funding to assist States to establish, expand, or improve State
veterans cemeteries.
vii. conclusion
Mr. Chairman, veterans from all periods of service should be
satisfied that this budget is a budget that protects their interests
and lives up to the nation's commitment to them.
I want to thank the members and staffs for your continued interest
in our Department. I look forward to continuing to work with you on
behalf of our nation's veterans and their families. We owe our veterans
the best service we can provide.
______
[General Accounting Office, April 15, 1999]
Progress and Challenges in Transforming Health Care
(By Stephen P. Backhus)
Mr. Chairman and Members of the Subcommittee: We are pleased to
contribute this statement for the record for the Subcommittee's
deliberations on the fiscal year 2000 budget request for the Department
of Veterans Affairs' (VA) health care system. In this request, VA is
seeking a funding level of $18.4 billion to serve 3.65 million
veterans.
Between its establishment in 1946 and 1995, VA's health care system
grew into our nation's largest direct provider of health care, serving
veterans at over 600 locations nationwide. These included 181 locations
where VA owned over 4,700 buildings and 18,000 acres of land. VA's
system focused primarily on hospital care, using high technology and
medical specialization.
VA's system, however, did not keep pace with such societal and
industry changes as:
--a market-based restructuring of American healthcare, including the
rise of managed care;
--a rapid growth in scientific and medical knowledge available to
treat illnesses and injuries; and
--an overall aging of the veteran population, including declining
numbers of potential system users and evolving medical needs.
In October 1995, VA began to transform its system from a hospital
operator to a healthcare provider that relies on community-based,
integrated networks of VA and non-VA providers to meet veterans' needs
more efficiently and effectively. In January 1997, VA proposed a 5-year
plan to operate within a fixed annual appropriation of $17 billion
through fiscal year 2002. To accomplish this, VA planned to reduce per
patient costs by 30 percent, increase patients served by 20 percent,
and reduce reliance on appropriations by 10 percent.
Since VA's transformation began, we have visited over 100 VA
medical facilities and spoken with over 500 officials, as well as many
veterans, including representatives of veteran service organizations.
We also examined hundreds of documents, including VA's budget
submissions and studies done by VA's Office of Inspector General and
others. Based on the insights developed during these efforts, our
statement today focuses on (1) VA's transformation progress to date,
(2) challenges that remain to be confronted, and (3) the implications
for VA's fiscal year 2000 budget.\1\
---------------------------------------------------------------------------
\1\ For 1996 and 1997 hearings of this subcommittee, we provided
assessments of VA's transformation progress. See VA Health Care:
Opportunities to Increase Efficiency and Reduce Resource Needs (GAO/T-
HEHS-96-99, Mar. 8, 1996) and VA health Care: Assessment of VA's Fiscal
year 1998 Budget Proposal (GAO/T-HEHS-97-121, May 1, 1997).
---------------------------------------------------------------------------
In summary, VA's transformation continues to make significant
progress. Over the last 3 years, VA has enhanced benefits and served
500,000 additional veterans, while realizing a nonappropriated revenue
surplus of $496 million that remains available for future use. This was
accomplished primarily because VA's management initiatives reduced
operating costs by almost $1 billion. The most notable initiatives
involved shifting veterans' care to appropriate settings and
reengineering administrative and clinical processes.
This year, however, our work shows that VA's transformation appears
to be losing momentum. VA, for example, has prolonged decisions
concerning much needed restructuring of aged capital assets, including
hospital closures, which could result in unnecessary expenditures of
billions of dollars over the next several years. VA's transformation
cannot be successfully completed until these and other critical
challenges are adequately addressed.
In our view, VA's fiscal year 2000 budget is based on the unduly
optimistic expectation that its ongoing transformation will generate
needed efficiencies of $1.4 billion in savings. VA assumes, for
example, that employment reductions in fiscal year 2000 will be more
than 3 times greater than expected fiscal year 1999 reductions. VA has
not taken the underlying management actions--such as aggressively
addressing all potential facility integrations and service
consolidations--that appear necessary to make a threefold reduction
possible. If VA had made such difficult decisions earlier, it might not
need to realize this level of savings. Moreover, VA may ultimately need
to use less desirable management actions, including large-scale
employee furloughs, to operate within its proposed budget. Such actions
could adversely affect all veterans' quality of care, especially
waiting times. VA could avoid such undesirable outcomes for higher
priority veterans if, as the Congress intended, VA uses its new
enrollment process to manage access to VA health care services within
available resources.
background
VA's health care system currently touches the lives of 15 percent
of our nation's 25 million veterans. The rest rely on private
insurance, other public programs, or their own resources to finance
their health care needs.
VA uses hundreds of delivery locations to provide services such as
primary care, specialized medical care, mental health, geriatrics, and
extended care. In addition, VA supports medical education and research
through its affiliation with 107 medical schools, and provides medical
backup to the Department of Defense and other federal, state, or local
agencies during national emergencies.
VA began its transformation by creating 22 regional offices to make
basic budgetary, planning, and operating decisions for veterans living
within defined geographical areas; VA's headquarters and over 150 large
hospitals made such decisions previously. These offices oversee between
5 and 11 large hospitals, as well as many clinics or other delivery
locations.
The primary focus of VA's transformation is to reduce reliance on
large hospitals by developing local or regional networks that provide a
continuum of care grounded in ambulatory settings. To encourage this
transformation, VA implemented a new resources allocation process that
bases funding decisions on user populations rather than facilities.
In addition, the Congress passed the Veterans Health Care
Eligibility Reform Act of 1996, which furnished tools that VA said were
key to a successful transformation and provided VA the means to develop
its 5-year financial plan, including
--new eligibility rules which allow VA to treat veterans in the most
appropriate setting;
--introduction of managed care principles, such as a uniform benefits
package, which allows VA to provide a continuum of services,
including preventive medicine; and
--an expanded ability to purchase services from private providers and
to generate revenue by selling excess services to nonveterans.
At that time, both the Congressional Budget Office and we concluded
that such reforms could generate additional demand for services,
primarily due to increased use of outpatient services. The
Congressional Budget Office also estimated that rising utilization
would, by extension, produce dramatic cost increases, potentially
billions of dollars.
To address such concerns, the Eligibility Reform Act also required
VA to implement a veterans' enrollment system to manage access in
relation to available resources. It established seven priority
categories, with the highest priorities given to veterans with service-
connected disabilities.
Each year, VA is to enroll veterans in those priority categories
for which there are sufficient resources to provide care that is timely
and acceptable in quality. The act also requires VA to maintain
capacity for veterans with special disabilities, including treatment
for spinal cord injury, blindness, amputation, and mental illnesses.
At VA's request, the Congress also authorized VA to retain all
collections from third parties (including recoveries from insurance
companies and certain tort claims), copayments, and per diems,
beginning July 1, 1997. VA is to deposit these collections in a Medical
Care Collections Fund and use them to supplement appropriations to meet
veterans' health care needs. VA may spend these funds in the year
collected or any subsequent year.
va has taken major steps forward in its transformation
As part of the transformation, VA's networks have implemented
hundreds of management initiatives that have significantly enhanced the
efficiency and effectiveness of VA's health care system.\2\ For
example, during fiscal years 1996 through 1998, VA reduced inpatient
workload by 38 percent and bed days of care per 1,000 veterans by 47
percent. This allowed over 20,000 hospital beds to be closed and
numerous administrative and clinical services to be consolidated.
---------------------------------------------------------------------------
\2\ VA Health Care: Status of Efforts to Improve Efficiency and
Access (GAO/HEHS-98-48, Feb. 6, 1998).
---------------------------------------------------------------------------
At the same time, VA used savings from its efficiencies to finance
improvements in veterans' access to, and quality of, care. For example,
VA served an additional 500,000 veterans, in part, by opening over 183
new community-based clinics, creating about 1,000 primary care teams,
and purchasing specialty care from private providers. VA's performance
indicators suggest that the quality of care is improving overall.
Veterans' rating of ambulatory care quality has risen and the reported
numbers of problems have fallen.
VA appears on track toward meeting its goals of reducing per-
patient costs, serving more veterans, and increasing nonappropriated
revenue sources by fiscal year 2002. Compared with its fiscal year 1997
baseline, VA projected and realized the results, shown in table 1, for
fiscal year 1998 (year 1 of VA's 5-year plan).
TABLE 1.--VA'S 5-YEAR GOALS
[In percentages]
------------------------------------------------------------------------
VA fiscal year
--------------------------
30-20-10 initiatives 1998
------------------ 2002
Results Goal Goal
------------------------------------------------------------------------
Reducing per patient costs................... 10 6 30
Serving more veterans........................ 9 5 20
Increasing nonappropriated funding........... 4 4 10
------------------------------------------------------------------------
More importantly, VA expects to have more resources available in
fiscal year 1999 than its 5-year plan projected, as shown in table 2.
TABLE 2: COMPARISON OF VA'S ESTIMATES FOR ITS FISCAL YEAR 1999 BUDGET
[In billions of dollars]
------------------------------------------------------------------------
Fiscal year 1999
---------------------
VA's 5-
Funding year VA's
plan's current
projection estimate
(1/97) (1/99)
------------------------------------------------------------------------
Appropriated...................................... 17.0 17.3
Other Sources..................................... 0.9 1.1
---------------------
Total....................................... 17.9 18.4
------------------------------------------------------------------------
Because of efficiency savings, VA needed to spend, in fiscal year
1998, only $170 million of its medical care collections. This allowed
VA to carry forward about $496 million for use in fiscal year 1999.
VA's management initiatives that contributed to these dramatic
results include:
--establishing primary care as the dominant delivery model;
--shifting medical care from inpatient to outpatient settings;
--consolidating administrative and clinical services; and
--establishing networks of VA and non-VA providers.
Establishing Primary Care As Dominant Delivery Model
VA established primary care case management to help ensure that
patients are served in the most appropriate settings and resources are
coordinated and best organized to address patients' specific medical
conditions.
Before 1995, primary care providers managed less than 20 percent of
VA's patients. Since then, VA has successfully oriented veterans to the
principal concept of primary care. VA, for example, reports that close
to 80 percent of veterans responding to its annual patient survey are
aware that one provider or primary care team has responsibility for
managing their medical care. This, in effect, relieves high-cost
specialists from day-to-day patient management responsibilities.
To enhance primary care access, VA has established over 1,000
primary care teams at large medical facilities and opened over 183
community-based outpatient clinics. These clinics provide primary care
closer to veterans' homes, especially those living in underserved,
often remote, areas. Currently, VA has approved 272 community clinics
to open in fiscal years 1999 and 2000 and expects to open about 200
more by fiscal year 2003.
Shifting Medical Care to Outpatient Settings
Advances in medical technology and practices, for example, have
afforded VA significant opportunities to shift medical care to
outpatient settings. Because of such new technologies as laser,
endoscopic, and other less invasive surgical techniques, many surgeries
are now performed in a doctor's office or outpatient clinic or require
shorter lengths of stay when performed in hospitals.
In addition, changes in medical practice and the development of
psychotherapeutic drugs to treat mental illness have led to fewer and
shorter hospital admissions for psychiatric patients and to the
deinstitutionalization of many long-term psychiatric patients.
VA has implemented management initiatives to identify patients who
can be served more cost-effectively in alternatives to inpatient
settings, including treatment of many chronically and catastrophically
ill patients at home rather than in a hospital.
Before 1996, VA had no systemwide external preadmission screening
program or other utilization review programs to ensure that patients
are treated in the most appropriate settings. In that year, we
recommended that VA develop such programs.\3\ Subsequently, VA
implemented management initiatives to:
---------------------------------------------------------------------------
\3\ VA Health Care: Opportunities for Service Delivery Efficiencies
Within Existing Resources (GAO/HEHS-96-121, July 25, 1996).
---------------------------------------------------------------------------
--review 100 percent of planned admissions to determine patients'
appropriate level of care; and
--perform continuing stay reviews to determine the appropriateness of
each additional day of hospitalization.
During fiscal years 1996 through 1998, VA's inpatient workload
declined 38 percent and bed days of care per 1,000 patients dropped by
47 percent. This allowed VA to close 20,000 hospital beds, a 40-percent
reduction.
This decrease in inpatient usage has been matched by major
increases in VA's outpatient care workload. During fiscal years 1996
through 1998, VA's outpatient visits increased 19 percent. Of note, VA
performed over 90 percent of certain surgeries, including
colonoscopies, arthroscopies, cystoscopies, breast biopsies, and
cataract surgeries, on an ambulatory basis in fiscal year 1998.
Consolidating Administrative and Clinical Services
VA also has implemented a variety of initiatives that consolidated
duplicate or underused services. VA, for example, integrated the
management teams of two or more large medical facilities in 24 markets;
this effort involved a total of 50 facilities. VA also consolidated
many other administrative and clinical services at these facilities,
which saved millions of dollars in unneeded operating costs.\4\
---------------------------------------------------------------------------
\4\ VA Health Care: Lessons Learned From Medical Facility
Integrations (GAO/T-HEHS-97-184, July 24, 1997).
---------------------------------------------------------------------------
Based on our work, VA appears to have an opportunity to achieve
even more significant savings by consolidating duplicate or underused
services. This is because VA still operates 17 large medical facilities
that compete with these newly integrated facilities in 10 markets, as
well as operating 44 large facilities in 19 other markets that compete
with each other to serve veterans.
Recently, we recommended, and VA agreed, that veterans' needs
should be assessed in these 40 markets and steps taken to integrate,
consolidate, or close unneeded services. This could result in billions
of dollars in additional savings over the next 5 years that could be
reinvested to improve veterans' access to high-quality care.\5\
---------------------------------------------------------------------------
\5\ VA Health Care: Capital Asset Planning and Budgeting Need
Improvement (GAO/T-HEHS-99-83, March 10, 1999).
---------------------------------------------------------------------------
Establishing Networks of VA and Non-VA Health Care Providers
VA has implemented important initiatives to establish integrated
networks of VA and non-VA providers. VA has made the most progress by
far in establishing new community-based clinics. Some notable progress,
however, has been made purchasing inpatient care from private hospitals
or military facilities, as well as developing joint ventures and
sharing agreements with the Department of Defense.
About half of VA's new community clinics operated through contracts
with non-VA providers during fiscal years 1996 through 1998. These
clinics helped to reduce VA's costs and improve access because they are
located closer to veterans' homes. VA expects these clinics primarily
to refer veterans to VA facilities for specialized diagnostic
procedures, treatment, or hospital admissions, although referrals may
also be made to other non-VA providers.
In addition, some VA hospitals located in rural areas have
contracted to provide inpatient care with non-VA hospitals. These
initiatives, according to VA, have been successful from a cost-
efficiency perspective and also have received high satisfaction scores
from veterans.
At the close of fiscal year 1998, VA and the Department of Defense
had negotiated almost 1,000 facility-level sharing agreements covering
more than 10,000 services ranging from laundry, blood, and laboratory
services to major medical and specialty care services. There are also
four joint ventures under way for the construction and operation of
medical facilities, with four additional agreements near completion.
We are currently reviewing these sharing agreements to assess the
benefits for veterans, military members, and beneficiaries, as well as
efficiency savings for VA. Recently, the Congressional Commission on
Servicemembers and Veterans Transition Assistance reported that
opportunities exist for greater sharing and partnering between VA and
the Department of Defense. Of note, the Commission made several
recommendations, including the development of a joint, clinically based
formulary and joint procurement of future information technology.
further transformation progress will require va to confront formidable
challenges
As VA's transformation proceeds through its fourth year, it now
turns to face the most onerous challenges it has encountered to date.
These include: closing unneeded hospitals, restructuring capital
assets, restructuring VA's medical education role, maintaining capacity
to serve special disabilities, improving resource allocations,
improving revenue collections, and implementing an enrollment process.
VA's failure to aggressively confront these challenges could result
in the unnecessary expenditure of billions of dollars over the next
several years.
Closing Unneeded Hospitals
The success of VA's strategies to transform its health care
system--shifting inpatient care to more appropriate settings,
establishing primary care in community clinics, and improving
efficiency through staff reductions, service consolidations, and bed
closures--has produced excess inpatient capacity at most VA hospitals.
As VA's transformation continues, VA's need for a large number of full-
service hospitals will continue to diminish, thereby challenging VA to
make difficult decisions concerning hospital closures.
VA and the private sector have reacted very differently to
declining inpatient workload. In the private sector, over 500 hospitals
were closed as health care practices were transformed. As we have
reported, VA instead has chosen to reduce operating beds at its
hospitals or shift services such as inpatient surgery among
hospitals.\6\ This approach often leaves VA operating only a small part
of most hospitals' inpatient capacity.
---------------------------------------------------------------------------
\6\ VA Hospital: Issues and Challenges for the Future (GAO/HEHS-98-
32, Apr. 30, 1998).
---------------------------------------------------------------------------
VA demonstrated the feasibility of closing underused hospitals when
it closed the Martinez, California, hospital because of earthquake
concerns. VA replaced it with a modern outpatient clinic supplemented
by existing VA inpatient locations and contract care, efficiently
meeting veterans' needs in that market. VA reports that veterans'
satisfaction with these changes is high, including satisfaction with
quality of care.
At a March 1996 hearing before this Subcommittee, VA stated that it
would look to close additional facilities; since then, VA in essence
has closed four hospitals by shifting inpatient care to other VA
locations or contracting with non-VA providers. In each location, VA
continues to provide outpatient care as well as nursing home care in
three locations.
Last year, we reported that VA could save $20 million a year and
care could be improved if veterans were served at one less location in
Chicago.\7\ Veterans' benefits, for example, could be enhanced if VA
used the savings to purchase primary care closer to veterans' homes. In
response to our recommendation, VA agreed to initiate a market-based
assessment of its health care delivery in the Chicago market. This
market assessment is scheduled for completion soon.
---------------------------------------------------------------------------
\7\ VA Health Care: Closing a Chicago Hospital Would Save Millions
and Enhance Access to Services (GAO/HEHS-98-64, Apr. 16, 1998) reports
that asset operations and maintenance costs for four VA hospitals in
Chicago generally represent about 25-35 percent of the hospital's
operating budgets.
---------------------------------------------------------------------------
VA is to be commended for its willingness to study how it could
improve its efforts to meet veterans' needs in this market. The extent
to which VA is committed to taking action on the basis of study
findings remains uncertain, however. Last month, VA stated publicly
that no additional hospitals will be closed in fiscal years 1999 or
2000. This decision seriously threatens the continued progress of VA's
health system transformation.
Restructuring Capital Assets
VA's massive, aged infrastructure could be the biggest obstacle
confronting VA's ongoing transformation efforts. VA's challenges in
this arena are twofold: deciding how its assets should be restructured,
given the dramatic shifts in VA's delivery practices, and determining
how a restructuring can be financed in a timely manner.
VA spends a major part of its health care budget--about 1 out of
every 4 health care dollars--to operate, maintain, and improve its
facilities, generally referred to as the costs of asset ownership.
Without a major restructuring, billions of dollars will be used in the
operation of hundreds of unneeded VA buildings over the next few years.
VA's transformation has largely ignored this capital asset dilemma,
as VA's plans call for assets to continue operating over the next 5
years essentially as they do today. Given VA's current and proposed
budgets, it seems inevitable that VA's ownership of unneeded assets
will eventually compromise veterans' health care services. On the other
hand, restructuring its capital assets could reduce budget pressures or
generate revenues that could be used to enhance veterans' health care
benefits.
Recently, we recommended that VA's capital asset planning should be
based on rigorous market analyses, a business tool that has produced
positive results in the private sector.\8\ Such analyses include the
determination of veterans' health care needs in a market, a comparison
of life-cycle costs of asset ownership, and alternatives analysis to
enable VA to evaluate options for meeting needs in the most cost-
effective manner.
---------------------------------------------------------------------------
\8\ Va Health Care: Capital Asset Planning and Budgeting Need
Improvement (GAO/T-HEHS-99-83, Mar. 10, 1999).
---------------------------------------------------------------------------
We identified 106 markets in which VA owns 4,700 buildings and
18,000 acres of land, which it uses to operate 181 major delivery
locations. VA has agreed to conduct market analyses in the 40 markets
where multiple VA facilities compete with each other to serve veterans
(VA operates assets at 115 locations in these markets) as well as 66
markets served by a single VA location.
Until VA completes these market assessments, it will be challenged
to make capital investment decisions to ensure that scarce resources
are not invested in assets that VA will vacate in a few years.
Recently, we recommended, and VA agreed, that more of its capital
investment decisions--specifically minor construction and certain
nonrecurring maintenance--should be subjected to more rigorous
management review. Toward that end, VA plans to institute an improved
investment decision-making process that involves top managers' review
and approval, based on newly enhanced guidance and criteria for
assessing the future of the affected asset within VA's ongoing
transformation.
Once VA has developed an asset restructuring plan, it will be
challenged to finance needed investments in a timely manner. Toward
that end, VA proposes a 5-year demonstration that would allow it to
sell, transfer, or exchange up to 30 excess or underutilized
properties, deposit proceeds into a new Capital Asset Fund, and use the
Fund to invest in more appropriate assets. This proposal is compelling
because it would provide VA incentives to dispose of properties no
longer needed to meet veterans' needs. VA asserts, and we agree, that
disposals are currently a cumbersome and lengthy undertaking with
limited benefits to VA, primarily because proceeds' use is limited to
improving nursing homes.
restructuring va's medical education role
Transforming VA's health care delivery system from an inpatient to
an outpatient focus, increasing reliance on primary care, and
integrating services in fewer hospitals require VA and medical schools
to restructure their affiliation arrangements.
Since VA's medical education program began in 1946, 132 VA medical
facilities have affiliated with 107 medical schools to provide training
opportunities for medical students and residents. These agreements
complicate VA's restructuring efforts, particularly integrating
administrative and clinical services across two or more medical
facilities.
VA assists in the training of health professionals for its own
needs and for those of the nation through its partnerships with
affiliated academic institutions. Each year, about 91,000 medical and
other students receive some or all of their clinical training in VA
facilities. In fiscal year 1999, VA expects to spend $750 million for
education and training of health professionals.
VA also assists in supporting medical research in connection with
the provision of medical care and treatment to veterans. The affiliated
medical schools are an integral part of VA's research effort. For
fiscal year 1999, VA expects to spend $682 million for research ($316
million from the medical and prosthetic research appropriation and $366
million in medical support from the medical care appropriation).
VA's successful transformation to a predominantly primary care
model, with its consequent deemphasis of inpatient, specialty care, has
direct implications on VA's education role. As previously discussed,
VA's management initiatives have decreased inpatient usage by 38
percent and increased outpatient workload by 19 percent. This
underscores a need to train more primary care physicians and fewer
specialty physicians.
In light of these changes, VA established a Residency Realignment
Review Committee and a Research Realignment Advisory Committee. In
response to these committees' recommendations, VA set a goal to more
equally divide resident training positions between specialty and
primary care by 2002; previously, about 70 percent of residents were
enrolled in specialty training and 30 percent in primary care. In doing
this, VA plans to eliminate 250 specialty positions and shift another
750 to primary care. To date, VA appears on track toward meeting its
goals.
As VA's transformation continues, its management initiatives should
increasingly involve consolidating programs to eliminate redundancy
among nearby VA facilities or the potential closing of facilities. This
will, by necessity, increase the potential for conflict between medical
schools' best interests and veterans' best interests.
Because VA provides a major source of medical training and research
opportunities, medical schools clearly have a vested interest in VA
hospitals staying open. As such, it will be difficult to achieve a
proper balance between VA's primary mission--serving veterans' health
care needs--and its secondary missions--supporting education and
research. VA must take care to prevent stakeholders, such as medical
schools, from unduly influencing the ongoing transformation of its
health care system.
At present, medical schools have concerns about potential
consolidations of VA medical facilities. It seems inevitable that
medical schools will need increasingly to share inpatient educational
and research opportunities at a single VA facility. VA must work
closely with medical schools to ensure that such restructuring is
accomplished without compromising VA's efforts to improve its
efficiency and effectiveness.
Maintaining Capacity to Serve Special Disabilities
VA is struggling in its efforts to address congressional concerns
that it is not appropriately maintaining its level of certain high-cost
specialized services as its transformation progresses.
The Congress required VA to ensure that its capacity to provide
specialized treatment and rehabilitative services for veterans with
certain disabling conditions is not reduced below October 1996 levels
and that veterans with these conditions have reasonable access to care.
The Congress identified four disabling conditions requiring specialized
care: spinal cord dysfunction, blindness, amputation, and mental
illness. For this requirement, VA defined mental illness to include
only veterans with serious mental illness and included two additional
conditions: traumatic brain injury and post-traumatic stress disorder.
VA cites a 2-percent increase in patients served as evidence that
it is maintaining capacity to serve special disabilities. But this
aggregate measure could mask potential adverse effects experienced by
individual services and delivery locations. VA plans to develop outcome
measures to reflect the overall capacity of its special disability
services.
Last year, we noted that unclear service definitions and cumbersome
data systems hindered VA's development of additional outcome measures.
As a result, it is difficult to establish a baseline for comparison
purposes, assess the accuracy of reporting at the local level, and
reconcile differences among individual facilities,' networks,' and
headquarters' data.\9\
---------------------------------------------------------------------------
\9\ VA Health Care: VA's Efforts to Maintain Services for Veterans
With Special Disabilities (GAO/T-HEHS-98-220, July 23, 1998).
---------------------------------------------------------------------------
To date, VA has designed functional measures for seriously mentally
ill patients and patients with a primary diagnosis of substance abuse.
VA, however, has generally not performed the program evaluations
necessary to determine whether these are the most appropriate or
sensitive measures for assessing responses to treatment and changes in
health outcomes.
Until adequate outcome measures are available, VA continues to use
its traditional process measurements, such as number of veterans served
and resources expended, including dollars, staffing, and beds. These
measures remain important indicators and should be continually
reviewed.
Improving Resource Allocation
VA's new resource allocation system is improving the equity of
resource allocations among networks. The system's promise for achieving
equitable access may not be fulfilled, however, because of VA's
inadequate oversight of how resources are allocated within networks and
historical access inequities are addressed.
To improve equitable access to care, the Congress enacted
legislation in 1996 requiring VA to develop a plan for equitably
allocating resources to ensure that veterans with similar economic
status and eligibility priority have similar access to VA health care,
regardless of the region in which they live. In response, VA began
implementing a new allocation process.
Previously, VA allocated resources directly to facilities on the
basis of their budget for the previous year. VA's new process allocates
funds to the 22 networks based on the number of veterans each serves.
Networks, in turn, allocate resources to the facilities in their
geographic area.
As we reported to you in September 1997, this new process is
correcting long-standing regional funding imbalances that have impeded
veterans' equitable access to services.\10\ Over the last 2 years,
funding has shifted from the Northeast and Midwest to the southern and
western regions where more veterans reside. Each network has increased
the number of veterans it serves, albeit to varying degrees, and
improved current users' access to care.\11\ VA's management
efficiencies were instrumental in achieving this outcome.
---------------------------------------------------------------------------
\10\ Va Health Care: Resource Allocation Has Improved, but Better
Oversight Is Needed (GAO/HEHS-97-178, Sep. 17, 1997).
\11\ VA Health Care: More Veterans Are Being Served, but Better
Oversight Is Needed (GAO/HEHS-98-226, Aug. 28, 1998).
---------------------------------------------------------------------------
VA, however, maintains that networks should not use its new process
to allocate resources to facilities and that they should, instead,
develop allocation methods appropriate to local circumstances. Such
resource allocations are the crucial link in VA's allocation strategy
to convert resources to services.
In spite of this enormous challenge, VA has done little to ensure
that networks achieve equitable allocations. VA says that it has not
provided criteria for equitable allocation of resources within networks
because developing such criteria would be contrary to its reengineering
philosophy, which decentralizes authority and accountability for these
allocations to the network directors. In addition, VA has not
adequately reviewed the equity of networks' allocations or measured
improvements in the equity of veterans' access to care.
Networks we analyzed have not incorporated criteria in their
allocations to improve equity in spite of historical inequities they
identified. As a result, in spite of the considerable effort VA has
invested in its new resource allocation process, resources may not be
equitably allocated in many markets.
Monitoring networks' progress in achieving equitable access to care
represents a significant challenge. Today, VA does not know what
progress, if any, is being made towards equitable access to care for
our nation's veterans. This is because VA has neither developed
indicators needed to do so nor included equity of access as a
performance goal for network managers.
Developing and implementing such indicators will be a major
challenge both technically and in obtaining stakeholders' agreement.
Without establishing such indicators and monitoring them, however, VA
can neither assure stakeholders that equity of veterans' access is
improving nor take corrective actions, if needed, to improve resource
allocations.
Improving Revenue Collections
VA faces a major challenge increasing its medical care collections
from third parties and veterans, as well as reimbursement from sharing
agreements with the Department of Defense.
VA's collections grew slightly between fiscal years 1997 ($520
million) and 1998 ($560 million). VA's 1998 collections were about 94
percent of its stated goal. For fiscal year 1999, VA set a goal of
$637.5 million. As of March 1999, collections are averaging about $46
million a month, which appears sufficient to meet VA's goal, given that
collections were historically higher during the last quarters of fiscal
years 1997 and 1998. VA's fiscal year 2000 budget sets a goal of about
$762 million and VA expects collections to grow to more than $1.2
billion by fiscal year 2004.
VA expects such growth for three reasons. First, VA assumes that
changing its medical care billing rates to reasonable charges for
inpatient and outpatient procedures will increase revenues. VA,
however, has neither historical data nor experience to estimate the
effect of reasonable charges on revenues.
Second, VA assumes that it will increase its revenues by
identifying more insured patients. However, VA finds it very difficult
to keep this information current because veterans are not required to
tell VA if they have insurance or when changes occur in their insured
status.
Third, VA plans to improve its debt collection improvement efforts
to boost revenues. In 1998, VA's Inspector General cited uncollected
debt as one of VA's significant management problems. To improve medical
care debt collection, VA has efforts under way to more aggressively
pursue insurance claims, including timely appeals of denied claims. For
example, VA is using a centralized approach to monitor claims and is
exploring ways to recover debts as an offset to veterans' federal
income tax refunds.
Despite a large number of sharing agreements for services between
VA and the Department of Defense, several barriers are likely to
inhibit effective sharing or prevent new agreements from being reached.
These barriers include conflicting agency guidelines, beneficiary
perceptions about sharing, and incompatible or unreliable information
systems. VA and Defense have recently embarked on a joint initiative to
revitalize sharing efforts at the national level for certain critical
services.
In its fiscal year 2000 budget, VA again asks the Congress to
authorize VA's reimbursement from the Medicare Trust Fund for medical
services it provides to Medicare-eligible veterans. VA seeks this
authorization anticipating that Medicare reimbursement will become an
important source of revenue.
If authorized, VA's efforts to realize such revenues, without
adversely affecting veterans, could pose a daunting challenge. Since VA
initially proposed receiving Medicare reimbursements, it implemented a
new veterans' enrollment process that has significantly increased
workload. As such, VA faces considerable uncertainty about its capacity
to target another patient population. Doing so could place veterans'
access to care at risk if this increased workload forces VA to choose
between serving veterans who have Medicare and those who do not.
Implementing an Enrollment Process
VA faces a significant challenge determining how many veterans to
enroll, given the uncertainties surrounding new enrollees' medical
needs and VA's available resources.
The Eligibility Reform Act of 1996 required VA to establish and
operate a system of annual patient enrollment to manage access to VA
health care services within available resources. VA began testing an
enrollment process on October 1, 1997, prior to the mandated enrollment
date of October 1, 1998. At that time, VA announced its decision to
enroll all veterans that apply during fiscal year 1999, that is, for
enrollment priorities 1 through 7. As of December 1998, VA enrolled
about 3.9 million veterans, according to VA's budget office.
VA is also challenged to assess the impact of its fiscal year 1999
enrollment decision on veterans' health care delivery. VA, for example,
lacks the baseline data needed to assess the impact of its fiscal year
1999 enrollment decision on the timeliness of veterans' medical care.
During the course of our ongoing review of VA's enrollment process,
almost all of VA's network directors reported that enrollment has
increased demand for services. About half cited a slight increase in
the waiting times to schedule both primary and specialty care
appointments. Over one-third noted that access to care for higher
priority veterans (priority groups 1 to 4) has been adversely affected
to some extent.
Finally, several directors commented that they are experiencing
increased demand by veterans whose primary care is provided elsewhere
but who obtain from VA the specialty care and services not covered by
their private insurance or Medicare, such as pharmaceuticals,
eyeglasses, and hearing aids.
VA is assessing the cost implications of its fiscal year 1999
enrollment decision. VA's data shows that, after the first 3 months of
fiscal year 1999, about $3.6 billion was spent meeting veterans' health
care needs. Of this, about half was spent serving veterans in priority
categories 1 to 4, and half was spent serving categories 5 to 7. Of
note, veterans in category 5 accounted for about 46 percent of the $3.6
billion.
VA plans to announce its fiscal year 2000 enrollment decision by
August 1, 1999. VA, however, publicly stated last month a desire to
enroll all veterans who apply and to serve all enrollees in fiscal year
2000. VA's current projections show that about 4.4 million veterans
could be enrolled by the end of fiscal year 1999.
VA could find this to be quite challenging because, as the
following section discusses, VA's fiscal year 2000 budget does not
contain sufficient funding to maintain current service levels (3.6
million veterans), unless VA's transformation produces required
savings.
va faces a budget dilemma in fiscal year 2000
VA will be severely challenged to serve all veterans seeking to
enroll and maintain quality of care in fiscal year 2000 with an $18.4
billion budget. This is primarily because VA's budget is based on an
unduly optimistic assumption that VA's transformation will save $1.4
billion in fiscal year 2000. VA's cost estimates also may be
significantly understated, given the increased enrollments over the
last 6 months and considerable uncertainties surrounding veterans'
medical needs.
VA estimates that $19.23 billion would be needed to maintain
current service levels (3.6 million veterans) in fiscal year 2000, if
no management efficiencies are realized. By contrast, VA estimates its
fiscal year 1999 spending level to be $18.36 billion. This $870 million
difference involves primarily payroll increases for existing employees,
inflation, and other mandatory rate changes.
VA plans to use another $525 million of its efficiency savings to
enhance services. Of this, $281 million will be used to: treat veterans
with hepatitis C ($135 million); enhance extended care services ($106
million); and expand services for homeless veterans ($40 million). In
addition, VA proposes that $244 million be used to expand its benefit
package for certain veterans. VA requests congressional authorization
to finance emergency care at non-VA facilities for veterans enrolled in
priority categories 1 to 3. Currently, only certain veterans with
special eligibility have such benefits.
To allow VA to operate within a proposed budget of $18.4 billion,
VA needs to achieve management efficiencies of $1.4 billion. In
general, VA estimates that initiatives could yield about $514 million
in personal services savings, essentially by reducing its employment
level by 8,529 full-time equivalents.
This presents a formidable challenge, given that an employment
reduction goal of 8,529 is significantly higher than the reduction of
3,606 that VA achieved in 1998 or the 2,518 that VA expects to achieve
in 1999. Interestingly, VA had initially set goals of 3,978 and 2,607
in its budget requests for fiscal years 1998 and 1999, respectively.
To achieve a personal services savings goal of $514 million in
fiscal year 2000, VA needs to achieve the 8,529 employment reduction
before fiscal year 2000 starts, only 5 months from now. The longer VA
needs to reach this goal during fiscal year 2000, the greater the
number of employees that ultimately must be reduced (to meet its goal)
because VA will have to spend some projected savings to pay salaries
and benefits in fiscal year 2000.
VA estimates that the remaining $876 million will be achieved
through nonpersonal services savings. If VA is unable to meet its
employment reduction goal, it will have to increase nonpersonal
services savings beyond this target level. This, too, could prove
challenging, given the rapid increases in nonpersonal costs, especially
medications and prosthetics.
VA's budget did not specify the nature of the management
initiatives. VA's networks, however, have identified over the past year
a variety of efficiency initiatives, including additional facility
integrations, bed closures, and service consolidations, which reflect
necessary shifts in patient care delivery practices. In most cases,
these changes will require reductions in force, as well as staffing
adjustments through normal attrition, in order to better configure VA's
workforce to meet VA's transformation objectives.
VA's networks are currently revising their plans to develop
alternative ways to realize savings of $1.4 billion in fiscal year
2000. At a recent congressional hearing, officials from three networks
expressed concerns about their abilities to achieve required efficiency
savings. They testified that their plans would likely include
significant furloughs of workers, as well as curtailment of proposed
service enhancements and delay of services when medically appropriate.
In addition, VA may need to save more than $1.4 billion because
veterans' demand for medical care, as well as the numbers of veterans
demanding care, may be significantly higher than VA estimated at the
time its fiscal year 2000 budget was developed.
VA's budget, for example, included $135 million to expand treatment
of veterans who have hepatitis C, based on an assumed prevalence rate
of 5.5 percent among its veteran user population. VA data, based on a
small, unscientific sample, suggests that this rate, and hence
treatment costs, could be much higher. To better estimate costs, VA
recently conducted a nationwide sample of veterans using VA facilities
and expects results to be available shortly.
VA's budget also assumes that an additional 54,000 veterans will be
served in fiscal year 2000, bringing the total served to 3.65 million.
To date, 3.9 million veterans have enrolled, and VA currently estimates
that 4.4 million could enroll by the end of fiscal year 1999.
VA's rapidly rising fiscal year 1999 enrollments could also
increase VA's fiscal year 2000 efficiency savings requirements by $200
million or more. This is because VA plans to carry forward $216 million
of fiscal year 1999 revenue collections to finance fiscal year 2000
health care costs. VA could be required to spend this potential surplus
in fiscal year 1999 if newly enrolled veterans require greater-than-
expected health care expenditures in fiscal year 1999.
concluding observations
VA has made significant progress transforming its health care
system but appears to have a long way to go before achieving its goal
of operating integrated networks of VA and non-VA providers that
efficiently and effectively serve veterans. VA needs to aggressively
confront its pending challenges, especially capital asset and medical
education restructuring, in order to maintain the impressive momentum
generated during its transformation's initial years. Absent this, VA
could waste billions of dollars to meet veterans' needs over the next
several years.
Meeting veterans' medical needs within VA's proposed spending level
will be problematic. To do so, VA needs to achieve significant
management efficiencies, but has no clear sense of the true magnitude
of its resource needs. To remedy this, VA needs answers to such
critical questions as:
--How many veterans will enroll for VA health care in fiscal year
2000?
--How prevalent are enrolled veterans' high-cost medical needs,
especially for hepatitis C?
--How many management efficiency savings will be realized in fiscal
years 1999 and 2000?
--What will the Congress decide to do concerning VA's proposed
benefit expansions?
VA's budget dilemma forces it to confront difficult choices
concerning its fiscal year 2000 enrollment decision--namely, how many
priority categories can be prudently enrolled, given the uncertainty of
estimates of potential costs and available resources. VA's current data
suggest that sufficient resources may not be available to serve
veterans enrolling in all seven priority enrollment categories. VA's
uncertainties become more manageable if VA enrolls veterans in the
manner the Congress intended--namely, veterans in those priority
categories for which there are sufficient resources to provide timely
access to high-quality care.
We remain concerned about VA's ability to deal with such
uncertainties, primarily because of VA's publicly stated desire to
serve all veterans who apply for enrollment. If VA experiences
significantly higher costs than it currently estimates or significantly
lower efficiency savings, enrolling all veterans who apply could
require VA to take actions, such as large-scale employee furloughs,
that could adversely affect the quality of care for all veterans.
medical care management efficiencies
Senator Bond. Thank you very much, Mr. Secretary.
VA expects to provide care to an additional 54,000
patients, while cutting net staffing by almost 7,000 next year.
The budget says there will be $1.14 billion in management
efficiencies, an additional savings of $244 million and 1,500
in FTE, if proposed legislation authorizing emergency room care
is enacted.
What specific cuts to medical services, staff, and programs
will be made to meet the $1.14 billion target?
Mr. West. We have asked for our network directors and our
medical center directors to respond with proposals as to how we
will meet these. I think that Dr. Kizer is just beginning to
receive those responses. When he has reviewed them, he will
discuss them with me, but we do not have specific information
at the moment.
I know the things that we expect they will do, but you
asked for specific cuts. It is true that the change in acute
beds is beginning to slow down, but by the same token, there
are a number of continued facility combinations, facility
mergers, that still remain to be done.
I noticed in the GAO report to which you referred earlier,
the GAO identified some 40 markets in which we can look what
GAO considers duplication of facilities, and we have had
discussions about that. I believe some of that will be
reflected, as well, in what Dr. Kizer will be receiving.
Yes, it is challenging, but I believe that we will develop
the plans and that we will make them work.
medical care budget formulation
Senator Bond. One thing that worries me, Mr. Secretary, is
there are two ways to go about things. One is to push down from
the top and say you will do this. And the other is to go from
the bottom up and say what kind of efficiencies we can make,
and put those together to come up with a number.
When I build a budget, I like to find out from the ground
up, where we can make the efficiencies and maybe establish
slightly tougher targets. I am very much concerned that this
budget proposal may cause some serious disruptions.
Number one, I would like to know when we will see the
specifics. I might as well turn to Dr. Kizer, and ask for Dr.
Kizer's view on whether we will be able to increase patient
care without degradation in the quality, within this budget,
and how we are going to meet the new demands on the budget,
such as Hepatitis C and long-term care enhancements with these
proposed cuts.
Mr. West. Let me answer the first part of your question, if
I might. And that is whether we are going to push down or have
them bring their plans up. You are right. It is a tendency of
all of us, well, of this person in leadership, to say, ``Here
is what you are going to do,'' but that is not the way we have
structured this. This is not the way that VHA, under Dr.
Kizer's leadership, has made its inroads in the last three
years.
The plans will start at ground level, Mr. Chairman, and
will come forward from medical center directors through network
directors to Dr. Kizer, and eventually to me.
Senator Bond. Dr. Kizer.
Dr. Kizer. Well, it is certainly clear that the budget, as
has been stated by all, presents many challenges to the marked
improvements in quality of care that have been achieved in the
recent years.
Specifically, in response to your question, the plans have
come in. They are in the process of being reviewed. On initial
review of the plans, there are elements or proposals that are
not acceptable to, at least, this person. And so, we do expect
to go back and forth with the networks. And hopefully, by the
end of May, we will have the level of specificity and
concreteness that you desire.
hepatitis c
Senator Bond. Let me go back to that Hepatitis C question.
That is one that bothers me. Your budget assumes that there
will be a 5.5 percent prevalence in the VA patient population
of Hepatitis C. Some initial studies have suggested prevalency
rates may be 10 to 20 percent.
Do you have any better information on it? And what happens
if the rate is 10 to 15 percent, rather than 5.5 percent?
Dr. Kizer. I believe it is well known that there is a
difference of opinion between the Department and OMB on the
prevalence rate of Hepatitis C among veterans. And what was in
the budget reflects OMB's position. We feel that the prevalence
rate is higher than that.
At the current time, data that we have would suggest that
the prevalence rate is probably in the range of 8 to 10
percent. On March 17, we did testing of some 26,000 blood
samples that were obtained from throughout the country. And
when one adjusts that for various factors, and recognizing that
the analysis is not final, the seropositivity rate is about 8
percent. I think it is 7.8 percent, with the adjustments.
When you look at all of the testing that has been done so
far this year, of the approximately 30,000 tests that have been
done throughout the VA, the seropositivity rate of those is
about 20 percent, recognizing many of those tests were done on
individuals who were known to be at risk.
So, our best data, at this point, and recognizing this
database continues to evolve, is that the lower level of the
range is around 8 percent. And it may well be higher than that.
Now, the other thing, just to be complete is to recognize
that the standard of treatment is rapidly evolving. And what is
considered standard treatment today, includes some testing as
the length of tests and the length of treatment and other
things are greater today than some months ago, which does
increase the cost per patient for a treatment, as well.
Senator Bond. Thank you, Dr. Kizer. That is a bit
disquieting. I turn to Senator Mikulski.
Senator Mikulski. If I could just follow up on the
Hepatitis C issue for a moment. Eight to ten percent, could you
tell us, Dr. Kizer, how that compares to rates in the general
population? Is it higher there? And what is the etiology of
such a high percentage at the veterans facilities?
Dr. Kizer. I can tell you two things with regard to
comparability to the non-VA population. One is data that is
available today, which is quite limited from the general
population. That data suggests that in the general population,
the rate is somewhere around 1.8 or 2 percent.
Senator Mikulski. I am sorry. I cannot hear that. What----
Dr. Kizer. However----
Senator Bond. 1.8.
Senator Mikulski. 1.8.
Dr. Kizer. 1.8 to 2 percent. However, I think one has to be
cognizant that is very limited data. A growing concern from the
limited amount of data that has become available from under-
served populations, which suggests that the rate may be
considerably higher in some sub-populations within the general
overall population. There just has not been adequate testing
done yet of the general population to know.
Senator Mikulski. What is the etiology at the Veterans----
Dr. Kizer. Clearly, within the veteran population this is
age linked. The higher rates of seropositivity are found in
Vietnam era veterans. Whether it was related to exposure to
blood during combat in Vietnam or some of the other routes that
are known to transmit the disease are not entirely clear, based
on scientific data at the moment.
Senator Mikulski. Is this also from drug abuse?
Dr. Kizer. It can occur from either intravenous or
injection drug use, or from intra nasal snorting of cocaine,
using straws.
Senator Mikulski. Well, I think--I think this is of great
interest to the committee, from essentially the standpoint of
epidemiology. And we will not take our hearing today to go into
the entire epidemiology, but really the routes of this either--
whether it was combat exposure or in combat zone exposure or
whether this also comes from abusive behavior at various other
points, I think, would be of interest to the committee.
two-year spending availability for medical care
Let me move on, though, and--and Secretary West, in your
testimony there was an item on page five that goes down, that
says--if you go to page five of your testimony, it says, ``VA
is proposing a change in appropriation language. It would
provide for two-year spending availability for up to 5 percent
of our resources, excluding those funds set aside due the
required deferral of funds for medical equipment.''
Are you asking for a two-year appropriation? This is--this
really caught my eye. What does that mean, operationally?
Mr. West. The easy answer is yes.
Senator Mikulski. Sir, would you pull the microphone a bit
closer?
Mr. West. I am sorry. The quick answer is yes, as to that
proportion, up to 5 percent of our resources. Yes, we are.
Senator Mikulski. So, you want a two-year appropriation for
95 percent of your resources.
Mr. West. No. No. I think it is up to 5 percent.
Senator Mikulski. Oh. I got it backwards.
Mr. West. Up to 5 percent.
Senator Mikulski. I thought you were asking for 95 percent.
Mr. West. No. Up to 5 percent----
Senator Mikulski. Actually, I----
Mr. West. Up to 5 percent----
Senator Mikulski. You know, I am somebody who is interested
in a two-year budget; particularly for those things that are
usual and customary expenditures, as compared to special needs
or special populations.
So, you would want a 5 percent.
Mr. West. And it is not even 5 percent of the whole. It
excludes those funds that are set aside due to the required
deferral of funds for medical equipment.
Senator Mikulski. For medical equipment.
Mr. West. They would not be included in the universe from
which we ask the 5 percent.
Senator Mikulski. Okay. Can you understand why I was a
little----
Mr. West. I do. 95 percent is a lot.
capital asset fund proposal
Senator Mikulski. I thought it was just--yes. Now, I would
also like to go to the issue--there are many issues that were
related to the GAO report. I know, within the GAO report, you
received many excellent kudos, really, Dr. Kizer, on efforts to
transform veterans health care. And I think we are well aware
of those issues, but one of which was the capital asset
planning, in which you have 4,700 buildings, 18,000 acres of
land, et cetera.
Do you want to--we need to really get a hand on our assets.
They are recommending some type of capital asset approach.
Could you tell us what that would be?
Mr. West. Well, I am not very clear on the GAO's
interpretation of it. What our approach----
Senator Mikulski. What you want to do, in terms of getting
your hands on your capital assets----
Mr. West. Yes. Well, first of all, we propose to set up a
capital asset fund. One of the points that the GAO report makes
is it is their belief that there is no incentive for VA to look
to the disposal of assets, as it were.
That gets said in a lot of government agencies. Our
response to that----
Senator Mikulski. Just tell us what your plan is.
Mr. West. Well----
Senator Mikulski. What are you going to do with the capital
asset fund? That is--that is a phrase.
Mr. West. Well, its purpose is to make it easier for us to
dispose of assets, rather than going through the existing
governmental requirements and then for VA to put that money
into a fund which we can then use for our own activities.
Senator Mikulski. Well, I do not understand what it means
that you do not have to go through what the government normally
would do. What----
Mr. West. Well, disposal of a capital asset is, of course,
a fairly lengthy process, to include, as I recall, several
different statutes. One statute makes a capital asset available
for the homeless program. Another one says we have to offer
these to other agencies, then to state agencies, before we can
finally get to the point of disposing of it for a price.
I presume that the capital asset fund idea would allow us--
--
Senator Mikulski. Well, Mr. Secretary----
Mr. West [continuing]. To go more quickly through the
process.
Senator Mikulski [continuing]. First of all, I think--well,
number one, we understand that the GAO report, plus your own
administrative evaluation, says there needs to be a new
contemporary approach to capital asset management.
Number two, we would want you to have flexibility.
Number three, however, we want to be careful that as you
move to expedite this decision making process, that VA has very
clear criteria. Number one, we do not want dumping in the
community.
Number two, as an example, where we have Loch Raven
Hospital, that was going to be closed for the new facility
downtown, that we opened some years ago. They were going to put
it up for highest and best use and a lot of the kind of GSA
swagger cliches.
And what happened was, because it was an integrated
neighborhood, Blockbusters came through and said, ``Drug
clinics are coming and so on.'' When we stopped that, recycled
it for one primary care and then an extended care rehab, one,
we stabilized the neighborhood around it, but we have to be
careful then, that when we are moving to, we do not have
unintended negative consequences to the community near it, what
this process need.
And I know my time is up, but I want to just bring to your
attention, Fort Howard. Fort Howard is an aging in place
infrastructure that has served the long-term care needs of
Marylanders, going back to even World War I. The dedication of
your staff and ingenuity around asset management has kept an
old building going. That building has to go.
We now want to look at what to do. You are on prime
waterfront property. We are talking about a long-term care
facility. We do not want Taj Mahal-ing. But should it be a
combination of new thinking, assisted living, home health care,
because it is in the zip codes of veterans aging in place?
So, we want you to be able to close down a building, where
just to keep it going is so difficult, but have new thinking,
in a way, either to recycle your--your land or--or if you are
going to dispose it, there must be, as an old city council
lady, what is the consequences to the neighborhood and how that
is managed. It just cannot be dumping.
Mr. West. Well, we agree with a process of including the
community in the decision making.
Senator Mikulski. Right. Now, I am going to--I know other
members have it. I would like you--we are going to be briefed
on the Fort Howard plan. And I would like you, sir--this could
be a tool for innovation and new thinking. I would like you,
sir, to personally stand sentry on the Fort Howard plan to make
sure that we meet the needs of aging veterans; see where there
can be innovation that is both compassionate and cost
effective, and that we do not have any RIFs in the process. New
buildings does not necessarily dump--changing buildings does
not necessarily mean changing personnel.
Senator Bond. Thank you very much, Senator Mikulski. I
would like to turn to Senator Burns.
statistics on va facilities and employment
Senator Burns. Thank you, Mr. Chairman. Boy, this is my day
today. I had the Forest Service down the hall. And it has been
a dandy day.
Thank you for coming this morning, Mr. Secretary. And could
you tell me how many hospitals we have in this country,
veterans hospitals?
Mr. West. Well, the number we are using is 172. I say it
that way; those are medical centers. The definitions, I notice
are----
Senator Burns. Well, how many--how many----
Mr. West. All right.
Senator Burns. Then, let us----
Mr. West. 172.
Senator Burns. Okay. Now, does that also count your
clinics?
Mr. West. No, sir.
Senator Burns. How many clinics?
Mr. West. If you combined clinics, outpatient clinics, are
about 600, with another 89 outpatient clinics in the fiscal
year 2000 budget.
Senator Burns. Okay. And long-term care facilities, nursing
facilities.
Mr. West. 132.
Senator Burns. 132. Okay. How many employees do you have?
Mr. West. Something in the neighborhood of 180,000 fulltime
equivalents, I would say.
Senator Burns. 180,000.
Mr. West. And that is health care, which is about 90
percent of our total.
Senator Burns. Yes.
Mr. West. Total.
Senator Burns. 90 percent of that is health care.
Mr. West. No. The 180,000 is 90 percent of our total. That
is health care. I thought that is what you wanted. Do you want
the total for the department?
Senator Burns. Yes.
Mr. West. 230,000 employees.
Senator Burns. 230,000.
Mr. West. It changes.
Senator Burns. How many veterans do we have----
Mr. West. I'm sorry.
Senator Burns [continuing]. In those? How many people have
you got in these facilities? Let us say, how many----
Mr. West. What is the population?
Senator Burns. How many people have you got in those
hospitals right now?
Mr. West. Let me just ask Dr. Kizer. Do you have a rough
estimate of what our medical center and clinic population are
together?
Senator Burns. Well, and how many--and how many people
are--are using the clinics?
Dr. Kizer. Last year, we provided care, both inpatient and
outpatient care to 3.4 million individuals.
Senator Burns. Now, how many--how many in the hospitals?
Dr. Kizer. Well, on any given day, there is 20,000, plus or
minus.
Senator Burns. 20,000. Well, that is all we are taking care
of today. And that is what I am doing here now.
Dr. Kizer. Well, we have, right now, in the system, around
25,000 hospital beds, and we are running an occupancy rate of
around 75-80 percent. So, somewhere, 20,000, 21,000, 22,000 on
any given day.
Senator Burns. How about--how about your clinics?
Dr. Kizer. I would have to defer to the actual number that
is seen----
[The information follows:]
Daily Census Information
In fiscal year 1998, VHA provided outpatient care to 3.3 million
patients, generating a total of 35 million outpatient visits.
Senator Burns. How many people--how people--how many people
have you got in the nursing homes and long-term?
Dr. Kizer. In the nursing homes there is approximately
15,000 beds. And they are running 90 to 95 percent occupancy
rates.
Senator Burns. So, you have got 14,000, about, in long-
term.
Dr. Kizer. 13.5 thousand, roughly for VA nursing homes.
funding for montana
Senator Burns. We increased the dollars last year in VA,
but Montana took a hit for some reason or other. And they tell
me it is because we--we opened a couple of clinics; one is
Glasgow and one in Billings. And that--that money siphoned off
dollars that usually went to Miles City or Fort Harrison. Is
that a correct statement, do you know?
Mr. West. I will let Dr. Kizer answer it. I would say, it
is not unusual as a part of the transformation of this system
that beds in medical centers are reduced as we open outpatient
clinics.
So--now that is my overall answer. Do you know the specific
case of that one?
Dr. Kizer. I would have to defer, but it is not
unreasonable that a certain amount of money, as you reallocate
to a greater number of facilities, there would be some changes
of what would go to individual facilities.
telemedicine
Senator Burns. Well, we have got a little firestorm going
on out there. And so far, we have not--we have not been able
get too many folks' attention on this. And I am kind of
concerned about it, especially when we have got 180,000 folks
trying to take care of 34,000. And it looks like there should
be some--you know, some help here, coming from somewhere. That
does not sound too efficient to me, if it takes that many--that
many folks.
I will tell you that this is the most inefficient way. I do
not know how come we are not issuing ID cards and sending them
to the local hospitals in the first place, instead of--where we
have got to deal with distances out there. And we have done
nothing, as far as telemedicine is concerned or anything. And I
would like to--I would like to see some kind of telemedicine
facilities put in--in these hospitals, especially in the west,
where we have got to deal with distances.
If you are going to put outpatient clinics in areas, then I
think they are going to have to be able to communicate, both on
a diagnostic and health care--ongoing health care problems with
whatever main facility that we are operating.
I do not see any of those things happening; those
innovative things that can keep us out of these busses that
pick folks up and cart them 180 miles, just to get their blood
pressure checked. That does not make a lot of--that does not
make a lot of sense to me.
I would like to just visit with you in my office one of
these days, and we can go over some of those things. This is
not the place for this, because that is sort of a parochial
thing that we have got in the west, Mr. Secretary.
But this is what I am looking at, right here.
[Indicating.]
Mr. West. I think you make good points about the use of
telemedicine and other inventive, forward-looking devices that
would deal with that. And I think that has been a hallmark of
what Dr. Kizer's folks have undertaken. I would be glad,
personally, to visit with you.
Senator Burns. If we could take a look at that and see if
we cannot make that work in some way or other, because--but I
am still concerned about this little figure about how many
people we have got and the facilities we have got, and then how
many people who are actually using the facility today.
Mr. West. As I would say, again, it is not unusual that
hospital beds are turning into outpatient clinics. That is the
way we have been able to bring health care closer to veterans.
Dr. Kizer. Senator, I think, for the record, at least, we
should make a comparison between the efficiency or the
inefficiency, if you will, of VA health care to Medicare. And
if you consider the capitation rate of VA health care at about
$2,600 per person, and however efficient or inefficient that
is, for a lesser scope of benefits and a product that does not
have the same level of quality, Medicare is paying about $5,600
a year. So, that gives you at least some sense of perspective
and reference. And if you want to----
Senator Burns. Well, I will not argue that figure with you.
I am just--I am saying that you have a very, very strong
argument. That is a very strong point. And I happen to agree
with you on that--on that point.
So, that--I just think people ought to understand, you
know, where our figures are coming from, because if there is
anything that is--that is really eating our lunch, it is--I
think we are--I think, somewhere in your--Mr. Secretary, in
your organization, I think we are little redundant in our R&D.
What are we doing in R&D in the Veterans, that they are not
doing somewhere else? I want to--someway or other, I want to
help the folks out at the Armed Forces Pathological. They want
to renovate out at Walter Reed.
I want to help some of those folks do that, because there
is a resource there that I think needs new facilities--but I
want to--there are some things I want to do that actually
contribute to the support of our Armed Forces, not only in the
field, but also our veterans in the same way.
I think we are a little redundant in some areas. But we
will talk about that. I would like to sit down and visit with
you about that sometime. If you get--if you happen to squirrel
off about 15 minutes sometime, why, I would like to sit down
and visit.
Mr. West. I will do that.
Senator Bond. Thank you very much, Senator Burns.
Senator Harkin.
personnel reductions and closing facilities
Senator Harkin. Thank you, Mr. Chairman.
Mr. Secretary and Mr. Chairman, I am sorry I am a little
late, but I understand some of the opening comments had to do
with the same concerns that I have, and that is the impact of
the VA medical budget on the care of Iowa veterans.
I am really becoming more and more concerned about what is
happening. Our local VA medical region officials have described
a $27 million shortfall in VA medical care funding for Iowa.
And that is during a time of double-digit medical inflation and
an aging veterans population, which I am going to get more into
with you in a minute, and a flat budget request for the VA's
hospitals. It is not a big surprise that we have this
shortfall.
Last summer, the VA hospitals of central Iowa announced a
reduction of some 94 of its hospital staff. Now, there are
rumors that even more reductions are going to happen sometime
soon.
With this current shortfall, the rumors are ringing even
more true. And I am now hearing about the possibility of VA
hospital shutdowns in Iowa. This could have a tremendous impact
on veterans in our state.
And again, this $27 million medical care shortfall in my
state really makes these rumors real. Recently, Mr. Secretary,
you were asked at a public forum here in Washington, DC,
whether the current VA medical budget will result in facilities
being closed around the country. And you responded, ``Not on my
watch.''
I appreciate that strong statement of support. But does
that statement also mean that VA facilities, whether in Iowa or
elsewhere in the nation, will not also see substantial
reductions in personnel or service? Does it extend to that,
too, or is it just for shutdowns? And I am----
Mr. West. I think I have an obligation to avoid giving
overly categorical statements at any time. I recall--I think
this was probably one of the winter meetings. And I spoke
fairly specifically.
I referred, first of all, to some rumors last year that we
were closing vet centers. That is the issue to which I made the
comment, ``Not on my watch.''
With respect to closures of medical centers, medical
facilities, I believe what I have said, and if not, I say it
now, we have no plans to close any medical centers in this
current fiscal year. Indeed, as far along as we are, there will
not be any closures. And I know of no plans to close any in
fiscal year 2000.
With respect to your question on reductions, no, I do not
make those categorical assurances. And I say this about the
whole issue of how we reform the face of VA health care, as we
continue what has been, now, a five-year program, to completely
transform health care from medical center based to ambulatory
care. That is what we were just talking about, turning hospital
beds into clinic beds.
I am going to leave it to our medical center directors, our
network directors, to offer up in their areas to Dr. Kizer
their best estimate, in consultation with their communities;
that is, veterans there, service organizations, other
interested people in those communities, how best health care
can continue to be reformed and improved; getting more health
care to more veterans. And in that, I put no restrictions on
them, on what they can send forward, and what can be heard.
So, my answer is: No closures in 1999. I know of no plans
for closures in 2000. I put no restrictions on our planners, as
to how they try to manage and send forward recommendations.
And as to staffing reductions, they are already part of our
budget. We are doing reductions in 1999. They will contribute
to the level we must reach in fiscal year 2000 budget. I have
seen a number as high as 8,000; I heard one mention 7,000; in a
base of some 220,000 employees in the Department of Veterans
Affairs. But I do offer this: When we do them, they will not be
budget driven. They will be driven for the purpose of improving
health care.
How do I say that? As we learn that we can bring health
care closer to veterans, in clinics that get closer to them,
that very surely will mean there will be fewer beds in major
medical centers.
Now, I may have missed the origin of your point. I do not
remember whether you were asking me about clinics or medical
centers, but the point is, there will continue to be changes in
the way health care appears in our communities across the
nation, as we continue to try to improve it.
iowa city vamc study
Senator Harkin. Well, we had a study done, with the
University and with the Iowa City Veterans Medical Center in
Iowa City, IA.
Mr. West. That is a medical center.
Senator Harkin. You are familiar with that. Well, there was
a study done as to whether they were going to close it and
transfer the veterans to the university hospitals. Another
study showed that the VA center would save $16.6 million a year
by closing its inpatient facilities, but would have to pay the
university hospitals $22.4 million to care for the patients.
So, it does not look like there would be any sense in
closing that and shifting over the veterans.
Mr. West. Well, but I hear you also saying, at one point,
closing the facility, and at another time, closing the
inpatient facility. This has happened in other medical centers
across the country, as we look for the best way to deliver
health care there.
I do not know the specific plans there. Do you know the
specific plans there?
Dr. Kizer. Yes. A decision was made not to move forward
there. As you know, the Iowa Medical Center has had a reduced
census--quite a low census--in the last couple of years. The
study was done, comparing the costs. And the decision was made
to retain the services at the VA, because it was significantly
cheaper than buying it across the street.
Senator Harkin. Yes.
Dr. Kizer. In other places, we have made the converse
decision.
Mr. West. Well, we do not make these decisions lightly.
Senator Harkin. Let me just get into that. My time is
running out.
Mr. West. Sir.
providing health care in rural areas
Senator Harkin. We talk about reducing population base. And
I have got a running argument with some people on that. I just
want to make it clear that you are right. There is a bigger
population base for veterans in some other states in the nation
than in Iowa; Arizona, Florida. When some veterans retire; they
go down there to live.
But what you have got to start looking at is not just base
numbers, but also how old these veterans are and how poor they
are and how sick they are. In Iowa a lot of people who have a
little bit more money, may have moved to Arizona, they may have
moved to Texas, or they have moved to Florida to retire.
And what is left behind are the poorest, and the sickest,
and the oldest. And those cost more money. And I do not--I just
say this to you with all due respect, I do not think the VA is
looking at it in those terms. I just keep hearing about a
population basis.
And I tell you, you have got to start factoring in that
aspect, plus as my friend from Montana said, the rural areas,
where they have to travel a great distance, where they do not
have the facilities right around the corner, and where, because
of the high incidence of near poverty--I will not say poverty,
but near poverty, where these veterans are basically living on
their social security checks and that is all.
They do not have the wherewithal to just jump in the car or
have someone drive them, because they are too sick to drive to
the University of Iowa or to Iowa City or to the Des Moines
Veterans Hospital.
So, I just want your reassurance that you are going to
start taking a look at not just population base, but age,
income, and health problems, all combined in that veterans
community.
Mr. West. Senator, we have done that and will be happy, if
you want to sit down outside this forum to go through some of
that data, but we actually have comparisons in the different
areas.
I think the most difficult issue that we find in some parts
of Iowa, as well as in Vermont and a number of other places in
the rural areas, where you have a low population density, but
you have elderly and sick veterans who need care, is how can
they get to a clinic or medical center. And this is an issue
that confronts not just veterans but rural health care
everywhere. We are part of that, trying to figure how to do
that.
As for Iowa veterans, the acuity and the functionality of
the population, the age of the population, et cetera, those
things have been looked at. And we would be happy to share some
of that information with you.
[The information follows:]
Providing Health Care in Rural Areas
VA has initiated a survey instrument to assess the health status of
our patients nationwide. This instrument takes into account such
factors as the patient's age, degree of illness, and area of the
country in which he/she lives. We have completed initial work on this
health assessment in order to establish baseline data on users of VA
care. Our plan is to now extend the health assessment to all enrollees
of VA care over the next several years. The health survey will also
include information on health behavior such as smoking, alcohol abuse,
physical activity and diet. We believe the assessment is pertinent for
resource allocation decisions and as outcomes of care. For your
information, we are including a recent article from the American
Journal of Medical Quality which describes in great detail the Veterans
Health Study thus far.
[Clerk's note.--The article from the American Journal of Medical
Quality, ``Health Status in VA Patients: Results from the Veterans
Health Study,'' can be found in the subcommittee's files.]
Senator Harkin. Well, I appreciate that, because--just one
last thing, Mr. Chairman. You have indulged me. I appreciate
that.
iowa community-based outpatient clinics
I understand that the Iowa Veterans Office has delayed the
start of the new community-based outpatient clinics, the CBOCs,
in Iowa. And again, Iowa is a rural state. And I am wondering
why is that happening? And if you could look into that, I would
sure appreciate it.
Thank you, Mr. Chairman.
[The information follows:]
CBOCs in Iowa
Healthcare services to rural veterans in Iowa are provided through
a variety of delivery sites and arrangements. Current active CBOCs in
Iowa are located in Mason City, Waterloo, and Bettendorf, with primary
care services provided in Dubuque through an extension of the Waterloo
clinic (see below).
Implementation plans continue on schedule for June 1999 for an
approved CBOC in Galesburg, IL. No additional Iowa CBOC business plans
have been submitted for approval at this time. In addition to CBOCs,
complementary strategies are being utilized to provide services to
veterans in rural areas of Iowa:
--Health screening and enrollment activities continue throughout the
Network with more than 150 clinic sessions so far in fiscal
year 1999.
--Primary care services will be provided in the Dubuque area through
a traveling team based at the Waterloo CBOC. This service will
begin on a part time basis with additional time being allocated
if workload levels increase. Currently, VA is exploring the
possibility of a lease for space in Dubuque.
--Specialty care has been expanded to rural areas of Iowa via
telemedicine, and telepsychiatry connections. Currently,
connections for telemedicine exist between the Iowa Veterans
Home in Marshalltown and all the Iowa VAMC facilities.
Telepsychiatry connections exist at the Quad Cities, Mason
City, and will soon be expanded to include Fort Dodge. This
technology provides increased access to specialty care follow-
up services. Additional connections via the Iowa Communications
Network (ICN) are being explored across the state.
Senator Bond. Thank you very much, Senator Harkin.
Mr. West. Mr. Chairman, can I just say one thing about this
issue of what gets reduced and what gets closed?
We should not be making these decisions--and I think we are
not, but we should not be making these decisions in a vacuum
here in Washington. These are the kinds of things that require
community discussion. Veterans, veterans service organizations,
everyone who has a role, is discussing it before they even get
here.
I think, sometimes--because I know many of our directors
and network directors are doing that, but sometimes when they
attempt to start a discussion, it gets everybody excited, and
it is back here in Washington as a decision before it has even
been talked through.
We will try to make sure that on any decisions like this,
the community has a role in the planning before we get to
making pronouncements here in Washington. I think that is very
important.
asset disposal
Senator Bond. Thank you, Mr. Secretary. You know, as we
look at these very difficult problems that you are facing, some
great philosopher, and it might have been Dr. Kizer, said that
VA should not be about maintaining buildings, but about
providing the best care for veterans.
Whoever said it, I think, was right. And I agree with that.
And you have got some tough choices. You said there are no
plans for closing any facilities in 2000.
Yet, do you agree with the assessment of the General
Accounting Office that hundreds of millions of dollars are
spent each year, and they suggest that billions of dollars,
over five years, are going to be used to maintain unneeded
buildings, unless VA takes some significant steps to begin the
process of getting rid of these unneeded buildings? Would you
agree with the assessment? Is that a fair calculation by GAO?
Mr. West. Are you----
Senator Bond. Yes. You, sir, or to whom you ever would wish
to----
Mr. West. I think Dr. Kizer might have something he wants
to say about that. And I am inclined to let him go first, but
let me just say this.
How can one quarrel with the observation or the conclusion
that we spend a lot of money maintaining buildings? Of course
we do.
How can one quarrel with the observation that a lot of them
are old? Of course they are.
And I took a glance at the report this morning. They are
right.
And how can one quarrel with the observation that if some
of those buildings that are tremendously old and that are big
and that we pay a lot of money for overhead are standing half
empty, that that is not at least something for us to look at,
as we consider the changing face of the delivery of health care
to veterans.
We are not going to turn aside from that. But I am also not
going to make pronouncements today that, ``Hey, everybody, get
ready for a wave of closures.''
I expect Dr. Kizer and his people to look at all of those
factors, as they decide in discussions with the community and
with the veterans there what we are going to do; how best we
can going to continue to give health care, and even improve it,
in the years ahead.
Senator Bond. That is a fair assessment. But what we are
looking at, in your budget, with the needs you have, the
balance between closing unneeded buildings--it is either that
or it appears likely that it is furloughs, RIFs, and other
drastic personnel actions. And these are not happy choices.
So, I would like to hear the solution from Dr. Kizer.
Mr. West. Before he speaks, I want to say one thing about
what you said, Mr. Chairman. Unneeded buildings. We must----
Senator Bond. That's what they----
Mr. West [continuing]. First determine that they are,
indeed, unneeded.
Senator Bond. Well, that was GAO's assessment. That is why
I asked you if you accept the premise.
Mr. West. Well, I do not accept that they are unneeded,
because I do not know the specific buildings. That is what we
expect our people to look at and to determine.
Senator Bond. Okay. All right. Dr. Kizer.
Dr. Kizer. This is always an interesting and scintillating
discussion. And I would add just a couple of points.
It is hard to argue with the rapidity of technology
development and how health care has changed as a result; that
when you have an infrastructure in which the average age of
one's buildings is 38 years old, and when 40 percent of them
are more than 50 years old, that there is certain to be
substantial inefficiencies built into those, because those
buildings were designed for a type of care in an era when
things were done very differently than they are done today.
The difficulty that you have, and it is a political
difficulty, in that people view these buildings as the
personification of health care, and this leap between
understanding that we can provide better health care and more
health care in alternative ways, is one that communities have a
very hard time coming to grips with.
And one of the things that we have, although you may not
have had a chance to review it, there is a proposal out for
review and comment, as we speak, for Capital Asset Realignment
Committees. That would involve VA headquarters mandating that
each network set up these committees that would be composed of
primarily non-VA people, representing the veterans
constituency, as well as some other folks, using consultants,
and to look through exactly what are the service demands; what
is the infrastructure that we have; where are the incongruities
or the mismatches between facilities and needs, whether it be
geographic site or just a physical plant in a site that may be
otherwise well, and to come up with some recommendations.
I believe that people in the local communities, if they are
given the full information and some time to mull it over and
they have confidence, they will end up making the right
choices. And the folks actually can make the tough decisions
about realignment of our capital assets that may be very
difficult to make politically.
market assessment process
Senator Bond. I know how difficult it is.
Mr. Secretary, prior to your tenure, this committee got
into a firefight over whether a new hospital was needed in
northern California. And a market assessment was done. And
following the recommendation that a new hospital was not
appropriate, outpatient clinics were provided instead, saving
tremendous amount of capital investment and operating costs.
And I believe this committee was vindicated by our
obstinacy in refusing to approve funds for a new hospital, but
it was based on a market assessment.
Is that process of market assessment appropriate? You have
got nine markets where there are four or more facilities. And I
have gotten into some trouble before mentioning them.
I will not start that fight again today, but is a market
assessment process appropriate? What resources do you need to
make such assessments?
Mr. West. Well, I do not have the answer to the second
question, but the answer to the first is: Any tool that will
inform us better about how well we are delivering care is
useful. And if a market assessment will do that, and GAO thinks
it does--and indeed, we have done market assessments before. It
has been very successful.
Senator Bond. But do you agree that market assessments
are----
Mr. West. Any tool. Any tool that will help us to
understand better what we need to do to deliver better health
care is not only acceptable, but desirable.
Senator Bond. Is there any other tool, what other tool are
you going to use, beside market assessments?
Mr. West. Well, there are all sorts of surveys. We have
even done market assessments before. I do not see how I can
object to market assessments.
Dr. Kizer. That process that you refer to is an inherent
part of the--what I mentioned before; the Capital Assets
Realignment for Enhanced Services [CARES] committees.
Senator Bond. We have not received the copy of the
directive for the record. We would be interested in seeing
that.
Dr. Kizer. We will get that to you today. It is a draft
directive that, before it was promulgated in final form, I
wanted to send it out to our various stakeholders for them to
comment on it and see if we could not make it better than our
first iteration.
[The information follows:]
Market Assessments
In recognition of VA's responsibility as a major land holding
agency to provide prudent and cost-effective management of its
extensive real estate portfolio, VA is taking a number of actions aimed
at maximizing the functional contribution and reducing VA's overall
cost of ownership associated with the over 22,000 acres and 140 million
square feet of space under our control.
To align our physical infrastructure to more effectively support
the current healthcare needs of the Department, we are in the process
of implementing an improved strategic planning process. To provide
oversight and direction for this planning, each VISN will establish a
Capital Assets Realignment for Enhanced Services (CARES) Steering
Committee including membership representing veterans, the state, our
affiliates, and our various missions. The CARES committee will develop
semi-annual plans aimed at realigning any imbalance between VA capital
assets and veterans needs. CARES plans will itemize historical, current
and projected utilization and demand for healthcare services, describe
current assets, and critically review the match of assets to the VISN's
current and projected future demands. The plans will further consider
alternatives to current service delivery modes, and will make
recommendations as to proposed reuse or reconfiguration of capital
assets to more efficiently provide services to veterans [see attached
draft Directive].
The Department has submitted legislation to authorize the
establishment of a new five-year pilot and Capital Asset fund to
significantly improve its management capabilities by encouraging and
streamlining the process of converting properties we no longer need
into productive assets. This proposal would allow the VA to dispose of
these properties (including land, structures or any equipment
associated with the property) by sale, transfer, or exchange, and to
reinvest the bulk of the proceeds in more appropriate capital to
benefit veterans. The Administration has also requested $10 million in
appropriation to fund the administrative start-up costs of this new
activity. Allowable deductions would include all costs of disposing of
the asset such as site preparation, demolition, administrative
expenses, etc. The pilot would raise the threshold for reporting
disposals in an annual budget document from $50,000 to an amount equal
to the cost of a major medical facility project (currently $4 million).
For disposals under this threshold, a notice of intent would be
provided to the local community and the congressional committees.
Because of the resources that will directly benefit VA programs, the
Department is moving quickly to establish procedures to implement this
authority as an additional tool in our overall Asset Management
program.
draft
Department of Veterans Affairs VHA DIRECTIVE 99-XXX
Veterans Health Administration
Washington, DC 20420
April X, 1999
veterans healthcare capital assets realignment for enhanced services
(cares) steering committees
1. Purpose.--This Veterans Health Administration (VHA) Directive
promulgates VHA policy regarding the establishment of Veterans
Integrated Service Network (VISN) Capital Assets Realignment for
Enhanced Services (CARES) Steering Committees and specific minimal
requirements for their membership, reports, and plans.
2. Background
a. Since September 1995, the veterans healthcare system has
undergone a profound transformation. Illustrative of the changes are
the implementation of universal primary care, a major shift from
inpatient to outpatient care, and marked improvement in a variety of
performance indicators. Similarly, more than half of all acute care
hospital beds have been closed, bed days of care per 1,000 patients
have dropped 62 percent, the percent of surgery performed on an
ambulatory basis has increased from a third to more than three-fourths
of all cases, and the number of patients treated has increased over 20
percent. Likewise, more than 270 new community-based outpatient clinics
(CBOCs) have been planned and/or sited, 50 VA medical centers have been
merged into local integrated delivery systems, and inpatient acute care
has been discontinued at several VA medical centers. Myriad other
service consolidations or program changes have also been completed.
b. At present, VHA owns and/or operates an extensive inventory of
capital assets located in all 50 states, Puerto Rico, the Virgin
Islands, Guam and Samoa. These assets include over 22,000 acres of
land, 4,700 buildings, and 140 million square feet of owned or leased
space at over 1,200 locations. The replacement value of building
supporting VA's healthcare mission is estimated at $35 billion. The
average of VHA facilities is about 38 years. Many of VHA facilities
were acquired from the military and are not sited near veteran
population centers. Likewise the physical infrastructure of VHA was
developed at a time when the dominant method of care required inpatient
admissions and relatively long lengths of stay. The standards to which
these facilities were designed and constructed decades ago are, in many
cases, no longer deemed appropriate or acceptable for modern
healthcare.
c. In addition, the hospital or individual hospital service
occupancy rates at many VA facilities today are less than needed for
either efficient operation or optimal quality of care. This situation
will likely worsen as current trends continue to shift more and more
care to ambulatory and home settings. Perpetuating inefficient use of
existing VA facilities diminishes the availability of funds that could
be used to increase veteran access to care, to strengthen the service
delivery capabilities of more functional VA facilities, or to otherwise
enhance services for veterans.
d. As we now begin to peer into the 21st century, it is clear that
new healthcare and information management technologies, combined with
advances in genomics and other medical sciences, the aging of the
veteran population, budget constraints, and other developments will
continue to further transform the delivery of veterans healthcare.
3. Policy.--When visualizing VA healthcare in the 21st century, it
is clear that in numerous locations, VA facilities and other capital
assets are not well aligned with the location or needs of veterans.
Therefore, it is imperative that each VISN begin a strategic planning
process aimed at realigning imbalances or inequities between VA capital
assets and veterans needs. The intent of such planning is to enhance
services to veterans.
a. To be successful, this capital assets realignment for enhanced
services planning process must be open and broadly inclusive of VA
stakeholders and VA health plan users.
b. Likewise, to help ensure objectivity and impartiality of the
process, assistance from knowledgeable outside and independent
consultants is essential.
4. Action.--To accomplish the above noted goal, each VISN is hereby
directed to convene a CARES Steering Committee by July 1, 1999. This
committee shall submit to VHA Headquarters, Office of the Under
Secretary for Health, a CARES Steering Committee initial report and
plan by December 31, 1999, and every six months thereafter. At a
minimum, the Committees' reports shall be linked to the VISN business
plan and shall:
a. Review historical, current, and projected service utilization
and demand for veterans healthcare services throughout the VISN and for
each particular facility.
b. Describe current VISN capital assets, including all owned and
leased properties/buildings and other relevant federal and/or state
facilities (e.g., State Veterans Homes). This review shall include at
least a description of each asset's geographic location, services
provided and treatment capacity, age physical condition, convenience or
access, availability of parking or public transportation, and need for
renovation or repair.
c. Critically review the congruence or match between present VHA
assets and the VISN's current and future projected demand for services.
d. Make recommendations for how VISN capital assets could be
reconfigured or rearrayed to better meet the demand for services.
e. Consider alternatives to current service delivery modes that
might allow the VISN to enhance services to veterans and/or serve more
veterans.
f. Membership of the CARES Steering Committee shall be selected by
the VISN director and shall consist of at least the following:
--1. a State Director of Veterans Affairs (or his/her
representative);
--2. a director of a State Veterans Home (or his/her representative);
--3. three representatives from veterans service organizations or
veterans advocacy groups;
--4. a dean of an affiliated medical school (or his/her
representative);
--5. an Associate Chief of Staff for Research from a VA medical
center;
--6. an Associate Chief of Staff for Education from a VA medical
center;
--7. a representative from a state medical association;
--8. a representative from a state hospital association;
--9. a VA clinician knowledgeable about geriatrics/gerontology and
long-term care; and
--10. the VISN director and Clinical Manager, who will serve as Ex
Officio members.
g. The chair, vice chair and other officers of the CARES Steering
Committee shall be selected by majority vote of the membership.
h. The CARES Steering Committee shall establish operating rules and
policies, and shall be given an operating budget by the VISN.
i. The VISN Director may chair the first and/or second meeting of
the Steering Committee until a chair is elected.
5. Resources.--In developing its Capital Assets Realignment for
Enhanced Services Strategic Committee plan, VISNs shall consider the
``Criteria for Potential Alignment of VHA Facilities and Programs''
dated September 1995, A Guidebook for VHA Medical Facility Integration
(1998), and other relevant internal and external reference sources.
6. Follow-up Responsibility.--The Chief Network Officer (10N) is
responsible for the contents of this directive.
7. Recission.--This VHA Directive expires January 31, 2005.
Kenneth W. Kizer, M.D., M.P.H.,
Under Secretary for Health.
Senator Bond. We will give you any ideas we have. Thank
you.
Senator Mikulski.
Senator Mikulski. I would just like to give some
observation on the--first of all, Dr. Kizer, I found your
description of the local teams to be very informative, as well
as the Secretary's comments.
Here is what I think: First of all, we are in the VA health
care business. We are not in a VA real estate business. And I
think the veterans will know that.
They have developed an attachment to facilities, because it
has usually been very important in the community, strong
volunteer base, both from veterans organizations, as well as
community, but really, deep down, what they want is continuity
of care. And they say they want VA to be in the health care
business and less worried about the real estate business.
What I believe, because I do believe decisions must be made
at the local level, though--but I do believe there needs to be
national guidelines, national criteria, and national training
of the people who will be organizing teams like that at the
local level; and then oversight and supervision of the teams,
so that you have the decision making, but you provide for local
VA administrators, who will putting these teams together,
because again, they have been in the VA administration
business. They have not been in the real estate business.
And that is why I know Senator Bond was focusing on market
assessment. And we would want the involvement of private sector
or non-profit private sector in the local community; the State
Economic Development Commission; in Baltimore, it might have
been the Baltimore Economic Development that says, ``This is--
this is really the--what this asset is worth. These are other
uses.''
Perhaps--and I could go through a whole string of things;
not creating destabilization, as well as that.
So, think about national guidelines, national criteria, and
national training, oversight and supervision, and then truly
not just saying Well, we are going to have a meeting with the
veterans to see what they want to do.
That is important, but property is a very complex business
for which there is specialties in that. So, that is one thing.
processing claims
Second, I would like to go, though, to the disability
issue. And Mr. Secretary, could you tell us what is the current
processing time for claims? And what is your goal? And how do
you hope to achieve it?
Mr. West. For claims.
Senator Mikulski. Yes. How long does the average--from the
time someone applies, what is the average length it takes to be
adjudicated?
Mr. Thompson. Original compensation claim.
Senator Mikulski. Yes.
Mr. West. Speaking strictly about original compensation
claims, Senator, that would be 198 days.
Senator Mikulski. I am sorry. I cannot hear you.
Mr. West. 198 days for original disability claims. All
claims involving disabilities, of which original claims are a
distinct minority, average 161 days.
Senator Mikulski. How could that time be reduced? And what
is the goal, Mr. Secretary? We have heard these two numbers.
What is your goal, sir, in terms of----
Mr. West. Well, in terms of time of processing, I have
several goals, Senator.
First of all, when I arrived, we knew we had improved the
time of processing, but I was told by my Under Secretary, Joe
Thompson, as he put his new process in place in VBA, that the
time of processing claims was going to lengthen for a bit, as
we tried also to improve accuracy and other considerations as
part of his balanced scorecard approach.
That has happened. He has put in his balanced scorecard
approach. We are improving accuracy. And yes, we will try to
improve timeliness, as well. But between now and, say, the end
of this fiscal year, my goal is to continue to show improvement
in accuracy, as well as beginning to make improvements in
timeliness, as well.
I think one of the things that has happened to this
department, in the past, is that we too quickly got ourselves
anchored to a number of days by a certain time line.
performance standard in processing claims
Senator Mikulski. What is your performance standard, then?
Mr. West. If I could finish that thought. What it did was
to create a problem that VBA has tried to overcome; that is
throwing all your assets, all your people, and all your best
thinking into just finishing fast.
Let me tell you what finishing fast can mean. It can mean
that you put aside older claims. And you only treat the new
ones coming in that are not too difficult. And so, you end up
getting better numbers, but you are really not serving veterans
better.
So, the first performance standard is servicing veterans
better.
Senator Mikulski. What is the operational definition of
that? What is the operational definition of serving veterans
better? What is the operational definition of----
Mr. West. It is the effect of our balanced scorecard.
Mr. Thompson. If I might, to echo something the Secretary
just mentioned, when we over-focus on speed, which we did as a
department for a number of years, we start to trade off things;
the accuracy of the decisions we made, the things that are not
measured, and specifically phone calls.
We had higher than a 50 percent blocked call rate, which
means more than half of all veterans who called us got a busy
signal.
Mr. West. I hate to interrupt him, but you can improve the
timeliness of claims if you turn off your phones and people
stop answering them, and just do claims. And to some extent,
that may have happened.
Go ahead.
Mr. Thompson. Appellate work, remands, fiduciary work; all
of those things got put on the back burner, because we focused
on one type of claim.
We have adopted the operational definition of a good job is
saying, ``You not only do it quickly, but you do it--you make
the right call, you make the right decision.''
As I mentioned last year, our error rate was 36 percent. We
pay out billions of dollars in our programs--we are either
doing a disservice to veterans or taxpayers or both when we
make mistakes.
I am happy to say, although it is nothing to write home
about just yet, we have reduced those by about a fourth. We
have gone down from 36 to 27 percent in a year.
This is an enormously complex business. It takes years to
train someone to do this job. To make adjustments in the error
rates is a multi-tiered approach. It is not just simply pay
more attention to what you are doing. As you mentioned,
Senator, it has to do with technology. It has to do with over-
complicated rules. It has to do with training. A host of
issues.
We want to build this system so it is strong and is capable
of delivering great service to veterans. We feel that the only
way you can do that is by looking at how long it takes to do
it; how accurate are you; what veterans think about it; and how
efficient are you in the process.
We have established a system of measures that look at all
of those things. It has taken some time to get that in place,
but I am very comfortable that looking at the system, we are
actually stronger than we were a year ago. I will admit that
the cycle times are not good. I completely agree with your
observation on that, but the system itself, from the base up,
is stronger than it was.
Senator Mikulski. Well, there--the two basic tools, of
course, are accuracy and timeliness. I mean, that is also the
way they--one, the way the taxpayers would evaluate you, and
second, the way the public would be.
But I feel I have been at this issue for a decade, both as
chair and then ranking. Paul has a report there, where there
was a GAO report in 1997. There was something in 1994. When--
the NAPA report, et cetera. And we are always going to get
there.
And the question is: When? How? What? Because--and when I
visited VA in Baltimore, trying to do disability, they had,
like, shelf upon shelf upon shelf of manual upon manual upon
manual, all of which were quite cumbersome. And each case
required pulling down four or five different manuals.
Certainly, there also needs to be an evaluation of the
regulations, the decision making. I believe Dr. Kizer would say
that there is even--since the original 1950 evaluation of what
criteria went disability, et cetera. Technologies have changed.
Certainly, if you can go in a hospital and you are out in one
day, it does not mean you that you are still a--no patient. But
disability has even been evaluated. Things that were once--just
because it is chronic, does not mean that it is disabling.
I am not, again, in the rehab disability evaluation
business, but there seems to me a way that we must really, by
the end of this century, get our hand on this.
Mr. Thompson. I quite agree on the things you mentioned.
The system itself was fundamentally weak and right across the
board, whether you look at regulations----
resources needed to meet goals
Senator Mikulski. Well, do you need more people? I know my
time is up. Do you need more people?
Mr. Thompson. Yes, we do.
Senator Mikulski. What do you need?
Mr. Thompson. We have asked to move 440 people into the
disability claims process. New hires, combined with
transferring FTEs from other areas with VBA, will enable us to
move 440 additional claims decisionmakers into the claims
process.
Senator Mikulski. As I understand it, the Administration's
budget calls for only a very modest increase in this area. Is
that correct?
Mr. West. It calls for 164 new positions. Those new
positions go directly to them. At the same time, as a result of
some duties that are changing in VBA, they are getting a total
of 440 claims decisionmakers. That will muscle it up.
But at the same time, Senator, I am not going to let our
people say to the folks working for them, Abandon everything
else you do in that office; just to get the days on those first
claims shortened.
They must do the other things. For example, if they get it
wrong, but get an answer out, they have still delayed the
veteran getting what he is due on his claim.
We want the accuracy improved, because that deals with the
most egregious problem, which is lengthy processes that go on
and never end.
Senator Mikulski. Well, this--if I might, Mr. Chairman----
Senator Bond. Please.
washington, dc, regional office
Senator Mikulski [continuing]. With your indulgence, follow
up on the D.C. field office. I was very disturbed by the
March--excuse me, the April 10 report by the Post that says the
D.C. field office was in chaos. There was a backlog of 10,000
cases. The field office has 158 staff, down 250 of--down from,
excuse me--down from--by 100, from five years ago.
Do you want to comment on this article? The 10,000 cases.
These are in my Montgomery County, Prince George's County, and
also the greater metropolitan area benefits.
Mr. West. I do want to comment. First of all, it is
unacceptable. I mean, that is just the fact.
Senator Mikulski. What's unacceptable? The article or the
D.C. field office?
Mr. West. No. There is nothing wrong with the article. The
article is based on a report made by Under Secretary Thompson's
team that went in there and reviewed it and wrote up their
findings. It is our self-assessment. It identifies an
unacceptable condition.
Under Secretary Thompson has several efforts underway. He
has a team in place and a person on his immediate staff
directly responsible for it. So, first and foremost, we found
the situation. And we found it because of the new system he has
put in place, whereby peers from other parts of that network
went in and looked at it.
Senator Mikulski. Well, then, what is the plan? Now, that
we have agreed that you found it and it is unacceptable, what,
then, is the plan?
Mr. Thompson. First, to echo the Secretary, it is a serious
situation there.
In the short-run, we will put the resources and the
leadership in there to get control of the immediate workload
situation. By this summer, we should have that under control.
Senator Mikulski. What does that mean? I mean, are you
going to bring 500 people? Are you going to bring six people?
Those are abstractions. What does--what are you really
specifically talking about?
Mr. Thompson. Well, specifically we are----
Senator Mikulski. I do not mean to be terse, but I----
Mr. Thompson. That is fine.
Senator Mikulski [continuing]. Need specifics.
Mr. Thompson. We are bringing people in to help the
regional office. We are also moving work out, temporarily, at
this point, to Baltimore, Roanoke, other parts of the network,
to help them bail the water out of the boat.
Senator Mikulski. How many people are you bringing in?
Mr. Thompson. We are only bringing in a handful to work in
the regional office.
Senator Mikulski. What is a handful?
Mr. Thompson. About five or six and that includes managers,
as well.
Senator Mikulski. So, the rest, then, will go on to
overburden people in Baltimore, Roanoke, and so on.
Mr. Thompson. Well, there----
Senator Mikulski. You just said that when you go to solving
one problem, another part collapses.
Mr. Thompson. The situation is this: Wherever we draw from,
they need the resources. There are no flush places in the
United States. Wherever we try to help, we are going to have to
draw from someone who also needs the help. It is a matter of
balancing priorities.
This system, in VBA has gone down farther than any of the
operating lines in VA; 18 percent over the last few years, as
the work has continued to build. It is important to understand
that there are no magic solutions. It takes years for someone
to learn the business. If I hire five people today, there----
plans to solve problems at Washington Regional Office
Senator Mikulski. I understand that. We have discussed
that. Let us go to the plan here, sir.
Mr. Thompson. Okay. We will get the work under control this
summer. In the long-term, there is a different problem and it
is a chronic problem with that office. That office has
traditionally served as the farm team for VA headquarters. What
that means, specifically, is, as we have trained people in
these very complex jobs, the temptation has been great to hire
them away into VA headquarters and other areas of the
government in Washington.
The grades in our regional office are not nearly as high as
they are in headquarters facilities. There are probably more
than 100 people in VA headquarters, who at some point in their
careers, were at the Washington regional office.
Over the long haul, it is hard for them, despite----
Senator Mikulski. What are we----
Mr. Thompson [continuing]. All the other things.
Senator Mikulski. What are we going to do about it?
Mr. Thompson. That is what we are crafting now. I will be
glad to sit down with you, as we decide what needs to be done.
Senator Mikulski. Do you now have a plan for that, sir?
Mr. Thompson. We have the short-term plan and we are
working on the long-term solution.
Senator Mikulski. And what do you envision the long-term
solution to be, Mr. Secretary?
Mr. West. It is not clear. I will have to wait and see. He
has put in a team and he has a deputy on his staff directly in
charge of it.
First, what we did was send in the team that told us what
the story is. Now, we need a team to look at several options.
One of them, quite frankly, is to stop treating that office
that way. This is no knock on the personnel in that office. The
fact is, though, they are constantly retraining themselves, as
their good people keep leaving.
And so, one thing to do is just allow them to grow and
strengthen themselves.
Another might be to reform the mission of that office,
entirely.
I do not announce that here today, but I am saying, as a
long-range----
Senator Mikulski. You will evaluate it.
Mr. West. As a long-range solution, those are two of the
key things to look at; to either allow them to exist there and
not constantly be raided, as we need good and talented people
in Central Office, so they can grow and mature. Second, we
could reform their mission in some way, so that their workload
is permanently assigned elsewhere. We need to work through
that, Senator, before we decide which of those to do.
In the meantime, as a short-term effort, we are diverting
some of that work. We are sending in a team to help those who
are there with the remaining work.
Senator Mikulski. Well, I know that the Chairman will ask
additional questions in this area. And let me say this: Number
one, yes, I would like a report on the specifics of those
short-term, long-term. And I know the Chairman does, as well.
In addition to that, as part of both dealing with the
10,000 case backlog there, my concern is that as you shift it
to other offices in the region the temporary shift could become
a permanent shift, or they themselves fall behind. I want to be
sure that this truly is a short-term, time-limited one, and
that the D.C. field office meet its responsibility to the
constituency area to which it has been assigned, so that
Roanoke does not collapse; Baltimore does not collapse; or
wherever you are going, because you already said they are
working under, at best, spartan circumstances or even skimpy,
quite skimpy, circumstances. And I do not have the exact
personnel numbers in those areas, but you know best.
[The information follows:]
Plans to Solve Problems at Washington RO
We are providing a summary of the short-term actions we have
undertaken to begin to bring the Washington Regional Office workload
back under control. The more fundamental issues related to the long-
term solution and the appropriate mission for the office are complex
and will take additional time to resolve. We will provide the Chairman
and Senator Mikulski with copies of our long term plans as they are
developed.
short-term action plan--april 1999
washington regional office
Restructure Veterans Service Center
Recruit new Veterans Service Center Manager.
Recruit for critical positions to include: Assistant Service Center
Manager, Master Rating Specialist and clerical personnel.
Define clear lines of responsibility and authority by establishing
work assignments, job descriptions, and performance standards.
Establish the following operational elements with clear lines of
responsibility and authority:
--2 Claims Servicing /Processing Groups
--1 Customer Service /Contact Group
--1 Claims Establishment /Mail Management Group
Centralize foreign cases to designated staff.
Stratify and assign work based on complexity level.
Mail and Folder Management
Place all mail under end product control.
Establish and strictly enforce a standard operating procedure that
ensures all employees update both the Benefits Delivery Network and
COVERS (Folder Tracking) systems as claims are processed.
Use experienced claims examiners to screen all authorization and
rating work on the floor.
Other Actions
Detail the Veterans Service Center Manager from Oakland to evaluate
and recommend changes to process.
Establish a Service Delivery Network Help Team to review and
finalize all cases over six months old.
Broker claims requiring rating action to the Satellite Rating
Activity in Huntington, WV and other regional offices.
Assign rating specialists to review the quality of requests for
medical exams and make direct telephone inquires in the event of
deficient exams.
Establish an aggressive training plan for the Veterans Service
Center.
Senator Mikulski. And as former Secretary of the Army, you
know we need to really now be able to deploy, because this is a
9-1-1 situation. We do not want it to be a permanent situation.
So, having said that, Mr. Chairman, I know you have
questions. Thank you.
Senator Bond. Thank you, Senator Mikulski. And I would note
that Senator Mikulski's leadership on this has been consistent
throughout. And she has strongly advocated for more personnel
for VBA. And I believe since I have taken over as chair of this
committee, we have added more people above the OMB budget
request for VBA. So, this committee is concerned about the
problem. And the ranking member and I are going to continue to
review that.
I have about completed my questions for this hearing. I
want to touch on two areas quickly. And then I will submit a
number for the record.
Senator Mikulski. And so will I.
medical school affiliations
Senator Bond. And Senator Mikulski will, as well.
With respect to academic affiliations, VA plays a critical
role in the education of medical students. And I think that has
already been referred to today. There are about 9,000 residency
positions through affiliations with 107 medical schools.
What impacts have there been on VA's affiliation over the
past several years, as VA has closed thousands of acute care
beds, reduced staffing, reallocated to ambulatory care? What is
the VA doing to preserve those critical relationships with
affiliated universities, at the same time transitioning to a
more appropriate number of residents in specialized programs?
And I would address that to Dr. Kizer, I believe.
Dr. Kizer. I believe we have strengthened those
affiliations and actually have become a more valuable training
resource than we were before, although some of the medical
schools still do not understand that. We have shifted to
provide venues of care that are more typical of what is going
to be utilized in the 21st century, and we have provided the
opportunities for both enhancing our care, but also provided
training sites for the universities that are, in general, less
replete with than we are.
medical staffing reductions
Senator Bond. We have heard concerns expressed about some
of that. We will share those individual concerns with you. And
as we also look at research facilities, particularly in
Columbia, MO laboratories, we will discuss later, but I guess
the last and most important question, Mr. Secretary and Dr.
Kizer, given the fact that VA did not meet its FTE reductions
last year and will not do so this year, you have got a much
higher goal for fiscal year 2000; 8,000 work-years. That is in
the budget you submitted to us.
And it appears that to meet the goal, a lot of these FTEs
need to be off the payroll by October 1. At least, that is
according to GAO.
How are you going to get it done? Are you looking at
significant furloughs? Obviously, this is RIFs, furloughs.
Normal attrition is not going to get you there. This is
something that we are very much concerned about and the impact
it is going to have on care and provision of services. How are
you going to get there?
Mr. West. Actually, before he answers, I would say normal
attrition or attrition of some sort can be very helpful, if we
make up our minds to do it. They have 35,000 employee turnovers
every year. If only five of six spaces are filled, there will
be an impact. Now, I do not propose that that is the way that
will happen.
Second, I saw the GAO comment. I noticed, for example, that
with respect to the medical affiliations that you asked about a
minute ago, they seem to think that the medical schools will
cause us not to do the things we need to do; because if we do,
it dries up some of the training for their specialists.
Well, GAO also said that business about having to get all
of these folks off the rolls at the outset of 2000. I do not
think that is true. You certainly cannot wait until the end of
2000. And the earlier you do it, the sooner you get the
savings.
Indeed, Dr. Kizer wrote me a memo a while back that said
before we even start on 2000, make sure we do as much as we can
in 1999. So----
Senator Bond. We have a copy of that memo, I think.
Mr. West. Third----
Senator Bond. That was interesting.
Mr. West. Third, you have buy-out legislation proposed by
us now. I think it has just gotten up here. I hope so. That
authority will be important to us as we do this.
So, yes, from my point of view--and I know you want to hear
it from Dr. Kizer's point of view--it would be a stretch, but I
do not think it is, by any means, impossible.
Senator Bond. Dr. Kizer.
Dr. Kizer. The challenge is a steep one. And I can assure
you that your concern is probably much less than mine. But
the----
Senator Bond. I do not doubt that. I will buy that.
Dr. Kizer. The other reality that we have to deal with is
the longer that it takes to initiate these reductions, the
deeper the cuts have to go. That is just the basic premise of
federal government personnel rules. And so, there is a need to
make those changes as rapidly as possible, to minimize what
might be considered the uncontrolled aspects, that would
develop if they get delayed into the next year.
Mr. West. I think the biggest complication of the whole
effort is me, Mr. Chairman. Because when proposals for RIFs
come up to me, I take my time on them. I want to make sure that
they really are needed and that they will not effect care to
our veterans. And so, I can process them quickly, when they are
justified, and it will be tough, but if we have to, we can do
that.
protocol for processing vha actions
Senator Bond. Item six in Dr. Kizer's memo of February 8,
said, ``I therefore request that we quickly establish a
protocol for rapidly processing requests or actions to right-
size the VHA health care system.''
Is that protocol ready? Has that been done?
Mr. West. Well, the protocol is simply that I have assigned
somebody to go get the packages when Dr. Kizer has them ready,
and get them directly to me as quickly as possible. That is
what that is all about. It is: How can we make sure that when
VHA releases its proposal to the Secretary, that the packages
do not wander around for so long that by the time they get to
me personally and that I act on them, that the results are
useless to the managers in the field who have been waiting for
them?
And the protocol is that I have assigned someone on my
staff, directly, to shepherd them from the time they leave VHA
to me.
[The information follows:]
Protocol for Processing VHA Actions
The Deputy Chief of Staff has been assigned the responsibility of
tracking and shepherding the RIF/Staffing Adjustment packets from the
time VHA recommends approval, through the formal staffing process,
until it reaches the Secretary for approval. A report on the status of
reduction in force requirements is maintained to assure visibility and
timely processing within the Headquarters.
Additional committee questions
Senator Bond. It sounds like my favorite cartoon character
of old, Walt Kelly's famous Pogo. We have met the enemy.
And we will count on you to deal with that.
[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 Bond
potential staffing efficiencies through restructuring
Question. VA expects to provide care to an additional 54,000
patients next year, while cutting staff by 6,949. The budget says there
will be $1.14 billion in ``management efficiencies''--and additional
``savings'' of $244 million and 1,580 FTE if proposed legislation
authorizing emergency room care is enacted. What specific cuts to
medical services, staff and programs will be made to meet the $1.4
billion target?
Answer. In all budget years, facilities and VISNs are encouraged to
continue efforts to identify potential staffing efficiencies through
restructuring. Initiatives such as internal reorganizations, changes in
missions and programs, elimination or reduction of services,
consolidations of services or functions between two or more facilities,
reallocation of workload, or redirection of staff and other resources,
etc., occur at VA facilities across the system. This is a necessary
part of sound, health care management that serves to improve the
delivery of services to patients.
Intensified budget pressures will likely accelerate VHA's re-
engineering efforts, requiring greater cost savings. If VHA is to
continue its efforts in maximizing efficiencies and quality, it must
have the tools required to carry them out. We believe that we must use
all the available mechanisms including normal attrition, early-out
authority, budget authority, RIF and staffing adjustment authority, to
re-engineer our workforce, since staffing accounts for about two-thirds
of VHA expenditures.
Following the release of the President's budget, the VHA networks
were asked to develop plans addressing the management improvements
necessary to achieve the significant savings required to operate within
the proposed fiscal year 2000 budget. Those plans are currently being
reviewed. In general, the plans show that we will need to continue to
significantly reduce staffing and restructure our health care delivery
methods. Staffing reductions would be achieved through attrition,
buyouts, if approved by Congress, and, when necessary, reductions-in-
force. Limitations on enrollment for lower priority veterans may also
be examined. Several headquarters and field-based review teams are
examining the network plans, and we will have a more complete national
plan by the end of June. Finally, we will continue to reform our
business processes (e.g., the purchase of medical and surgical
supplies) to achieve efficiencies.
Question. Without knowing the specific cuts which are planned, how
can we assess the adequacy of your budget?
Answer. Specific actions are being reviewed and a national plan
should be completed sometime in June.
Question. Do you believe VA will be able to increase patient care
without any degradation in the quality of care with the budget you
propose?
Answer. No matter the budget level, we will ensure quality by
carefully monitoring through a comprehensive performance management
system. Despite flat budgets in the past, we have been able to increase
the number of patients treated and outpatient visits, while
simultaneously improving our quality of care performance and customer
satisfaction. To become competitive in quality and service
satisfaction, and to achieve necessary financial discipline, VHA has
embarked on a more business-like approach to operations that forces us
to take tough, but necessary actions. Our actions have resulted in
significant efficiencies while we have concurrently achieved
significant quality improvements.
Question. Do you agree with GAO's assertion that VA's
transformation seems to have lost some of its momentum over the last 12
months?
Answer. The perceived loss of momentum reflects the expected
maturation of many major VHA transformation initiatives. The early
start-up phase was characterized by a flurry of escalating activities.
Currently, the framework for VHA's transformation has been established.
Program officials are undergoing a period of refinements to streamline
and improve upon what has gone before. During the third phase of
change, quality transformation will be the defining characteristic.
With few exceptions, external reviewers, including the Office of the
Inspector General, the General Accounting Office and independent
consultants, have consistently supported the organizational directions
that VHA is pursuing.
Question. Given that VA did not meet its FTE reductions last year,
and will not this year, do you really believe you can meet the fiscal
year 2000 projections of about 8,000 workyears?
Answer. The challenge in meeting the management efficiencies set
forth in this budget is a steep one. However, we have made significant
progress in the past, and we have the energy to continue. As mentioned
earlier, if VHA is to continue its efforts in maximizing efficiencies
and quality, it must have the tools required to carry them out. We
believe that we must use all the available mechanisms including normal
attrition, early-out authority, budget authority, RIF and staffing
adjustment authority, to re-engineer our workforce, since staffing
accounts for about two-thirds of VHA expenditures.
Question. When will these FTEs need to be off the payroll by
October 1, in order to realize sufficient savings? Why were the planned
FTE reductions not met for fiscal year 1998 and fiscal year 1999?
Answer. To optimally achieve the desired savings, staff reductions
would occur effective October 1, 1999. In fiscal year 1998 and fiscal
year 1999, Congress provided additional funding that affected VHA's
overall management strategy and allowed for the retention of staff
above those levels budgeted. In addition, VHA was granted authorization
to carry over Medical Care Collection Funds (MCCF) collections to
support medical care operations.
va's request to omb
Question. I understand that VA's request to OMB was $1.2 billion
more than what is in the final President's budget. What specifically
were the additional funds requested for, and why did the President deny
VA's request?
Answer. The attached tables list VA's budget submission to OMB for
budget authority. We respect your desire for information on the budget
process, but must insist on the maintenance of open communication
within the Executive Branch and my Department which requires
confidentiality particularly on budget matters. If all written and oral
communications made in the decision making process are subject to
review and public examination, there would be an adverse effect on the
candor in the opinions provided me in reaching decisions on budget
matters.
BUDGET AUTHORITY NET--COMPARISON OF THE FISCAL YEAR 2000 OMB SUBMISSION TO PRESIDENT'S BUDGET REQUEST
[In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
President's
OMB submission request Difference
----------------------------------------------------------------------------------------------------------------
DISCRETIONARY PROGRAMS
Medical Programs:
Medical care................................................ 17,950,287 17,306,000 -644,287
Medical care collections fund........................... 749,141 749,141 ..............
Proposed legislation.................................... 577,100 .............. -577,100
-----------------------------------------------
Subtotal, Medical Care................................ 19,276,528 18,055,141 -1,221,387
Medical and prosthetic research............................. 336,877 316,000 -20,877
Other Medical--Smoking Cessation Program Proposal........... .............. 56,000 56,000
MAMOE....................................................... 67,896 60,785 -7,111
-----------------------------------------------
Total Medical Programs.................................... 19,681,301 18,487,926 -1,193,375
===============================================
Construction Programs:
Construction, major projects................................ 135,000 60,140 -74,860
Construction, minor projects................................ 175,000 175,000 ..............
Parking revolving fund...................................... .............. .............. ..............
Capital asset fund proposal................................. 50,000 10,000 -40,000
Grants for State homes...................................... 60,000 40,000 -20,000
Grants for State cemeteries................................. 11,000 11,000 ..............
-----------------------------------------------
Total Construction Programs............................... 431,000 296,140 -134,860
===============================================
Veterans Benefits Administration:
Education loan program account.............................. 1 1 ..............
Vocational rehabilitation loans program account............. 57 57 ..............
-----------------------------------------------
Total Veterans Benefits Administration.................... 58 58 ..............
===============================================
General Operating Expenses & Misc.
Veterans Benefits Administration (GOE and Credit).......... 731,920 706,457 -25,463
Veterans housing benefits program fund program account.. 150,231 152,231 -2,000
Native American veterans housing loan program account... 503 503 ..............
Education loan program account.......................... 214 214 ..............
Vocational rehabilitation program account............... 415 415 ..............
-----------------------------------------------
Subtotal, Credit Reform............................... 151,363 153,363 -2,000
-----------------------------------------------
Total, Veterans Benefits Administration w/Credit...... 883,283 859,820 -23,463
===============================================
General Administration.......................................... 224,664 206,000 -18,664
Credit Reform (General Counsel):
Veterans housing benefits program fund program account.. 4,727 4,727 ..............
Native American veterans housing loan program account... 17 17 ..............
-----------------------------------------------
Subtotal, Credit Reform (General Counsel)........... 4,744 4,744 ..............
-----------------------------------------------
Subtotal, General Administration w/Credit........... 229,408 210,744 -18,664
-----------------------------------------------
Total General Operating Expenses w/out Credit....... 956,584 912,457 -44,127
Total, Credit Reform--Administrative................ 156,107 158,107 2,000
===============================================
National Cemetery Administration................................ 103,312 97,311 -6,001
Office of Inspector General..................................... 43,959 43,200 -759
-----------------------------------------------
Total General Operating Expenses and Misc................. 1,259,962 1,211,075 -48,887
===============================================
Proprietary Receipts:Medical Care Collections Fund.............. -761,560 761,560 ..............
-----------------------------------------------
Total Discretionary Programs.............................. 20,610,761 19,233,639 -1,377,122
===============================================
MANDATORY PROGRAMS \1\
Benefit Programs:
Compensation and pensions................................... 21,568,364 21,568,364 ..............
COLA increase........................................... 293,300 293,300 ..............
Proposed legislation.................................... 5,000 5,000 ..............
-----------------------------------------------
Subtotal, Compensation and pensions................... 21,866,664 21,866,664 ..............
Readjustment benefits....................................... 1,469,000 1,469,000 ..............
Veterans insurance and indemnities.......................... 28,670 28,670 ..............
Guaranteed transitional housing loan program for homeless 9,600 9,600 ..............
veterans...................................................
Veterans housing benefit program fund program account....... 282,342 282,342 ..............
-----------------------------------------------
Total Benefit Programs.................................. 23,656,276 23,656,276 ..............
===============================================
Proprietary Receipts:
GI Bill..................................................... -180,700 -180,700 ..............
Post-Vietnam era veterans education account................. -1,432 -1,432 ..............
National service life insurance............................. -195,790 -195,790 ..............
-----------------------------------------------
Proprietary Receipts from the Public...................... -377,922 -377,922 ..............
===============================================
Trust Funds:
Post-Vietnam era veterans education account................. 3,719 3,719 ..............
General post fund........................................... 32,351 32,351 ..............
National service life insurance............................. 1,050,450 1,050,450 ..............
U.S. Government life insurance.............................. 5,220 5,220 ..............
National cemetery gift fund................................. 90 90 ..............
-----------------------------------------------
Total Trust Funds......................................... 1,091,830 1,091,830 ..............
===============================================
Intragovernmental Transactions:
Post-Vietnam era veterans education account................. -2,287 -2,287 ..............
National service life insurance............................. -1,710 -1,710 ..............
U.S. Government life insurance.............................. .............. .............. ..............
-----------------------------------------------
Total Intragovernmental Transactions...................... -3,997 -3,997 ..............
===============================================
Total Mandatory Programs.................................. 24,366,187 24,366,187 ..............
===============================================
Total Department of Veterans Affairs...................... 44,976,948 43,599,826 -1,377,122
----------------------------------------------------------------------------------------------------------------
\1\ The mandatory program estimates were revised after the initial OMB submission by VA to reflect technical and
economic assumption adjustments.
hepatitis c
Question. VA's budget estimates spending $250 million to treat
veterans with Hepatitis C. VA now believes the prevalence rate is
closer to 8-10 percent. What is the total amount needed given the
revised anticipated prevalence rate?
Answer. The $250 million budget figure is based upon a prevalence
rate of approximately 5.5 percent. On March 17, 1999, VA conducted a
one-day national point prevalence testing activity to estimate the
prevalence rate for VA patients who were having blood drawn and who
agreed to be tested. This testing activity was not scientifically
designed to accurately measure the prevalence in all veterans or in all
VHA users. Rather, it was designed to be quick step that would verify
and improve on the existing data. Anomalies in the data from this
testing activity have been observed and analyzed. The measured
prevalence, not considering obvious data inconsistencies, was 6.6
percent. Using 6.6 percent as a baseline, experts have estimated the
true prevalence to be 8-10 percent, at minimum, based on what is known
of the inconsistencies in the data. Assuming an estimate of 8 percent,
the expected rise in the cost will be between $50 and $100 million
above the initial estimate.
Question. Why didn't VA do a better job sooner to estimate the
prevalence rate?
Answer. The understanding of the true prevalence rates both inside
and outside VA is not well documented. The VA initiative is the largest
surveillance activity ever undertaken and required substantial planning
and logistical coordination. No other entity has even begun to address
prevalence or any other Hepatitis C-related activities as broadly or
aggressively as VA.
Question. Will VA provide the treatment to all patients who would
benefit?
Answer. VA will provide appropriate treatment to all patients for
whom it is clinically appropriate and who wish to be treated.
enrollment
Question. Legislation enacted in 1996 required VA to create an
enrollment system. Once enrolled, veterans are entitled to receive a
full continuum of medical services. VA decided to allow all veterans--
regardless of their income or disability status--to enroll. How many
new veterans have enrolled for care who are not low-income or service-
connected, and at what cost?
Answer. Priorities 6 and 7 include veterans who are not low-income
or service-connected. Priority 6 veterans are mostly veterans receiving
care for disorders associated with exposure to a toxic substance,
radiation, or for disorders associated with service in the Gulf War or
World War I and Mexican Border veterans, and compensable zero percent
service-connected veterans. Priority 7 veterans are nonservice-
connected veterans and zero percent non-compensable service-connected
veterans with income and net worth above the statutory threshold and
who agree to pay specified co-payments.
For these veterans, as of February 26, 1999, there were
approximately 55,525 current enrollees in Priority 6, of which 6,281
were new to the VA system (not VA patients in fiscal year 1996--fiscal
year 1998). Approximately 605,108 current enrollees are estimated to be
Priority 7, which include 231,592 estimated to be enrollees new to the
system. These estimates include an estimate of those veterans who
currently have not been assigned a priority because they lack a current
means test. Based on current data and trends, we expect 766,000
Priority 7 enrollees by the end of fiscal year 1999, 378,000 (or 49
percent) to be users. In estimating the costs for Priority 7 patients
in fiscal year 1999, we applied the same relationship of part year to
full year performance experienced in fiscal year 1998 to fiscal year
1999 year-to-date actuals. Through March 1998 we expended 44.1 percent
of the full year, total fiscal year 1998 priority 7 costs ($311 million
of $706 million). Applying that spending rate to $349 million spending
to date (through March 1999), results in an estimated cost of $761
million for fiscal year 1999, an increase of $85 million over fiscal
year 1998.
Question. Why did you decide to allow all veterans to enroll when
funds are so tight? Aren't you risking the quality of care and the
ability to provide a full benefits package to those veterans who VA is
mandated to provide care to (low-income and service-connected)?
Answer. Last year, before deciding to enroll veterans through all
priorities, VA weighed all the available information and carefully
considered the implications of the decision. It was VA's belief that VA
could provide a comprehensive package of health care services to both
mandatory and discretionary veterans seeking VA enrollment. VA
projections last year of the expected number of fiscal year 1999
enrollees are very close (less than 1.5 percent variance) to the actual
number who have applied for enrollment this year from both eligibility
groups. The marginal cost of the Priority 7 enrollees, especially those
who are new to the system, are quite low, with considerable offsets
from copayment and third-party payments. Fiscal year 1999 data will be
used to better predict cost and utilization of this group of veterans
in the future.
Question. Are any networks having problems meeting the health care
needs of veterans who have enrolled?
Answer. Appointment waiting times have increased in some specialty
clinics, and in some areas new users wishing to get their primary care
from the VHA are being put on waiting lists for a period of time before
they are taken into the system. However, at this time the VHA is
maintaining its ability to provide needed acute care to all veterans as
medically indicated.
Question. Will VA be able to continue providing care next year to
those enrolled individuals who are not low-income or service-connected
next year under the budget you have requested? If so, will there be
services denied to higher priority veterans?
Answer. VA will continue to utilize both an internal VA model and
an external actuary model to make these projections. An integrated
analysis will be provided to VA's senior management this summer in
order to assess the level of enrollment that will be supportable for
fiscal year 2000. Services within VA's defined comprehensive services
package will not be denied to higher priority veterans.
asset restructuring
Question. There may be a real opportunity for ``savings'' in the
health care budget by improving VA's use of its capital assets and no
longer operating and maintaining unneeded buildings. GAO states that
``VA's asset planning indicates that billions of dollars might be used
to operate hundreds of unneeded buildings over the next five years or
more.'' Has VA developed an estimate of how much savings could be
realized by excessing unneeded space and better asset management?
I understand a commitment was made by Dr. Garthwaite to the House
Veterans Affairs Committee to conduct market assessments as GAO
recommends. What is the cost and the timeframe involved?
Please describe the process VA will undertake to conduct these
assessments, how VA will prioritize which assessments to conduct first,
and how VA will involve the community and all stakeholders in these
assessments to ensure the recommendations will be viable.
Answer. VA does not have an estimate of how much savings could be
realized through improved capital asset planning and management. Based
on the size of the portfolio, and the significant changes in health
care that are shifting care away from hospitals to outpatient settings,
we do, however, expect significant savings can be achieved. To align
our physical infrastructure to more effectively support the current
health care needs of the Department, we are in the process of
implementing an improved strategic planning process. To provide
oversight and direction for this planning, it is proposed that each
VISN will establish a Capital Assets Realignment for Enhanced Services
(CARES) Steering Committee, including membership representing veterans,
the state, our affiliates, and our various missions. The CARES
committee will develop semi-annual plans aimed at realigning any
imbalance between VA capital assets and veterans needs. CARES plans
will itemize historical, current and projected utilization and demand
for health care services, describe current assets, and critically
review the match of assets to the VISN's current and projected future
demands. The plans will further consider alternatives to current
service delivery modes, and will make recommendations as to proposed
reuse or reconfiguration of capital assets to more efficiently provide
services to veterans. Note that this proposal is currently out for
review and comment.
Dr. Garthwaite agreed that we should conduct the market assessments
that GAO recommended and recognized the need for outside consultant
support in this effort. Within funding limits, and consistent with
legislative requirements and our final CARES policy, we expect to
assess all the multiple market areas identified by GAO. We have
estimated that the total contracting support could cost from $35-$40
million. VA may also need to modify its major construction
appropriation language in order to fund this contracting support.
medical care cost fund
Question. VA's budget presumes an increase of $124 million in
collections from third-parties and co-payments, for a total of $761
million. Unfortunately, VA's performance has consistently lagged behind
its targets. Given performance to date in fiscal year 1999, I
understand VA can expect to collect just over $600 million, compared to
its original estimate of $677 million, a difference of $77 million.
What are the ramifications of failing to meet your target, and why is
VA doing so poorly?
Answer. The collection plan is set prior to the beginning of the
fiscal year, based on estimates contained in the President's budget.
Many variables are considered in developing the plan and the values are
determined by trending historical information and projecting forward,
including anticipated workload and utilization. If collections continue
at the current rate, the end-of-year projection for the MCCF fund is
estimated at $579.6 million, or approximately 91 percent of the fiscal
year 1999 President's Budget estimate of $637.5 million.
VA is continuing to improve on collections. Average daily
collections for the month of March reached $2.3 million per day,
bringing the fiscal year-to-date collections to $275.6 million. This
represents a 7.5 percent increase over the same period for fiscal year
1998.
Historically, much of the MCCF goal is met during the final months
of the fiscal year. Performance goals and key process measures have
been set for each Network and are monitored on a monthly basis.
Progress toward the MCCF goal is measured as a part of each VISN
Director's quarterly performance review. The signal has been clearly
given to the VISN Directors that collections are a vital part of the
Medical Care budget.
It is estimated that MCCF funds carried over from fiscal year 1998
and applied to medical care operations would offset any shortfall that
may materialize in fiscal year 1999 MCCF collections. Given everything,
it's disappointing to hear that VA's performance is characterized as
poor. Last year, VA hit 94 percent of its target. By any other grading
system that would be an ``A'', or excellent.
Question. According to a 1997 Coopers & Lybrand report of VA's cost
recovery program, the private sector collects $3.1 million per FTE,
while VA collects $151,000. Last year VA told us it was evaluating
which functions could be effectively done by a contractor. What are the
results of that evaluation? Given VA's performance in this area,
doesn't it make sense to contract out?
Answer. VHA is currently using the services of a contractor, Trans
World, for some collection activities. Trans World performs aggressive
follow-up functions with insurance carriers for any VA medical center
that needs assistance with follow-up collection activities. This
contract has been made available to all facilities. At this time 68
facilities are using this contract.
The results of the Coopers & Lybrand study found that the issue of
contracting out field-based revenue billing and collection functions is
complex, and not easily addressed. There are many issues that need to
be addressed prior to any additional contracting for this function,
including the cost-effectiveness of:
--Contracting ``back-end'' functions only, (i.e., billing and
collections) or entire revenue cycle (i.e., identification of
insurance, coding, utilization review, and billing and
collections).
--Contracting only third-party claims or 1st party debts, also (i.e.,
veterans' co-pays and per diems).
--Contracting by Network and holding the Network Director
accountable, or contracting on a larger scale with national
accountability.
--Whether to use VistA software or contractor provided software; if
the latter, there are connectivity issues that must be
addressed.
--Establishing measurable performance standards/parameters for data
quality and coding and other front-end processing.
--Cost of contracting will be taken from collections and could be as
much as 20 percent.
VHA has recently hired several contractors to perform audits and
reviews of billing and collection functions, specifically targeting the
comparison of medical record documentation with claims submitted to
insurers. Results from these external reviews indicated that the
medical record documentation and coding were less than optimal. VA's
plan remains to contract for billing and collections. However, problems
with documentation and coding of medical records must first be fixed.
Actions being taken to address the issues of documentation and coding
problems include the key elements of staff education and data
validation. All medical centers are required to provide training on
coding and documentation to clinical and coding staff, enabling VA to
code both inpatient and outpatient records to meet Medicare standards.
Medical Centers are being required to examine the encounter forms
process, and establish a full-time compliance officer at each medical
center. Each VISN Director is to establish a strong internal compliance
program with internal audits to hold VISN and Medical Center management
staff accountable for the data that is entered into the system.
Question. VA has cost recovery programs in each of its 172
hospitals, each employing its own methods with greatly varying degrees
of success. If VA isn't going to contract out, doesn't it make sense to
at least centralize functions to a few high performing hospitals? What
are VA's plans to do so?
Answer. Each Network Director is responsible for the billing and
collecting of third-party insurance and first-party copayments within
the Network's medical centers. Some Directors have consolidated the
billing and collection activities associated with third-party insurance
to a consolidated collection site within their VISN. This was based
upon VISN/medical center decisions in locations that had demonstrated
best practice procedures for these functions. All medical centers
electronically transmit the first party copayment information to the
Consolidated Copayment Processing Center (CCPC) at the Austin
Automation Center. Copayment statements are mass-produced and mailed
from the CCPC to take advantage of high-speed printers and bulk mailing
rates. In addition to the above consolidations, a national solution is
being developed for electronic billing of health care payers using ANSI
X12 and other national standards as mandated in the Health Insurance
Portability and Accountability Act of 1996 (HIPAA). Electronic Data
Interchange (EDI) will automate submission and receipt of billing,
payment, and related information through computer software modules to
VA Integrated Billing and Accounts Receivables software packages.
access to specialized services
Question. In August 1998, GAO reported that in the two networks it
reviewed (Bronx and Pittsburgh), overall access to VA care had improved
but access to certain specific services decreased, such as spinal cord
injury care and post-traumatic stress disorder. According to the
veterans' Independent Budget, several specialized outpatient PTSD
programs have been closed recently. Is access to specialized (and more
expensive) care declining nationally as networks work to tighten their
belts? What is being done to ensure that these critical programs are
appropriately supported? What does VA do nationally to monitor the
provision of these critical programs which are so important to
veterans?
Answer. Although there may be localized reductions in access to
some programs, access at the national level is improving in all
programs, except for a slight increase in waiting time for admission to
the Blind Rehabilitation program. Further, these improvements in access
have been achieved despite increases in the number of patients being
treated in these programs.
Regarding appropriate support for these programs, the Network
Directors are aware of VA's expectations regarding the special
disability programs, and they participate in the special monitoring and
reporting requirements, as described below. In addition, we continue to
maintain special national funding for prosthetics items across the
system, and this is supplemented by additional local funding as needed.
VA monitors the provision of these programs by sending to VISN
offices the mid-year and full-year workload and dollar expenditures for
each program at each VA facility. VISNs are asked to validate these
statistics and to explain any reductions from the 1996 levels, which
are congressionally-mandated to be (at least) maintained. Since April
1997, VA has issued a congressionally-mandated report detailing the
results of its efforts to maintain capacity in these special disability
programs.
Question. Are there performance measures for network directors to
meet which directly address the need to protect specialized programs?
If not, why not?
Answer. Yes, there are individual performance monitors established
for the specialized programs listed in Public Law 104-262, Section 104.
These specialized programs are spinal cord injury and disorder,
blindness, amputations, serious mental illness, traumatic brain injury
and post traumatic stress disorder. These monitors are included in the
annual Report to Congress on Maintaining Capacity to Provide for the
Specialized Treatment and Rehabilitative Needs of Disabled Veterans.
long term care
Question. According to the veterans' Independent Budget, on any
given day 587,165 veterans are in need of long-term care services. VA
provides only 10 percent of the estimated need. The number of veterans
needing long-term care services is expected to grow by 13 percent over
the next five years. What is VA's long-term care policy, and what are
VA's plans to address this critical need?
Answer. VA has drafted a document, ``A Strategic Plan for Long Term
Care Provided by the Veterans Health Administration,'' which contains
essential policy elements and action plans to address the long-term
care needs of veterans. This draft VHA document is based on the
recommendations of the Federal Advisory Committee on the Future of VA
Long Term Care. The Draft Strategic Plan, which is attached, is
circulating for stakeholders' comments.
A Strategic Plan for Long Term Care Provided by the Veterans Health
Administration
introduction
In serving America's veteran population, the Veterans Health
Administration (VHA) is now confronted with a ``demographic
imperative'' that the rest of American society will confront in another
15 to 20 years (i.e., a burgeoning population of elderly persons
needing both acute and long-term healthcare services). Decisions that
will eventually have to be made for the larger American public need to
be made now for veterans.
The imminent need to provide a coherent and comprehensive approach
to long-term care for veterans will severely strain the VA healthcare
system and will require significant increased funding. In confronting
this challenge it is important to remember that addressing this need is
important both in its own right, and because it will provide critically
important experience and knowledge that will be instructive in
addressing the long-term care needs of the even larger number of
elderly Americans who will need such services in the not too distant
future.
In fashioning a solution to the unmet long-term care needs of
veterans it is important to understand that long-term care should no
longer be viewed as something ``extra'' or an extravagant adjunct to
acute healthcare. Instead, like acute care, long-term care should be
viewed as a requisite part of the continuum of care that VHA provides.
Today, acute care and long-term care are both essential components
of healthcare; they are merely different places along the continuum of
care that should be available. This continuum of care has health
promotion and disease prevention on one end and palliative or end-of-
life care on the other end. And just as the services provided in
hospitals have changed dramatically in the last decade, so has the role
of the traditional nursing home in providing long-term care. Today, a
comprehensive approach to long-term care certainly needs to include
nursing home care, but also should include home care, assisted living,
adult day healthcare, respite care, and other noninstitutional options.
Indeed, the many different forms of both acute care and long-term care
potentially available today create myriad venues of service delivery
along the continuum of care.
The essentiality of providing both acute care and long-term care is
recognized by the healthcare profession, families and patients. It is
now time for health plans and for Congress to affirm and support this
as well.
In November 1998, the Federal Advisory Committee on the Future of
VA Long-Term Care, an expert group convened by the Under Secretary for
Health, released its report entitled VA Long-Term Care at the
Crossroads (Appendix A). The Committee, chaired by Dr. John Rowe,
President and CEO of the Mt. Sinai-New York University Medical Center,
recommended 24 measures to enhance VA's services to veterans in need of
long-term care. Its overall conclusion was that long-term care must
remain an integral part of the veterans healthcare system. The Veterans
Health Administration concurs with this recommendation.
The Committee's report was widely reviewed and commented on by VHA
stakeholders. Based on a review of those comments, the Report and VHA
expert opinion, the following strategic action plan was prepared. This
plan outlines specific actions necessary to implement the Crossroads
recommendations. Taken together, this plan and the Report provide a
comprehensive yet incremental approach to meeting the challenges of
providing long-term care for the growing numbers of older, chronically
ill veterans.
Important to note is that in this plan the term ``long-term care''
is defined by patient needs and not by programs. ``Long-term care'' as
used in this plan refers to the sustained care needs of older,
chronically ill and disabled patients. The ``long-term care patient''
has on-going need for services; however, the intensity and the nature
of specific services that are required will wax and wane over time. The
continuing need for services in these patients is in contrast to the
patient who requires such care episodically or for brief periods of
time. The particular focus of this strategic plan, therefore, is on the
``long-term care patient'' whose functional abilities necessitate
varying but ongoing care.
Each Strategic Action Plan detailed below contains 3 parts: (1) The
Federal Advisory Committee's Recommendation; (2) Stakeholders Comments,
if any; and (3) the VHA recommended Action Plan to implement or
otherwise actualize the recommendations.
strategic actions
defining long-term care
Strategic Action I
1. Report Recommendation.--VA should maximize network flexibility
in developing and restructuring its long-term care services within
broad national policies.
2. Stakeholders Comments.--None.
3. Action Plan
A. Long-term care will be defined in VHA by the continuing care
needs of the person, as determined by their functional status. A VHA
work group will develop the criteria for use of this definition by
August 1999.
B. Existing VHA policies will be reviewed, revised, rescinded, and/
or replaced as necessary to support the objectives outlined in the
Crossroads Report. New policies will be developed when necessary.
C. Each network will be responsible for providing long-term care
services which are appropriate to the individual needs of each enrolled
veteran and which are defined in the basic benefit package. Separate
policies will address the provision of nursing home care.
D. Each network will specifically address long-term care in its
annual strategic plan.
performance measures
Strategic Action II
1. Report Recommendation.--VA must create a series of financial
incentives and performance measures to ensure that adequate access to
long-term care services is provided to veterans.
2. Stakeholders Comments.--None.
3. Action Plan
A. VHA will incorporate measurement of the provision and quality of
long-term care services into its performance measurement system. New
performance measures that include non-VA and VA-provided long-term care
will be implemented in fiscal year 2000.
B. The Geriatrics and Extended Care Strategic Healthcare Group
(GEC/SHG) and the Performance Measures Work Group have been tasked with
developing these performance measures.
long-term care planning
Strategic Action III
1. Report Recommendation.--Long-Term Care Planning Model offers an
objective measure of service needs. The Department should continue to
refine this population-based Planning Model, using the latest available
data.
2. Stakeholders Comments.--Comments indicated general support for
the use of the Long-Term Care Planning Model. Some reviewers suggested
that the model was not sensitive to ethnic and social differences,
which could affect utilization.
3. Action Plan.--A. The GEC/SHG and the Office of Policy and
Planning will provide the networks with annual long-term care need
projections (for both institutional and home- and community-based care)
using the recently developed Long-Term Care Planning Model. The model
will be run with the latest available utilization and demographic
information from the National Medical Expenditure Survey. The next
Long-Term Care Planning Model report will be provided by June 1999.
Strategic Action IV
1. Report Recommendation.--To meet the needs of veterans who are
eligible for and use VA for their healthcare needs, planning for long-
term care should be based on Category A veterans.
2. Stakeholders Comments.--Comments show agreement that long-term
care planning should be based on the Category A veteran population.
There was interest in also running the Long-Term Care Planning Model
using the total veteran population. This was in order to be prepared
and anticipate veteran interest in accessing VHA long-term care since
enrollment categories may change from year to year.
3. Action Plan
A. The GEC/SHG and VHA's Office of Policy and Planning will provide
the report described in Strategic Action IV for the Category A
(Priority Groups 1-6) veteran population.
B. Additional modeling for Category C (Priority Group 7) veterans
will include an analysis of co-payments, coinsurance and insurance for
long-term care. If feasible, such coverage will be initiated.
C. Networks will use data from the Long-term Care Planning Model
for strategic planning for its Category A veteran population.
home and community based care
Strategic Action V
1. Report Recommendation.--VA should retain its core of VA-operated
long-term care services while improving access and efficiency of
operations. Most new demands for care should be met through non-
institutional services, contracting, and, where available, State
Veterans Homes.
2. Stakeholders Comments.--Comments indicated general support for
increased use of non-institutional services, contracting and State
Veterans Home use to address a planned increase in the demand for long-
term care services.
3. Action Plan
A. The GEC/SHG will continue to maintain its on-line long-term care
service inventory by network. Each network will assure that the
inventory is accurate and up-to-date.
B. Each network will include in its strategic plan the number and
type of long-term care services directly operated or paid for by VA,
using uniform measures of utilization. The GEC/SHG will promulgate
these uniform measures by August 1999.
C. Each network will form a team of community institutional and
non-institutional providers, State Directors of Veterans Affairs and/or
State Veterans Home Directors to advise the network on the provision of
long-term care services.
D. The GEC/SHG will produce an annual report for the Under
Secretary for Health describing changes, if any, in VHA's long-term
care services.
E. In order to build capacity to provide the full array of long-
term care services, VHA will continue working toward resolution of
multiple payer and coordination of benefits issues. Additionally,
issues related to investment and program development and expansion will
be resolved.
Strategic Action VI
1. Report Recommendation.--VA should expand options and services
for home- and community-based care, making these services the preferred
placement site, when clinically appropriate, for veterans needing long-
term care. The service mix should be based on the care needs of the
veteran population and the availability of services in local
communities.
2. Stakeholders Comments.--None.
3. Action Plan.--A. VHA will provide home- and community-based
services (H&CBC) as defined in the Basic Benefits Package to all
enrolled veterans as appropriate to their needs. The strategy document
entitled ``Improving and Expanding Home and Community Based Care''
(Appendix B) will provide policy guidance for network planning.
Strategic Action VII
1. Report Recommendation.--VA should increase its investment in
home- and community-based care from 2.5 percent to 7.5 percent of VA
healthcare budget.
2. Stakeholders Comments.--Comments indicated concern that the
increase in investment of home- and community-based services could not
be achieved by simply shifting funds currently available to the
networks.
3. Action Plan
A. VHA proposed a $106 million increase in the fiscal year 2000
budget for home- and community-based long-term care. Similar increases
will be proposed for the next 4 years.
B. VHA will earmark $30 million per year over the next 4 fiscal
years for new and innovative models that expand H&CBC, with emphasis on
community provider partnerships.
C. VHA will develop methodologies for tracking cost and utilization
of H&CBC services used by long-term care patients.
D. VHA will track the quality and cost of contract care separately
from VHA-operated care, for comparative purposes.
E. VHA will maintain primary care responsibility for patients
receiving VHA contracted services. Funding to support additional staff,
as required, will be sought.
Strategic Action VIII
1. Report Recommendation.--Within VA long-term care spending, the
proportion of home- and community-based care and enriched housing
should double--to 35 percent of total long-term care expenditures.
2. Stakeholders Comments.--Comments indicated concern that the
increase in spending for home- and community-based services and
facilitated residential living could not be achieved by simply shifting
funds currently available to the networks.
3. Action Plan
A. See Strategic Action VII, Action Plan 3.A.
B. Budget initiatives will be developed for Facilitated Residential
Living for the fiscal year 2001 budget cycle. Legislative action will
be necessary to allow for payment for selected facilitated residential
living programs (See Strategic Action XVI in the legislative sections).
nursing home care
Strategic Action IX
1. Report Recommendation.--VA needs to maintain its three nursing
home programs. Home- and community-based services cannot substitute for
nursing home care for most of the veteran population. VA should use its
own hospital-based nursing home beds to provide care to post-acute
patients, patients who cannot be cared for in other nursing home
programs, and those patients who can be cared for more efficiently in
VA Nursing Homes (VANHs).
2. Stakeholders Comments.--Comments indicated support for
maintaining the three nursing home programs and using the VHA hospital-
based nursing home beds for post-acute or complex patients, or those
patients who require skilled nursing care or are difficult to place in
a community nursing home.
3.Action Plan
A. A VHA work group will develop a policy to encourage the use of
VANH beds for sub-acute and short-term post-acute care for future
admission of those patients who cannot return home immediately after
hospitalization. This work will be completed by June 1999.
B. A major role of State Veterans Homes will be to support the
long-term care needs of those veterans with sustained care needs beyond
short-term and post-acute care.
C. Because of the great need for dementia care for veterans, the
dementia care programs within VANHs must continue to be supported,
especially where comparable programs do not exist in the community.
Strategic Action X
1. Report Recommendation.--VA should implement and enhance existing
national policies on Community Nursing Home (CNH) placement. Length of
CNH placements should be based on patient care needs, not fiscal goals.
2. Stakeholders Comments.--Comments indicated support for the
length of CNH placements based on patient care needs. Comments also
suggested a desire for clear guidance on CNH placements.
3. Action Plan.--A. A VHA work group will develop a policy on CNH
placement, based on patient needs rather than a ``one size fits all''
approach to contract length. This work will build upon existing
network-based efforts and will be completed by June 1999.
Strategic Action XI
1. Report Recommendation.--In fiscal year 1997, 12.3 percent of
veterans in VANHs had lengths of stay in excess of one year. VA should
take necessary steps to ensure that VANH patients who no longer require
hospital-based nursing home care are properly transitioned into home-
and community-based care programs. Patients who require nursing home
care, and have received care for more than 1,000 days, and desire to
remain in the nursing home, should be allowed to remain in the VANH.
2. Stakeholders Comments.--Comments revealed agreement that there
is an obligation to patients who have resided in VANHs for long periods
of time and are still in need of skilled nursing care. Some comments
suggested the 1,000 day criteria proposed for keeping patients was
arbitrary or inappropriate and instead the decision should be left up
to the VAMC or VANH care team.
3. Action Plan.--A. VHA will promulgate a policy to allow residents
of VANHs who have continuing care needs and who have had stays
exceeding 1,000 days to remain as permanent residents if they chose to
do so. A work group will formulate this policy by July 1999.
Strategic Action XII
1. Report Recommendation.--In an era of limited budgetary
resources, VA should not seek funding for any new nursing home beds,
except for approved projects that are justified by objective standards
that include a measure of community capacity and national policy goals.
Renovation projects that affect the number of beds also should be
rejustified. Renovation projects that affect patient privacy and life
safety issues should receive first priority.
2. Stakeholders Comments.--Comments indicated that a minority of
reviewers thought additional VHA nursing home beds may be needed to
accommodate the projected increased demand in long-term care, and this
recommendation was overly restrictive.
3. Action Plan
A. Options for a redesigned State Home construction grant
prioritization methodology will be advanced by April 1999. This effort
will seek to maximize investment in new nursing home construction for
veteran patients with sustained long-term care needs.
B. Enhanced Use Leasing will be encouraged to support private
sector nursing home construction that will benefit veteran patients.
C. Construction of VANHs will be considered only when acceptable
community or State Home resources are not available or replacement of
an existing VA facility is justified by the objective standards
referenced above.
coordination of care
Strategic Action XIII
1. Report Recommendation.--VA should implement its plans for the
Resident Assessment Instrument/Minimum Data Set (RAI/MDS) without
delay.
2. Stakeholders Comments.--Comments indicated concerns that
appropriate technology (hardware, software, information linkages) was
not in place to support this initiative.
3. Action Plan
A. VHA will continue its implementation of the computerized version
of the RAI/MDS, commencing with VANHs in fiscal year 1999 and extending
the system to long-term care patients in other settings as MDS-based
instruments become available for home care, post acute care, etc.
B. VHA will continue its implementation of planned capture of long-
term care contract workload in VISTA (Veterans Health Information
Systems and Technology Architecture).
Strategic Action XIV
1. Report Recommendation.--VA should establish system-wide care
coordination processes based on a comprehensive assessment of patients
requiring long-term care services. A standardized core assessment, upon
which VISNs or facilities can add criteria to meet individual
objectives or target improvements, should be the baseline. VA should
reassign and train existing staff to implement such processes.
2. Stakeholders Comments.--None.
3. Action Plan
A. A VHA work group will define an evidence-based standardized core
assessment for evaluation of all enrolled patients referred for long-
term care services by December 1999.
B. Existing Geriatric Evaluation Management (GEM) teams will
provide the foundation for implementing such processes.
C. The RAI/MDS when fully implemented will be used to assess the
continuing care needs of long-term care patients.
legislative action
Strategic Action XV
1. Report Recommendation.--VA should seek legislative authority to
broaden respite care in 38 U.S.C. 1720B, to include its provision in
all long-term care settings.
2. Stakeholders Comments.--Comments indicated support for this
provision but also concerns regarding adequate funding for this
expansion.
3. Action Plan.--A. The GEC/SHG will initiate a request for new
legislative authority for in-home respite care to be submitted in the
next legislative cycle.
Strategic Action XVI
1. Report Recommendation.--VA should seek legislative authority to
allow for the payment of assisted living/residential care under 38
U.S.C. 1730.
2. Stakeholders Comments.--Comments indicated support for this
provision but also concerns regarding adequate funding for this new
service.
3. Action Plan.--A. The GEC/SHG will initiate a request for new
legislative authority for payment or co-payment of facilitated
residential living (assisted living) for eligible veterans.
Strategic Action XVII
1. Report Recommendation.--VA should seek legislative authority to
include a limited, 100 days/patient/year nursing home benefit following
a period of VA hospitalization under 38 U.S.C. 1710 and 1720,
notwithstanding current nursing home rules and policies.
2. Stakeholders Comments.--Comments indicated differences of
opinion regarding this benefit. Although most reviewers agreed that
nursing home care should be an integral part of the veterans health
benefits package, many were concerned with the significant increase in
costs that may be associated with this initiative. Other reviewers were
concerned that this benefit could be counter-productive in trying to
shift more long-term care to non-institutional alternatives.
3. Action Plan
A. The GEC/SHG will initiate a request for new legislative
authority to be submitted in the next legislative cycle for this
limited Medicare-like benefit. The proposal will include increase cost
estimates associated with implementation of this benefit.
B. The GEC/SHG, the Office of Policy and Planning and/or the
Management Decision Resource Center will complete a study to
investigate implementation of a more expansive nursing home benefit,
including analysis of rationale, options and cost. The funding options
will include a separate long-term care ``trust'', insurance payments
and co-payments. Results of this study will be used in proposed
legislative initiatives for subsequent legislative cycles.
research
Strategic Action XVIII
1. Report Recommendation.--At least 5 percent of VA's research
appropriation should support health services and other research, such
as rehabilitation, related to long-term care issues. Priorities for
this research are:
Testing the effectiveness of VA long-term care programs and
services, using cost and clinical outcomes that can be compared to the
private sector;
Examining the effectiveness of clinical interventions, using long-
term care services, in the treatment and management of veterans with
psychiatric disorders. Non-pharmacological as well as pharmacological
interventions should be included;
Comparing the effectiveness of post-acute care provided by VA to
the private sector; and
Exploring the effectiveness of providing acute care services in the
home.
2. Stakeholders Comments.--None.
3. Action Plan
A. The Office of Research and Development (ORD) will continue to
evaluate the proportion of research devoted to long-term care, in
coordination with GEC/SHG. ORD will report on its findings annually to
the Under Secretary for Health.
B. Requests For Application specific to health services and
rehabilitation research in long-term care should be developed and
issued within six months. Priority will be given to long-term care
issues noted above.
educational activities
Strategic Action XIX
1. Report Recommendation.--Additional educational efforts and other
collaborative ventures between long-term care and mental health program
staffs are strongly encouraged.
2. Stakeholders Comments.--None.
3. Action Plan.--A. VHA will develop programs and training that
encourage coordinated care for patients with both long-term care and
mental health needs so that such patients receive care appropriate to
all of their needs (e.g., the collaborative work of the Gero-
Psychiatric Task Force and the Mental Health/Geriatric/Primary Care
National Training Program).
Strategic Action XX
1. Report Recommendation.--VA should continue its leadership role
in the training of physicians and associated health professions in
geriatrics and long-term care. VA also should continue to utilize its
expertise at GRECC and other VA sites to train VA staff in areas such
as care coordination for complex patients. VA training should be
supported by long-term care environments that can adequately prepare
trainees for future practice.
2. Stakeholders Comments.--None.
3. Action Plan
A. VHA will initiate support for a new geriatric leadership
training program in Academic Year 2000-2001.
B. VHA will continue to expand the GRECC program until there is at
least one GRECC in every network by 2002. The GRECCs will continue to
provide leadership in clinical care, research and training for care of
frail elderly veterans.
strategic suggestions
Strategic Idea I. Access to Care
1. Idea.--VA should adopt a performance measure for Access to Care
which rewards networks for: Increasing their share of long-term care
services to the national VA average; or maintaining their share of
long-term care services, if that share is above the national average.
2. Stakeholder Comments.--None.
3. Action Plan
A. A long-term care access measure will be implemented through
Strategic Action II (page 4).
B. Further refinements for measuring access to H&CBC services will
be made as the capability of VISTA permits.
Strategic Idea II. Cost/Price
1. Idea.--VA should adopt a performance measure for Cost/Price
which rewards networks for lowering the average cost of long-term care
patients by 5 percent per year. This measure should be used only in
conjunction with meeting the access measure above.
2. Stakeholders Comments.--None.
3. Action Plan
A. This idea is, in essence, incorporated into already established
VHA goals (30-20-10 target) for reducing the cost of care. The
expansion of alternatives to nursing home care will provide more
opportunities for not only treating veterans in the most appropriate
long-term care setting but also reducing the total cost per patient
through careful care coordination.
B. The GEC/SHG will continue to monitor and report per patient
costs for long-term care.
Strategic Idea III. Quality/Functional Status
1. Idea.--VA should develop a composite Long-Term Care Quality
Index using evidence-based indicators that are realistic and
measurable.
2. Stakeholders Comments.--None.
3. Action Plan
A. A Nursing Home Quality Index will be piloted in fiscal year
1999.
B. Data from the automated RAI/MDS will be used to monitor nursing
home quality beginning in fiscal year 2000.
C. The RAI/MDS, or similar instrument, will be expanded to H&CBC
services in fiscal year 2001.
Strategic Idea IV. Patient Satisfaction
Idea.--VA's National Customer Feedback Center should develop
reliable patient satisfaction measures for veterans using long-term
care services, including those in institutional settings. This program
should be a high priority, and once developed, must be operated on a
routine basis.
2. Stakeholders Comments.--None.
3. Action Plan
A. The GEC/SHG and the Office of Quality and Performance will
continue to work with the VA National Customer Feedback Center on the
technical issues intrinsic to assessing service satisfaction in
elderly, debilitated and/or cognitively impaired patients.
B. Proposed patient satisfaction performance measures will be
referred to the Performance Measures Work Group for approval and
inclusion in VHA's performance monitoring system.
[Clerk's note.--The article ``VA Long-Term Care At The
Crossroads,'' report of the Federal Advisory Committee on the Future of
VA Long-Term Care, dated June 1998 can be found in the subcommittee's
files.]
VHA Directive 98-022
national home and community-based care strategy
1. purpose
This Veterans Health Administration (VHA) Directive articulates
national VHA policy and establishes a national VHA strategy that will
provide the context for expanding and developing home and community-
based care within each Veterans Integrated Service Network (VISN) to
respond to the healthcare needs of enrolled veterans.
2. background
a. Home and community-based care is a vital component of an
integrated healthcare delivery system. Both the healthcare industry, in
general, and VHA, in particular, are placing greater emphasis on
outpatient and community-based care rather than traditional inpatient
care. Between 1988 and 1996 Medicare spending on home care grew from $2
to $18 billion, and the number of home healthcare agencies increased
from 5800 to 9000. A recent American Medical Association survey
reported that for every patient in a nursing home, there are three more
severely impaired patients cared for in their own homes. An estimated
20 percent of patients over age 65 have functional impairments with
related home care needs, and 44 percent of all patients discharged from
the hospital by primary care physicians require post-hospital medical
or nursing care that cannot be provided in the home by family or
friends alone.
b. In 1996, 173,000 veterans needed non-institutional home and
community-based care on any given day. The Department of Veterans
Affairs (VA) estimates that number will increase to 180,000 by 2005. Of
the 173,000 veterans needing this level of care last year, 75,000 were
Category ``A'' veterans. In 1996, VA met the home and community-based
care needs of 8,300 Category ``A'' veterans daily, or 11 percent of
those in need of care. The aging and disabled veteran population, with
its prevalence of complex chronic illness, is creating a new balance
between acute care needs and chronic, long-term healthcare care needs.
New eligibility rules make it possible and necessary for VA to respond
to the increasing demand for home and community-based services. The
shift from episodic treatment of illness to managing the healthcare
needs of an enrolled population of veterans will require innovative
approaches to care. Home and community-based services must be
integrated with primary, secondary and tertiary care in such a way that
reliable, comprehensive healthcare is provided to veterans in an
individualized, seamless, coordinated manner across settings and among
providers.
c. The VHA can build on its unique experience and expertise in
providing interdisciplinary, long-term home-based care to seriously
chronically ill veterans as it expands home and community-based care.
VA Home-Based Primary Care (HBPC) can provide a strong base for
developing and coordinating an array of services for both long-term
chronically ill veterans and those needing short term home care
services. The VA can provide national leadership in this critical area
of healthcare by developing an innovative, flexible approach to home
and community-based care that is fully integrated into the healthcare
system and uses resources efficiently and effectively to meet the needs
of an aging and chronically ill population.
3. policy
a. Objectives.--The specific objectives of this policy are to:
(1) Provide the most appropriate care to veterans in the most
appropriate setting to achieve optimal health outcomes and quality of
life.
(2) Assure that a comprehensive array of high quality healthcare
services are available in the community to facilitate early discharge
from acute care settings, prevent avoidable hospitalizations and reduce
unscheduled emergency care visits.
(3) Provide services that improve and maintain functional capacity
so that the veteran may continue community-based living.
(4) Ensure that access to care is appropriate and timely.
(5) Provide for continuity of care over time and across settings by
appropriately integrating an array of home and community-based services
into the coordinated continuum of care provided by each VISN.
(6) Promote innovation in developing new models and approaches to
home and community-based care, incorporating evaluation and research as
integral components of program change.
(7) Assure accessibility, reliability and quality of all services,
whether provided directly by VA or through arrangements with community
providers.
(8) Provide compassionate, humane care that includes the patient
and family in making informed decisions regarding the use of home and
community-based services.
b. Policy Elements.--This policy addresses:
(1) The array of services included in a comprehensive home and
community-based care strategy.
(2) Programs that deliver these services, including VA programs,
non-VA programs, and new models of care.
(3) Organizational structures and processes necessary for providing
coordinated, integrated and efficient home and community-based care.
(4) The strategic planning process.
c. Array of Services.--The flexible use of an array of coordinated
services is necessary to assure that veterans receive the most
appropriate care in the most appropriate setting to achieve optimal
health outcomes and quality of life. A comprehensive home and
community-based care strategy should include access to the following
services:
(1) In-home care, including all of the following services:
(a) Short-term, post-acute, and rehabilitation services.
(b) Long-term chronic care.
(c) Palliative and end-of-life care.
(d) High-tech care, including infusion therapy.
(e) Respiratory therapy and ventilator maintenance.
(f) Mental health and psychiatric care.
(g) Personal care and homemaker services.
(h) Prosthetic services.
(2) Respite care services.
(3) Adult day healthcare services.
(4) Other community-based services (e.g., transportation, home
delivered meals, telephone support, senior center programs, friendly
visitors, assisted living, etc.).
d. Programs That Deliver These Services.--Services may be delivered
directly by VA or through arrangements with non-VA community providers.
The coordination and integration of a ``package'' of locally available
services is often essential to assure timely, equitable access to the
array of services necessary to successfully manage the care of veterans
in the community. The following list of programs reflects both existing
programs and new models that are being developed; it is not intended to
be an all-inclusive list of mandated programs (see App. A for
definitions).
(1) In-home Programs
(a) VA Home-Based Primary Care (HBPC);
(b) VA Spinal Cord Injury (SCI) HBPC;
(c) Medicare-Certified Home Health Agencies;
(e) Fee-Basis Home Care;
(f) Hospice (VA Hospice, Medicare-Certified Hospice, Community
Volunteer Hospice);
(g) VA Homemaker/Home Health Aid Program (H/HHA); and
(h) Other community programs (e.g., those provided through
Department of Rehabilitation Services, County Health Departments, Area
Agencies on Aging, Department of Health and Human Services).
(2) Respite Care
(a) VA Respite Program,
(b) Hospice Respite Care, and
(c) Community Respite Care Programs.
(3) Adult Day Healthcare
(a) VA Adult Day Healthcare Programs,
(b) Contracted Adult Day Healthcare, and
(c) State Veterans Home Adult Day Healthcare.
(4) Innovative Models, Demonstrations and Pilots
(a) Program of All-inclusive Care for the Elderly (PACE).
(b) MediCaring.
(c) In-home respite.
(d) Disease management models.
(e) Enriched housing, assisted living, and community residential
care.
(f) Social health maintenance organizations.
(g) Disability management models.
(h) Prevention of secondary complication models.
(i) Specialty primary care models.
(j) Rural disabilities projects (Montana and Arkansas).
(k) Telemedicine initiatives.
(l) VA initiated innovations and demonstrations such as: Care and
Assistance for Rural Elders (CARE) in VISN 7, and Patient Access to
Community Health (PATCH) in VISN 15, Teleheart CHF Management Program
in VISN 8, and Vets Helping Vets in VISN 8.
e. Organizational Structures and Processes.--In order to provide
reliability and continuity of care for eligible veterans over time and
across settings, a sound infrastructure is essential. Organizational
structures and processes must be put in place that promote the
philosophy and practice of individualized, comprehensive, integrated
home and community-based care. Necessary organizational processes
include the following:
(1) Assessment and Referral
(a) A coordinated referral process based on standardized assessment
of patient needs, including functional status;
(b) A coordinated referral process that is linked to discharge
planning and continuity of care planning;
(c) Defined criteria for access to available services and programs;
and
(d) A process that assures timeliness of referrals.
(2) Care Coordination
(a) Care management within the context of primary care teams and
specialty care teams that also deliver primary care.
(b) Care management and/or coordination across settings and
programs.
(c) Twenty-four hour, 7-day-a-week access to services and
coordination of care.
(d) Patient and family participation in healthcare decisions.
(e) Streamlined care management that avoids duplication of care
management functions.
(3) Evaluation and Accountability
(a) A process for determining the responsible provider and defining
accountability when the patient is receiving services from more than
one provider or program.
(b) Ongoing monitoring of functional status, quality of life, and
other patient outcomes using standardized measures.
(c) Ongoing monitoring of customer satisfaction using standardized
measures.
(d) Standards for and/or evaluation of services provided by non-VA
providers.
(e) System-wide, state-of-the-art home care outcome measures.
(f) Performance standards (e.g., same-day service for durable
medical equipment).
(g) Ongoing, real-time measures for continuous quality improvement
of programs and services.
(h) Comparison of VA care with that provided by non-VA programs in
the community.
(4) Research
(a) Support for demonstration projects for new and innovative
projects and strategies, including an evaluation component;
(b) Identification of best practices, through literature reviews,
case examples, existing data, primary data collection; and
(c) Identification of state-of-the art assessment and outcome
measurement tools
(5) Information Systems
(a) Identification of which patients receive which services;
(b) Monitoring utilization of services across the entire continuum
of care;
(c) Providing process and structure information (e.g. staff mix,
patient acuity, components of service provision);
(d) Monitoring outcomes;
(e) Providing cost data; and
(f) Providing access to patient care data across sites of care.
f. Strategic Planning Process.--System-wide strategic planning for
home and community-based care is essential at all levels. The strategic
planning process should include:
(1) Identifying the strengths and weaknesses of existing programs
relative to needs of the veteran population through a population-based
planning model.
(2) Identifying the need for program expansion, development of new
programs, modification of existing programs, and the potential for
piloting innovative models.
(3) Identifying the strengths and weaknesses of relationships with
community providers and developing a strategy for partnerships,
sharing, and coordination of services with non-VA providers.
(4) Considering local and regional home care service contracts and
purchase agreements.
(5) Achieving more efficient utilization of resources (e.g.,
through flexible scheduling, using state-of-the-art technology,
telemedicine applications, adequate clerical support and communications
equipment).
(6) Including representatives of VA home and community-based care
programs, as well as experts from other areas and external stake-
holders, in the strategic planning process (e.g., developing network
based home and community-based care work and advisory groups).
(7) Fully integrating home and community-based services with
inpatient, outpatient and ambulatory care programs and services within
the context of primary care.
(8) Promoting access to and coordination with ancillary services
such as laboratory, radiology, pharmacy and durable medical equipment.
(9) Collecting cost and utilization data across settings to begin
to be able to compare aggregate costs for patients receiving different
kinds of care and services.
4. action
a. VISNs will develop, implement and regularly review strategic and
tactical plans for expanding home and community-based services,
including the allocation of adequate personnel, equipment and other
resources.
b. The Geriatrics and Extended Care Strategic Healthcare Group will
provide guidance, consultation and dissemination of information.
c. The Geriatrics and Extended Care Strategic Healthcare Group will
support VISN and local leadership in all aspects of improving the
provision of home and community-based care.
d. Health Services Research and Development, through the Chief
Research and Development Officer, will support the evaluation of
outcomes and cost-effectiveness of new models of providing home and
community-based care.
f. The Office of the Chief Information Officer (19) will ensure
that national data systems support home and community-based services.
5. references
None.
6. follow-up responsibility
The Office of Extended care (114) is responsible for the contents
of this Directive.
7. rescission
This VHA Directive expires on April 1, 2003.
Attachment A
definitions
1. Home-Based Primary Care (HBPC).--A designated HBPC is a program
providing primary healthcare, delivered by an interdisciplinary team of
VA staff, to functionally dependent, homebound patients. Services
include medical care, nursing care and education, rehabilitation,
nutritional counseling, and social work.
a. HBPC manages: long-term care patients with multiple, complex
medical problems requiring prolonged intervention to maintain status
and retard decline; terminally ill patients, and as resources permit,
certain patients with relatively short-term problems who need skilled,
high-tech health services, home training or home adaptation.
b. Medications, supplies, medical equipment, and assistance with
home improvements and structural alterations are provided. Caregiver
support and training are provided. Bereavement care is offered to
survivors of deceased patients for up to 6 months. At affiliated
medical centers, HBPC provides comprehensive training in primary care
of long-term patients to medical residents, geriatric fellows and
allied health professionals.
2. Medicare-certified Home Health Agencies.--Medicare pays for
intermittent skilled nursing care, home health aide services, physical
therapy, occupational therapy, speech therapy, medical social work
services and durable medical equipment (with a 20 percent co-payment).
Services must be provided by a Medicare-certified agency. To qualify
for home care under Medicare, a patient must have at least one skilled
need. Without the continuing presence of a skilled need, supportive
services such as home health aide visits cease. Most Medicare home care
is for relatively short-term post-acute care. However, some chronically
ill recipients can receive care for long periods, i.e., those with
indwelling catheters, blind diabetics, psychiatric patients requiring
intramuscular medications.
3. Fee Basis Home Care.--The Veterans Health Administration (VHA)
authorizes payment for medically necessary, skilled home care services
for eligible beneficiaries on a fee for service basis. Nursing,
physical therapy, occupational therapy, speech therapy, and social work
are examples of allowable services. Fee Basis, except for patients in
need of bowel and bladder care, does not pay for home health aide
visits. The Department of veterans Affairs (VA) Clinic of Jurisdiction
pays a per visit rate to the community home health agency providing
care. It is possible to establish a preferred provider or negotiated
rate with a community agency. The total cost of Fee Basis care for any
patient cannot exceed the cost that would have been incurred if the
veteran were treated in a contract nursing home during one month.
4. Homemaker/Home Health Aide (H/HHA) Program.--The program
provides homemaker/home health aide visits to eligible beneficiaries
using Contract Nursing Home funds. Expenditures for a veteran may not
exceed 65 percent of the average nursing home per diem rate. Veterans
enrolled in this program must be in receipt of primary healthcare from
VA and will meet program criteria including the need for nursing home
care.
5. Hospice.--Medicare, many state Medicaid programs, and some
private insurance plans offer a hospice benefit to their beneficiaries.
Beneficiaries waive curative treatment options in favor of palliative
services: comfort care, counseling, and supportive home care visits for
terminally ill individuals and their families. The patient's physician
certifies an expected life expectancy of less than 6 months. Hospice
provides skilled nursing, home health aide, social work, and chaplain
visits. Medications for the terminal condition, durable medical
equipment, and supplies are furnished. Bereavement counseling is
provided to survivors of deceased patients.
6. Adult Day Healthcare Program (ADHC).--ADHC is a therapeutically
oriented outpatient day program that provides health maintenance and
rehabilitative services to frail elderly persons in a congregate
setting. ADHC is provided in a protective setting during part of a day
but less than 24-hour care. Individualized programs of care are
delivered by health professionals and support staff, with an emphasis
on helping participants and their caregivers to develop the knowledge
and skills necessary to manage care requirements in the home. Its
predominant focus is a therapeutic one, directed at persons with
disabling conditions and medical disorders, thus distinguishing ADHC
from social day care.
7. Respite Care.--Respite care is a program which provides veterans
with hospital or nursing home care on a short-term basis to give the
caregiver a period of relief or respite from the physical and emotional
burdens associated with furnishing daily care to chronically ill and
disabled persons. Respite care is planned in advance for the benefit of
the caregiver rather than being incidental to the provision of
necessary medical care of the patient. Respite care enables the
caregiver to continue in the caregiving capacity and permits the
veteran to continue to live at home.
Question. Does VA have sufficient long-term capacity?
Answer. Every indicator of supply and demand for long-term care
shows that VA will have sufficient capacity to meet the needs of
veterans who use the VA health care system. This scenario assumes that
VA will expand home- and community-based care services, contract for
long-term care services, and increase the use of State Veterans Homes,
where available.
Question. The recent report on long-term care, commissioned by Dr.
Kizer, found that new demand for long-term care should be met primarily
through non-institutional services and contracts. VA's budget proposes
an increase of $106 million for extended care program enhancements. Is
this adequate to meet the recommendations contained in the long-term
care commission's report? What is being done specifically to implement
the recommendations of the commission?
Answer. The budget reflects a first year investment toward the
recommendation of the Federal Advisory Committee on the Future of VA
Long-Term Care on tripling the investment in home- and community-based
care over a 5-year period.
The recommendations in the Committee's report, VA Long-Term Care at
the Crossroads, have been studied by VA long-term care staff and the
senior leadership of VHA. Comments on the Crossroads Report have been
sought from VHA stakeholders and integrated into a VHA plan. Currently,
the draft Strategic Plan is circulating for review and comment. This
Plan will implement the Committee's recommendations. As noted above, a
copy of the draft Strategic Plan is attached.
Question. What will VA do to make more equitable access to long-
term care services?
Answer. VA will improve access to long-term care by providing
incentives to networks to provide more long-term care services. VA will
also enhance its admission and discharge policies for VA and Community
Nursing Home Care. These changes will improve access and fairness.
In the draft Strategic Plan, improved access is discussed on pages
3, 7 through 9, and 14. Pages 3 and 14 outline the action plan for
performance measures on access to long-term care services. Pages 7
through 9 discuss improvements in the admission and discharge planning
processes in nursing home care.
Question. What measures are being taken to ensure quality of care
in VHA long-term care programs, especially for those referred to
community facilities and programs?
Answer. VHA staff monitors the quality of care received for all
long-term care patients, regardless of setting. For care provided off-
campus, by non-VA staff, the best developed measures of quality care
are found in the Community Nursing Home Program (CNH). In CNH, VA
relies on a three-pronged approach to care monitoring. First, VHA staff
visits the veterans in CNHs on a monthly basis. This presence sends
important, positive messages to the nursing home staff and the
veterans, regarding VHA's approach to caring and watching. Second, VHA
uses on-line data from the Health Care Financing Administration (HCFA)
to assess the quality of the nursing homes under contract. These data
allow VHA staff to compare one nursing home to another over a period of
time. Third, VHA staff reviews every re-hospitalization from CNHs. This
review focuses on poor quality care as the reason for the patient's
return to the hospital.
This approach to monitoring veterans' care highlights VA's
commitment to quality long-term care. It is timely, patient-focused and
incorporates information from a variety of sources.
veterans equitable resource allocation (vera)
Question. In a recent report, GAO found that the two networks it
reviewed had no specific criteria for allocating their resources within
the network to ensure equity. GAO's testimony today says ``VA has
neither provided criteria for equitable allocation of resources within
networks, adequately reviewed the equity of allocations, nor measured
improvements in equity of veterans' access to care.'' Why? How would
you assess the success of VERA in achieving real equity of access?
Answer. The VA philosophy concerning network allocations to
facilities is to continue balancing oversight with flexibility. VA does
not want to dictate how each network should fulfill its
responsibilities, and we believe that this philosophy has been
effective in network implementation. Nevertheless, in fiscal year 1999,
VA added a criterion in the ``network allocation principles directive''
that stated the equity of resource allocations to facilities should be
achieved, but the directive does not prescribe how this should be done.
That is, VA continues to allow networks the flexibility they need to
meet local needs. Although the GAO report states that headquarters did
not review the network allocations methodologies and equity of
allocations in the past, VA has in fact completed these reviews. VA
will continue to review the network allocation plans and methodologies
to assure equitable resource allocation within networks.
VERA equitably allocates funds across networks and was created to
support VA's goals of:
--Treating the greatest number of veterans having the highest
priority for health care.
--Allocating funds fairly according to the number of veterans having
the highest priority for health care.
--Recognizing the special health care needs of veterans.
--Creating an understandable funding allocation system that results
in having a reasonably predictable budget.
--Aligning resource allocation policies to the best practices in
health care.
--Improving the accountability in expenditures for research and
education support.
--Complying with the congressional mandate.
VERA achieves these objectives and, at the same time, strikes a
balance between simplifying resource allocation and recognizing the
complexities of the veterans' health care system. VERA equitably
distributes funds across networks according to the number of veterans
actually served by VA and promotes efficiency gains through the use of
national prices. The VERA system was developed in response to a
congressional mandate in Public Law 104-204. Independent reviews by the
General Accounting Office and Price Waterhouse Coopers, LLP have
validated the model as meeting the intent of Congress. Price Waterhouse
Coopers, LLP found that VERA equitably distributes funds across
networks and that VERA focuses funding on the highest priority veterans
using the VA health care system. VA achieves equity of access because
funding is based on high priority veterans through the VERA Basic Care
workload measure, which includes Category A veterans only, and the
Complex Care workload, which provides significantly higher resources
for patients with special or long-term needs.
Question. GAO also raised concerns as to whether VA headquarters
had adequate, timely data to ensure effective oversight.
Answer. Collecting timely, accurate, and meaningful data from VHA's
national databases is critical to the decision making process. The
availability of this information directly supports the performance
measurement, outcome assessment, and oversight activities of VHA. In
addition, data quality is integral to VHA's efforts to provide
excellence in health care and figures prominently in Dr. Kizer's
Journey for Change and related documents.
In order to improve the timeliness and availability of information,
VHA issued Change 2 to Directive 96-079 (Closeout of the Veterans
Health Administration Corporate Data Files) on March 5, 1999. This
directive changed the file closeout dates of all patient treatment
information to provide more timely data for the Veterans Equitable
Resource Allocation (VERA) system, health care planning and statistical
purposes, and for the Secretary of Veterans Affairs' Annual Report to
Congress.
A comprehensive overview of key VHA data quality issues was
instituted in early fiscal year 1999. As part of this effort, a VHA
steering committee conducted a Data Quality Summit in December 1998.
The summit participants recommended six initiatives to address data
quality in VHA. They are:
--Form a Data Quality Council to Provide Leadership
--Define a Standards Process
--Define and Implement Local Accountability for Data
--Establish On-going Employee Education, Training, and Communication
--Programs for VHA Data Users
--Provide Patients with Access to their Data
Workgroups have been formed to address each initiative, and all
workgroups have met to determine priority items on which to focus.
These efforts provide a foundation for VHA's continuing process to
improve the quality, availability, and accuracy of information that
supports the decision process.
In order to provide a VISN-level management tool, the VHA Decision
Support System (DSS) Steering Committee has just completed a test of
four national measures. Based on the outcome of these tests,
recommendations regarding standardization and data quality will be
forwarded to the National Leadership Board for its consideration on May
18, 1999.
Question. What oversight functions does VHA currently conduct, and
what is VA doing to improve its oversight of the field, and in
particular improve its data collection systems so that VA can monitor
changes in access to care?
Answer. Public Law 104-262 required, among other things, that VA
maintain its capacity to treat certain classes of specially-disabled
veterans. VA produces an annual Capacity Report, for which numerous
access measures were developed and are reported on. The Capacity Report
calls specific attention to changes in access to care.
Currently, VHA assesses waiting times for primary care clinic
appointments in annual patient feedback surveys, and the results are
shared with the field. Plans are underway to expand monitoring to
include the length of time it takes to obtain a specialty clinic
appointment. Interest in such a measure is driven by concerns that the
increase in access due to additional community-based clinics, along
with the increased efficiencies of primary care, will raise the demand
for specialty clinic care. If the demand for specialty clinic care,
indeed, does increase, one would expect to see increases in the time it
takes to obtain an appointment. VHA is currently developing requisite
software capability that will capture data on specialty clinic waiting
time.
As indicated earlier, the file closeout dates were changed for all
patient treatment information to provide more timely data. In addition,
data quality is likely to improve in response to the initiatives
undertaken in response to the Data Quality Summit described previously.
Question. Why doesn't VA have a performance measure for network
directors that directly addresses the need to improve equity of access?
Answer. Equity of access means different things to different
people-patients and stakeholders alike; there needs to be a better
understanding of what this term entails and what are the expectations.
For example, some view equity of access as meaning that all health care
services should be available at all VA facilities. Others feel that all
care should be available to patients via VA or contract services, and
still others believe that equity translates to geographic distance or
time involved in accessing care. Fundamentally, however, VHA's
reorganization into VISNs was part of an effort to empower local
management (i.e., VISN Directors) to determine the extent of services
required and requested by patients as well as the amount of resources
allocated to these services. Each VISN has improved that by virtue of
establishing CBOCs. Each of the 22 VISNs has established at least three
CBOCs and the total number of CBOCs approved between March 1995 and
January 1999 is 272; these actions affirm VHA's commitment to improving
equity of access, as defined by geographic points of availability.
quality management
Question. Concerns also have been raised about the lack of
guidelines put out to the field in the area of quality management. The
IG has recommended a national set of QM guidelines as there is a great
deal of variation in individual hospitals in their approach to quality
management. Will VA follow these recommendations? If so, when?
Answer. We concurred with the IG recommendation regarding
establishing quality management guidance for use at all VHA operating
levels. The Office of Performance and Quality will establish a process
that will include a work group of senior Headquarters and field quality
management specialists to recommend the specific scope of content that
should be included in the guidance and to suggest the most effective
ways to expedite field access to the guidance. Following approval of
the work group's recommendations, a detailed action plan for
development and implementation of a field reference tool, including
completion timelines, will be initiated. The process will be underway
in this fiscal year.
academic affiliations
Question. VA plays a critical role in the education of medical
students. Since 1946 VA has had affiliations with medical schools, and
currently supports about 9,000 residency positions through affiliations
with 107 medical schools. VA has eliminated 560 subspecialty medical
resident positions in the last two years, consistent with
recommendation of a residency review realignment commission. What has
been VA's strategy with respect to deciding where (e.g. which
particular hospitals) to eliminate these positions, and what effect
have these reductions had on VA's relationship with its affiliates?
Answer. VISN targets for residency realignment were developed based
on the Residency Realignment Review Committee's (RRRC) recommendations.
Goals were based on the historical allocation of resident positions
among facilities and projected RRRC Categories I-IV rates applied to
each VISN. In September 1996, each VISN was notified of its realignment
goals for medical resident positions for Academic Year 1997-1998 and
beyond. Each VISN was asked to develop a plan for medical resident
allocations that took into account the goals and objectives for VHA's
realignment of graduate medical education set forth by the RRRC.
Networks were asked to make their plans based upon a review of the
respective VISN health care delivery plans, the historical allocation
among facilities and relationships with academic affiliates, and the
specific goals for distribution between generalists and specialists
positions.
Each Network Director convened a Network Education Committee made
up of representatives of VHA and academic affiliates that advised the
Network Director on residency allocations within the VISN. These
discussions led to the creation of new generalist residency positions
where they best served VHA and affiliates training programs and a
pruning process for the most vulnerable residency programs.
VHA's change strategy has emphasized alignment of excellent patient
care with training of future health professionals. In this regard, VHA
has provided important leadership for its academic partners during
these times of great change that affects all of health care. The future
health care environment will be very different from today's. In
implementing the additional 50 percent reduction in specialty positions
this year, the challenge was to downsize specialty programs while
concomitantly developing additional primary care training
opportunities. We view this challenge as an opportunity to both improve
the health care of veterans and the education of future physicians.
Not surprisingly, changes in VHA's training strategies have
produced understandable anxiety and resistance from some of our
affiliates. The response of individual medical centers has been
heterogeneous. In the aggregate, though, I believe that VHA has been
sensitive to the effect of its changes, and that we have appropriately
tried to engage stakeholders in the academic, accrediting, and broader
health care community. Indeed, given the implications of the wide
ranging changes in the nation's health care enterprise, we are
committed to seeking and exploring advice from all willing and credible
sources as this process goes forward.
Question. VA has less than 11,000 acute care beds in operation
today compared to 35,000 ten years ago. How can VA continue to support
residency programs in 125 hospitals with a third as many beds?
Answer. Across the U.S. health care system, major changes have
occurred in the last decade that have resulted in substantial portions
of patient care shifting from inpatient hospital settings to care
delivered in an outpatient environment. Likewise, VA has made great
strides in these same directions through a number of re-engineering
efforts that have resulted in decreasing the total number of acute care
beds, decreasing the bed-days of care per 1,000 patients, and
increasing the percentage of surgeries performed in outpatient
settings.
Concomitant with the shifts VA has made to the ambulatory care
treatment environment, VA has increased the total number of patients
receiving care, increased the number of ambulatory visits, and
instituted systems to measure improvements in the quality of care
veteran patients receive. VA has implemented a universal system of
primary care for VA patients and opened over 200 new community-based
outpatient clinics to improve access to care. VA's reengineering
efforts have resulted in a more efficient health care delivery system
that is able to provide quality care to a larger group of patients.
Medical schools are posed with the challenge of training students
and residents for the workplace reality of their future professional
lives. Consequently, academic affiliates and VA are working together to
develop effective methods for care and teaching in the ambulatory
setting. Examples of VA's leadership include the Primary Specialist
Program where over 60 percent of all medical specialty and psychiatry
residents who receive training in VA participate. This new training
strategy emphasizes access, continuity, and comprehensive care for
their seriously ill patients with emphasis on ambulatory care. In
another initiative, VA recently received a grant of $985,000 from the
Robert Wood Johnson foundation to develop new curricula for internal
medicine residents who care for patients near the end of life. This
project emphasizes training in the ambulatory setting, including VA
clinics, hospice and the home. This project will provide leadership in
30 of our academically affiliated settings, thus having an impact on
fully one quarter of the nation's medical schools. A third example is
the VA Quality Scholars Program which will develop criteria for
physicians training in the important area of quality improvement in
health care.
Question. How many acute care beds are needed in a hospital for a
strong residency program?
Answer. There is no minimum number of beds required for a strong
residency program.
va/dod sharing
Question. The recent report of the Congressional Commission on
Servicemembers and Veterans Transition Assistance recommends a much
greater level of sharing of health care resources between VA and DOD.
The budget estimates that a total of just $73 million will be shared.
Aren't there greater opportunities to share services with the DOD, and
make better use of resources in doing so, such as joint purchasing of
supplies and pharmaceuticals?
Answer. The $73 million sharing figure significantly understates
the actual amount of sharing going on between VA and DOD health care
facilities. Much VA-DOD sharing is done on a barter or exchange basis
with little or no money changing hands. One reason for this is that,
unlike VA facilities, DOD medical treatment facilities (MTFs) do not
retain sharing revenues. It is therefore in their interest to receive
services in kind as payment. Similarly, savings generated from joint
purchasing are not reflected in sharing estimates. VA is actively
pursuing all opportunities to share services with DOD facilities and
their TRICARE contractors, as well as facilitate savings in the
procurement of pharmaceuticals and medical surgical supplies.
Currently, over 120 VA medical centers have agreements to treat TRICARE
beneficiaries through agreements with DOD's TRICARE contractors.
Question. What barriers do you face in increasing the level of
sharing?
Answer. The VA-DOD sharing law (38 U.S.C., section 8111) is a model
of flexibility. It permits sharing between VA and DOD facilities of any
health care resource provided that the primary beneficiaries of the
facility providing the care are not adversely affected. No changes to
that authority are required, although we are proposing that, in the
future, sharing revenues be deposited in the Medical Care Collection
Fund. The ability to retain the proceeds from sharing earned in prior
years will promote efficiency and increased use of this authority.
DOD's migration to TRICARE has caused VA some difficulty in
adapting to an unfamiliar billing and collecting system. VA's
conversion to ``reasonable charges'' for third-party billing should
promote greater consistency and, ultimately, with training, more
efficient TRICARE billing in VA. There is currently and issue with DOD
facilities concerning whether recent TRICARE contracts, which include
active duty personnel, somehow limit the use of traditional VA-DOD
sharing arrangements (between MTFs and VA health care facilities). We
hope this will soon be resolved, and that beneficial sharing
arrangements directly between VA and DOD health care facilities can be
preserved and expanded.
Question. What specifically will be done to implement the
commission's recommendations in this area?
Answer. The commission's recommendations are sweeping and remain
under review. While VA's implementation plans are not yet complete, we
are proceeding, along with DOD, to implement a number of initiatives
that correspond to commission proposals. For example, DOD and VA have
agreed on policy to consolidate the DOD separation physical exam with
VA's disability evaluation physical; are working together to achieve
seamless care for repatriated POWs; and, are jointly surveying veterans
and military populations to better meet beneficiary needs and
expectations in the delivery of health care. The VA Under Secretary for
Health and DOD's Assistant Secretary for Health Affairs meet regularly
with their top advisors to facilitate increased sharing of specialized
treatment services; promote more effective and efficient procurement of
pharmaceuticals, supplies, and equipment; develop a standard computer
based patient record; and integrate clinical practice guidelines for
disease treatment.
congressional commission on servicemembers and veterans transition
assistance
Question. What is the Department's position on the recommendations
on Montgomery GI Bill enhancements and each of the major
recommendations contained in the Commission's report? Will the
Administration propose legislation to implement some or all of the
recommendations?
Answer. The Department is currently in the process of finalizing
its comments on the Commission's report. When that is done, we will
provide the Subcommittee with a complete copy of our response.
We would anticipate that in areas where the Administration agrees
with the Commission and that legislation is required for implementation
of the recommendation, that a legislative proposal would be
forthcoming. It should be noted that not all of the Commission's
recommendations were directed toward VA. Some of the recommendations
were directed to the Department of Defense or the Department of Labor.
community based outpatient clinics
Question. VA has been given approval for hundreds of outpatient
clinics in the past few years to improve access to care. How many CBOCs
have been activated and how many more will open in fiscal year 1999 and
fiscal year 2000?
Answer. Between March 1995 and January 1999, 272 CBOCs have been
approved, of which 183 are currently operational (treating patients).
Recent information suggests that approximately another 77 CBOCs will
open by the end of fiscal year 1999. All but one or two of the
remaining 12 are expected to open by the end of fiscal year 2000. Those
one or two were part of a strategic business plan which documented a
sequential opening of clinics; therefore, they are on schedule for
their openings. Additionally, there are a number of additional CBOCs
that have been proposed for the remainder of fiscal year 1999 and into
fiscal year 2000.
Question. What is the total amount of funding being devoted to
CBOCs in fiscal year 1999 and fiscal year 2000? Are they sufficiently
funded?
Answer. Of the 272 CBOCs approved between March 1995 and January
1999, 183 are currently operational, with all but a couple of the
remaining 89 projected to be open during fiscal year 2000. The combined
actual and projected annual recurring budget for these 272 CBOCs is
approximately $174 million. Additional proposals for CBOCs continue to
be submitted; therefore, additional dollars will be devoted to CBOCs in
fiscal year 2000. Again, no additional resources can be requested to
support the establishment of CBOCs; the resources are to come from
within the VISN. To date, there is no indication that the CBOCs are not
receiving appropriate and adequate funding from their VISNs.
Question. Are any CBOCs oversubscribed, and if so, what is being
done to address the problem?
Answer. To date, there have been no reports of VISNs not being able
to accommodate any patients presenting themselves to a CBOC for care.
Question. Is the opening of any CBOCs being delayed owing to budget
difficulties?
Answer. There have been some delayed openings due to issues such as
contract problems, recruitment problems, and location of appropriate
space. There is no indication that budget issues have or will cause
significant delays in CBOCs becoming operational in fiscal year 1999.
The establishment of CBOCs is dependent upon veteran medical needs and
resource decisions made at the VISN level.
Question. What quality of care indicators or monitors have been
established for CBOCs?
Answer. A key element of the CBOC proposals is that evaluation/
monitoring mechanisms be in place for the parent facility and VISN to
assure that the clinic is meeting its goals and objectives. In
addition, VHA top management has requested a VHA Health Services
Research & Development (HSR&D) study to evaluate the performance of
those CBOCs that are operational and to recommend some standard
national criteria that could be used to evaluate all CBOCs. This study
is well underway and should be completed, with recommendations from VHA
on national evaluation criteria, by the end of fiscal year 1999. The
development of national criteria will not preclude VISNs and parent
facilities from continuing to monitor certain things that are important
to them and specific to their clinics.
veterans benefits administration
Question. VA's efforts to improve the timeliness of claims
processing have deteriorated in the last year, and are not projected to
improve significantly in the near term. It took an average of 168 days
to process an original compensation claim in 1998, compared to 133 days
the year before. Currently it is taking about 193 days. VA's own survey
found that only 60 percent of veterans were satisfied with the way
their claims were handled. When can we expect to see significant
improvements in timeliness, quality, and customer service?
Answer. We recognize that the challenge to improve claims
processing timeliness has increased. Some of the performance drivers
which have impacted claims processing timeliness are discussed in the
following paragraphs.
Workload Management
We have adopted a balanced scorecard approach emphasizing accuracy,
customer satisfaction, employee development, processing timeliness, and
unit cost. The balanced scorecard will focus the entire organization
upon its vision and the results it needs to achieve to be successful.
We have shifted our emphasis from processing timeliness to
accuracy. Improvement in technical accuracy is the number one priority
for the Compensation and Pension Program. This priority is reflected on
the VBA Balanced Scorecard with accuracy weighted the heaviest of the
five measured performance categories.
Because of concerns about our high error rate, we have asked our
employees to do a closer review of their award documents. We have also
asked them to write better decisions which are understandable to our
claimants and which can be sustained through the appellate process.
We have shifted our focus from working newer cases and have asked
our employees to process the older claims to ensure that they continue
to move through the system.
Increased Difficulty and Complexity of the Workload
Our decision makers have been faced with significant changes in the
body of law governing the compensation and pension programs. Decision
makers who now rate cases must do so increasingly by case law rather
than a static body of regulations--a more difficult and time consuming
process. The process of evaluating claims using a combination of
regulations and precedent decisions is much more complex, and requires
additional research time.
The impact of adjudicating Gulf War veterans' compensation claims
has exacerbated our already significant backlog. Decisions for these
claims are labor intensive and are completed at the expense of other
claims. We have struggled with the issue of service connection for
undiagnosed illness because this is contrary to the way we
traditionally adjudicate service connection. VBA has dedicated
resources to several efforts to ensure that Gulf War veterans are
properly evaluated.
Changed Organizational Structure
The transition into the first phase of our reengineered environment
has required stations to undertake a major cultural and organizational
shift as they blend Adjudication and Veterans Service Divisions into
Veterans Service Centers.
This reengineered environment requires extensive cross-training of
personnel. As employees have been pulled away from claims processing
and customer service activities to undergo training, there has been a
degradation in service to our veterans.
Data Integrity
VBA has asked its managers to review operating practices, workflow,
data entry methods, and management reports to ensure that all
management reports are accurate. We have also asked them to promote a
culture and an atmosphere where data integrity is of the highest degree
possible.
Effective data management requires decision makers to spend more
time on entering data and reviewing it for accuracy.
Although claims processing timeliness will continue to be a major
challenge for us, we are beginning to achieve significant improvements
in other areas. The following paragraphs highlight achievements thus
far in fiscal year 1999.
Technical Accuracy.--In 1998, the Compensation and Pension baseline
technical accuracy levels were 64 percent for Core Rating Work and 70
percent for Authorization Work. Based upon Statistical Technical
Accuracy Reviews (STAR) conducted so far during fiscal year 1999,
preliminary results show a 73 percent rate for Core Rating Work and 74
percent for Authorization Work.
Blocked Call Rate.--At the end of fiscal year 1998, our blocked
call rate was 52 percent. Through March, the fiscal year 1999 blocked
call rate is 39 percent. The March 1998 blocked call rate was 57
percent compared to 17 percent for March 1999. Several ongoing
initiatives in the area of telecommunications will also contribute to
further improvements in the blocked call rate. We expect to be below
our balanced scorecard fiscal year 1999 target of 30 percent by
September 1999.
Pending Workload.--We have reduced the pending appellate workload.
In fiscal year 1998, we had 102,834 appeals pending to be worked, and
as of March 31, 1999 that number has been reduced to 101,184. We have
also made progress in reducing the number of old remands (pending prior
to 1996) from about 10,000 in fiscal year 1998, to 1,108 in fiscal year
1999.
Question. VA's budget indicates it will take 99 days to processing
rating-related actions in fiscal year 1999. Is this estimate still
accurate? If not, what is the 1999 estimate and 2000 estimate? When
will VA meet its objective of 74 days, while also improving the quality
of adjudication?
Answer. We are currently processing rating-related actions in an
average of 161 days. We do not anticipate achieving 99 days as shown in
the budget for this year. We are in the process of working with Service
Delivery Networks (SDNs) to project where we will end this fiscal year
for rating related actions. Once we update our fiscal year 1999
timeliness projection, we will be in a better position to establish a
revised fiscal year 2000 target. As indicated above, we are already
beginning to see some improvement in claims processing accuracy. Claims
processing timeliness will continue to be a major challenge for us. The
earliest we foresee attaining our 74-day timeliness objective in
rating-related actions is fiscal year 2005.
Question. VA projects there will be 410,000 pending claims at the
end of fiscal year 1999. The number of pending claims is not expected
to change in fiscal year 2000. What do you believe is an acceptable
level of pending claims and when will you reach that?
Answer. While ``pending workload'' is not one of our primary
organizational measures on the Balanced Scorecard, it is a significant
indicator of timeliness trends. Timeliness of processing clearly needs
to improve and as one component of that improvement we will strive to
reduce the pending workload to 350,000 claims by March of 2000.
Question. In 1998, VBA's accuracy rate for core rating work was
only 64 percent. VBA projects to get to 81 percent by 2000. Do you
believe today VBA can meet this goal? When will VBA meet its objective
of accurately adjudicating claims 96 percent of the time.
Answer. In 1998, the Compensation and Pension baseline technical
accuracy level for core-rating work was 64 percent. Improvement in
technical accuracy is the number one priority for the Compensation and
Pension Program. This priority is reflected on the VBA Balanced
Scorecard with accuracy weighted the heaviest of the five measured
performance categories. We are beginning to achieve improvement in this
area. Based upon Statistical Technical Accuracy Reviews (STAR)
conducted so far during fiscal year 1999, preliminary results show a 73
percent rate. We are encouraged by the preliminary results and expect
to attain our 75 and 81 percent targets for fiscal year 1999 and 2000
respectively. We expect to reach our 96 percent goal by the end of
fiscal year 2004.
construction--murfreesboro
Question. GAO has raised questions about whether VA could pursue
the $12.7 million patient privacy project requested in the budget for
Murfreesboro, TN. Given GAO's concerns, does VA continue to support
this project for fiscal year 2000?
Answer. Although the payback period for the expected savings has
not been quantified, VHA analysis of workload and mission for the
Murfreesboro facility fully supports the beds included in the proposed
project. Murfreesboro is the Network referral center for long-term
mental health care and it receives patients from Nashville and Memphis.
The facility currently has an authorized mental health bed level of
229, and the project proposes renovation of 120 beds. The project will
enhance the proposed integration of Murfreesboro and Nashville.
Integration planning has identified the Murfreesboro campus as the
focal point for psychiatric services for the integration. The acute
psychiatric care currently at Nashville is planned to be shifted to the
Murfreesboro campus as part of the proposed integration.
Since, the percentage of veterans over age 65 will increase to an
estimated 69 percent by 2008, this high percentage of elderly veterans
will sustain bed utilization due to an increasing utilization of mental
health services that comes with aging and loss of income at retirement.
Murfreesboro VAMC currently has a mental health penetration rate of
0.53 percent, which is less than half of the national utilization rate
for these services (1.68 percent). Provisions for patient privacy and
handicapped accessibility will allow the facility to improve access, in
line with the national utilization rates.
The Murfreesboro project is consistent with VA's mission to provide
care to veterans with identified special needs and with the assigned
mission of the Murfreesboro VAMC. The primary goals and objectives of
the project are to eliminate serious access and quality of care
deficiencies, as reflected in accreditation and life/safety
evaluations. In addressing these goals, VA has taken a conservative
approach to bed projections and if these estimates are unexpectedly
overstated, contingency plans have been established to use the beds for
gero-psychiatric patients.
colorectal screenings
Question. The Center for Disease Control and Prevention (CDC) has
determined that colorectal cancer is the second leading cause of
cancer-related death in the United States. Federal policy and
guidelines call for the regular screening of all average-risk adults
after 50 and older. The guidelines call for screenings that include
yearly fecal occult blood tests (FOBT), and flexible sigmoidoscopy
every five years for average risk patients. Federal policy and
guidelines call for more intensive surveillance of the entire colon
with colonscopy for those at high risk.
What is the VA doing to ensure that the aging population of
veterans are appropriately screened for colorectal cancer?
Answer. The United States Preventive Services Task Force Guide to
Clinical Preventive Services (2nd Edition 1996) (USPSTF) calls for
regular screening of average-risk adults age 50 and older for colon
cancer using annual fecal occult blood testing (FOBT) or sigmoidoscopy.
Since 1996, VHA has recommended that all average-risk veterans aged 50
years and older receive annual fecal occult blood testing (VHA 1108.1)
This recommendation has been updated recently (draft update currently
in VHA concurrence process, VHA 1120.2) stating that all average risk
veterans aged 50 years and older should receive annual fecal occult
blood testing or undergo sigmoidoscopy examination every 5 years.
Question. Is the VA following existing Federal policy and
guidelines to ensure that those veterans of average or high risk are
receiving the requisite colorectal screenings?
Answer. Yes. VA Policy matches existing USPSTF and the Agency for
Health Care Policy and Research (AHCPR Publication No. 98-0033, May
1998) recommendations. In addition, VHA evaluates colorectal cancer
screening rates among the veteran population in two ways: (a) Screening
for colorectal cancer is a component of the VHA Office of Performance
and Quality Prevention Index. This index tracks delivery of preventive
services to veterans, and (b) VHA also surveys veterans to establish
receipt of colorectal cancer screening via the Veterans Health Survey
of the VHA National Center for Health Promotion and Disease Prevention.
Furthermore, VA identifies veterans of average or high risk for
colorectal cancer through assignment to a primary-care provider. The
primary-care provider should ensure that all relevant preventive care
strategies are available to the veteran including annual FOBT or
periodic sigmoidoscopy for colorectal cancer. Veterans at high risk for
colon cancer are referred to a gastroenterologist for regular
endoscopic screening, diagnosis and management.
Question. Is the VA currently identifying veterans of average or
high risk for colorectal cancer? By what process?
Answer. Yes, the VA is aggressively promoting colorectal cancer
screening. Since September 11, 1991, VA policy requires screening
veterans age 50 and older with annual FOBT. Since May 16, 1996, VA has
required screening with either annual FOBT or flexible sigmoidoscopic
examination.
Question. What is your estimate of the benefits to the veteran
population to be derived from appropriate colorectal screenings (i.e.,
reduction in premature death, reductions in medical costs, increase in
prevention and quality of care)?
Answer. The USPSTF and the AHCPR estimate the benefit of screening
to be a 31-57 percent reduction in colorectal cancer mortality for the
general population. Veterans can expect to enjoy similar benefits. To
clarify this expectation, VHA is currently funding research--a cost-
utility analysis--into colorectal cancer in veterans.
Question. What are the possible benefits to the U.S. population as
a whole?
Answer. Veterans in the over 50 age group represent a significant
portion of the U.S. population over age 50. VHA research and best
practice models have the potential to benefit the population as a
whole.
hepatitis c
Question. Given the increase in funding you are requesting in
fiscal year 2000 for Hepatitis C screenings and treatment for veterans,
what plans do you have for longitudinal studies to analyze the clinical
course of Hepatitis C and identify the factors resulting in the
progression from Hepatitis C to cirrhosis and liver cancer?
Answer. A three-part longitudinal study is under development. The
first part will be a thorough study of the prevalence of HCV infection
among veterans. The second part of the study will be an assessment of
risk factors for HCV infection. This study will determine the
importance of both traditional and non-traditional risk factors for
infection in the veteran population. The third part of the study will
explore the natural course of the progression of HCV infection to
clinically important liver disease among veterans.
Question. With growing evidence of the relationship between HCV and
the rising incidence of hepatocellular carcinoma, aren't longitudinal
studies as a follow-up to HCV screenings and treatment essential in
order to improve our understanding of the relationship between
Hepatitis C and liver cancer?
Answer. Yes, longitudinal studies as a follow-up to HCV screenings
are essential in order to improve our understanding of the relationship
between Hepatitis C and liver disease, including cancer. This is why VA
has developed the three-part effort just described.
Question. What portion of the requested increase for Hepatitis C
screenings and treatment is dedicated to longitudinal studies of
outcomes?
Answer. None of the earmarked budgeted dollars for HCV screening
and treatment from Medical Care is dedicated to longitudinal studies of
outcomes. VA Research plans to use appropriated Research funding, which
is independent of the Medical Care request, for the proposed
longitudinal study.
Question. Won't these longitudinal studies provide data useful in
treating Hepatitis C and preventing liver cancer not only for veterans,
but for the population as a whole?
Answer. Yes, the longitudinal studies should provide data useful in
treating Hepatitis C and preventing associated liver cancer not only
for veterans but also for the population as a whole.
acid reflux as a risk factor for cancer of the esophagus
Question. According to a recent New England Journal of Medicine
article (N-Engl J Med 1999; 340: 825-832), there is a strong and
probable causal relationship between gastroesophageal reflux and
esophageal adenocarcinoma. The study found ``The risk of esophageal
adenocarcinoma was almost eight times as high among persons in whom
heartburn, regurgitation, or both occurred at least once a week as
among persons without these symptoms.''
In fiscal year 1998 and fiscal year 1999, how much of the VA
Medical Research budget was dedicated to studying the relationship
between acid reflux and cancer of the esophagus? How much is requested
for fiscal year 2000?
Answer. Gastroenterology represents a significant portion of VA's
research portfolio. In fiscal year 1998, $23 million was expended on
176 research projects related to diseases of the digestive tract. In
that year VA funded one investigator-initiated project relevant to acid
reflux and esophageal cancer for $93,348. We would expect a similar
level of investigator initiated research in fiscal year 1999 and fiscal
year 2000.
Question. Given the growing evidence of the causal relationship
between acid reflux and cancer of the esophagus, to what extent will VA
Medical Research make this area of study more of a priority?
Answer. Cancer represents an area of high priority for the VA
research. In fiscal year 1998 $22 million, representing 8.1 percent of
the VA's Research appropriation, was expended on cancer. Acid reflux
induced esophageal cancer is a subset of this research effort and will
benefit from the broader effort. VA will continue to fund
scientifically meritorious proposals submitted by VA investigators
studying cancer and esophageal reflux.
More importantly, perhaps, is research that eliminates or
diminishes the occurrence or severity of acid reflux. As noted in the
quoted New England Journal of Medicine article, `` * * * the more
frequent, more severe, and long lasting the symptoms of reflux, the
greater the risk [of cancer].'' VA research efforts are focused on
successful treatment of reflux to reduce the frequency or severity of
the problem. This strategy would result in the prevention of esophageal
cancer or a dramatic reduction in risk for our veteran patients.
Accordingly, the VA completed the first ever randomized controlled
trial comparing medical treatment with surgical treatment for severe
gastoesophageal reflux disease (GERD) in 1989 ($1.7 million). Results
showed that in men with complicated GERD, surgery is significantly more
effective than symptomatic medical therapy or intensive medical therapy
in relieving the symptoms and endoscopic signs of esophagitis for up to
two years. While medical therapy is also effective, it is only to a
lesser degree. Nearing completion in fiscal year 1999 is a multi-site
clinical trial following up the earlier study ($150,000). This study
would establish the percentage of patients in the surgical group who
still have effective control of their GERD symptoms, thus documenting
the durability of the surgical intervention and the reduction of risk
related to cancer.
Additionally, VA has recently approved another multi-site trial,
entitled ``A Double-blind, Randomized, Placebo-controlled Trial to
Evaluate the Cost-effectiveness of Alternative Management Strategies in
Patients with Dyspepsia.'' The goal of the study is to test whether
giving antibiotic in combination with heartburn medication (Prilosec--
an acid blocker) is better than giving heartburn medication alone. This
study will involve 826 veteran patients from 15 VA medical centers over
a 30-month period of time ($7.4 million). Final disposition of this
study is awaiting the availability of funds.
______
Questions Submitted by Senator Burns
hepatitis c program
Question. I am pleased that the VA budget request includes a
substantial expenditure ($135 million) for evaluation and treatment of
veterans with the Hepatitis C virus. It is my understanding that a very
substantial portion of the veterans' population may be infected with
Hepatitis C. This is likely to be a challenge for many years. Can you
please explain the VA's plan for testing and treating these patients
and making available all promising approved treatments?
Answer. VA has emerged as the Nation's leader in the recognition,
testing, and treatment of the Hepatitis C virus. VA's public health
response to this emerging epidemic fully recognizes that treatment and
containment of this virus is a long-term commitment. VA has already
developed a systematic management approach that addresses current
requirements and will respond to future developments. VA already has
put in place treatment guidelines and protocols. In addition, VA has
dedicated two ``Centers of Excellence'' and advanced a number of
partnerships with private industry that will ensure that veterans
receive the benefit of the most up to date and state-of-the-art
research, service, and treatment.
Question. It is my understanding that there are several approved
Hepatitis C treatments, each of which has complications and limited
response rates, but some of which may be particularly appropriate for
certain portions of the VA patient population. Can you assure me that
the VA will make all FDA-licensed treatments available for VA Medical
Centers so that doctors will be able to choose the most appropriate and
cost effective therapy for each patient?
Answer. VA's treatment protocol is evidence-based. It will be
adjusted by the outcome of clinical trials and when FDA has approved
any new drugs.
______
Questions Submitted by Senator Shelby
medical care needs
Question. Secretary West, veterans in Alabama note that the VA is
attempting to downsize and streamline its operations. However there is
a concern that the medical care needs of our veterans, especially those
of World War II (WW II), are not being met.
Does the President's budget deal realistically with the medical
care needs of our veterans?
Answer. Yes. The underlying premise for this budget and others is,
no matter the budget level, we will ensure quality first for our
patients. We ensure this by carefully monitoring through a
comprehensive performance management system. For example, despite flat
budgets in the past (in terms of purchasing power), we were able to
increase the number of patients treated and outpatient visits while
simultaneously improving our quality of care performance and customer
satisfaction. We know that fiscal year 2000 poses challenges that are
steep, but if past accomplishments are an indicator for future success,
our track record has been outstanding.
Question. How is the VA dealing with the increased medical care
needs of the WW II veterans?
Answer. Every indicator of supply and demand for long-term care
shows that VA will have sufficient capacity to meet the needs of World
War II veterans who use the VA health care system. This scenario
assumes that VA will expand home- and community-based care services,
contract for long-term care services, and increase the use of State
Veterans Homes, where available. The proposed $106 million increase in
home- and community-based care is not viewed as a one-time investment.
Rather, the budget reflects the recommendation of the Federal Advisory
Committee on the Future of VA Long-Term Care on tripling the investment
in home- and community-based care over a 5-year period. VA will improve
access to long-term care by providing incentives to networks to provide
more long-term care services. VA will also enhance its admission and
discharge policies for VA and Community Nursing Home Care. These
changes will improve access and fairness. VHA staff monitors the
quality of care received for all long-term care patients, regardless of
setting.
Question. Secretary West, as you know there has been a process of
integration and consolidation of services at Alabama's Tuskegee and
Montgomery Veterans' Hospitals. I am concerned that the consolidation
may have created travel hardships for veterans seeking outpatient
treatment at the facilities. I am told that veterans travel to one of
the facilities and many times must be transported to the other facility
for their treatment.
Answer. The consolidation into the Central Alabama Veterans Health
Care System (CAVHCS) was intended to improve the accessibility,
quality, and efficiency of care delivered to veterans in south central
Alabama and southwestern Georgia which have been traditionally served
by the Tuskegee and Montgomery VA medical centers. Most CAVHCS
outpatient care can be delivered by primary care physicians who are
located at the East Campus (Tuskegee), the West Campus (Montgomery),
the Columbus, Georgia Community Based Outpatient Clinic (CBOC), and
most recently the Dothan, Alabama CBOC. Some specialty outpatient care
is available at the East Campus and the West Campus, however, tertiary
level specialty care is referred for the most part to the Birmingham VA
medical center which serves as a referral point state-wide for
veterans. Outpatient surgery is available only at the West campus
because the veteran population in the CAVHCS service area will only
support the critical mass needed for one program in order to maintain
the necessary quality.
Question. Is it possible to have more comprehensive outpatient
services at each facility so as to limit the travel hardship for our
aging veterans?
Answer. The provision of more comprehensive outpatient services is
dependent upon several factors such as:
--The availability of specialists and the costs of hiring those
specialists as VA employees in sparsely populated areas.
--The availability of specialists in the community that may be
willing to work part-time for the VA.
--The eligibility of veterans and the costs of fee basis care.
--The critical mass of veterans needing specialty care in sparsely
populated areas.
--The availability of resources to duplicate scarce specialty
services at several sites.
The needs of veterans living in rural areas of Alabama and Georgia
mirror the needs of all citizens living in similar areas nationwide who
must travel in order to access specialty medical care.
Question. In consolidation cases such as this, how does VA
equitably allocate outpatient services between hospital facilities?
Answer. In the case of CAVHCS, the intent was to improve access to
primary outpatient care, such as through the opening of the Dothan,
Alabama CBOC, to build on the traditional strengths of the existing
facilities, and consolidate at one location those services that could
not, or should not, be maintained at multiple locations. The
traditional strengths of the East Campus have been in the delivery of
long-term, rehabilitative, and mental health care. Traditionally, the
strengths of the West Campus have been the delivery of acute medical
and surgical care. Because the critical mass (volume of patients) of
surgical care needed was not sufficient to maintain quality in two
locations, both inpatient and outpatient surgery were consolidated at
the West Campus, which contained much better facilities, a more
concentrated veteran population, and access to more surgeons.
Question. Secretary West, there is a concern among Alabama veterans
about the ability of retired veterans and their spouses to utilize
active duty military facilities for their medical care. Is there a
policy within DOD and the VA regarding this issue?
Answer. Retirees and their beneficiaries under age 65 may enroll in
TRICARE Prime (DOD's managed care HMO option) and receive care through
a DOD health care facility. Retirees are also veterans, and may enroll
under current eligibility guidelines, to receive care from VA.
At those VA facilities that also serve as TRICARE providers, dual-
eligible individuals (retirees under age 65) may be treated either as
veterans or as TRICARE beneficiaries, depending on which option is to
the retirees' advantage. For those veterans in priority levels (1)
through (6), it is to their advantage to receive care as a veteran. For
those in level (7), the decision must be made on an individual basis.
VA cannot treat non-veteran family members except as TRICARE
beneficiaries through sharing agreements with DOD's TRICARE managed
care support contractors. In Alabama, only the Birmingham VAMC is a
TRICARE provider.
______
Questions Submitted by Senator Craig
boise va hospital
Question. Your department has claimed that the fiscal year 2000
budget is feasible, relying largely on creating new ``efficiencies.''
The Boise VA Hospital is about as lean as it can get. Where are these
efficiencies going to come from?
Answer. Additional efficiencies can and are being achieved at the
Boise VA Medical Center and within VISN 20. These planned efficiency
actions include further standardization of medical and prosthetic
supplies with consolidated contracting for these supplies,
consolidation of laboratory services, implementation of Medicare rates
for purchased medical services and continued improvements in the
delivery of medical services. It is the view of the Boise VA Medical
Center and VISN 20 that these planned efficiencies will not cover the
expected shortfall in the President's fiscal year 2000 budget. As a
result, VISN 20 has chosen to address this issue through the adoption
of a medical service area (MSA) concept. In this model, the Northern
Alliance of VISN 20 (comprised of VA Medical Centers in Anchorage,
Boise, Puget Sound, Spokane and Walla Walla) will serve as an
integrated medical unit. Veterans in this area will obtain all their
services within the MSA, with the exception of a few highly specialized
procedures such as liver transplants. This may mean that veterans need
to travel within the MSA for some tertiary services so that other
services like primary care can be retained and provided on a more
timely basis at the local level.
Following the release of the President's budget, the VHA networks
were asked to develop plans addressing the management improvements
necessary to achieve the significant savings required to operate within
the proposed fiscal year 2000 budget. Those plans are currently being
reviewed. Several headquarters and field-based review teams are
examining the network plans, including VISN 20's, and we will have a
more complete national plan by the end of June.
boise va medical center
Question. I would also like to submit for the record a copy of a
news article from the Idaho Statesman. The article highlights the
nearly 600 Idaho veterans who are awaiting care at the VA Medical
Center in Boise. I think it is pretty clear that our obligation to our
veterans to provide adequate medical care is not being met in Idaho.
I would like your comments on what you can do to help resolve this
problem so that these 600 veterans do not have to wait any longer. I
would also ask that you look into the situation in Boise, and report
back to me in a prompt manner.
Answer. I will work with the leadership in VISN 20 to ensure ``best
practices'' are in place in Boise and other facilities in VISN 20. This
will insure that current resources are being utilized to an optimal
capacity. VISN 20 has implemented new measures including an infusion of
funds to reduce the waiting list at Boise and other VISN 20 facilities.
In the meantime, we should point out that veterans on the waiting list
in Boise and in other VISN 20 facilities may receive urgent or emergent
care from the VA whenever they have a need for such services.
______
Questions Submitted by Senator Hutchison
kerrville va hospital
Question. Many veterans in South Texas are concerned about the
Veterans Hospital in Kerrville, and I sent a letter to Dr. Kizer on
February 11th about the Kerrville facility, yet have not received an
answer. I would like to know what the specific long-term plans are for
the South Texas Veterans Health Care System and the VA Kerrville
Hospital?
Answer. There are currently no plans to close the Kerrville
Division of the South Texas Veterans Health Care System. Current
services provided at the Kerrville Division include 154 Extended Care
Beds, 20 General Medicine and five Medical Intensive Care Beds, an
active primary care program, and several outpatient specialty clinics.
An earlier proposal to close the 20 General Medicine and five Medical
Intensive Care Beds and replace them with ten Observation Beds has been
placed on hold pending the fiscal year 2000 budget requirements.
integration of visns
Question. Texas is broken up into three Veterans Integrated Service
Networks (VISN), with two of the centers controlling these areas from
outside of the state, like Jackson, MS and Phoenix, AZ; which many
veterans have complained have difficulty dealing with one another to
provide service. How are we going to improve the integration of these
systems, or as many feel, would it not work better if a state with a
large veterans population like Texas fell under one network?
Answer. The 22 Veterans Integrated Service Networks were configured
around historical VA patient referral patterns rather than State
boundaries. Geography, travel distances, patient preferences and the
availability of specialty referral services are major factors in VA's
patient referral patterns. The facilities in West Texas (Amarillo, Big
Spring and El Paso) have a predominant referral relationship with
Albuquerque. Last year, 93 percent of patient referrals from these West
Texas facilities were to facilities in VISN 18. Similarly, Houston has
a significant referral relationship with several facilities in VISN 16.
It provides many specialty services to VISN 16 veterans who are not
from Texas.
Although the Texas facilities are in different VISNs, referrals are
made as needed regardless of the VISN boundaries. The three VISNs that
include Texas facilities have received very few complaints about
referral issues or the configuration of the facilities by VISN.
transfer of land for national cemetery
Question. With the majority of our WWII and Korean War veterans now
in their 60s and older, there has been an increased interest in the
space availability at the limited number of national cemeteries. In
Texas there is no national cemetery in the Central Texas area, Waco,
Temple, Killeen, and Austin. The closest cemeteries, which serve the
needs of this increasingly large veterans population, are in Dallas and
San Antonio. The U.S. Army at Fort Hood has stated that they would be
willing to transfer land to the VA on the Fort Hood military
installation for a national cemetery. Given the opportunity to acquire
government land, the historical significance of the military base at
Fort Hood, and the lack of a national cemetery within 100-150 miles of
the Central Texas area, what plans are you making to utilize the offer
made by Fort Hood and to service this community.
Answer. For the last decade, VA's basis for determining where to
establish new national cemeteries has been the findings in two reports
to Congress. One Report was completed in 1987 and a second in 1994. The
reports identified areas in the country most in need of new national
cemeteries based on concentrations of veteran population. The Central
Texas area was not identified in either of these reports.
The VA is currently constructing four new national cemeteries in
geographic areas that were identified in the 1987 and 1994 reports to
Congress. These new cemeteries will be located in the Albany, New York;
Chicago, Illinois; Dallas/Ft. Worth, Texas; and Cleveland, Ohio
vicinities. This volume of construction is unprecedented in the history
of the National Cemetery Administration (NCA) since its inception
during the Civil War. After these four new cemeteries open later this
year, VA will evaluate the potential establishment of additional new
national cemeteries in the remaining geographic areas identified in the
two reports. These remaining areas include, in alphabetical order:
Atlanta, Georgia; Detroit, Michigan; Miami, Florida; Oklahoma City,
Oklahoma; Pittsburgh, Pennsylvania; Sacramento, California; and St.
Louis, Missouri.
The focus of our planning will be in those areas with the largest
concentrations of veterans identified above. We recognize the burial
needs of veterans in Central Texas. If land at Ft. Hood becomes
available for a veterans' cemetery, it could be transferred to the
State of Texas for the establishment of a state veterans cemetery.
State veterans' cemeteries are a complement to our national cemeteries
and are usually located by states in areas where there are not current
plans for NCA to operate and maintain a national cemetery. The State
Veterans Cemetery Grant Program funds one hundred percent of the cost
of construction and for the cost of initial equipment when the cemetery
is established. The States remain responsible for providing the land
and for paying all costs related to operation and maintenance.
construction of future veterans' homes
Question. Many of the veterans in Texas are concerned about the
availability of Veterans Homes in the future. The Texas Land
Commissioner has said that the state is ready to provide land and state
funding for the projects, if federal VA dollars come through. Will the
VA be proposing any additional funding for the construction of future
veterans homes?
Answer. Each budget cycle, there is a separate line item in VA's
proposed appropriations package that includes ``Construction Grants for
State Extended Care Facilities.'' The State of Texas has submitted a
total of 11 construction grant applications, each for a 160-bed nursing
home facility in different regions of the State. The first two grants
will be awarded shortly (in Temple and Floresville), with fiscal year
1999 funding set aside for two additional grants (in Bonham and Big
Springs).
______
Questions Submitted by Senator Kyl
hepatitis c
Question. I understand that because the VA budget is so tight, you
plan to fund Hepatitis C activities with yet-to-be-identified
efficiencies in other programs. So, clearly cost is an issue here. I
understand that prices vary for different approved therapies. For
example, one year of an interferon may cost from $5,300 to $8,800,
whereas a combination therapy may cost from $15,600 to $17,200. How
much does drug therapy cost for one Hepatitis C patient over a year?
Answer. The estimate for the drug therapy per month is $1,100 or
approximately $13,200 per year (which excludes the cost of testing).
Question. Is that the cost that VA used in preparing your budget
submission?
Answer. Yes.
Question. I understand there are significant clinical and economic
differences among currently approved Hepatitis C treatments. The least
expensive treatment has fewer side effects and is approved for treating
patients who do not respond to initial therapy. What consideration did
you give these factors in developing your budget submission and
treatment plans?
Answer. Evidence-based treatment protocol recommends dual therapy
as the standard of care; however, provision has been made in the
protocol for those patients who either cannot tolerate dual therapy or
are not clinically appropriate for dual therapy. Our veteran patients
are provided the most up to date therapy possible and the treatment
protocol is reviewed and updated on a regular basis as the science
indicates the need. Our decision-making is based on the appropriate
clinical indications.
______
Questions Submitted by Senator Mikulski
albuquerque regional office
Question. Senator Bingaman investigated complaints by veterans and
veterans organizations about the problems regarding claims processing
being experienced at the Albuquerque regional VA office. I understand
that you met with Senator Bingaman to discuss these problems and see
what could be done to fix them. Could you outline for me what steps you
have taken thus far, what initiatives or changes have been implemented,
and what action items you may be planning for the future?
Answer. The following steps have been taken to improve claims
processing timeliness at VARO Albuquerque:
The vacant Service Center Manager position has been recently
filled. The new manager is scheduled to report to VARO Albuquerque May
10, 1999. The new manager has recently made a visit to the regional
office and assessed the situation. Under his direction the
implementation and execution of a Work in Progress review plan has been
accomplished. The new plan is designed to provide better workload
control.
Since February of this year the Albuquerque Regional Office has
received assistance with the processing of over 450 cases from other
regional offices. An additional 150 cases are currently being prepared
to be sent out next week. Recently VBA installed video conferencing
equipment at Albuquerque Regional Office to improve the office's
ability to conduct video hearings with the Board of Veterans Appeals
(BVA). This will provide better service to the New Mexico veterans by
resulting in more timely hearings with BVA.
The following action items are planned:
The pursuit of a person to fill the Congressional Liaison position
is continuing. The filling of this position will provide a direct point
of contact for New Mexico's Congressional offices, as well as improving
the timeliness, coordination and resolution of all congressional
inquiries.
Recruitment of two additional service center employees will
commence shortly. Authorization from VBA headquarters has been granted
for these hires.
Albuquerque's Service Delivery Network leadership will be meeting
the week of May 3, 1999. On the table for discussion will be the
formulation of a help team to be detailed to the Albuquerque Regional
Office.
board of veterans' appeals
Question. It takes an average of almost two years nationwide for an
appeal to make it through the Board of Veterans' Appeals. Are there
things that you could do or legislative assistance that you need to
accelerate that process so that ALL veterans could obtain a more timely
resolution to their claims?
Answer. VA is committed to reducing the time it takes for a veteran
to receive a final decision on his or her appeal. Continuous
improvement in appellate decision quality and timeliness has been the
focus of much of BVA's budgetary and strategic planning in recent
years. With the support received from the Administration, Congress and
the veterans service organizations, BVA has markedly reduced the
appeals backlog and improved its decision-making timeliness in fiscal
years 1995 through 1998. BVA's traditional measure of timeliness is
average response time. Average response time is an estimate of the time
that it will take to decide all cases certified as ready for BVA
review. BVA succeeded in reducing average response time from a fiscal
year 1994 high of 781 days to 197 days by the end of fiscal year 1998.
The fiscal year 2000 budget reflects an important change in the way
we view timeliness with respect to the VA appeals process. For the
first time, BVA and VBA have adopted a timeliness performance measure
that cuts across the two organizations' boundaries. This new timeliness
measure, Appeals Resolution Time, measures the average length of time
it takes the Department to process an appeal from the date a claimant
files a Notice of Disagreement until that case is resolved, either
through resolution at a VA field facility or by a final decision by the
Board. Previously, most VA timeliness measures for claims and appeals
processing focused on measuring various segments of time, based upon
which organization was responsible for the various components of the
overall processing cycle. These measures fail in the sense that they do
not reflect the length of the process from an appellant's perspective,
that is, from the day an appellant registers his or her dissatisfaction
with a decision on a claim until the matter is finally decided. Not
surprising, appellants are less interested in how long individual
stages in the process take as they are about the length of the entire
process. Appeals Resolution Time will provide appellants, elected
officials, Departmental leadership, VBA and BVA management, and other
interested parties a much more comprehensive and accurate answer to the
question, ``How long does the appeal process take?'' Appeals Resolution
Time is described in the Department Performance Plan component of the
fiscal year 2000 Budget Submission as one of VA's key goals and
performance measures.
VA's goal for fiscal year 2000 is to reduce Appeals Resolution Time
to 545 days--a 20 percent reduction from the fiscal year 1998 level of
686 days. Our long-term strategic goal is to reduce Appeals Resolution
Time to 365 days. The key to success in achieving these goals is for
VBA and BVA to work closely together, looking beyond immediate
organizational boundaries to seek more innovative, Departmental
solutions to the problems associated with resolving appeals in the most
timely manner.
contract services and outreach clinics in new mexico
Question. What impact do you foresee that the President's budget
request will have on contract services and outreach clinics in New
Mexico and nationwide?
Answer. Following the release of the President's budget, the VHA
networks were asked to develop plans addressing the management
improvements necessary to achieve the significant savings required to
operate within the proposed fiscal year 2000 budget. Those plans are
currently being reviewed. Several headquarters and field-based review
teams are examining the network plans, including VISN 18's, and we will
have a more complete national plan by the end of June.
va's dc field office
Question. A recent VA internal review, made public by a Washington
Post article, found serious backlogs and a state of chaos at the DC
field office. Although there is a backlog of almost 10,000 cases, the
DC field office has only 158 staff, down from almost 250 five years
ago. VA has plans to distribute the outstanding claims to other field
offices in the region to speed their processing.
Is the Washington Post article accurate?
Answer. The Washington Post article accurately described the
workload situation. The office currently has 158 full time employees,
down from 210 employees in October 1994.
Question. If so, why do these conditions exist in the DC field
office?
Answer. The workload problems at the Washington Regional Office
(WRO) have been escalating over the past few years due to a number of
complex factors. The office had taken a very aggressive approach to
merging the Adjudication and Veterans Services Divisions, in line with
our Business Processing Reengineering vision for compensation and
pension claims processing. Many hours were devoted to cross training
employees, which reduced the time available to process claims and
increased workload backlogs. WRO elected to participate in the Decision
Review Officer Pilot, which focused resources on the appeals workload,
but reduced the number of rating specialists available to process
claims. The office prematurely moved to a team environment where teams
were given responsibility for workload management without providing
them with the proper training or ensuring that adequate controls and
management systems remained in place. A large number of staff losses
further degraded the office's ability to manage its workload and timely
process claims.
WRO has a history of recurring difficulties similar to the current
situation, although never quite as critical as the workload problems it
now faces. It has always been difficult for WRO to work in the
headquarters city and attract and retain top employees when the grade
structures and opportunities for promotion are so much greater in VACO
and other Federal agencies.
Question. What is your plan for handling the backlog of claims in
the DC field office?
Answer. Our primary concern is obviously for the veterans who are
awaiting decisions on their claims. Our immediate actions have focused
on organizing the pending claims, associating all documentary evidence
with those claims, and establishing the appropriate workload controls
so that we can process these claims as expeditiously as possible. We
brought in a highly skilled management team from the Oakland Regional
Office to assist in this process. This team also provided some critical
interim training support to the employees of the Washington Regional
Office. A new Service Center Manager has now been appointed for the
office, and we are recruiting to fill additional positions in order to
further strengthen the management structure and increase the technical
capabilities of the staff.
Some of the pending claims have already been transferred to other
regional offices to be worked. We are developing a plan for further
redistributing a significant portion of the pending workload to other
regional offices for both development and rating action. Throughout the
summer we will be bringing in ``help teams'' from across the country to
screen and process claims. We will continue to call on the assistance
of other regional offices until we have brought the pending workload
down to a level which can be timely managed by the Washington Regional
Office.
Question. Who will be in charge of correcting this problem?
Answer. The Office of Field Operations is the organizational
element within the Veterans Benefits Administration responsible for the
operations of the regional office field structure. That office is
closely monitoring the Washington Regional Office situation and working
directly with local management to implement the short term actions that
will bring the workload back under control and to design the long term
solution for the office that will best serve veterans.
The Washington Regional Office is part of Service Delivery Network
3, which also includes the Baltimore, Huntington, Roanoke, and
Louisville Regional Offices. The Network shares in the responsibility
for managing the workload at WRO and was instrumental in assessing the
extent of the problems and laying out an initial course of action. The
network will continue to provide assistance and support to WRO until
the situation is resolved.
Question. What is your timetable for a solution?
Answer. The goal for WRO is to be in a position to maintain its
workload without extraordinary assistance within 12-18 months.
Question. When can veterans who were, or are, served by the DC
field office expect to see positive results?
Answer. With the actions we have already undertaken and the planned
redistribution of many of the pending claims to other offices, veterans
can expect to see positive results within a three to six month period.
This is not to say, however, that all claims will be finalized during
this period. Depending on the type of claim and the extent of
evidentiary development required, the decision-making process could
extend beyond the six month period.
In addition to increased attention to managing the claims process,
we plan to implement the National Automated Response System at WRO in
the near term. This system will assist in reducing the telephone
waiting times that veterans experience when calling regarding the
status of their claims.
Question. If the VA plan includes distributing these outstanding
claims to other field offices, will this result in slower processing
for other offices?
Answer. The work will be transferred to a sufficient number of
offices so that the impact on the receiving stations will not be
dramatic. The regional offices selected to assist will be those that
can best handle the additional work with the least disruption to their
own workloads.
Question. How long will this transfer of work last?
Answer. The WRO pending workload is being continuously monitored.
As indicated in response to a previous question, we will continue to
call on the assistance of other regional offices until we have brought
the pending workload down to a level which can be timely managed by the
Washington Regional Office.
Question. Is it possible that this will be a permanent shift of
responsibility?
Answer. We have made no decisions on the long term solution for the
Washington Regional Office. Our goal is to establish an effective
organizational structure, implement the appropriate management systems
and develop comprehensive training programs that will enable all
employees to perform at their highest level of competence and ensure
veterans' claims are properly developed and decisions timely made.
Question. How will this affect veterans who were, or are, served by
the DC field office?
Answer. The transfer of a significant portion of the pending work
to other offices is the most expeditious way of resolving the claims
and bringing the workload at WRO back under control. We will be careful
to notify all veterans whose claims are transferred and we will
coordinate our actions to minimize the impact on claimants and their
representatives. Any medical examinations required in order to process
the claims will be scheduled in the local area.
va's disposal of capital assets
Question. What is VA's plan to dispose of excess capital assets?
Answer. VA is proposing a pilot program to significantly improve
its management of capital resources by encouraging and streamlining the
process of disposing of surplus government property. This proposal
would allow VA to dispose of excess and underutilized property
(including land, structures or any equipment associated with the
property) by sale, transfer, or exchange, and use the proceeds to fund
further disposal activities and other non-recurring capital needs. The
pilot would be restricted to thirty dispositions over its life.
Proposed legislative changes include:
Establishing the Capital Asset Fund (CAF). Proceeds that VA retains
(90 percent) from disposals, after deductions, will be deposited into
the CAF to be used to fund additional disposal activities and other
non-recurring capital needs. Allowable deductions would include all
costs (administrative, demolition, etc.) of disposing of the asset.
This fund will have a cap of $50 million, with excess proceeds to be
transferred to the minor construction program.
Raising the threshold of reporting disposals in an annual budget
document from $50,000 to an amount equal to or greater than the cost of
a major medical facility project (currently $4 million). VA would
notify GSA of all approved disposals and this information would be
entered into GSA's internal database. Property with an estimated value
less that the value of the Major Medical Facility Project threshold
(currently $4 million) could be disposed of after notifying GSA, no
other Federal agency has expressed an interest in paying fair market
value for the property within 30 days of the notice, and then a Notice
of Intent is placed in the real estate section of local newspapers.
Properties valued in excess of the Major Medical Facility Project
threshold would be described in the Congressional budget document for
that fiscal year. In addition, GSA would offer the property to other
Federal agencies. If after 30 calendar days, no other Federal agency
expressed an interest in paying fair market value for the property, VA
would be authorized to proceed with the disposal provided: (1) a public
hearing is held in the local community where the disposal would occur;
(2) the Secretary's intention to dispose of the property is published
in the Federal Register; and, (3) the Committees on Veterans' Affairs
are notified and 60 calendar days have elapsed. The Secretary would
report in the yearly budget submitted to Congress on the disposals to
be undertaken in that fiscal year that are valued in excess of the
Major Medical Facility Project threshold, and also report on all
completed disposals. For disposals in excess of this threshold, General
Services Administration (GSA) would be notified, a notice of intent
would be published in the Federal Register and the Committees on
Veterans' Affairs would also be notified. For disposals under this
threshold, GSA would be notified and a notice of intent would be
provided to the local community.
Requiring 10 percent of the proceeds to be transferred to the
Department of Housing and Urban Development's (HUD) Homeless Assistance
Grants Housing account.
Question. What process will be followed regarding the disposal of
these assets?
Answer. VA Proposed Asset Disposal Pilot-Procedures and Process:
Offices with responsibility for real property assets (VHA, VBA,
NCA) would perform surveys to determine excess or underutilized real
property, and report proposals for disposal to the VA Capital
Investment Board (VACIB).
VACIB will review proposals and forward its recommendations to the
Secretary for approval.
For disposals less than $4 million, GSA would be notified and no
other Federal agency has expressed an interest in paying fair market
value for the property within 30 days of the notice and a notice of
intent would be placed in local papers.
For properties valued at greater than $4 million:
1. GSA would be notified and if not other Federal agency has
expressed an interest in paying fair market value for the property, VA
would be authorized to proceed with the disposal.
2. The proposed disposal would be described in the Congressional
Budget for the fiscal year.
3. A notice of the Secretary's intent will be placed in the Federal
Register and local hearings would take place.
4. Congressional committees would be notified 60 calendar days
prior to any disposal.
VA would notify GSA of all approved proposed disposals and would be
authorized to perform disposal activities utilizing GSA's technical
assistance when desired.
Ninety percent of the net proceeds of any sale, transfer or
exchange would be deposited into CAF to fund future disposal activity,
other non-recurring capital projects and augment funding for VA's
homeless program. Ten percent of the net proceeds would be transferred
to HUD's Homeless Assistance Grant Account.
Question. How will local communities who might be impacted by the
disposal of these assets be involved in the process?
Answer. For disposals less than $4 million, a notice of intent
would be placed in local papers. For properties valued at greater than
$4 million, the proposed disposal would also be described in the
Congressional budget, the Secretary's intention would be published in
the Federal Register, and a public hearing would be conducted in the
local community where the disposal would take place.
Question. What are VA's goals regarding capital asset disposal?
Answer. The goal of the disposal pilot is to improve the management
of the VA's capital assets by providing incentives for the disposal of
unneeded or underutilized VA real property. The pilot will also promote
efficiencies, cost savings and generate income to supplement VA's
capital programs. Currently little incentive exists for VA to dispose
of its excess or underutilized property as it must first be offered
(sometimes at little or no cost) to public and private organizations
that do not directly benefit the veteran population. In addition, any
proceeds that are retained by VA can only be used to construct nursing
homes--not currently a high priority need.
The pilot promotes efficiency by enabling VA to redirect funds
currently spent on maintenance and operating costs for underutilized
property and instead use these funds to provide improved quality and
access to services for veterans.
Another goal of the pilot is to generate income that will be
utilized to supplement VA's capital programs in order to improve the
VA's infrastructure, increase its information technology capabilities
and provide better accommodations and services to the veteran.
Question. What is VA's timeline for the disposal of capital assets?
Answer. VA anticipates that the proposed process will represent a
streamlining of the current one. However, the time frame required for
completion of a disposal is heavily dependent on a number of factors
including: the size and potential future uses of the property to be
disposed of; the complexity of environmental study and/or restoration
required prior to disposal; and the volatility of the real estate
market in the surrounding community. While simpler asset disposal
proposals may be completed within 12 months after they receive approval
from the Secretary or are submitted to Congress, based on GSA and DOD
experience, VA believes it may take 24 to 36 months to dispose of an
asset under the most difficult conditions. The proposed pilot program
is limited to 30 transactions over its five-year life.
Question. What criteria will be used to determine which capital
assets should be disposed of?
Answer. VA anticipates a strategic planning process aimed at
realigning imbalances or inequities between VA capital assets and
veterans needs. While overall guidance and direction for this program
is given at the headquarters level, much of this process will be
undertaken at the regional level through each Veterans Integrated
Service Network (VISN). The process provides for the creation of a
Capital Assets Realignment for Enhanced Services (CARES) Steering
Committees at each VISN whose responsibility is to undertake and
complete a report which will be linked to that VISN's business plan.
This report would include the following elements:
--A review of historical, current and projected service utilization
and demand for veteran healthcare services throughout the VISN
and its constituent medical facilities.
--A review of current VISN capital assets in terms of their
ownership, location, services provided, physical condition,
convenience of access, repair requirements and similar
characteristics.
--A review of the congruence between current capital assets and the
VISN's current and future projected demand for services.
--Consideration of alternatives to current service delivery modes
that may enhance services to veterans.
VBA and NCA will follow similar internal processes, prior to
reporting proposed disposals to the VA Capital Investment Board. In the
context of capital asset planning, VA closely follows the principles in
the OMB Capital Asset Programming Guide for any proposed capital
investment of disposal in terms of analyzing each proposal in light of
other alternatives.
Question. How will VA incorporate local flexibility with national
standards regarding the disposal of capital assets?
Answer. As previously stated, while overall guidance and direction
for this program is given at the headquarters level, much of this
process will be undertaken at the regional level through each VISN. The
process provides for the creation of Capital Assets Realignment for
Enhanced Services (CARES) Steering Committees at each VISN whose
responsibility is to undertake and complete a report which shall be
linked to that VISN's business plan. These committees will include
members representing veterans.
hepatitis c
Question. We understand that the VA plans to only use combination
therapy to treat hepatitis C, but combination therapy is not approved
for patients who have not responded to initial therapy. Another
interferon therapy is FDA approved for treating all patients with
Hepatitis C including those who do not respond to initial therapy. What
therapy do you plan to offer veterans who are HCV positive and do not
respond to initial treatment?
Answer. VA does not plan to use only dual therapy for hepatitis C
infection (HCV). While combined interferon (IFN)-ribavirin treatment is
associated with higher response rates, and is generally considered the
most appropriate ``standard'' treatment, it may not be suitable for all
patients as initial therapy. For example, ribavirin may cause a
hemolytic anemia severe enough to require its discontinuation; this
could make a patient with blood or heart disease a poor candidate for
combination treatment. In addition, it is teratogenic and requires
additional caution when considered for females of childbearing age.
Moreover, side effects and treatment dropout rates are greater with
dual versus single drug treatment. Thus, some HCV patients may be
offered only interferon as initial therapy. However, combination
therapy has not been used only as initial treatment; Davis et al. (NEJM
1998;339(21):1493-1499) demonstrated that IFN-ribavirin was superior to
IFN re-treatment for patients who had relapsed after initial IFN
treatment. IFN alone is appropriate for use in patients who relapse
following an adequate course of combined drugs.
The treatment guidelines address all of these concerns. We are
aware that not everyone is suitable for dual therapy and our treatment
protocol specifically addresses this. There is a special warning
section on individuals of child-bearing age.
The development of the treatment protocol was done with the leading
hepatologists in the Veterans Health Administration and based on the
best clinically current information. According to the literature no
single drug therapy has been demonstrated to meet or exceed dual
therapy. There are some differences in response to various types of
interferon. Each patient will be individually evaluated by his or her
physician and appropriate therapy will be provided.
Question. Based on warnings in the label, HCV positive individuals
who have cardiac, pulmonary, or renal related illnesses may not be good
candidates for combination therapy, and women of childbearing age and
their partners taking combination therapy must also take strict
precautions to avoid the risk of pregnancy. What therapy will be made
available to HCV positive veterans who may not be good candidates for
combination therapy due to these risk factors?
Answer. Monotherapy with interferon (IFN) alone is appropriate
treatment in those patients; it is covered in the treatment protocol.
The Pharmacy Benefits Group decides which interferon products are
placed on the national formulary. The clinicians review the literature
and clinical trials to determine which drugs provide the best clinical
benefit. This information is also gathered and reviewed by the Pharmacy
Benefits Group to decide which drugs to place on the national
formulary.
Question. I understand that the VA's projected HCV treatment costs
are based on the cost of combination therapy. However, there is another
approved interferon therapy that costs 50 percent less than combination
therapy and may be more effective and/or safer in some patient
populations. Have you considered how clinically appropriate use of
interferon monotherapy will reduce the cost of your HCV treatment
program?
Answer. We have not developed predictions of cost differences
between dual (IFN-ribavirin) and montherapy (IFN alone). Such
projections would require knowledge, or estimates, of the proportion of
HCV patients who had specific contraindications to the addition of
ribavirin to IFN in treatment of their disease, or who would be likely
to drop out of, or specifically defer dual drug therapy. We have no
such reliable data available which would permit such assumptions nor
does any exist for other populations. Moreover, if the higher response
rates reported for dual therapy are substantiated in VA patients, the
more costly initial therapy could be more than compensated by savings
due to lower rates of relapse and progression of liver disease. The
evidence-based treatment protocol currently recommends dual therapy as
the standard of care, however, provision has been made in the protocol
for those patients who either cannot tolerate dual therapy or are not
clinically appropriate for dual therapy. Our veteran patients are
provided the most up to date therapy possible, and the treatment
protocol is reviewed and updated on a regular basis as the science
indicates the need, and our decision-making is based on the appropriate
clinical indications.
______
Questions Submitted by Senator Harkin
hepatitis c
Question. I am pleased that the VA budget request includes a
substantial expenditure for evaluation and treatment of veterans with
the Hepatitis C virus. It is my understanding that a very large portion
of the veterans' population may be infected with this disease. This is
likely to be a serious health challenge for many years. Can you explain
the VA's plan for testing and treating these patients and making
available all promising treatments?
Answer. VA has emerged as the Nation's leader in the recognition,
testing, and treatment of the Hepatitis C virus. VA's public health
response to this emerging epidemic fully recognizes that treatment and
containment of this virus is a long-term commitment. VA has already
developed a systematic management approach that addresses current
requirements and will respond to future developments. VA already has
put in place treatment guidelines and protocols. In addition, VA has
dedicated two ``Centers of Excellence'' and advanced a number of
partnerships with private industry that will ensure that veterans
receive the benefit of the most up to date and state-of-the-art
research, service, and treatment.
Question. It is my understanding that there are several approved
Hepatitis C treatments, each of which has complications and limited
response rates, but some of which may be particularly appropriate for
certain portions of the VA patient population. Can you assure me that
the VA will make all FDA-licensed treatments available for VA Medical
Centers so that doctors will be available to choose the most
appropriate therapy for each patient?
Answer. VA's treatment protocol is evidence-based. It will be
adjusted by the outcome of clinical trials and when FDA has approved
any new drugs.
______
Questions Submitted by Senator Leahy
department of veterans affairs and department of defense-computerized
medical record systems
Question. In recent years I have pushed the Department of Defense
to adopt new software tools that automate data capture and clinical
guidance for servicemembers. These products promise to save funds by
identifying servicemember medical problems and solutions continuously,
while creating standardized patient data to better analyze how
resources are being used. If systems incorporating these
characteristics had been in place during Desert Storm, many of the
medical problems experienced by veterans after that war would have been
definitively traced to their causes.
I know you are working closely with the Department of Defense in
developing a computerized medical record that will enhance the care of
tomorrow's veterans and servicemen. I would like to make sure that your
efforts are taking advantage of the progress that DOD has made
recently.
Will you have someone brief me on the cooperative efforts between
the two departments?
Answer. VA continues to work closely with the Department of Defense
(DOD) on computerized medical record systems. Certainly, the most
visible collaborative activity relates to the Government Computer-based
Patient Record (GCPR) initiative, which derived, in large part, based
on the data standardization problems that you referred to and that were
identified since the Gulf War. This interagency project is focused on
developing and implementing a framework to electronically move patient
medical records between the VA, DOD, and the Indian Health Service
(IHS). Members of the GCPR Project Management Team or the GCPR
Executive Committee are prepared to brief you on this cooperative
effort at your convenience.
hepatitis c
Question. I am pleased that the VA budget request includes a
substantial expenditure ($135 million) for evaluation and treatment of
veterans with the Hepatitis C virus. It is my understanding that a very
substantial portion of the veterans' population may be infected with
Hepatitis C.
Can you please explain the VA's plan for testing and treating these
patients?
Answer. VA has emerged as the Nation's leader in the recognition,
testing, and treatment of the Hepatitis C virus. VA's public health
response to this emerging epidemic fully recognizes that treatment and
containment of this virus is a long-term commitment. VA has already
developed a systematic management approach that addresses current
requirements and will respond to future developments. VA already has
put in place treatment guidelines and protocols. In addition, VA has
dedicated two ``Centers of Excellence'' and advanced a number of
partnerships with private industry that will ensure that veterans
receive the benefit of the most up to date and state-of-the-art
research, service, and treatment.
Question. Can you assure me that the VA will make all FDA-licensed
treatments available so that doctors will be able to choose the most
appropriate and cost effective therapy for each patient?
Answer. VA's treatment protocol is evidence-based. It will be
adjusted by the outcome of clinical trials and when FDA has approved
any new drugs.
subcommittee recess
Senator Bond. Mr. Secretary, gentlemen, it looks like a
challenging year ahead. We appreciate the testimony and the
discussions today. There will be more questions. And we look
forward to continuing to work with you and thank you for your
attendance.
Meeting is recessed.
[Whereupon, at 11:34 a.m., Thursday, April 15, the
subcommittee was recessed, to reconvene subject to the call of
the Chair.]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
THURSDAY, APRIL 22, 1999
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:30 a.m., in room SD-138, the
Dirksen Senate Office Building, Hon. Christopher S. Bond
(chairman) presiding.
Present: Senators Bond, Craig, Stevens, Mikulski, Leahy,
Lautenberg, and Harkin.
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
STATEMENT OF ANDREW CUOMO, SECRETARY
ACCOMPANIED BY:
SAUL RAMIREZ, DEPUTY SECRETARY
JON COWAN, CHIEF OF STAFF
GAIL LASTER, GENERAL COUNSEL
JACQUIE LAWING, DEPUTY CHIEF OF STAFF FOR POLICY AND PROGRAMS
RHODA GLICKMAN, DEPUTY CHIEF OF STAFF
HAL DeCELL, ASSISTANT SECRETARY FOR CONGRESSIONAL AND
INTERGOVERNMENTAL RELATIONS
CARDELL COOPER, ASSISTANT SECRETARY FOR COMMUNITY PLANNING AND
DEVELOPMENT
HAROLD LUCAS, ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING
JACKIE JOHNSON, DEPUTY ASSISTANT SECRETARY FOR NATIVE AMERICAN
PROGRAMS
WILLIAM P. APGAR, ASSISTANT SECRETARY FOR HOUSING--FEDERAL
HOUSING COMMISSIONERS
IRA PEPPERCORN, DIRECTOR, OFFICE OF MULTIFAMILY HOUSING
ASSISTANCE RESTRUCTURING
GEORGE ANDERSON, EXECUTIVE VICE PRESIDENT, GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION
XAVIER BRIGGS, DEPUTY ASSISTANT SECRETARY FOR RESEARCH,
EVALUATION AND MONITORING
EVA PLAZA, ASSISTANT SECRETARY FOR FAIR HOUSING AND EQUAL
OPPORTUNITY
DAVID GIBBONS, ACTING CHIEF FINANCIAL OFFICER
EDWARD KRAUS, DIRECTOR, ENFORCEMENT CENTER
DONALD J. LA VOY, DIRECTOR, REAL ESTATE ASSESSMENT CENTER
JOE SMITH, ACTING ASSISTANT SECRETARY FOR ADMINISTRATION
DAVID JACOBS, DIRECTOR, OFFICE OF LEAD HAZARD CONTROL
SUSAN GAFFNEY, INSPECTOR GENERAL
OPENING STATEMENT OF CHRISTOPHER S. BOND
Senator Bond. The Senate VA, HUD, and Independent Agencies
Appropriations Subcommittee will come to order. Senator
Mikulski is meeting with the ambassador from Poland this
morning and asked that we go ahead and I will do so and ask her
to make her opening statement when she concludes that very
important meeting.
It is a pleasure to welcome Secretary Cuomo and our other
guests from the Department of Housing and Urban Development who
have joined us here today to testify on the President's fiscal
year 2000 budget request for the Department of Housing and
Urban Development. The President's budget request for HUD
proposes $28 billion for fiscal year 2000, which is an increase
of some $2.5 billion over the fiscal year 1999 appropriation of
$25.5 billion.
I must say at the outset, as I have had to say at each of
the hearings we have had to date in this subcommittee, that
this again will be a very difficult year in attempting to meet
the funding requirements and the programs within the
jurisdiction of this subcommittee.
The caps on domestic discretionary spending will compel
domestic programs to absorb some $23 billion in reductions, and
the VA, HUD Appropriations Subcommittee, as one of the largest
subcommittees within the Appropriations Committee, will have to
absorb its fair share of domestic cuts. We hope that we will
only have to absorb our fair share and not more.
As is often the case, the President's budget request for
fiscal year 2000 has created unrealistic expectations by
increasing spending by almost $25 billion above the budget caps
through a series of puts and takes that simply do not work or
exist. In effect, he has proposed spending dollars that are not
there.
When these phantom funds are squeezed out it will mean real
and difficult cuts; therefore, much of the Subcommittee's work
this year, including the budget review and funding of HUD
programs, will have to be to prioritize our funding decisions
to ensure that the principal programs within the subcommittee
work effectively and efficiently.
renewal of expiring section 8 contracts
While there are many HUD issues that merit comprehensive
discussion, I begin by touching on several specific issues that
are important to me. First, Congress has made a commitment to
fund fully all expiring section 8 contracts. Now, this is not
glamorous, it is not sexy, it is not politically high profile,
but it is a vitally important commitment.
It means that we are not going to abandon the low-income
families, the elderly, and the disabled who depend on Federal
housing assistance for decent, safe, and sanitary housing.
Within the next 10 years the financial reality is that by
fully funding the expiring section 8 contracts on an annual
basis the Congress will need to appropriate some $20 billion
per year to renew all existing expiring section 8 contracts
without any new incremental section 8 assistance.
Without that funding current residents will lose their
section 8 assistance and the ability to afford their homes. So
keeping low-income families with their children, keeping the
elderly, and keeping the disabled in their homes will remain
our top priority.
It is against this bleak financial setting that the request
for additional incremental section 8 units must be viewed.
The VA-HUD fiscal year 1999 appropriations bill, at the
insistence of the Administration, included 50,000 incremental
section 8 vouchers at the cost of $283 million in fiscal year
1999. This $238 million cost will become an annual cost as
these section 8 contracts expire. Again, this year, the HUD
budget calls for an additional 100,000 incremental section 8
vouchers to meet low-income housing needs.
These 100,000 incremental vouchers will cost some $578
million, which again will become a recurring annual cost if we
continue to meet our commitment to fund fully all expiring
section 8 contracts.
Let us put a human face on this. We have thousands of
families and elderly individuals who face the potential loss of
their homes if we do not provide sufficient resources to extend
expiring section 8 contracts. We cannot kick these people out
the back door because we are so eager to fund a new family
coming in the front door.
That is what my priority is and will remain, taking care of
the current residents of public and assisted housing, and only
after this is done will we look to provide new commitments.
section 8 incremental assistance
Mr. Secretary, I must also remind you of a discussion that
we had last year during the VA-HUD fiscal year 1999
appropriations conference concerning the funding of section 8
incremental assistance.
During the meeting with Senator Mikulski, Congressman
Lewis, Congressman Stokes, and me, you promised to find
adequate funds to cover the full cost in fiscal year 2000 for
the 50,000 incremental vouchers which we included in the fiscal
year 1999 VA-HUD appropriations bill.
You said that you would cut programs if necessary, but that
you would find adequate funding to cover the costs of new
incremental section 8 assistance. This was a promise you made
to me and to other members of the VA-HUD appropriations
conference personally, and I am concerned that the President's
fiscal year 2000 budget request for HUD does not live up to
this promise.
I want to be clear on this, because I believe the
President's fiscal year 2000 budget fails to provide the needed
funding for the existing expiring section 8 contract, and
instead it relies on an advanced appropriation of $4.2 billion
to be appropriated in fiscal year 2001. This would create an
immediate shortfall of $4.2 billion in fiscal year 2001 within
the HUD budget, which this subcommittee will have to make up.
This policy essentially says to our elderly and other low-
income tenants that HUD is promising a 1-year lease, but is
only willing to provide the funds for a few months, and then
hope that the rest of the rent money is available later. That
just does not work, and essentially bankrupts the system.
Even more unsettling is the fact that the Administration
assumes flat funding for section 8 contract renewals over the
next 9 years. If you have not looked at it, and I would ask
those who are here who are interested in this to look at the
multi-year projections.
The projections of OMB, reflecting the President's budget,
assume only $11.5 billion for expiring section 8 contracts for
each fiscal year from 2001 through 2009. This means the
Administration is not committed to funding all expiring section
8 contracts and begs the question as to what this means for the
thousands of current residents who would be forced out of their
homes.
In essence, we have two sets of books, one that looks good,
but when you look at the real spending plan there is not the
money there, and I am very worried about what that means. I
believe in living up to our commitments, and if the budget
cannot sustain additional incremental section 8 vouchers, then
we ought to say that and prioritize our funding to preserve the
housing assistance we currently have.
opt-outs
Second, HUD is facing a housing crisis with the opt-out of
a number of section 8 project-based multifamily housing
developments. For example, according to the National Housing
Trust, during 1998, 219 properties, with some 25,000 section 8
units, opted out of receiving Federal rent subsidies under the
section 8 project-based market program. These were projects
with expiring section 8 contracts with rents below the market
rate. In these cases, HUD has refused to review the section 8
contracts at market.
In other words, the owners believed that they could get
more rent for their properties if they did not have to rely on
the existing section 8 rents for their housing stock.
Now, the Administration has a stated policy of opposing
section 8 project-based assistance in favor of vouchers.
Nevertheless, many of these projects are home to the elderly,
or a scarce housing resource in an area in which there is
little available, low-income, affordable housing.
It is just not acceptable to say we will give you a
voucher. This often means that low-income families will not be
able to afford the housing in their community, or there is no
available housing in their community, or elderly people will
need to venture out with their walkers, or, even more
troubling, in their wheelchairs, to look for housing where none
may exist. We, in Congress, I believe, have been clear that we
need to preserve low-income elderly housing as well as low-
income family housing in areas with low-vacancy rates.
I think we owe it to the communities, we owe it to our low-
income families, we owe it to our elderly, and we owe it to our
disabled citizens. While I believe HUD has the authority and
resources to address this problem, HUD must make the commitment
now to save this housing.
procurement and contracting reforms
On the right side, however, Mr. Secretary, I do want to
compliment you on HUD's substantial progress in reforming the
procurement and contracting procedures as reported by the
National Academy of Public Administration [NAPA]. This is an
area where we can jointly take pride in a significant
accomplishment.
This reform grew out of Congressional concerns over HUD
contracting and procurement procedures as the Department
downsized, and as you know, it was the House and Senate
Appropriations Committees that initially asked GAO and the HUD
Inspector General to review and audit HUD's procedures for
contracting, and then subsequently funded NAPA to complete the
review and work with HUD on procurement reform.
Therefore, I am very pleased that HUD has taken our
procurement concerns seriously and worked with NAPA to achieve
what appears to be solid results. I congratulate you and the
people of HUD on this significant step forward.
I hope HUD will continue to follow through on additional
NAPA recommendations. HUD's implementation of NAPA's
contracting and procurement recommendations are still only
beginning steps in the context of HUD's larger problems, but I
do believe these reforms are needed.
I am hopeful that HUD's efforts and procurement reform
represent a larger commitment to a more comprehensive overhaul
of how HUD does its business.
audit findings
Also, I congratulate you on the first clean audit that HUD
has received, but there is much work to be done. I remain
disappointed that HUD again was designated in 1999 as a high-
risk area by GAO, as it was in 1995 and 1997, the only agency
ever designated as high risk on an agency-wide basis.
Further, the bad news is that the most recent audit of
HUD's financial statements revealed 6 material weaknesses and
11 reportable conditions. This is one more material weakness
and one more reportable condition than identified in last
year's audit.
That is unacceptable, it undermines the confidence of the
American people in the ability of the Federal Government to
make a meaningful contribution to housing and community
development policy.
Mr. Secretary, I know you are working hard to address HUD's
problems; nevertheless, as long as the Department remains high
risk I do not want to hear how you saved the Department from
being dismantled. Frankly, this claim reminds me of claims
about how certain financial institutions were too big to fail
during the savings and loan fiasco. In HUD's case it may be
both, too big to fail as well as too complex to be devolved.
Nevertheless, as we move forward, I will be directing my staff
to look at ways to enhance how HUD does its business, including
the possibility of spinning off FHA as a separate institution,
as a separate corporation, or as a government-sponsored
enterprise.
hud 2020 management reform plan
I also continue to have concerns regarding a number of HUD
program and management issues. In the first place, I remain
concerned over HUD's implementation of the HUD 20-20 management
reform plan, which is designed to rebuild the public trust in
the Department through management and program reform in
conjunction with the downsizing of the Department from 13,000
staff in 1992 to 9,300 currently.
We have discussed the need to maintain adequate staffing to
ensure there is quality delivery of HUD program services, and I
know you share my concerns that the success of each program
must remain the primary goal of the Department.
Nevertheless, I am not convinced that the Department has
achieved this goal. I have heard concerns about HUD's ability
on processing applications and providing consistent program
information to prospective clients. Where that is not done on a
timely basis, as we have discussed, unreasonable delays can
cost money and deals can collapse. While a number of these
concerns are anecdotal, they are very real.
I am also concerned with the Community Builders program,
which I initially understood to be a limited program to
encourage a new generation of young professionals to invest
their time and energy in housing and community development
issues at the local level while helping to facilitate local
decisionmaking on local housing and community development
issues.
Instead I hear the program has ballooned to staffing of
some 600 to 800 Community Builders out of a total HUD staff of
9,300 persons, or some 8 percent of all HUD staff. Moreover, I
have heard reports that there is confusion over the role and
authority of Community Builders in decision making as well as
significant questions as to their qualifications and knowledge
of HUD programs. This could really be a big problem if HUD's
other staff are undermined while performing their jobs.
In addition, HUD's budget includes, according to GAO, some
19 new programs and initiatives, with funding of some $731
million. As we have discussed, HUD needs to focus its efforts
on its core programs rather than redirecting HUD staffing and
expertise to new boutique programs and activities, especially
since many of these programs and activities can be achieved at
the discretion of state and localities under the existing
authority of programs such as CDBG and HOME.
Because of recent downsizing and restructuring, HUD is
vulnerable to poor management decisions, structural weaknesses,
and deficiencies in its primary housing and community
development programs. An overload of new activities and
programs could substantially weaken the Department.
Thus, I believe we have to continue to consolidate HUD
programs and activities to ensure that HUD's primary core
programs, such as public housing, section 8, CBDG, HOME,
homeless assistance, FHA mortgage insurance, and the disabled
and elderly programs meet the needs of our citizens, especially
those who are low and very low income.
I do not need to remind you that HUD, as a high risk area,
is considered vulnerable to fraud, waste, abuse, and
mismanagement, and the GAO, the HUD Inspector General, and the
National Academy of Public Administrators have at various times
identified substantial concerns with HUD's ability to
administer its programs and meet its statutory requirements.
Moreover, many of these concerns still must be resolved, as
we have discussed in the past, as a matter of fiscal
responsibility. HUD is one of the nation's largest financial
institutions, with sizeable commitments and obligations,
managing more than $400 billion worth of insured mortgages,
$485 billion in outstanding mortgage-backed securities, and
$180 billion in prior year's budget authority.
gao reviews
Now, the GAO and HUD IG were responsible for identifying
the need for procurement reform; therefore, it was of great
concern when it was reported to me that HUD has refused to
allow GAO to review HUD programs, collect data, and talk to
staff. I think that is unacceptable.
GAO is the eyes and the ears of Congress, and our ability
to develop a meaningful HUD budget depends on GAO's ability to
keep us fully informed on HUD programs and funding issues. I
expect the Department to open its doors to GAO immediately, to
extend to GAO every courtesy needed for its program and budget
reviews.
To be blunt, Mr. Secretary, we have a mutual interest in
making sure that HUD's housing and community development
programs both work well and are financially responsible, and
can only do this with your cooperation and with the cooperation
of our agency and the GAO.
state/local decision-making
Finally, I emphasize the continued need for the Department
to redirect the responsibility of HUD programs and activities
from the Federal Government to state and local decision-making.
It is critical, because HUD does not have the staff, the
expertise, or the resources to manage on a micromangement basis
every program.
The success of housing and community development programs
and initiatives reside at the state and local level, where
other state, local, private, and non-profit resources can be
leveraged to expand the availability of affordable housing and
to create new economic initiatives. Most importantly, state and
local housing and community development needs are best
addressed through state and local decision-making.
We look forward to hearing your comments, but Mr.
Secretary, first let me turn to the Members who are with me
now. I turn first to Senator Leahy.
STATEMENT OF PATRICK LEAHY
Senator Leahy. Thank you, Mr. Chairman.
The Chairman and I have been friends for many, many years
and agree on far more things than we disagree on, but I would
note that I see that the glass is more full than empty in this.
Mr. Secretary, I am delighted to have you here before us,
and I too have some of the NATO and Kosovo things going on and
will have to leave after this, but will leave questions for the
record.
When you appeared before this committee as Secretary, I
offered you congratulations and condolences at the same time,
and you have told me on different occasions you were not quite
sure which was more in keeping, but I felt then as I do now
that you have brought more personal experience and more
commitment to the Federal Homeless Assistance Programs than so
many of your predecessors.
I also knew you were taking over the helm of a very large
ship, sort of a super tanker, and everybody knew the ship was
taking on water long before you were put at the helm from years
of mishandling and needed to be turned around. Big ships do not
make tight turns. No matter how much you turn the wheel to
change course it might not be enough.
I knew you had the experience, I knew you had the ideas to
take charge and implement the reform plan for the agency, I
knew it takes some time for the tanker to follow your lead.
You have put together what I believe is another strong
budget for fiscal year 2000. I appreciate your efforts to
address the affordable housing crisis by requesting 100,000 new
vouchers for rental assistance. I am encouraged to see your
continued commitment to the Home and CDBG programs. I believe
they are two of the most effective programs available for
financing housing and economic initiatives at the local level.
I also want to commend you for conducting the first ever
physical inspection of all federally subsidized properties.
That is over 4.5 million properties. It is about time that we
took stock of our investment in affordable housing, it should
have been done long before you came, and I commend you for
taking the initiative when others said not to do that. That
demonstrates that HUD does care. I hope this will promote a new
attitude about Federal housing programs.
The Real Estate Assessment Center that you established
demonstrates a fresh long-term commitment to the Federal
investment in housing. Gone will be the days when projects were
built and then just forgotten. I believe what you are doing is
making sure the housing units remain affordable, but also
remain liveable, two things that do not always occur together.
So many Secretaries before you touted how many thousands of
units of housing are all over the country. You are probably
going to be the first Secretary to say that you know the
condition of those units, who are the good and bad landlords,
and what repairs and enforcement are required, and that is
very, very good. To paraphrase a person who lived many years in
Vermont, Robert Frost, you have miles to go before you sleep.
We talked about the GAO watch list. HUD was on that watch
list for several years before you became Secretary. It remains
there, but I am encouraged by the steps you have taken to
address the problems raised by GAO, and I think we should note
that 2 days ago, the National Academy of Public Administration
released a report that actually commended HUD for making
substantial progress in the area of procurement reform,
something that should be welcome news, but also reflects
improvements made.
I have seen your personal commitment and knowledge of these
programs on occasions when you have been in Vermont, and to a
little state like ours, taking the time when you come there,
you have given great, great encouragement to people who have
not had much to encourage them before in life.
Even this past week, when I was there, I ran into a couple
of people in downtown Burlington who told me how much their
life had been affected by your words, your presence, and your
programs there in Vermont.
A lot of work lies ahead for you and your staff, and I
wanted to thank you for those efforts of yours and your
leadership. There will be bumps in the road in the future,
anybody coming to HUD knows that will happen. I am confident
you are doing your best to ensure that HUD will turn the corner
and enter the 21st Century in far better condition than it was
in the past.
Mr. Chairman, as always, I will work with you on these
programs, because I know you are very concerned about them. I
will have questions for the record, and I apologize for having
to leave.
Senator Bond. Thank you very much for being with us,
Senator Leahy. We will add your questions, and as always we
will keep the record open for both statements and questions by
all members of the committee.
And, Mr. Secretary, we hope that you will take those into
account and respond promptly to them.
Let me turn to Senator Craig.
statement of Senator Larry Craig
Senator Craig. Mr. Chairman, thank you very much. I will be
brief. I came in late.
Mr. Secretary, welcome.
As we all know, in 1988 Congress passed and President
Reagan signed into law amendments to the Fair Housing Act that
included disability and family status. Now, these Fair Housing
laws are important. We all recognize that, and I do not dispute
the value of the Fair Housing Act to prevent housing
discrimination. This is never a valid reason for discrimination
against anyone.
When Congress passed the laws the intent was to increase
the inventory of accessible housing for disabled citizens. I
still support and believe in that goal, so I want to
congratulate you this morning Mr. Secretary for HUD's recent
decision to uphold those goals. I think that is extremely
valuable.
I decided to rescind proposed rules that would have
prevented the public housing authorities from receiving Federal
funds. The funding was to have been cut off because of the
unsubstantiated claims against the agencies. I am glad that you
realized that this would be an extremely punitive measure that
would have harmed local low-income communities, while at the
same time penalizing the agencies without proof of wrongdoing.
So there are questions to be asked this morning, there are
other concerns, but I did want to recognize that, Mr.
Secretary, and thank you for that.
Mr. Chairman, I would ask that the bulk of my statement be
made a part of the record----
Senator Bond. Without objection.
Senator Craig [continuing]. So we can turn to other
colleagues and get to the questions. Thank you.
Senator Bond. Thank you very much.
Senator Lautenberg.
statement of Senator Frank Lautenberg
Senator Lautenberg. Thank you, Mr. Chairman. I first
commend you for trying to stretch the inadequate resources that
you have, but we do face a crisis in housing for the needy and
for the poor in the years ahead.
Unfortunately, I can only stay here briefly, because of a
conflict with a budget committee hearing, but I do want to
speak for just a couple of minutes on two important subjects.
First, I want to thank Secretary Cuomo for taking on such a
difficult task and doing it as well as you have. Bringing HUD's
management and finances into the 21st Century is a job that
many people have shied away from, but I am pleased that
Secretary Cuomo had the courage to tackle HUD's problems, and I
want to commend him and his staff for their hard work and
congratulate him on the progress made so far.
Second, I want to take a couple of minutes to express my
concern about the funding levels available in the fiscal year
2000 appropriations for critical programs like affordable
housing and community development. The budget resolution that
just passed would mandate an 11 percent budget cut for most
discretionary programs in the year 2000, and that is what
happens when you are pledged to budget caps while defense
funding is increased and protecting some other programs, while
other critical programs take unacceptable hits.
These budget cuts will get worse in ensuing years and
require close to a 30 percent cut, 30 percent, in programs by
the year 2004. I believe that budget cuts of this size are
extreme, unsustainable, and crippling, and that is why I so
strongly oppose the year 2000 budget resolution.
The Senate version of the majority's budget resolution
recommended the elimination of the community development block
grant program. The numbers in the conference report appear to
confirm the elimination of CDBG as well, and that would be a
devastating blow particularly to our cities.
We already have 2 million low-income Americans on waiting
lists for housing assistance and over 5 million low-income
Americans pay more than half of their income in rent or live in
substandard housing. This problem will just get worse if we
cannot fund HUD programs at the level requested by the
President.
Our cities are struggling to survive while traffic
congestion and gridlock increasingly eat away at the quality of
life in our suburbs. We cannot just leave these cities and
forget about them. We have to face these tough economic and
social problems head on.
The budget does not help with these problems. It hurts
them, and we do not provide the resources to save our cities;
instead we give enormous and I think unneeded tax cuts to the
wealthiest Americans.
The budget resolution does not give us much detail about
where these massive budget cuts are going to come from. We will
learn the answers to this question during the appropriations
process over the next few months, and I hope that we will not
damage our cities and cut programs which benefit working
Americans to satisfy our desire to give tax breaks.
I know the Chairman and the ranking member of the
subcommittee care deeply about these programs. It has been
evident with their hard work in the past. They will do their
best under the difficult circumstances we face this year, and I
look forward to working with Chairman Bond, Senator Mikulski,
and my other colleagues to find the resources necessary to
continue to fund the key programs within this subcommittee.
I thank you, Mr. Chairman.
Senator Bond. Thank you very much, Senator Lautenberg.
Now, Mr. Secretary, we will give you an opportunity to have
your say.
statement of andrew cuomo
Secretary Cuomo. Thank you very much, Mr. Chairman, and
thank you for having us here today.
With the Chairman's permission let me quickly introduce the
HUD team who is here. We have the full team here, Mr. Chairman,
so we could answer any questions that the committee might have.
Let me also send my regards to Senator Lautenberg before he
leaves, and Senator Leahy, and Senator Craig, good to see you,
sir.
introduction of hud staff
With me at the table, Mr. Chairman, to my right is Dave
Gibbons, who is the acting Chief Financial Officer of the
Department. To my left is Saul Ramirez, Deputy Secretary of the
Department, and Bill Apgar, who is the FHA Commissioner.
With us is--and I would ask them to stand as I call their
name--Gail Laster, who is the General Counsel of the
Department; Jacquie Lawing, who is the Deputy Chief of Staff
for Policy Programs; Rhoda Glickman, who is Deputy Chief of
Staff; Hal DeCell, Assistant Secretary for Congressional
Affairs; Cardell Cooper, Assistant Secretary Community Planning
and Development; Harold Lucas, Assistant Secretary Public
Housing; Jackie Johnson, Deputy Assistant Secretary for Native
American Programs, the first Native American to ever hold that
position; Ira Peppercorn, of OMHAR, Director of OMHAR; George
Anderson, who is the Acting President of Ginnie Mae; Xavier
Briggs, who is the Deputy Assistant Secretary Policy
Development and Research; Eva Plaza who is the Assistant
Secretary for Fair Housing; Susan Gaffney, who is the Inspector
General; Edward Kraus, who is the Director of Enforcement
Center; D.J. LaVoy, who is the Director of the Real Estate
Assessment Center; Joseph Smith, Acting Assistant Secretary for
Administration; Dave Jacobs, Director of the Office of Lead-
Hazard Control; and Mark Kinsey, who is the head of OFHEO.
Senator Bond. We welcome all of our friends from HUD. How
many people from HUD were not introduced, if you would hold up
your hands? Is there anybody else?
Okay. We are delighted to welcome all of you, and thank you
for coming.
Secretary Cuomo. Mr. Chairman, I am very excited by the
possibilities for this year, because we believe that we can
build on the progress and success of last year. Last year was a
great year for the Department of Housing and Urban Development.
It was the best budget we have had in a decade.
We actually passed a public housing reform bill, which
showed the ability to proceed and put one foot in front of the
other, which had not happened for some time. We got past the
politics, we got past the stereotypes, and we actually got
something done. With that as precedent, we hope to go forward
this year.
Senator Leahy mentioned the glass full, glass empty
analogy, and whether I should get congratulations or
condolences for my position, and I take that with a grain of
salt, obviously. At HUD, there is no doubt that we have very
real challenges, as do most Federal departments, and there is
no doubt that HUD has its share of critics for various reasons.
Some people just do not want to see HUD doing what HUD is meant
to do, and I do not think they will ever be satisfied, but
there are also issues that HUD has to address, but I take
heart, Mr. Chairman, in your opening statement.
I do not recall another opening statement that you have
made that had a flip side, that had a right side, and was
actually congratulating the Department for the good things that
we have done.
Senator Bond. I have been waiting a long time to get that
opportunity, Mr. Secretary. I am delighted we got there.
Secretary Cuomo. Well, I am glad we finally got there, Mr.
Chairman, and I knew it would happen, and we got there
together, and we want to build on that positivism, and I also
point to the NAPA procurement and the clean audit as indicators
of the overall success and progress we have made.
need for affordable housing
There are two basic points I would like to address quickly,
and then we will get on with your questions, Mr. Chairman. For
me, the bottom line of this hearing, and the Department, and
this budget is, is there a need that we need to address in this
Nation, and can HUD address that need? As you pointed out quite
accurately, there is a very great need when it comes to housing
in this Nation.
Actually, the cruel irony is, the need for affordable
housing is at its highest point in history as we sit here this
morning. It is almost counter-intuitive, the economy is so
good, all the news is good, you almost have to take a break, at
least I did, to understand that the need for affordable housing
is at its highest point in history, $5.3 million.
Actually, the strong economy is one of the reasons. The
economy is so strong it is driving up the rents. Those who are
on fixed income cannot reach the higher rents. One of the other
reasons why we have such a need for affordable housing is we
went out of the affordable housing business when we went to
zero funding for section 8 vouchers.
I believe we are now paying for that hiatus, because when
we stopped producing, we built up a backlog, and the backlog is
now cresting, and as the Chairman pointed out, we have an
impending crisis on the op-outs, the buildings that are now
reaching the expiration of the contract, the landlord has no
further legal obligation to us, and the landlord can say, ``I
am taking my building and going to the private market.''
You put those three factors together, strongest economy,
the hiatus on the production of affordable housing, no new
section 8 vouchers, opt-outs, and you have a housing crisis in
this Nation.
section 8 renewals
I hear you, Mr. Chairman, when you say you are committed to
renewing the vouchers and renewing public housing, and that you
do not want to let someone in the back door only to have
someone leave by the front door.
My point would be, Mr. Chairman, and I think the point of
departure is, I believe we have to do both. We have to renew
all the existing, but we also have to have more production. The
waiting lists in this country are going crazy, literally.
The waiting time for public housing authorities has gone
from 2 years to 3 years on the largest public housing
authorities just in the past couple of years. The waiting time
for section 8 has gone up to three-and-a-half years from 2
years. So this pent-up demand is having a real impact on real
Americans.
Senator Mikulski's hometown city of Baltimore, the waiting
time for public housing is up to 3 years. The waiting time for
section 8 is up to 2 years. Kansas City, the same thing,
waiting times for public housing is up to 3 years. For section
8, it is up to 7 years that people will wait for a section 8
certificate.
This is true all across the country. So I do not think we
have a choice of continuing renewing or 100,000 new, I think we
have to do both, and Mr. Chairman, I understand the constraints
of the overall budget, but I think when it comes to this field,
we just do not have that choice.
By the way, Mr. Chairman, 100,000 new vouchers is a drop in
the bucket on the need, and all that does, in my opinion, is
keep some of the pressure off the system, but if we go to zero
vouchers again, we will increase the demand, increase the
backlog, and make a bad situation worse.
We also have a need for economic development. One out of
five cities has an unemployment rate which is higher than 50
percent of the national average. One out of five cities is
shrinking and losing population since 1980. Cities all across
the nation, especially medium-size cities, are crying out for
help to keep jobs and keep their economic base, and they are
looking for HUD to do that. So the need, Mr. Chairman, is
undeniable.
management reforms
The second question becomes: Can HUD meet the need? Is HUD
part of the solution? While I have told the Chairman that I
would not suggest by any stretch of the imagination that HUD
has done all it needs to do in management. I would also say,
Mr. Chairman, that we have made significant progress and we are
part of the solution as opposed to part of the problem, and the
chorus of objective, unbiased validators of that success is
growing and growing.
Booze-Allen will attest to it. Price Waterhouse will attest
to it. David Osbourne, the so-called ``guru'' of reinvention,
will attest to it.
GAO kept us on the high-risk list, which is curious, Mr.
Chairman. The House has asked the GAO for their definition of
high risk that is a quantifiable formula. How do you determine
high risk that cites HUD, but not Defense, not HHS? What
quantifiable formula did they use? They have yet to produce the
formula. They did say that whatever it is, we could not get off
the list in 2 years, which is also peculiar to me. They said it
was virtually impossible to have gotten off the high-risk list
in 2 years.
Before we understand that significance of the term, I would
like to know the definition of it, and I am waiting for that
report, but GAO also went on to say, and I quote, ``HUD is
making significant changes and has made credible progress.''
That is from GAO.
NAPA, as you pointed out, said that the procurement
process, which was long pointed to by critics of the Department
as an Achilles heel, is significantly reformed, and we had the
clean audit for the first time's in the Department's history,
Mr. Chairman, and if I am not wrong, less than half of the
Federal departments actually get a clean audit. So that is a
real significant improvement.
I see the light. If I could have the Chairman's indulgence
for just 2 more minutes.
Before we get caught up in the details of the HUD budget,
and at HUD sometimes I believe the details become deceptive and
we tend to lose the forest for the trees, not only has HUD's
progress been organizational, as attested to by objective
sources, but we have made real progress on the ground.
accomplishments at hud
The bottom line is this, Mr. Chairman, when you want to
know what HUD has done, FHA last year did one million
mortgages, which was close to a record, and returned $1.5
billion to the treasury, more money than ever before. FHA is
making money. FHA is making loans. FHA is making progress.
In fair housing, we are working to double the number of
enforcement actions. We have brought an energy to fair housing
that has resonated across the Nation.
In community planning and development, Mr. Chairman, your
interest in economic development, we have done $3.5 billion in
economic development loans, and listen to this, not a single
dollar taken from Uncle Sam's pocket for any default, $3.5
billion and not a dollar taken from Uncle Sam's pocket for any
default, about a 7 percent default rate, creating about 300,000
jobs.
In public housing, we've created first rating system ever.
By the end of this year, we will have inspected all of HUD's
properties for the first time, Mr. Chairman. We have a system
where if public housing is not going to work, we can actually
do something about it. So not only are we making great
organizational changes, but they are having a real impact.
new initiatives
In our budget this year, we have minimized the number of
new initiatives. We can argue whether there are three, as we
suggest. GAO has a different way of counting; they count 19.
But in my opinion, they require a minimum amount of manpower
and time, and they are necessitated by the needs of the client,
because if we are not doing what Kansas City says they need
from us or Baltimore says they need from us, then we are not
doing our job, and these are the minimum to do that.
I agree with the Chairman, I want to focus on the poor
programs; that is where our investments are. We focused on the
senior housing, which is the message we got from you last year,
and to the extent we have ``new initiatives,'' they focus on
the economic development side primarily, with the President's
plan for APIC, and a regional approach, which I believe are the
bare minimum that we need to be responsive to the clientele.
In sum, Mr. Chairman, the Department has made progress.
There is a different attitude and atmosphere about HUD. The
Community Builders, which are only about 380 new employees on a
work force of about 9,000; 380 were directly responsive to what
I have heard from this committee, and everyone who I have
talked to where they said get us some people at HUD who we can
talk to.
We have a new attitude about waste, fraud, and abuse,
because when the FBI came to HUD, with all due respect to all
the other agencies that worked for all those years after
scandals were going on, when the FBI teamed up with HUD, people
understood it was a different day at HUD.
I am looking forward to building on the progress, building
on last year, meeting the needs, and going forward together.
Thank you, and I look forward to the discussions, Mr.
Chairman.
[The statement follows:]
Prepared Statement of Andrew Cuomo
Chairman Bond, Ranking Member Mikulski, Members of the
Subcommittee. Thank you for inviting me here today to discuss HUD's
fiscal year 2000 Budget. If it pleases the Committee, I would like to
enter my testimony for the record.
Mr. Chairman, last year when I presented HUD's budget to you, I
told you that it represented the second step in a process that we had
initiated to restore HUD's ability to fulfill our mission of empowering
communities across America. Step One was to restore competence through
reform, reinvention and renewal. Step Two was to expand opportunity, by
creating jobs and new housing opportunities for low- and moderate
income families.
Since then, working together with this Committee, we have made a
great deal of progress in both of these areas. The fiscal year 2000
budget continues our efforts to restore the public's trust in this
Department, and to open new doors of opportunity for people who are not
yet benefiting from the current wave of national prosperity. I am
convinced that HUD has the most important mission of any agency in the
federal government--empowering communities to aid those most in need,
to assist those who do not yet enjoy the full fruits of what this great
country has to offer.
This year, HUD's budget request is $28 billion. That represents a
$2.5 billion increase over the fiscal year 1999 level. It offers
opportunity and security for millions of Americans. It builds on the
strong foundation that we have built at the Department over the past
two years--both on the budget side and the management side.
This budget builds on last year's strong bipartisan budget. Last
year was truly a milestone for HUD: the first incremental vouchers in
five years, expanded FHA loan limits, increases in virtually every
major HUD program, and a historic public housing bill.
We could not have passed that budget without this Committee's
support and commitment, Mr.Chairman. You were instrumental in making
this happen, and we look forward to continued cooperation this year.
As both the last budget of this century and the first budget of the
next century, this is an important budget for our nation's cities and
rural communities. It represents a renewed vote of confidence by the
President that HUD is on the right track, and that HUD is better
positioned than ever to help communities take on the new challenges of
the 21st century.
the foundation--management reform
Mr. Chairman, a budget is about more than dollars and cents. It's
about the agency's ability to manage its funds. And on that front HUD
has made extraordinary progress.
This budget is a direct result of the management reforms we have
put in place over the past two years--restoring competence at HUD. As a
result of Management 2020, begun two years ago, HUD is in a stronger
position than ever to manage and implement this budget.
While the job is not yet done, HUD is increasingly recognized as a
new model for government in the 21st century: a government that does
more with less, a government that empowers communities through less
regulation, fewer mandates, and better customer service.
We have now hired and trained our first two classes of more than
400 Community Builders. That means that our Public Trust Officers are
now freed up to focus on ensuring that HUD funds are used effectively
and in compliance with federal laws and regulations.
Some 335 properties have been referred to our new, independent
Enforcement Center, under Ed Kraus, who came to us from the FBI. We
have five satellite Enforcement Center offices that are now open and
fully operational.
The new Real Estate Assessment Center, run by D.J. Lavoy, has
completed over 13,500 inspections, averaging 150 a day. We're on track
towards meeting our goal of inspecting all 45,000 apartment complexes
in HUD's inventory by the end of the year 2000.
Through our Super Notice of Funds Availability (SuperNOFA), we have
consolidated 40 separate competitive grant applications into one
application--two months ahead of schedule. This is a first in HUD's
history.
We have opened the first two HUD storefront offices--here in
Washington and in Albuquerque, New Mexico--with another nine
storefronts slated to open this fiscal year. The most visible evidence
of management reform, the storefronts are easily accessible consumer-
friendly service centers in downtown business districts, where people
can walk in to get information about HUD programs and activities.
We opened HUD's new Section 8 Financial Management Center in Kansas
City. The new Center consolidates the management of the Department's
largest program--Section 8 rental assistance program. Previously, this
function had been dispersed among dozens of field offices.
There is clearly more work to do. It will take time to fully
implement all of our reforms, to turn around all of the problems that
built up over time. But there is growing, independent evidence that
these management reforms are making a difference.
Even the recent (January, 1999) General Accounting Office Report
supports the work we are doing to reform the Department. While we were
of course disappointed by GAO's continued finding of high risk, the GAO
found that ``HUD is making significant changes and has made credible
progress since 1997 in laying the framework for improving the way the
Department is managed. HUD's Secretary and leadership team have given
top priority to addressing the Department's management deficiencies.''
That is a vote of confidence in our efforts to reform HUD. Even
more of an endorsement is the clean, or unqualified, audit that we just
received from HUD's Office of the Inspector General--the first in HUD's
history. The Inspector General stated that ``the unqualified opinion
represents a considerable achievement for HUD, and it further reflects
continuing improvements in HUD's commitment and ability to properly
account for funds entrusted to the department''.
Since audited financial statements were first required by the 1990
Chief Financial Officers Act, HUD had received no opinion or, more
recently, only qualified opinions. While we still have work to do, this
new opinion is a validation of the work that has been done so far.
Another important measure of progress is our Y2K preparedness. In
January, the House Committee on Government Oversight and Reform gave
HUD an A-minus on this front--ahead of 18 other Federal agencies. I am
also encouraged by this week's new report from the National Academy for
Public Administration that concluded that HUD has substantially
improved its contracting and procurement operations. And just yesterday
we announced the results of the first comprehensive physical
inspections of public housing around the nation.
Management 2020 is on track. A December, 1998 report from Price
Waterhouse Coopers LLC found that ``implementation of the Community
builders, Enforcement Center, Procurement reform, Real Estate
Assessment Center, Storefronts and Troubled Agency Recovery Center is
well under way. Each project met all or substantially all of the
critical milestones that HUD established for completion as of September
1.''
our programs are achieving tangible results
HUD's management reforms are being translated into real, tangible
benefits for the American people. Look at some of the results we're
achieving in some of our key programs:
CDBG.--Each year, Community Development Block Grant funds go to 847
cities, 137 counties and another 3,000 small cities and counties. An
Urban Institute Study found that CDBG is one of the largest sources of
non-tax Federal assistance for the construction or rehabilitation of
privately owned housing. The largest single use of CDBG money (30
percent) is housing rehabilitation, leveraging $2.31 for every CDBG
dollar. In our latest Report to Congress, we reported that for the
three-year period 1994-1996, 641,000 housing units were developed or
rehabilitated through CDBG.
During the same period three-year, CDBG economic development funds
created approximately 445,000 jobs. We have also boosted the economic
development impact of CDBG through the Section 108 Loan guarantee
program--with some $3.5 billion in commitments to 652 projects over the
past six years, creating thousands of additional jobs. Most CDBG
economic development goes to small businesses--more than half of all
businesses assisted employ five or fewer persons. And jobs created with
CDBG assistance meet basic tests of job quality: 89 percent of the jobs
remain after four years; 96 percent are full-time jobs; 90 percent pay
more than the minimum wage. And 32 percent are held by local residents.
HOPE VI.--HOPE VI is the most visible of our efforts to transform
public housing, replacing obsolete high rises or outdated projects with
new, livable communities. Over the seven-year history of the HOPE VI
program, we have distributed a total of $3.1 billion--$540 million each
year--for 104 projects in 28 states plus the District of Columbia and
Puerto Rico. These funds have leveraged $3.4 billion in additional
funds.
But more than the overall numbers, we are making more effective use
of these funds. In 1993, the average cost per unit was $94,345. That
dropped in 1998 to only $74,700 per unit. The number of non-HOPE VI
dollars leveraged has increased--from only 32 cents for every HOPE VI
dollar in 1993 to $2.28 per HOPE VI dollar in 1998.
Brownfields.--One of our newer initiatives, our Brownfields
Redevelopment Initiative, is beginning to have an extraordinary impact
in cities by returning contaminated land to good use. Last year we
committed just $25 million in direct grants to 23 communities. In
addition to leveraging $141 million in guaranteed loans, this initial
outlay will generate another $811 million in additional investments,
creating an estimated 9,500 jobs.
Elderly housing.--We are proud of the track record of our elderly
housing programs. Over the past two years our Section 202 program has
funded 320 projects, for approximately $900 million--creating some
12,500 new elderly housing units. Overall, the program has about 7,600
projects and serves 350,000 people. Also, over the past two years,
through our Section 232 mortgage insurance program we have insured 334
nursing homes or assisted living facilities for $2.4 billion. Another
440,000 elderly people live in public housing, approximately 400,000
receive housing vouchers or certificates, and another 100,000 elderly
live in project-based Section 8 facilities.
Mr. Chairman, with these kinds of initiatives already in place and
our management reforms underway, we are better positioned than ever to
take on the new challenges of the 21st century--challenges addressed by
this budget.
fiscal year 2000 budget addresses five major challenges
HUDs' fiscal year 2000 budget addresses five major challenges
facing America: (1) ensuring that our communities remain economically
competitive in the new global economy; (2) tackling the continuing
crisis of affordable housing; (3) moving closer to One America; (4)
finding regional solutions and creating sustainable communities; and
(5) a addressing the aging of America.
competing in the new global economy
HUD's economic development mission has become more important than
ever in the rapidly-changing global economy. By any measure, the nation
is doing well. The numbers are compelling: eighteen million new jobs,
the lowest peacetime unemployment in more than 40 years, a stock market
that is off-the charts, the lowest inflation since the 1950s.
But the rising tide of opportunity has not yet lifted all
communities. There are still too many places--in both our inner cities
and rural areas--where jobs are scarce and poverty persists at levels
well above the national average.
The good news is that, as the President said in the State of the
Union Address: ``Our greatest untapped markets are not overseas--they
are right here at home. And we should go after them.''
Several HUD programs will help communities tap these markets, and,
at the same time, help spread our prosperity to all corners of our
nation. The goal of these programs is to ensure economic
competitiveness of all communities by uncovering new markets, ensuring
strong regional economies, tapping new sources of private capital,
helping businesses grow and prosper in underserved communities, and
expanding our effort to move people from welfare to work.
CDBG
CDBG is the most flexible federal aid to both cities and smaller
rural communities. Contributing to vital community infrastructure,
housing, and economic development, this year's request for the CDBG
program is up $25 million to $4.775 billion. And formula funding that
goes directly to entitlement communities and states will increase by
$130 million over 1999 enacted levels.
Community Empowerment Fund
Our proposed Community Empowerment Fund will boost capital for
business investment and job creation in underserved inner city and
rural areas. The CEF combines and streamlines two existing HUD
programs: our existing Economic Development Initiative (EDI) grants
program and with Section 108 guaranteed loans. We are requesting $125
million in competitive EDI grants, which will leverage an estimated
$625 million in guaranteed private loans and support an estimated
100,000 new jobs. Overall, our budget seeks $1.3 billion in loan
guarantee authority under Section 108 of the Housing and Community
Development Act.
We have established two priorities this year for these grants:
Welfare-to-Work job creation and City-Suburb Business Connections that
help central city firms tap into regional economies. Under a pilot to
be launched later this year, we will also use the CEF to nurture a
badly-needed secondary market for economic development loans.
America's Private Investment Companies (APICs)
The President has proposed a comprehensive New Markets initiative
to bring business investment to underserved inner city and rural
communities. HUD is requesting $37 million to subsidize and secure $1
billion in privately issued, federally-guaranteed loans, along with
$500 million in private equity commitments, to create for-profit
venture capital funds known as America's Private Investment Companies
(APICs). APICs will make much-needed private equity capital available
to larger businesses that are expanding, or relocating, or joint
venturing in inner cities and rural areas. APICs will be jointly
administered jointly administered by HUD and the Small Business
Administration.
Empowerment Zones
Empowerment Zones and Enterprise Communities have successfully
combined tax credits with federal grants and loans, along with local
resources to attract billions in private sector investment. Our fiscal
year 2000 budget requests $150 million for Empowerment Zones--$105
million that will go to 15 recently-selected Round II urban Empowerment
Zones, and another $45 million for Strategic Planning Communities that
placed 16th through 30th in the Round II competition. Our budget also
requests funds for three related programs: to support additional, non-
designated communities, to establish technical assistance partnerships,
and to emphasize regional strategies that tie the zones to their
regional economies and employ urban youth.
Youthbuild
Finally, we are requesting an increase in the highly successful
Youthbuild program. In 1999, Youthbuild will serve between 5,000 and
6,000 disadvantaged youth, who will--literally--will help rebuild their
communities as they learn vital job skills. We are requesting an
increase from $43 million to $75 million.
the continuing crisis of affordable housing
At the core of HUD's mission is the charge to provide housing that
is decent, safe and, affordable to all. Despite the longest peacetime
economic expansion in the Nation's history, rents have soared in many
regions with strong economies. In fact, an all-time high of 5.3 million
households--12.5 million people--face the high rent burden known as
``worst case'' housing need. And worst case needs have grown especially
fast among working families.
What's more, persistent gaps in homeownership remain for low- and
moderate-income families and other under-served groups. With the
nation's homeownership rate running at a record high of 66.3 percent,
large gaps remain--cities lag behind suburbs, and underserved groups
need increased access to mortgage credit. Special housing needs persist
for homeless people, disabled people, and people living with HIV/AIDS.
And as many as 600,000 individuals have no home at all on any given
night.
To meet this challenge, our budget opens doors to affordable
housing in three ways: First, by expanding affordable rental housing.
Second, by expanding homeownership opportunities. And third, by meeting
special housing needs.
Section 8 renewals and incremental vouchers
To expand rental housing, HUD is requesting $10.6 billion in new
budget authority to renew existing Section 8 contracts--covering 2.4
million rental units. We are also requesting 100,000 new vouchers to
help address the tremendous need that remains.
A number of the proposed new vouchers have designated purposes:
25,000 will expand the pool of Welfare-to-Work vouchers; 18,000 will be
for homeless persons, to ensure the availability of permanent housing
solutions at the end of the Continuum of Care; and 15,000 will be
targeted to extremely low-income elderly persons. Another 42,000 will
be unencumbered and will be distributed to Public Housing Authorities
to help the many families on the Section 8 waiting lists throughout the
country.
Transforming Public Housing
We must continue our efforts to transform public housing. Last year
the Congress enacted a historic public housing bill. This year, our
budget requests a significant increase in public housing operating
funds, from $2.81 billion to $3.0 billion. We are also are proposing
$2.55 billion for the Capital Fund, a slight increase over last year's
request. We are also are requesting continued funding for HOPE VI,
which allows communities to replace obsolete high rises with new,
mixed-income, mixed-use livable communities and housing vouchers. We
are also are seeking continued funding for the Drug Elimination Grant
Program (DEG) to reduce crime and restore safety in public housing.
HOME
The HOME program is a proven housing rehabilitation and production
tool in both urban and rural America. We are requesting $1.61 billion,
a small increase over last year's level. This will provide more than
85,000 units of affordable housing for both owners and renters through
a combination of new construction, rehabilitation, acquisition and
tenant based-assistance.
Homeownership
We must redouble our efforts to expand homeownership. This year's
State of the Cities report this year again identified homeownership
gaps between whites and other groups--African-Americans, Hispanics and
other minorities--as well as between cities and suburbs. As a result of
the FHA loan limit increase approved last year by Congress, we are
projecting expanded demand for FHA and therefore are requesting a $10
billion boost in the FHA loan volume cap, and a $50 billion increase in
the Ginnie Mae guarantee limitation. Additional proposals to boost
homeownership include continued funding for Housing Counseling and
another round of Homeownership Zones.
Native American assistance
Native American housing needs will be served through the Indian
Housing Block Grant Program, and the Indian Housing Loan Program. And,
per Congress direction in last year's budget, we propose to address
rural housing needs through the Rural Housing and Economic Development
program. There we will focus on innovations that complement USDA's
important work in rural housing.
Homelessness and Special Needs
Reducing homelessness is one of this Department's top priorities.
In 1993, HUD initiated the Continuum of Care to provide a coordinated
community approach to homeless assistance, with the goal of moving
homeless persons from homelessness into jobs and permanent housing.
The Continuum of Care is working, leveraging many times the
investment of Federal resources. For fiscal year 2000, we propose an
increase of $150 million, to $1.12 billion. This increase, plus 18,000
new rental vouchers to create permanent housing solutions, will address
the housing needs of the most vulnerable Americans--those making a
transition from the streets back into homes and community life.
HUD is also proposing an increase of $15 million in the Housing
Opportunities for People with Aids program (HOPWA), to $240 million.
This increase is solely dictated by the increase in the number of cases
and in the number of jurisdictions eligible for funding.
Elderly and the disabled
Our special needs programs also serve the elderly and disabled. We
are proposing $194 million for the Section 811 program serving persons
with disabilities, matching last year's enacted level the same as last
year. We also propose to increase the number of disabled persons served
by increasing the portion of funds that may be used for vouchers from
25 percent to 50 percent. We are also proposing a total of $747 million
to fund programs that serve the nation's rapidly expanding growing
elderly population. These elderly programs are discussed in more detail
below.
Citizens Volunteer Housing Corps
We are also proposing a modest initiative--at $5 million--to
mobilize a corps of citizens through a new Citizens Volunteer Housing
Corps to help reclaim and to rebuild abandoned and dilapidated housing
in cities across the country. The Corps will tap into the spirit of
civic pride and expand the stock of affordable housing, doing for
existing housing what Habitat for Humanity and other groups now do in
the arena of new home building.
moving closer to one america
For Despite the more than 30 years, of prohibition of
discrimination in housing has been prohibited under law. Yet audits of
discrimination in the rental and sales market show that an estimated
over 2.5 million plus instances of discrimination still occur annually
nationwide. Today's discrimination is often more subtle than it was in
the past, but it is no less real and no less damaging to our social
contract as a nation that values equality of opportunity for all. It
might not always be overt as it has been in the past, but it is there.
We will only reach ``One America,'' in the President's words, when we
all have equal housing opportunities.
Last year, President Clinton announced his commitment to doubling
the number of fair housing enforcement actions by the year 2000. To
help complete this effort, we propose to increase the Fair Housing
Enforcement budget by 18 percent--to a total of $47 million.
Our budget request provides for increased funding of both the Fair
Housing Assistance Program (FHAP) and the Fair Housing Initiatives
Program (FHIP). This request includes monies for innovative
partnerships between public and nonprofit fair housing groups, as well
as the second year of FHIP funding for a national audit of
discrimination in housing rental and sales. This audit will create the
first ever report card at both the national and local levels of the
extent of discrimination against each of the Nation's major racial and
ethnic groups.
regional solutions and sustainable communities
Our communities face a number of threats to sustainable
development, from uncontrolled growth to crime and drug abuse, from
environmental hazards and a lack of energy efficiency in housing to
blight and under-investment in vital community infrastructure. Many of
these challenges call for cooperative regional solutions that span
jurisdictional lines.
To address these challenges, the Administration has proposed a
comprehensive Livable Communities initiative. This provides communities
with new tools and resources to preserve green space, ease traffic
congestion and pursue regional smart growth strategies.
Many HUD programs already support these goals. CDBG grants can be--
and are being--used to support an array of activities to create safe
and livable communities; HUD's Community 2020 mapping software allows
communities to quickly match government resources with community needs,
using state-of-the art geographic information system technology; and
HOPE VI helps create sustainable, mixed used communities.
Regional Connections
In addition, we are proposing $50 million in competitive Regional
Connections grants as a key part of the Administration's livability
initiative. These funds may be used by states, partnerships of local
governments, businesses and civic groups to develop and pursue smarter
growth strategies across traditional municipal lines. Without in any
way mandating solutions or telling local communities what to choose,
Regional Connections will define ``smarter growth'' to mean two things,
broadly speaking: first, more compact development in new growth areas,
and, second, coordinated reinvestment in already built-up and
infrastructure-rich areas (usually cities and older suburbs). Smarter
growth is not slow growth or no growth--but different growth, growth
back in, growth in support of livable communities.
Brownfields
The Department is proposing to double the funding for the
Brownfields Initiative to $50 million in fiscal year 2000. This will
accelerate the Administration's previous commitment to a four-year,
$100 million program.
Abandoned Buildings
Our Abandoned Buildings Initiative will turn ``Brown Yards into
Backyards'' by addressing some of the primary sources of blight in our
urban neighborhoods: abandoned apartment houses, single family homes,
warehouses, and even office buildings. As part of the Administration's
Better Quality of Life initiative, we are requesting $50 million in
competitive grants that will go to local governments to demolish
blighted abandoned buildings as part of a comprehensive plan to
redevelop properties for commercial or for residential use, while
safeguarding historic buildings.
Lead Paint and PATH
We are also proposing continued funding for Lead-Based Paint
Reduction and the Partnership for Advancing Technology in Housing
(PATH), at the same levels as the fiscal year 1999 appropriation.
the aging of america
The final challenge addressed by the HUD budget is the ``Aging of
America''. Just as we are committed as a nation to saving Social
Security, we must also ensure housing security for older Americans. HUD
is proposing a total of $747 million in fiscal year 2000--an increase
of $87 million--as well as changes in existing programs. These are
aimed at both increasing the supply of housing for America's elderly,
and improving the housing of those already receiving assistance.
We propose a comprehensive approach--a Continuum of Care--that will
enable our seniors to both obtain decent housing and access the
supportive services they need.
Healthy Homes for Seniors
This Continuum begins with helping seniors stay in their own homes.
Elderly residents are often house-rich and cash-poor. To help them get
the money they need to stay in their homes, HUD will expand and focus
its Healthy Homes for Healthy Seniors Initiative on the needs of the
elderly. Healthy Homes will allow seniors to convert the equity in
their homes into rehabilitation and property improvement loans through
HUD's reverse mortgage program.
Administrative changes
Because caring for our elders starts with the family, the
Administration has proposed a $1,000 long-term care tax credit to help
families meet the costs of long-term care for their relatives. HUD will
build on this proposal by allowing families who own apartments to rent
them to family members under the Section 8 program while retaining
appropriate safeguards against abuse.
Section 202
Finally, HUD will continue its commitment to the successful and
popular Section 202 Housing for the Elderly program with $660 million
in fiscal year 2000. The funds in fiscal year 2000 will expand non-
profit senior housing by an estimated 5,790 new rental units. We
propose that $100 million of the 202 funds will be used to convert some
existing elderly housing to assisted living facilities, with additional
services to help low-income frail elderly live as independently as
possible.
Elderly housing vouchers
We are also requesting an additional $87 million for 15,000 new
vouchers for extremely low-income elderly, to be used in projects using
the Low Income Housing Tax Credit. The Administration will shortly
submit legislation to authorize these additional subsidies.
conclusion
This is a reasonable, responsible and critically needed budget
request that will serve America's communities well as they take on the
challenges of the next century.
It addresses the needs of millions of Americans who, despite our
great national prosperity, do not yet have the affordable housing they
need or the economic opportunity to live in safety and security. Our
budget brings together HUD's programs in innovative, integrated ways
that will truly make a difference in people's lives and in the places
they live.
Mr. Chairman, with this budget, along with our management reform
efforts, I look forward to working with you and the Members of this
Committee to make the goal of decent housing and a suitable living
environment a reality for all Americans.
Senator Bond. Thank you, Mr. Secretary.
Because of scheduling conflicts, Senator Craig is going to
have to leave to meet the British Prime Minister.
So let me turn the questioning over to you, Senator Craig.
idaho fair housing complaints
Senator Craig. Mr. Chairman, thank you for that courtesy.
I have one question of you, Mr. Secretary. There are
others, but let me ask this one, because it is the one most
perplexing in my State of Idaho right now.
You have mentioned fair housing and fair housing
enforcement. Let me run you through a scenario that we are
finding ourselves in conflict with right now in Idaho that is
causing some real problems. In 1988, Congress passes the Fair
Housing Act. In 1991, Fair Housing amendments go into effect.
In 1991, HUD publishes Fair Housing guidelines, makes
points that they are not mandatory. In 1996, HUD releases
manual with disclaimer that the regulations were not accurate
or complete, and I have looked at the manual and it is printed
right in there. In 1998, Idaho, the first 25 complaints filed
by the Idaho Fair Housing Council. In 1999, an additional 52
complaints filed.
Here is the problem we have, one of our builders and
property owners has settled, all the rest are fighting it, and
they are fighting it on this premise, but when these were built
there were no guidelines, or there were no specific guidelines,
or there was no educational program, or an admission within the
manual that they were not accurate or complete.
Now, based on a contract with the Idaho Fair Housing
Council, they are out filing complaints and fines are being
slapped on these builders. The builders are saying, ``Wait a
moment. Why do you not just come to us and show us the problem
and we will correct it, instead of fining us, because we
operated under the law, and the law was not clear?'', and HUD
admits it was not clear, and it is kind of like ``We do not
give a darn. We are going to enforce it.''
We have a big problem in Idaho, and I am not very happy,
because I know most of these builders, I have met with them, I
have worked with them, and they said, if we have problems, we
will correct them.
Interestingly enough, no one filed a complaint until you
put a contract out and somebody needed a job, and that is how I
am reacting, and we created an Idaho Fair Housing Council, and
they went out around the state with a fine-toothed comb. Up
until that time, by a very cautious and careful check on the
part of my staff, there were no complaints.
Nobody had felt discriminated against, and in one instance
where it occurred, it was corrected immediately so that there
was full access. But none of our disabled people had felt they
had been denied access.
Now, the initiative says we are going to walk through it
with a fine-toothed comb, and our builders are saying, wait a
moment, if you point it out, we will correct it, but do not
come in here like a gestapo and slap us with complaints and
fines and say we will meet you in court, because the builders
are saying, fine, we will meet you in court, and when that
happens, Mr. Secretary, it compounds the costs, and we have a
lot of builders saying, why should we ever get involved again?
If the government is going to do this, why should we get
involved in constructing these kinds of facilities, if this is
the relationship that is existing.
The reason that is of a concern to me, Mr. Secretary, is
Idaho fortunately is one of those growth states. Our economy
has been relatively robust. We do not have the inner-city
problems that you face and have dealt with. What has happened
in a robust growth economy is that property values go up,
people of lesser means cannot find housing, because the housing
prices price them out of the market, as people come in for the
jobs and can afford to buy these houses and fix them up and
improve them.
So we have a need, a need in Idaho for low-income housing,
but we have a building community today that is saying, what the
heck, if this is the relationship, we will have no
relationship, because we can go out and build an apartment
building and get a much greater return, and not have to worry
about the hassle. There is the problem. How do we deal with it?
Secretary Cuomo. Well, Senator, first, two quick points,
and then I will ask the Assistant Secretary if she has any
specific information on this. I share the Senator's concern.
We are trying to attract private-sector builders to HUD
programs, and many of them come dragging one foot, because they
are a little afraid with dealing with government and getting
involved with the regulations, et cetera, so we do not want to
make the experience an uncomfortable one.
As the Senator poses it, I would agree with the Senator,
that you cannot change the rules once the game has begun, and
if HUD was unclear about the rules when they began the game,
you cannot then come back and say, well, we have decided
retroactively.
I would ask the Assistant Secretary if she has any specific
information on this case.
Ms. Plaza. Yes. I thank you, Mr. Secretary, and thank you,
Senator.
First of all, let me make clear that the Fair Housing Act
is administered fairly. Fairness is part of the game, and as
part of the requirements in the Fair Housing Act, we are
required to enter into conciliation efforts with the builders
or with any respondent that is being complained about under the
Fair Housing Act.
The law has been in the books for 10 years, and there is
some uncertainty, and as a result, we are going around the
country, and specifically we have gone to the State of Idaho
and Seattle, in that area, your area, to conduct many seminars
on the requirements of the design manual and accessibility
requirements.
We are not out to play ``gotcha'' at all, even though we
are emphasizing enforcement under this Administration. I can
tell you about a number of seminars that we have sponsored and
many education efforts that we have sponsored in the State of
Idaho.
I am familiar with the complaints. The Council that you
mentioned, the Fair Housing group that you mentioned, is
entitled to file these complaints when they find that certain
buildings violate the Fair Housing Act.
We do not always take all of the complaints that are filed.
Of those we do take, we look at them very, very carefully to
determine whether we have jurisdiction, and then beyond that,
we investigate the case, and we sometimes get the parties
together and have the whole issue resolved through
conciliation. We are not out to get any builders, we are not
out to get any of the industry.
Senator Craig. Well, I thank you for that explanation. Two
years since your initiative was aggressively started, 77
complaints. Now, that is big for Idaho. It may not be big for
New York City or a large area, but that is very big for Idaho,
and we have checked prior to that, none.
Now, that does not mean there were not problems, and I am
not willing to say there were not, but I have checked this
personally, because of the outcry from folks who are just
simply saying, look, we are not being treated fairly here, if
we had known the difference and it were clear.
Education is a part of that responsibility, and as I have
said, I just checked last night before the hearing how many of
these complaints have been settled. One in 2 years. The rest of
them are ongoing, and my builders say that they feel they are
being mistreated, and they are going to fight it.
Now, many of them have gone on to correct the problem,
because they did not want to deny anybody access, but they are
going to fight out of principle, because the guidelines were
not there, or it was not clear. So I hope you will take another
look at this.
This is not good in a state that needs low-income housing,
as I have explained, and the very builders that will build that
are the builders that are walking away from it.
Secretary Cuomo. Senator, just so we are clear, because you
raised two issues. One is we do fund Fair Housing groups who
are charged with taking the law, and educating about it, and
enforcing the law, and I think they do a good service, because
many times people just do not know about this law. The second
issue is that we are retroactively trying to enforce a law
which was unclear, ambiguous, or did not exist at the time.
Senator Craig. It is the retroactivity that we are
frustrated over.
Secretary Cuomo. Yes, and I can see the Senator's
frustration there. I will look at it myself, and I agree with
the Senator, if we are retroactively enforcing a law which was
unclear or ambiguous, we should not be doing that.
Senator Craig. But as you know, in those instances, a
partnership works a lot better than a whip. Let us jointly
correct this together for the sake of the people who need the
service, instead of saying gotcha.
I know you say you are not doing that, but the fines that
are levied and the frustrations that are out there cause our
builders to think that way.
Ms. Plaza. I can understand that.
Secretary Cuomo. We will look into it, Senator, and we will
get back to you.
Senator Craig. I appreciate it.
Senator Bond. Thank you very much, Senator Craig. We are
very pleased to be joined by the Chairman of the Full
Committee. Is there anything that you wish to add?
Senator Stevens. No.
flat funding for section 8 renewals
Senator Bond. All right. You come at a very good time,
because we are about to talk about one of the most difficult
problems that we face in the appropriations process. I
mentioned it in my opening statement. Mr. Secretary, as we
discussed, the Office of Management and Budget is proposing
flat funding of $11.5 billion for section 8 contract renewals
for the next 10 years.
That comes out of their comparison, and policy, and
baseline. This means that low-income families, low-income
disabled, and low-income elderly will be put in a position
where they will lose their housing in the years to come. Just
taking the year 2001, the next year, the Administration
proposes $11.5 billion for section 8 contract renewals.
Nevertheless, under the Administration's own estimates, it
would require $15.6 billion for section 8 renewals' existing
contracts in 2001.
My question to you is: How many families will lose their
homes if we stay with the OMB budget request of $11.5 billion
for fiscal year 2001?
Secretary Cuomo. Mr. Chairman, the OMB director has stated
a number of times, unequivocally, that the Department's
position and the Administration's position is that it is
committed to renewing all vouchers that are there, period.
We share the same concern that the Chairman shares, that
the last thing we want to do is not be able to renew a voucher,
not be able to fund public housing, and the President himself
is committed to that, I can tell you that on firsthand
knowledge.
In terms of the out-year budgets, OMB will go on to explain
that there are a number of contingencies that they are working
through, primarily the one about the Social Security fix, and
once that is accomplished, there could then be adjustments on
other elements within the budget, but at the end of the day
they are committed to funding all the section 8 certificates.
Senator Bond. Mr. Secretary, the reason I asked this
question is because it has a great deal to do with the
commitments we made in this current year. The problem, the
challenge, the fact of life in housing is the commitments we
make this year have to be funded in future years, and we show
the need, when you go out to fiscal year 2008, 2009, you get up
to $26 billion, $27 billion.
Now, I do not know any Social Security fix or any Social
Security change that is going to impact the requirements for
renewing these section 8 certificates, nor do they change what
the President has projected in his request for the future. How
many families would have to be kicked out of housing if the
budget for fiscal year 2001 is $11.5 billion?
Secretary Cuomo. The position of OMB, Mr. Chairman, is that
the contingency would never occur, that they are committed to
making sure that all the vouchers are fully funded, all the
expiring ones, as well as the additional ones that we are
proposing.
Senator Bond. Mr. Secretary, are you telling me that they
have two sets of books----
Secretary Cuomo. No.
Senator Bond [continuing]. One of them they presented to us
and another one they mean?
Secretary Cuomo. No.
Senator Bond. This is the crux of the matter. Maybe Mr.
Gibbons could tell me, how many families would we have to throw
out if we had $11.5 billion in 2001? Mr. Gibbons?
Mr. Gibbons. I would have to go back and take a look at
that and provide that for the record.
Senator Bond. I do not want it exact. You can do the
figures. Tell me.
Mr. Gibbons. Well, it would depend on what year, but by----
Senator Bond. Fiscal year 2001.
Mr. Gibbons. It would be----
Senator Bond. 2001. We are looking at how many people on
October 1, 2000, would be dumped on the streets. The
Secretary----
Secretary Cuomo. None.
Senator Bond [continuing]. And I do not want to see that.
Secretary Cuomo. But Mr. Chairman----
Senator Bond. We are fighting an uphill battle.
Secretary Cuomo. Mr. Chairman, to be fair, almost without
exception during my tenure at the Department the relevant
budget discussion is always the immediate year on the table,
and the out-years always vary. I remember out-years where we
were almost zeroing out CBDG in the out-years, because there
were many assumptions, and maybe it is just being the HUD
Secretary, but I take it 1 year at a time, that is the relevant
year that is in discussion, and the Administration has said
unequivocably that in the out-years they are committed to
finding the funding, which obviously, Mr. Chairman, has to be
the position, because it is consistent with everything that we
have done and everything that we are saying we want to do.
Senator Bond. But Mr. Secretary, we got relevant yeared
this year. We put in 100,000 new incremental vouchers, and you
and I agreed that those will be fully funded. They are not.
This is the relevant year. This is the relevant year. We are
$4.2 billion short on--I mean on the 100,000 vouchers we did
not have a full amount provided in the budget, because----
Senate Staff. We funded $50,000 incremental----
Senator Bond. $50,000 incremental.
Senate Staff [continuing]. But the HUD budget has pushed
out $4.2 billion, because there is not adequate funding.
Secretary Cuomo. Just to be clear here, Mr. Chairman, when
you said in your opening statement that this year we fully fund
all the vouchers within the President's budget, we said we
would do that, and we did do that. This year they are fully
funded, with 50,000 from last year, or 100,000, depending on
how you count, but the incremental from last year and the
additional we proposed this year are fully funded this year.
Senator Bond. But that is fully funding for these vouchers
that carry over, have to be funded in fiscal year 2001.
Mr. Gibbons. Maybe I can sort of address this. We are
mixing two issues. With respect to the advanced appropriations,
the point is not correct to say that we will be postponing the
appropriation of $4.2 billion into the year 2001. The proposal
is that you would fully appropriate the entire $11.5 billion in
this budget.
That covers all renewals, including the incrementals from
last year, plus the 100,000 that we are requesting for this
year. It would fully fund those. What it says is, and it is a
bit of a misnomer to call it an advanced appropriation, it
says, having done that, we would delay the availability of $4.2
billion of those funds until October 1, 2000.
Probably the best way to demonstrate this is perhaps by
example. Suppose that a contract expires on April 1.
What the proposal would do is include immediately all the
funds necessary to draw down and pay for that contract up
through September 30, and then on October 1 the funds would be
made immediately available without any future appropriation, or
the period of October 1 through the next April, and then what
the Administration's proposal is, is that is repeated every
year.
Senator Bond. Well, the problem with that is, it puts us
farther behind, because we have traditionally provided at least
the full year of a contract. We are going to be in a position
where we will then have only $7.1 billion for expiring
contracts in 2001, if you push it off.
Mr. Gibbons. No. You are going to appropriate the entire
$11.5 billion, and that is important to emphasize, because to
the recipient, to the owners, and to the tenant, this becomes a
completely invisible process. Nothing changes. The terms of the
contract do not change, the period of the contracts do not
change.
The only thing that is happening here is we are making the
funds available in the remaining part of the fiscal year 2000,
and for the funds that will not be needed until the next fiscal
year, they will be made available on the first day of the next
fiscal year. In the past we have fully funded the contracts for
the entire year, even though it crosses 2 fiscal years.
Senator Bond. Right. My point is that we are making
commitments, as tough as this year's budget is, we are
struggling to fund what we already have committed, and if we
push off the $4.2 billion to the next year, to fiscal year
2001, that is why I am asking, we will have more, significantly
more, section 8 contracts expiring than we will be able to fund
with the $11.5 billion that is projected by the President's
Office of Management and Budget.
Secretary Cuomo. Mr. Chairman, I think we are going past
each other here. You would appropriate the full amount this
year to renew all the expiring contracts. We would not draw
down on the amount we need for next fiscal year until the next
fiscal year, but you would have appropriated the full amount.
Mr. Gibbons. Yes, that is absolutely correct; otherwise, we
could not legally make a contract for a whole year, but the
fact is that you will fully appropriate these funds.
Senator Bond. Yes, but we are having to appropriate it out
of the 2001 funds.
Mr. Gibbons. But you do the same thing next year and in
each subsequent year, and if you look at the out-years, you can
see that there is $4.2 billion that is rolled each year, so you
are basically doing this every year from now on, so the net
effect is no change in the out-years. This has no impact on the
availability of funds in the out-years.
Secretary Cuomo. Mr. Chairman, let me say it this way. What
we have done for the first time is we have justified the period
of the section 8 with the fiscal year. Instead of paying for a
section 8 contract on its own annual basis, which may cross
fiscal years, we only pay for the amount of that section 8
contract which is in that fiscal year, which goes to September
30.
Senator Bond. That is correct. When I came here we had
funded the section 8 contracts on a multi-year basis, and we
have taken on more and more responsibilities----
Secretary Cuomo. Yes.
Senator Bond [continuing]. And the problem is we are caught
in not just crack, a chasm that is getting bigger, because
these numbers get to be huge, and I just want to go--just so we
can figure out how many section 8 are at risk, I would like to
know how many section 8 contracts--would there be a shortfall?
How many section 8 contracts would we not be able to fund in
2001 with the assumption of $11.5 billion for fiscal year 2001?
Mr. Gibbons. In 2001, we do not think that there would be
any shortfall in 2001.
Secretary Cuomo. Just to stay with the Chairman's point,
Mr. Chairman, I think what we, as you correctly stated, section
8 at one time were 10 years, and 5 years, and then that went
down to 1 year----
Senator Bond. Now we are going down to part of a year.
Secretary Cuomo. Well, now what we have said is, basically,
yes, we will only fund that amount of a section 8 voucher which
we actually have to pay for in that fiscal year, and the amount
of that voucher for the next fiscal year we will pay the next
fiscal year, yes, but we are paying for the full price of that
section 8 voucher this year. We would be deferring costs until
next year the other way.
Senator Bond. Well, there is a difference between the
budget authority and the outlays, and the outlays obviously are
going to occur in 2001.
Secretary Cuomo. Yes.
Senator Bond. The budget authority you are putting the
budget authority on a current basis, and saying you are only
making the budget authority, but what I want to know is how
many vouchers--there is a difference of $11.5 billion versus
$15.6 billion. That is $4.1 billion in budget authority. If you
are rolling that over into fiscal year 2001, then are you not
short--you start to work with $7.1 billion in 2001.
Secretary Cuomo. The outlays are actually the same. We are
outlaying what we would outlay. The BA, we are only spending
the BA this year that we need for this year and the BA for next
year, starting September 30, from now on, would be paid next
year. Then where do we get the BA in the out-year, that is
where the Administration says they are committed to funding the
BA.
Senator Bond. Yes, but I mean their projections make the
totally unrealistic assumption that you can hold it at $11.5
billion, and we all know, looking at the BA needs, that that
figure is shooting up, and we are facing a train wreck. How
many section 8 vouchers, full-year section 8 vouchers does $4.1
billion fund?
Mr. Gibbons. Well, vouchers run about $6,000 a piece.
Senator Bond. Okay. So you have a paper and pencil there. I
know you are quick on math. We will just sit here and wait. Mr.
DeCell is back there, he always sends letters to me, Mr. DeCell
is a wizard at math. Somebody just give me the figures.
Secretary Cuomo. Mr. Chairman, while they are doing that, I
do not understand the contingency. If the Administration did
not find the money in 2001.
Senator Bond. This is the budget. We are trying to figure
out what commitments we can make this year that we can continue
next year, because I am very much concerned, as I have pointed
along. Mr. Gibbons, the number is?
Mr. Gibbons. The $4.2 billion continues to roll over, so
next year's funding level for this program is still $11.5
billion, even by the OMB estimate. It is not $7.3 billion. It
is $11.5 billion this year and it is $11.5 billion next year,
and part of that $11.5 billion is the roll-over of the $4.2
billion. That occurs each and every year.
Senator Bond. Yes, but you have already rolled it over. You
have already rolled it over in----
Mr. Gibbons. You will roll it again. You would roll it
again.
Senator Bond. You have already rolled it over to 2001.
Mr. Gibbons. You keep rolling it every year.
Senator Bond. You rolled it over at $11.5 billion, so
actually you have taken advantage of that roll over. You were
using up your cushion in 2000.
Mr. Gibbons. You keep rolling it. Every year, if you look
at the out-year estimates, every year shows about $11.5
billion. Part of that is a roll-over of $4.2 billion. So $4.2
billion is fully funding those contracts every year.
It is a different issue as to whether--well, your first
question was whether $11.5 billion was enough, but the $4.2
billion is in the budget every single year, so there will be no
reason why those vouchers would not be renewed.
Senator Bond. Yes, but you have the $4.2 billion, it is
rolled over from 2000 to 2001, means that you cannot get
another $4.2 billion by--you had used up that $4.2 billion when
2001 rolls around, so you have $15.6 billion in expiring
vouchers, and only $11.5 billion. What is the number? How many
section 8 certificates is that?
Mr. Gibbons. That is a different question. It has nothing
do with the $4.2 billion, per se.
Senator Bond. No, but I would say it is a difference
between what is recommended and the need. What is that? That is
a different calculation. You are dividing $6,000 into $4.2
billion.
Mr. Gibbons. That would be around 8,000 units.
Senator Bond. How many?
Mr. Gibbons. It is 7,000 units.
Senator Bond. Seven thousand? No. No. You are losing a
couple of zeros. If you divide 6,000 into $4.2 billion----
Secretary Cuomo. Mr. Chairman, if you would like----
Senator Bond. No, no, this is simple. I mean we have to--
can somebody do math? Can somebody do math? Six thousand goes
into 4.2 billion a lot more than 7,000 times.
Secretary Cuomo. About 80,000.
Mr. Gibbons. Seventy thousand.
Senator Bond. Try it again. This may be a problem. We may
be--all right. How many times does $6,000 go into $4.2 billion?
Seven sounds right. How many zeroes does it have? There is a
voice in the back. Voice in the back.
Secretary Cuomo. 700,000.
Senator Bond. 700,000. Thank you very much. Okay. Seven-
hundred-thousand vouchers are at issue here, and that is what
we are worried about, that is why--we have 700,000 vouchers
that are at risk under these long-term budget projections, and
if we were to add more incremental vouchers, we would increase
the number of existing vouchers at risk. That is my point, Mr.
Secretary. We have not accounted for the needs of these
expiring vouchers and the significant increase in budget
authority needed to accommodate them.
Secretary Cuomo. Mr. Chairman, you have lost me along the
way, because the $4.2 billion, this economic adjustment for
this year would continue every year on the out-years----
Senator Bond. Right.
Secretary Cuomo [continuing]. And, therefore, the $4
billion, or whatever the number is, would never really come
due, because you would continue to roll it forward, and the
Administration has repeatedly said in the out-years they are
committed to funding all expiring, and we also know that the
out-year budgets are only projections that get modified, and we
also know that this year, especially with the budget caps and
the pressure we are under, and contingencies like Social
Security out there, the bank on the out-years at this point I
think would have too many variables to come up with any
reasonable conclusion.
Senator Bond. As much as I enjoyed this, I am going to turn
to my ranking member and the Senator from Iowa, but I would
make the one simple point. You can further squeeze the BA
requirements by rolling over the BA to the actual year that it
will be expended, but you can only get the benefit of that roll
over one time.
Secretary Cuomo. That is correct.
Senator Bond. If you get the benefit of it in 2000, you
cannot get the benefit of it in 2001. That is where we hit the
wall. That is the kind of question that you and we have to
resolve before we make commitments for more programs that will
be more expensive in out-years, and that is where we have to do
the work. Maybe for clarification and for such enlightenment I
now turn to Senator Mikulski.
Welcome, Senator.
STATEMENT OF BARBARA MIKULSKI
Senator Mikulski. Thank you very much, Mr. Chairman, and I
apologize both to you and Secretary Cuomo. I had to attend a
very important NATO ceremony with the Polish Prime Minister and
then attend the meeting with the Prime Minister of Great
Britain, Tony Blair.
Mr. Chairman, in the interest of time I am just going to
ask that my opening statement be included in the record----
Senator Bond. Without objection.
Senator Mikulski [continuing]. As if I were here on time.
Mr. Secretary, let me just go to some questions that I
would like to focus on, and let me tell you what they would be.
I would like to focus on HOPE VI, on housing for the elderly,
and then also what success we might have seen from
Brownfield's, or it is too early to tell. In the interest of
time, and if it runs out, then perhaps we can go to a second
round.
hope vi
HOPE VI, as we know it has probably been one of the single-
most important tools to deal with the concentration of poverty
in our high-rise public housing. However, now that we have had
HOPE VI for several years now, I would like to ask you, number
one, what success do you think we have had from this program,
and give you then three questions.
My three questions really are: Number one, not only what
have we accomplished on the policy objective side of HOPE VI,
but as really the originator, I am concerned about the cost of
HOPE VI. The projects seem to be very expensive, more expensive
than if we essentially gave vouchers to the poor.
Number two, I am concerned about the fact that the
demolition of the public housing, that all we have done is just
take vertical concentrations of the poor and through the way
that we have handled the moves of the people who are in it,
just done horizontal concentrations of the poor, often
destabilizing neighborhoods on the basis of social class, and
then number three, there also seems to be an issue around the
fact that there seems to be a small number of developers who
are continually winning the HOPE VI contracts, and there are
those that are concerned that we have essentially an oligopoly
growing up of developers.
So tell me about the money. Tell me about, is HOPE VI
really now becoming a hollow opportunity, that for all of that
money we spread sieged neighborhoods, distressed neighborhoods,
and all we are doing is creating more siege, rather than
stability, and then also the competitive bid process.
Secretary Cuomo. Senator, thank you very much for the
opportunity to talk about this. I am very excited about what we
have done here and what the Senator has done by starting this
HOPE VI. We are actually on to something I think for the first
time in the history of public housing.
What HOPE VI said was, let us demolish the bad and rebuild
the bad, which was the right intention and the right idea. One
of HUD's problems was, we had no good way of really separating
the good from the bad. We have now put a full system into
place, where we were actually inspecting public housing.
The HOPE VI program basically said let us demolish the bad.
HUD's first problem was, we did not have a good way of telling
the good from the bad. We have since put in a full system in
place, physical inspection, audits, full rating system for
public housing for the first time ever. We just got the first
sample back on the physical inspection. Eighty-seven percent of
public housing was actually, once inspected, in good or
excellent condition. These were by outside, private-sector
contractors.
So we know what is good, we also know what is bad, and then
HOPE VI says demolish the bad and rebuild. We will meet the
goal of about 100,000 units we think by 2003, which was the
initial goal of HOPE VI. On the cost of HOPE VI I share the
Senator's concern----
concentrations of poverty in public housing
Senator Mikulski. Wait a minute, Mr. Secretary. The issue
around HOPE VI was not the condition of the buildings, but the
condition of the concentration of poverty in the buildings.
Secretary Cuomo. Yes. Yes.
Senator Mikulski. That is what I want you to focus on.
Believe me, modernization, safety of architecture, but it was
not the physical architecture that was so troubling that led to
the HOPE VI, it was the concentrations of poverty.
Secretary Cuomo. Okay. Then let me get to the third point
of the three-part question that the Senator asked; the
concentration of poverty. I checked the numbers after our
previous conversation, and you were right, Senator, my initial
impression was actually wrong.
We do not now have a prohibition against the concentration
of section 8 vouchers in the neighborhood, and I went back and
checked after our conversation, and there is a logical misstep,
in my opinion, upon our review.
We do have prohibitions against the concentration of public
housing construction. You cannot go into a neighborhood that is
overly concentrated, your term was saturated, and build more
public housing.
We specifically say if a census track has a high
concentration of assisted households, you cannot go in and
build more public housing, because we do not want to
concentrate. We do not have that same requirement when it comes
to section 8.
So you could bring in more section 8 tenant vouchers into a
neighborhood, overload, saturate, overly concentrate a
neighborhood with section 8 voucher holders, and it does not
violate any HUD regulation or any HUD planning guideline, and
that is what has been happening. I enjoyed the Senators analogy
of the vertical/horizontal.
We went to deconcentrate, but in the effort to
deconcentrate we may have just reconcentrated. This is only in
the past couple of days, prompted by the Senator's
conversation, but we are now going to go back upon our review
and come up with a regulation which mirrors the public housing
regulation, the goal is not to reconcentrate a different
neighborhood, and we would pass a regulation and put out a
notice for comment, because there is going to be a lot to
discuss here, but that says you cannot use section 8 tenant
vouchers to overconcentrate an area, period, let alone in an
effort to deconcentrate a previously concentrated area. I think
that will get to exactly the Senator's point about what has
been happening with the----
Senator Mikulski. Well, I want to be very clear on where I
would like you to go. First of all, number one, we want to
acknowledge that if someone has a section 8 voucher that in the
United States of America they can go anywhere with that section
8.
Secretary Cuomo. Yes.
Senator Mikulski. So we want to affirm essentially the
concept of individual freedom and mobility. Number two, we want
to honor and respect all Fair Housing laws, so that whatever
regulations come, we do not in any way inhibit individual
choice and also our legal framework of fair housing.
Number three, we want to make sure it is not a hollow
opportunity for the poor, that it is not a hollow opportunity
for the poor.
Let me say this about HOPE VI. I would have thought that I
did not have to prescribe every single thing in law for you,
when I say you, I mean HUD, to think about the next steps. When
we knew that a building was going to come down, the people were
going to go somewhere. Obviously, nobody thought about that
consequence. I did not think we had to be that prescriptive or
micromanaged. Now that I am raising this issue, I am sure that
there will be a consequence to that regulation.
So before you are quick to think that you are satisfying
me, what I am looking for is opportunity for the poor, and that
there is no Federal program that stabilizes neighborhoods, and
that is what has been happening.
Either we have public housing, which concentrated poverty,
we have private-sector apartment holders and inner-beltway
communities that just took buckets and buckets of section 8 and
created another form of public housing, but what did both the
poor and the taxpayers who wanted to help the poor get for our
money?
Now that we have raised this issue, which obviously had
never been raised in HUD before, I want you to really focus on
this, because I believe you agree on the same public policy
objectives, but do not just come out with a quick reg to think
you are going to satisfy me.
The question is: How can we make sure that the poor have
hope and opportunity, and that we play a role in taking sieged
neighborhoods and moving them into stability, not spreading
siege to stress, and I am concerned that we are spreading siege
to stressed neighborhoods and putting them into siege
categories. I am using thematic language, and I do not want to
be the prescriptive micromanager.
Now, I gather you are going to do a careful examination of
this. Number two, you are going to come up with a strategy and
a framework for regulatory change, again, meeting the test of
fair housing.
When can we look forward to hearing your analysis and what
you think you would like to do, in consultation with mayors,
the National Association of Counties, civil rights groups, as
well as grassroots community organizations?
Secretary Cuomo. Senator, I would like to have a paper to
you first, and I would like to have that done within several
weeks, because this is a complex issue.
Senator Mikulski. Very.
Secretary Cuomo. Just so you know, Senator, it is not that
this was a concept that was totally missed. What has actually
happened, and again, this is only on 2 day's conversation, but
we could not tell you, because we did not have the technology a
couple of years ago exactly where the vouchers were being used
by census track.
We just did not know. We could stop the construction of
public housing in a concentrated neighborhood, because we knew
where the buildings were, but we did not know where the section
8 person was going with that voucher.
We now have improved the technology, we have improved our
information. We can actually tell you now where all these
section 8 vouchers are.
Senator Mikulski. Well, I appreciate that. Remember, when
we started the conversations on HOPE VI, we wanted to eliminate
what I called Zip Codes of pathology and create Zip Codes of
opportunity. So let us hear now about the costs and also
competitive bidding.
total development costs
Secretary Cuomo. I share the Senator's concern that the
numbers on HOPE VI are apparently high on some projects, and we
discussed this last year, and we have actually done quite a bit
to reduce the costs, and for the first time we have cost
limits. We have something called the TDC, Total Development
Costs, where we say this is a cap, if you will, no how much we
are willing to spend on the reconstruction of a unit.
One quick caveat, sometimes, Senator, these numbers are
somewhat deceiving, because it is not apples and apples. You
will hear numbers that it cost $200,000 to build a HOPE VI
unit. That may be technically correct, but it is misleading,
because it is not apples and apples.
When you go to do HOPE VI, you have a very high
deconstruction or demolition cost, because you have to take
down the old building. You very often have a very high
abatement cost for Brownfield's problems. You often are
building community service centers, parks, et cetera, which get
added to the cost of the housing, but really they are separate
costs, they are community development costs rather than housing
unit, per se, costs.
With that caveat and that stipulation, we have put in place
for the first time total development costs. There are caps on
how much we can spend. We did it in collaboration with our
partners, our stakeholders.
Elinor Bacon, who is a Deputy Assistant Secretary, who has
done a phenomenal job on this, is now working on the next level
of cost control, which is what they call ``soft costs,'' which
will actually go below the total cap and say we now want to
talk about the attorney's costs, the accounting costs, the
tenant costs, and we will come up with caps on those sub-costs,
if you will.
On the number of developers we had a conversation from our
first conversation, Elinor Bacon has a whole plan in place to
reach out, to bring in more developers. We do not want to have
a captive audience or a captive industry. We are working with a
number of groups, Urban Institute, different building groups,
AIA, APA, and we want to get as many private-sector developers
as possible competing to drive down these costs, and we will.
Senator Mikulski. Well, thank you. I know that my time is
up. The issue around the developers came to me through other
people who raised this as a yellow flashing light. I am not
sure who they are or what they are, but you should be aware
that that was a concern, and like anyone else, a good set of
requirements and competition always works in the marketplace. I
will go to my senior housing in my second round.
Senator Bond. Thank you, Senator Mikulski.
Senator Harkin.
statement of Tom Harkin
Senator Harkin. Thank you, Mr. Chairman. Mr. Chairman and
Mr. Secretary, I want to just cover some things dealing with
rural areas.
rural housing and economic development
Mr. Chairman, last year this subcommittee provided a new
initiative, which I thank you for, the $25 million in rural
housing, which you put out, of which $4 million of that went to
Iowa. Just last weekend I was out visiting some of these
projects, the rural housing that had been built with this
money, and, again, I want to thank you, Mr. Secretary, for what
you have done with this, because your office in Kansas City has
just been really great about pushing this program.
The money that we have gotten in Iowa has been leveraged up
to five times, five times, with Fannie Mae Foundation, with
local banks, I think with Farmer's Home Rural Development, and
the Iowa Department of Economic Development. Five times.
So I was seeing some of this housing built in these small
towns, so families that I have seen moving into these new
houses with maybe as much as 60 percent of median income now
becoming homeowners, and I have to tell you, to see the look on
their faces, many times single mothers with two or three kids,
they do not have much money and now they have a home that they
can call their own. It is just an incredible thing that is
going on out there.
I would like to invite you out there to take a look at it,
because they are really doing good stuff out there. I do not
know what they are doing in Missouri, or whatever, in other
states, but I can just tell you in Iowa they have leveraged
this money up to five times and it is doing a great thing.
So I just wanted to tell you that, and as the Department
considers grant applications for the Office of Rural Housing
and Economic Development I hope we will see a real priority for
proposals that provide for home ownership in small towns, where
they can take this money that we allocated and really leverage
it up. So I hope you take a look at what we have done in Iowa.
I do not know if we are unique. I have not been in other
states, but it just seems to me they have done it, and they
have done it in a short period of time. So whatever is
happening out there, I hope you will take a look at it and give
some priority to this in small towns. We need that housing out
there.
Now, secondly, I was listening to your exchange with
Senator Mikulski on section 8, we have a real--whatever
problems you have in urban America, we have them in spades in
rural America in section 8 housing, Senator Mikulski. Vouchers
do not work too good in a small town, because you have a lot of
these elderly people living in these small towns, they are in
these section 8, they have no place to go. So a voucher just
does not work for them.
We are losing a lot of the section 8 housing in Iowa. I
have talked to some of these people. You have people who have
been paying up to 40 percent, and these are people in their
seventies. The only income they have is Social Security. They
have nothing else. Eighty percent of the elderly people in Iowa
exist only on Social Security, and the average Social Security
check in Iowa is around $700 a month. You go figure. They are
paying up to 40 percent.
The housing, as opted out, I have talked to them, now they
are up to 60 percent of their monthly income going to rent.
They have no other place to go. You can give them all the
vouchers you want, unless they move half-way across the state
or go to Davenport, or Des Moines, or someplace like that, and
then they are away from their kinfolks, their families, and
stuff like that. So I really think and hope that you will do
some real targeting, the projects. Now, I am not very cognizant
of what is happening in some of the urban areas. I leave that
to my friend and my colleague from Maryland, and others, but I
can tell you about rural America, and these small towns, and
somehow we have to start targeting in these areas. I do not
know if you can do it administratively, I hope you can, and if
you can comment on that I would sure appreciate that.
Secretary Cuomo. Yes. Senator, first, thank you for the
words about the rural housing and economic development
initiative, it is something we are very excited about. It is
going very well in your state. We have a good team of what we
call community builders out there who are people who work with
the local governments, work with the state government, and that
is working well.
The problem you point to, we discussed it earlier, we
called it the opt out problem, it is, in my opinion, the
housing crisis for this year. These are buildings which were
under contract with the federal government----
Senator Harkin. I understand.
Secretary Cuomo [continuing]. For about 20 years----
Senator Harkin. I understand that.
Secretary Cuomo [continuing]. Different terms.
Senator Harkin. I understand that.
Secretary Cuomo. The contracts are expiring, the owners are
now saying we may opt-out of the program. They tend to be
opting out of the program where they have better buildings,
frankly, where they can go on the market and make more money.
Those are precisely the buildings we want to keep.
Our answer has been, ``Well, do not worry, we will give the
tenants a section 8 voucher, and they can go find an
apartment,'' but that is not enough, frankly, because a lot of
the tenants are elderly, they do not want to go out on the
market and find an apartment, they cannot find an apartment for
the rent that the section 8 voucher pays, and it is just a life
crisis for them.
I think we have to go at it two ways. One is we need a
systemic solution for these opt outs, where we can go to the
table with these owners and say, I want to renegotiate, and
where it is a good building that we want to keep in the
inventory, we have to be in a position where we can negotiate
with the owner and keep that building in the inventory, and
figure out a way that we do not have to go through this every
year, because this is such a tumult on the tenants.
We have a legal, or maybe a statute, or a regulation that
on an annual basis the landlord is notifying all the tenants
that their lease may be up at the end of the year, which just
gets all the tenants in an uproar on an annual basis.
We need to be able to negotiate with the owner, we need to
come up with a longer-term contract so we do not go through
this every year, and we need to keep the good buildings in the
inventory.
fair market rents
At the same time, we have to make sure that the section 8
vouchers do work everywhere, and that they are paying an amount
where you can actually get an apartment in those circumstances
where you must.
This gets into something called the fair market rent, how
much the voucher pays, and we are working through that now, but
there are too many instances right now, frankly, where the
section 8 voucher does not pay what it needs to pay to get an
apartment in an area where we want the person to live.
Senator Harkin. I appreciate that, and that is true. I know
about the FMRs, but keep in mind, and this may be somewhat
unique to Iowa, but I think it is true of a lot of the rural
states. We have a disproportionate portion of elderly living in
small towns.
They are in these section 8 houses, and they are pretty
accessible for elderly, but if they get a voucher, even if they
get the FMR, and they have to go to another place, usually
those apartments are not that accessible, they have a lot of
stairs, or upstairs someplace, that they are just not that
accessible in small towns.
I mean you have to get out of your mind that we are in an
urban area. These are these small, little towns. So they are
just not really a kind of a place where these elderly people
can go.
Maybe it is a little bit unique to Iowa. I do not know. We
have the highest proportion of the elderly over the age of 80,
and second only to Florida in over 65, so perhaps we are a
little bit unique, but I can tell you that in these small
towns, the FMRs just will not work either, you know, that 40
percent thing, where you are talking about giving them 40
percent of the fair market rent for the area like that.
In some cases it might work, but in a lot of these cases it
just does not work. So I do not know, if you are going to be
talking to section 8 landlords and getting them to renew their
contracts, obviously, it is going to cost you some money.
You do not have a lot of money, so I am asking you to look
at targeting, and to think about some things, Mr. Secretary,
where you say, okay, let us look at areas where we have very
low vacancy areas, we have rural elderly projects, in which
there is little in the way of alternative or appropriate
housing, and sort of build that into some kind of targeting. If
you cannot do that administratively, I would like to know and
maybe we ought to do something legislatively, if you cannot do
it administratively.
Secretary Cuomo. I agree with the Senator's concerns 100
percent. Within the next couple of weeks, we are actually going
to have a plan exactly on this problem, because as it is
unfolding it is getting worse. I agree with the Senator's point
about the targeting, and we do have to have some targeting. The
elderly are in prime rural areas where there is not an
alternative.
But we also have to be careful the way we do this, because
this becomes a negotiation with the owners, and we cannot be in
a position where the owners believe they have us over a barrel
either, and we have no choice but to renew the contract,
because then our negotiating position just went out the window,
and we will wind up in a position where it is not a negotiation
at all, it is one-sided, and we are going to have to pay
whatever they demand, and we do not want to be in that
position, also.
Senator Harkin. I agree. I agree.
Secretary Cuomo. It is a tricky situation, but I hear what
the Senator is saying 100 percent. We are aware of it. The
Administration is aware of it, and we will have a full proposal
that meets the needs nationwide, and the particular needs in
your state.
Senator Harkin. Thank you, Mr. Secretary.
Can I get one more in?
Senator Bond. Sure. Quick.
Senator Harkin. Thank you, Mr. Chairman.
Senator Bond. It has not turned red yet.
housing for the disabled
Senator Harkin. All right. Housing for the disabled. The
disability community is very upset, Mr. Secretary, over the
limited support for housing assistance. The need is very high.
The funding has dropped considerably from its funding levels in
the early 1990s for the 811 program.
The Consortium for Citizens with Disabilities did an
analysis of the loss of housing for the disabled, because of
the elderly only designation passed in 1992. They found
considerable housing units being lost from 1993 to now. I
understand that HUD is doing an inventory of the losses for
assisted housing for the disabled.
You do not have to tell me now, but if you could just get
to me the status of the study, and please have HUD take a look
and make available to field offices and disability advocates
the specified and specific assisted housing projects that have
changed their tenant selection policies to not include the
disabled.
I do not know what more can be done, but if you have any
more ideas on what could be done to help the disability-
oriented non-profit organizations, and there are some out
there, to compete and administer these housing units in a
quality fashion, what more can be done to help these non-profit
organizations compete and administer these housing units in a
quality fashion.
It has to do with, I am hearing from disabled groups saying
that under the 811 program, because of the elderly-only, they
are losing a lot of this, they have lost a lot of the assisted
housing units. How many, we do not know. I hope you can do an
inventory and tell us.
[The information follows:]
Loss of Units for the Disabled
The Department has designed a study which will examine the extent
to which the privately-owned assisted stock serves the non-elderly
disabled. It will also detail the way in which non-elderly people with
disabilities access the assisted housing stock in 10 housing markets.
The contract for the study is expected to be signed be the end of July
1999, with results available approximately one year later.
Senator Harkin. And second, can you develop some better
criteria or are you in the process of doing so to get these
non-profit groups out there better able to compete and
administer these?
Secretary Cuomo. Senator, we were in the midst of doing
both. I will get to you the study of the numbers as soon as
that is ready, but that should be ready almost imminently. I
agree with the concern, I have met with the disabled groups. We
have the 811 program, it is $194 million. We proposed to
continue the funding at $194 million.
I would very much like to be able to say, Senator, we will
put more money in the 811 program, but as the preceding
conversation with the Chairman would suggest, I think he is
trying to suggest to me that money is a little tight this year.
I am starting to get that general hint.
Senator Bond. Mr. Secretary, I am glad we are kind of
reaching that conclusion, and if you would, provide for Senator
Harkin and us your full answer to that, we are faced with a
vote coming up fairly shortly, and we are going to try to get
in a couple more rounds, go as quickly as we can on this, but I
do want to follow-up on Senator Harkin's question on the opt
out.
opt-outs
We appreciate the practical problems, but there have been
some confusion over the authority and the ability of HUD to
deal with the opt-out problems. I am a little confused about
Mr. Apgar's testimony before the House Appropriations
Committee. He did seem to indicate that the Department has the
authority and funding through a tenant protection appropriation
that could be used to resolve it, and I would appreciate
knowing whether HUD has the authority to resolve the opt-outs,
which are vitally important, particularly in rural communities
with limited housing supply.
Is there authority in the appropriations account, or is
there authority as part of the existing mark-to-market
legislation, which really is the flip side of the opt-out
problem. Do you need more authority? We have to get it
resolved. You need authority one way or the other.
Secretary Cuomo. Mr. Chairman, thank you very much. You are
right, this is the flip side of the mark-to-market crisis, if
you will. If you remember, last year, and the year I was
confirmed, the big crisis was the mark-to-market, and we had to
address that.
We addressed that crisis, and now we are on to the next
one, which is almost the flip side. As this is unfolding, Mr.
Chairman, it is getting worse, and the pervasiveness of it is
now starting to communicate itself.
Section 8, Senator, is normally an urban problem, inner
cities. We are hearing from everyone all across the nation, and
the number of landlords who are now considering opting-out, is
increasing, my own theory is, as the economy is getting better.
Senator Bond. Mr. Secretary, let us move on to the
authority issue.
Secretary Cuomo. Let me ask Commissioner Apgar if he would
like to respond.
Senator Bond. Excuse me for interrupting. Can you do it?
Mr. Apgar. In the mark-to-market legislation it did provide
our capacity to raise rents under certain circumstances, that
is correct, but as the Secretary mentioned we need a
comprehensive approach, otherwise, we will just get in a bad
negotiating posture with the property owners.
We estimate that fully marking-up all the inventory to
market across the board would require about $600 million to
$800 million worth of research this year and every year out in
the future. So obviously that is a non-starter.
We have to think about a way to target the resources toward
the appropriate cases. We need to have other tools that we do
not have authority for to complement this, for example, to take
the tenant issue off the table by making sure that we have
enhanced vouchers, so we are not debating whether or not we are
going to be throwing tenants out or not, that we have the
authority to give enhanced vouchers for residents everywhere.
We need to talk about this renewal issue, whether or not we
can do something around the multi-year renewal without
committing funds. So there are elements for which we have
authority for and elements which we need authority for.
Senator Bond. Do you need additional legislative authority?
Secretary Cuomo. Yes.
Senator Bond. When will you provide it for us?
Secretary Cuomo. We are in the process of putting together
a package and working on the House side with folks who have
already put legislation forth.
Senator Bond. Okay. Let us know, would you please, because
it is vitally important. If you need legislation, let us know.
Secretary Cuomo. We will.
[The information follows:]
Opt-Outs
Market rents for certain properties.--Building on HUD's emergency
actions, a longer-term program should be established to raise selected
properties' rents to market. This program should include targeting
criteria for which properties' rents will be increased and specific
commitments that will be required from owners in return for increased
rents. By extending the criteria and commitments embodied in HUD's
initiative to a full fiscal year, the Administration proposes to spend
up to $100 million for this purpose in fiscal year 2000.
Improve Section 8 renewals.--Recent changes in renewal policy have
led to greater insecurity for residents and owners through frequent
resident notifications and changing rules. Recognizing this, Congress
provided for a single notification under a five-year contract that
could replace the current annual notifications. HUD is using this
provision as part of the five-year commitment required from owners
under its emergency initiative. Extending this authority to allow a
single notification prior to the expiration of a contract of any length
would encourage longer-term preservation of affordable housing while
removing the fear among residents caused by misleading notices each and
every year. Second, renewal of Section 8 contracts could provide
greater security to owners while reducing HUD's administrative burden.
Currently, owners may be required to perform a study of comparable
market rents each year at the renewal of the contract. A better
alternative would be to allow an operating cost adjustment to be
applied for four years, with a comparability study needed only every
fifth year to ensure that rents remain in line with the local market.
Market returns for other properties.--While lifting Section 8 rents
to market and providing more secure renewals can limit opt-outs of
valuable affordable housing, these actions will have limited success in
avoiding prepayments in properties that are important to preserve as
project-based housing. Limiting prepayments is more difficult than
limiting opt-outs because the subsidy level provided by the mortgages
is fixed. Part of a potential solution could be a reexamination of
current limits on rents, distributions and ``excess income'', all of
which were called for by statute at a time when subsidized rents were
not linked to local markets. Now that Congress has realigned project-
based Section 8 rents so they are driven by local market conditions,
HUD could further this change by realigning rents, distributions and
``excess income'' more closely to market in HUD's other privately-owned
project-based properties. These changes could be targeted to the best
properties and none of them would require additional appropriations.
Rents in Section 236 and 221(d)(3) properties could be capped at the
market level (offset for the interest subsidy) instead of the current
budget-based formula, although still limited to 30 percent of
residents' incomes. Distributions could be revised to allow for
recognition of project equity built up over time instead of remaining
tied to the original equity contribution. And continuing a trend by
Congress over recent years, ``excess income'' could be made available
to the owners of certain 236 projects to better approach a true market
return.
New resources and ownership.--Even when owners choose to remain in
HUD's multifamily subsidy programs, there are cases when new ownership
or resources are needed to preserve decent affordable housing. Whether
for tax or other business reasons, owners may be effectively locked
into ownership despite a waning interest in running the property. Or in
markets where local rents are below what is needed to pay for
recapitalization later in the project's life cycle, other forms of
resources may be necessary outside of current rent and interest
subsidies. Any effort to stop the loss of affordable housing should
take account of these cases by encouraging the transfer of properties
to more motivated owners, particularly tenant organizations and non-
profits. One way to do this is through targeted increases in Section 8
rents to market for valuable properties in strong markets that would
not otherwise be eligible but agree to a transfer to a tenant
organization or non-profit. A second method would be to target federal
subsidies to affordable multifamily properties that receive State and
local contributions subsidizing a transfer or recapitalization.
Finally, the current legislation guiding the disposition of properties
foreclosed by HUD could be made permanent, including the option to
transfer properties to resident organizations and non-profits with Up-
Front Grants in negotiated sales.
More effective resident protection.--Even with a comprehensive
proposal that includes all the suggested changes discussed, there will
still be cases where owners choose to opt out. In these cases, HUD can
better protect residents by offering ``enhanced'' vouchers that allow
them to remain in their homes without substantial rent increases when
an opt-out occurs. Any proposed solution should give HUD the authority
to offer ``enhanced'' vouchers in all opt-outs at up to market rent
levels. In addition, Congress could clarify the permissible increases
in ``enhanced'' rent levels over time by allowing them to track
reasonable increases after the first year.
gao
Senator Bond. We will try first to get it through the
authorizing side. If that fails, you know what happens. We
would love to see it authorized.
Mr. Secretary, I mentioned a grave concern I had about GAO.
GAO has told us that their staff cannot meet and talk with HUD
people directly, that GAO is required to submit written
questions on all issues rather than dialogue. As I mentioned,
GAO is our eyes and ears. What is the problem, and can we get
your commitment to get back working a normal relationship?
Secretary Cuomo. Mr. Chairman, I was not aware that we were
not. I have no problem. I have not been informed. I will ask
the Deputy Secretary, who does this on a day-to-day basis, if
he has any ideas.
Mr. Ramirez. What we have done, Senator and Mr. Chairman,
is that, quite frankly, with the different tasks that we have
put at hand, the staff that we have available, we have asked
GAO to help coordinate the work that they are asking for. It
requires a great deal of time and manpower to respond to a lot
of their requests.
We want to organize it and make it as expeditious as
possible to compile the information that has been requested.
What has happened is that when it comes down to specifically
the concerns they have had as it relates to the budget, is that
we would like to coordinate our responses on the budget through
the CFO's office.
We have been more than willing to set up any sort of
working schedule with the different program areas to be able to
answer those questions, but to give you a recent example, just
yesterday they called in and asked for two pages of information
on work that they wanted to get out of the budget office from
specific program areas, and they wanted to meet yesterday, and
it is very hard to assemble the team of a half-a-dozen or a
dozen individuals that actually have to deal with responding to
the issues, because they were very program specific in that
kind of short order.
We want to keep our working relationship a strong one, we
appreciate the work that they do, and we want to work with them
to coordinate a more effective way of getting that
information----
Senator Bond. GAO does this all the time, they go around
and ask lots of questions of lots of agencies, and this is the
first time I have ever heard them really complain that they
were getting stiffed. I would like to not worry about this
problem.
I have a lot of other things to worry about, but if it is a
problem you can bet I am going to be worrying about it, and you
can either solve it at the Department, or you will solve it in
my office. I really would be in a bad mood if we had to solve
it in my office.
Secretary Cuomo. We do not want you in a bad mood, Mr.
Chairman.
rental subsidy overpayments
Senator Bond. Rental subsidy overpayments. The HUD IG's
financial statements found a number of material weaknesses. For
example, HUD reported in 1997 that it spent $18 billion to
provide rent and operating subsidies to a variety of programs,
but on the basis of data collected for 1996, HUD estimated it
had provided over $900 million in overpayments, $900 million,
funds that could be used, for example, to fund all these other
things. What has HUD done to reduce subsidy overpayments?
Secretary Cuomo. Mr. Chairman, I would ask FHA Commissioner
Bill Apgar to respond.
Senator Bond. Please.
Mr. Apgar. Well, as you know, we are engaged, first, in a
pilot effort to establish the capacity to do income matching
where we use income records and other things to match to tenant
income files to identify which situations that might exist in
terms of overpaying. That has been successful, and now we are
moving to a total income matching approach.
We have designated REAC, the Real Estate Assessment Center,
our new data analysis agency to take over that responsibility,
and they are literally matching millions of files of
information to try to identify which particular vouchers, or
project-based subsidies, or public housing residents may be
mispaying their rent, and providing that information back to
the authority.
There are some constraints on that process, because of our
limited capacity to use and divulge the income tax records, but
we are working within the confines of confidentiality to get
the information so that the local housing authority and the
residents can move their rent payment in line.
obligation and monitoring of hud funds
Senator Bond. I am going to have a number of questions for
the record. I will submit one that has been called to our
attention about, it says, ``As of September 30 of last year,
HUD had unexpended balances totaling more than $158 billion.
About $40 billion was unobligated, and $114 billion was
obligated, but not expended.''
I am concerned about these very high balances. It seems to
be the equivalent of about 6 years of budget authority, and I
would appreciate for the record, and I will give you a fuller
question for the record, how HUD monitors and oversees the
funds to ensure they are obligated and expended as prescribed,
because that seems like a huge number, and I would like to get
to the bottom of that. I do not know if you have looked at
that.
Secretary Cuomo. We have. I will get you that, Mr.
Chairman, in detail; but just a general comment, in some ways
it is the nature of our business. Many times, we often will
award a certain amount of money and the organization, the city,
the PHA then has to go find a site; then has to do
architecturals; and then has to break ground.
Sometimes there is even a lawsuit, believe it or not, in
the midst somewhere. So it tends to be the nature of our
business, but I will get you a thorough explanation.
eeoc costs
Senator Bond. One final question. As we all know the HUD IG
is currently the subject of an EEOC investigation centering on
the promotion of a staff member. It has come to my attention
that the Department has contracted with outside counsel in a
manner that is inconsistent with typical investigative
practices for EEOC complaints, and that there has been hundreds
of thousands of dollars spent on it.
What are the normal costs associated with an EEOC
complaint, and how much is being spent on this investigation?
Secretary Cuomo. Mr. Chairman, the Chairman I am sure knows
that one of the things that the Department does is fair housing
anti-discrimination work. We take that very seriously. A charge
like this against a senior official we take very seriously, and
we wanted to make sure that we practice what we preach.
Senator Craig was talking about our fair housing work, and
how good we are at telling everybody do not discriminate. When
we have a complaint in-house we want to make sure we are just
as good as reviewing ourselves as we want to be at reviewing
everyone else.
The matter is now in Federal court. I believe there is a
Federal lawsuit, because the Department did not come to any
conclusion, did not take action, and the aggrieved party has
the right to go to Federal court, which they did exercise, and
the matter is now in court, and will be resolved through the
judicial process.
Senator Bond. Is it customary to spend several hundred
thousand dollars on counsel to investigate other EEOC----
Secretary Cuomo. I do not know that that was the number,
but I do not know that it is customary to have this type of
complaint by this senior of an official against this senior
official, especially when the Department has been as adamant as
it has about racism and discrimination. So I do not think this
is at all a typical situation, Mr. Chairman.
Senator Bond. I would appreciate knowing if there are any
similar circumstances or any similar cases, how much it cost,
how it was handled, any other officials. With that, let me turn
the questioning back to Senator Mikulski.
[The information follows:]
Cost of EEOC Complaint
The normal costs associated with the investigation of an EEO
complaint, as will as the amounts of the contracts awarded to the law
firms Williams & Connolly and Day, Berry & Howard for the specific EEO
investigation at issue, are described in the report prepared for HUD by
Donald Bucklin of Squire, Sanders & Dempsey. Copies of that report and
its attached exhibits have been provided to the Committee under
separate cover.
elderly housing
Senator Mikulski. Thank you, Mr. Chairman. In anticipation
of a vote shortly, I just want to say to the Secretary, I am
going to submit the rest of my questions for the record, but
let me give you the framework for my questions on housing for
the elderly.
As you know, I have persistently raised the issue that
demography is destiny, and that we have senior housing that was
built under the Carter Administration and in the early days of
the Ford Administration. The seniors themselves are aging in
place, and the buildings are getting old, and the question is,
what is the public policy thrust in what we are going to do to
help that particular population.
They are going from 60 and robust to 80, and many being
frail elderly, different situation, with no continuum of care.
Then, number two, really with the aging baby boomers coming
online, how also are we--not all boomers have Cuisinarts, and
401Ks, and a variety of other things, they are poor, so the
question is, what about them?
As you know, I asked for a report, it was delivered this
week. We have not had a chance to review it, but let me give
you three yellow flashing lights that I am going to respond to
in your testimony.
You want to have something called Healthy Homes, help
seniors stay in their homes. My experience is that that is
often a platitude and not a program. That is in every program
where I hear let us help people. That is not only at HUD, that
is throughout social agencies. So I do not want platitudes, I
want programs.
Second, your recommendation is to convert equity in their
homes and to rehab and property. My flashing yellow light in
that is one of the biggest senior scams has been reversed
mortgage.
There is the bonafide reverse mortgage that has helped
people for independence, but it has been fraught with scam, and
our friends at Fannie Mae have been one of the leaders to make
sure again that we know that where there is need, there is
greed, and that often we go to scams run by scum. I do not want
this to happen here. So I do not want platitudes, I want a
program, and I do not want another senior scam.
Having then said that, it is how we are going to use tax
credits. We are going to have more vouchers. There is what
Senator Harkin has raised, $87 million for your new vouchers. I
really do not know if this is a program or essentially people
forage through what is existing, try to come up with something
new, and again, I am out of the placating me business, I want
to be in the senior opportunity business, and the senior safety
net business.
So we are going to raise questions with your initiative for
which we have significant yellow flashing lights, and then
perhaps we could work together to see what we can really do to
address these problems in a way that is not more vouchers,
complicated programs around tax credits, and oh, gee, we are
going to keep them in their own home.
Poor people do not often have equity in homes. If your
house is already going to a siege neighborhood, and you paid
$50,000 for it, it is now worth $12,000. There is not a lot of
equity there.
Secretary Cuomo. Senator, let me make one quick comment,
and then I refer it over to the FHA commissioner. I know time
is short, so I will keep it brief. You just received the
report, I am aware, but you should also know that the basis of
the work, there has been a lot of work that has gone on over
the past year, a lot of consultation, and I believe this
program that we have come up with is not a platitude at all,
but it is a program.
You should also know the situation we find ourselves in at
HUD time and time again is we cannot buy our way out of these
problems. It could be very easy for me to say I will tell you
the solution to senior housing, take the 202 program, bring it
from $600 million to $7 billion. We do not have that luxury.
I also do not think that would be responsible. We have many
different programs at HUD, and sometimes the truth is, bringing
those fragmented programs into a systemic approach that
actually makes sense, we did that with the homeless programs
and the continuum of care----
Senator Mikulski. Exactly right.
Secretary Cuomo [continuing]. And that is what we are
trying to do with the senior programs.
Senator Mikulski. Well, rather than have everyone respond,
let us look at the report, you know my yellow flashing lights--
--
Secretary Cuomo. Yes.
Senator Mikulski [continuing]. And then let us see, as we
move forward, what we can do, again, for a safety net for
seniors, why stewardship of taxpayers' funds, and that
continuity of care just along what you said about the homeless
program, and I think we could really do something exciting and
beneficial. Thank you very much.
Secretary Cuomo. I think we can, Senator. Thank you.
Senator Mikulski. Mr. Chairman, that is it for me.
Senator Bond. Thank you, Senator Mikulski.
Senator Harkin, do you have----
privatization of gnma
Senator Harkin. One short one, Mr. Chairman. Thank you.
I just want to talk a little bit about Ginnie Mae, there
have been some proposals out there to privatize Ginnie Mae. It
was suggested in the Senate budget resolution, and I am
informed that while there might be a gain for the year 2000 of
some $2.5 million, that HUD would lose money every year
thereafter. I do not have figures on that, but I understand it
is quite a bit, and I expect that some of the targeted efforts
by Ginnie Mae to promote housing would be lost, and I just want
to know what your thoughts are on this issue. Do you have any
figure on about how much HUD might lose in the future?
[The information follows:]
Would Money Be Lost If Ginnie Mae Were Privatized?
The answer has a couple of parts, one of which is relatively
straight forward and the other more problematical.
The straight forward part of the response is that the Treasury
looses the compound value of the net income foregone by not having
Ginnie Mae. The average annual growth rate of Ginnie Mae's net income
over the past 8 years (through 1998) was 9.5 percent. If we assume that
that rate would prevail over the next 10 years, on average, then the
Treasury would be giving up approximately 12 billion dollars in net
income. Of course the offset would be tax revenues from a fully taxable
entity and the price received from the sale of the Ginnie Mae
franchise.
The more problematical part of the response is that a sale of
Ginnie Mae would also likely affect the volume of loans to be insured
or guaranteed by FHA, VA and RHS. A private Ginnie Mae would most
likely be traded at a significant discount price to the current Ginnie
Mae MBS because it would not likely have the full faith and credit
guaranty of the U.S. Treasury. Moreover, over the initial formative
years of the new ``Ginnie Mae'', there would not likely be a
significant volume of securities issued (the old Ginnie Mae and the new
Ginnie Mae securities would not trade on the same basis, i.e. they are
not interchangeable) which would also serve to lower its price relative
to current Ginnie Mae MBS. The lower prices of the new Ginnie Mae's
have a twofold effect on lending to low- and moderate-income families,
the primary beneficiaries of the Government mortgage insurance and
guaranty programs. More time would be necessary to estimate this
effect.
The first effect of lower Ginnie Mae prices is that the interest
rate to potential FHA/VA/RHS borrowers is higher because interest rates
and prices are inverse to each other. The higher interest rates on home
loans necessitated by lower prices on the securities would disqualify a
number of such borrowers at the margin. Families and communities would
not enjoy the benefits of home ownership and the Government would loose
the premium income on the loans that would not be made.
The second effect of lower Ginnie Mae prices would be to encourage
lenders to turn their attention to secondary market instruments that
would yield relatively higher prices and, therefore, lower rates for
their customers. They would follow this course of action because of
competitive reasons--offer their customers the lowest rates possible on
home loans--and because they seek the highest return on their capital
in order to remain in business-higher prices, and increased customer
base, mean more potential return. The alternative secondary market
sources (i.e. the other GSEs) would not likely be of primary benefit to
low and moderate income borrowers, especially first time buyers, since,
today's market, the alternative sources tend to not place priority on
FHA/VA/RHS lending or loans to borrowers that typically use FHA/VA/RHS.
Secretary Cuomo. Senator, I will get you the numbers, but I
could not agree with you more, this would be a terrible
mistake, this would be a fire sale tragedy, fiscal
irresponsibility, in my opinion. Ginnie Mae makes about $600
million this year, $670 million----
Senator Harkin. $600 million, yes.
Secretary Cuomo [continuing]. $674 million this year. They
proposed selling it for like $2.5 billion or $2.8 billion. That
would be very shortsighted, in my opinion, to take a recurring
asset, just on the dollars and cents, you are making $670
million, you settle for $2.4 billion, $2.8 billion, it is not
an intelligent financial transaction, plus Ginnie Mae works
amazingly well with FHA as part of this affordable housing
system.
Why would you want to take Ginnie Mae out, disassemble the
system that is working? FHA works. Ginnie Mae works. They are
working better than ever before. They are doing more loans,
they are making more money. We have so many things that are
broken.
Why do we want to go to the one place that is working well
by everyone's admission and fix what is not broken?
Senator Harkin. Well, I appreciate that, and Mr. Chairman,
I do know what your personal feelings are on this, but
obviously you know what mine are now, but it just seems to me
that, first of all, OMB is suggesting it, and we have the
Senate budget resolution suggesting it, and I say a pox on both
their houses on this one. I just do not understand how OMB
could come up with that.
My staff tells me that the preliminary figures might be
that HUD might lose somewhere in the neighborhood of maybe $300
million to $500 million, something like that. Anyway, it is
extensive. So it just seemed to me very shortsighted for OMB to
suggest that.
Thank you, Mr. Chairman.
Senator Bond. I can assure you that suggestions sometimes
go into the budget resolution, and assumptions or suggestions
from OMB do not necessarily drive the bus around here.
Senator Harkin. I sure hope that is true on this one.
Senator Bond. We will take their views for what they are
worth. Mr. Secretary, do you want to add----
Secretary Cuomo. Just as a point of clarification. On this
one, I do not want to have OMB unfairly criticized. They
originally thought of this idea, they thought again, and OMB is
against the sale of Ginnie Mae.
Senator Bond. Oh, is that a fact now?
Secretary Cuomo. Yes, it is.
Senator Bond. Okay.
Senator Harkin. Good.
Additional committee questions
Senator Bond. We have plenty of other things to worry
about. We promised to submit some interesting and challenging
questions for the record. Our colleagues may wish to have
additional statements. We will keep the record open.
[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 Bond
section 8 contract renewal and incremental section 8 assistance
Question. As I discussed elsewhere, the HUD budget for fiscal year
2000 has raised expectations about providing additional section 8
housing assistance while implementing policies and long-term budget
goals that will actually decrease the availability of housing for low-
income families, including the elderly and disabled.
For example, the HUD fiscal year 2000 Budget proposes 100,000 new
incremental vouchers for fiscal year 2000 while actually reducing
substantially the level of funding needed in the future to preserve and
support rental assistance for families that are currently assisted. In
the first place, HUD has shifted the responsibility for paying for
expiring fiscal year 2000 section 8 contracts by deferring $4.2 billion
until fiscal year 2001, despite the fact that the cost of expiring
section 8 contracts will increase by some $2 billion in additional
funding needs in fiscal year 2001 to maintain existing section 8
contracts. In addition, OMB has decided to freeze the funding of rental
assistance for section 8 contract renewals at $11.5 billion for fiscal
year 2001 and each year thereafter through fiscal year 2009. This would
mean over 250,000 low-income families, including the elderly and
disabled, will lose existing section 8 housing assistance under HUD's
proposal. To put this in real terms, this also means for every new
family HUD proposes to provide incremental housing assistance, HUD will
be kicking some 2 to 3 families out the back door. How can you justify
the HUD fiscal year 2000 budget when, as a practical matter, it removes
housing resources from those who can least afford to lose it?
Answer. The Department's long standing policy has been to renew all
existing section 8 contracts and the Department did not deviate from
this policy in the fiscal year 2000 budget request. When the Department
requested the $4.2 billion in advance appropriation, the intention was
to shift the date the funding is appropriated to the time the funding
needs actually occur. With the advance appropriation, there is no need
to change the expiration dates on contracts, and there will be
absolutely no impact on either the tenants or the owners. The advance
appropriation will not actually be scored under the rules of the Budget
Enforcement Act until the start of the next fiscal year, on October 1,
2000. Because we are providing funding for a large portion of our
section 8 renewals only through the last day of fiscal year 2000, as
opposed to a full 12 months, we will need to be certain that funds to
continue those contracts will be available the first day of fiscal year
2001.
It is true that OMB decided to freeze the funding of rental
assistance for section 8 contracts in future years. This issue will be
addressed during internal budget negotiation on the fiscal year 2001
Budget. OMB Director Lew has also stated that funds have been set aside
within the Administration's total budget request to fully fund contract
renewals and other programs once Congress and the Administration reach
an agreement on Social Security.
Again, as mentioned before, if full funding for contract renewals
is enacted as requested with advance appropriation or if the full
amount needed is available in the beginning of fiscal year 2000, no one
will be ``kicked'' out including the elderly or the disabled.
The 100,000 new incremental vouchers requested by the Department
are desperately needed. As described in last year's Report to Congress
on Worst Case Housing Needs, there are 5.3 million households with
worst case needs. HUD's most recent report, Waiting in Vain: an update
on America's Rental Housing Crisis, tells us that the waiting lists for
public housing and Section 8 tenant-based assistance is growing and
that the average time on the waiting list, before receiving assistance
has increased. In the nation's largest cities, the wait can be as long
as 5-10 years. Among the causal factors are the loss of affordable
housing stock--a drop of 1.3 million units or 19 percent between 1996
and 1998--and the lack of additional Federal support for affordable
housing.
Question. Mr. Secretary, as you know, I support additional housing
assistance, including section 8 assistance as part of a menu of
flexible tools subject to local decision-making. However, because of
budget constraints and the need to meet a number of national objectives
in a number of agencies, I have had to make certain compromises that
balance funding decisions in a fiscally responsible manner.
Nevertheless, as part of our discussion last year in adding 50,000
incremental vouchers, you promised to ensure that adequate funding
would be provided to cover the cost of this incremental rental
assistance in fiscally responsible manner. Nevertheless, the HUD fiscal
year 2000 Budget now proposes an additional, 100,000 incremental
vouchers at an annual cost of some $585 million. In addition, the VA/
HUD Appropriations Subcommittee has the responsibility to cover the
cost of those 50,000 incremental vouchers as a recurring annual cost.
Again, I remind you that the costs of renewing expiring section 8
contracts continues to rise each year. For example, the cost of
renewing section 8 expiring contracts in fiscal year 1999 is $9.5
billion and will rise to an actual cost of $13.6 billion in fiscal year
2000 and to $15.6 billion in fiscal year 2001. How has HUD responsibly
covered the cost of the fiscal year 1999 incremental vouchers and
fiscal year 2000 proposed incremental vouchers, especially since HUD
has used a budget gimmick of pushing off until fiscal year 2001 or that
other programs, such as VA Medical, will have to cut to pay for these
contracts. I always try to look ahead that overcharging my credit cards
now. How do you plan to pay for these additional contracts in fiscal
year 2001 (and to make it real assume flat funding for fiscal year 2001
at the President's budget level for HUD for fiscal year 2000 or at a
funding level of $11.5 billion)?
Answer. I can assure you that the cost of renewing 50,000
incremental units enacted in fiscal year 1999 is fully covered in
fiscal year 2000. As stated earlier, the advance appropriation was
requested to shift the date the funding is appropriated to the time the
funding needs actually occur. The advance appropriation will not be
scored under the rules of the Budget Enforcement Act until the start of
the next fiscal year, on October 1, 2000. Neither the owners nor the
tenants will feel the impact with this methodology change since there
will be no change on the expiration dates on the contracts. Funding for
contracts renewals in fiscal year 2001 and forward will be addressed
again during internal budget negotiation on the fiscal year 2001
Budget. The 50,000 vouchers enacted in fiscal year 1999 and 100,000
vouchers requested in fiscal year 2001 will be covered in our fiscal
year 2001 budget request. As Director Lew has stated that funds have
been set aside within the Administration's total budget request to
fully fund contract renewals and other programs once Congress and the
Administration reach an agreement on Social Security.
section 8 opt-outs
Question. HUD has made a point of emphasizing its commitment to
low-income families and the provision of affordable housing.
Nevertheless, there are a number of section 8 project-based housing
developments throughout the country that receive rents that are below
market. Because of lost revenue, a number of owners are opting out of
the section 8 program and raising rents beyond the financial ability of
many residents. This is especially troubling where the projects are
elderly or are located in areas where vacancy rates are low. For
example, in 1998, 219 section 8 properties with some 25,488 units opted
out of the section 8 program. HUD has done little to address this
problem and, in fact, a number of HUD policies have exacerbated the
loss of this housing and the displacement of low-income families,
including the elderly and disabled. This is even more troubling since
HUD has both the authority and funding available to renew these section
8 contracts. I am looking for a commitment from HUD to preserve this
housing for low-income families and a time schedule reflective of the
seriousness of this problem to the many families facing displacement.
Also, please advise as to why HUD has not acted.
Answer. HUD has done and is doing all that is feasible with the
legislative authority and funds that Congress has made available to
this effort. For example, we have just issued instructions to our field
offices for an Emergency Initiative to mark up to market project-based
rents in developments we believe are most likely to opt-out. Our
initiative is necessarily limited by the cost of such increased Section
8 rents and by the authorities available under existing law, but the
Emergency Initiative is to prevent further losses in the assisted
housing inventory pending Congressional action on the appropriations
request for fiscal year 2000, and a package of legislative changes
which are being formulated. The Budget request includes sufficient
funding for a broader program to stop opt-outs, as well as funding to
permit expanded availability of enhanced vouchers to prevent
displacement of families in circumstances where owners decline to
renew.
In the final analysis, we believe that owners are opting-out for a
number of reasons, many of which are outside of the Department's
ability to address. HUD cannot unilaterally solve the opt-out problem.
We must work in partnership with the Congress to address this important
issue.
eeoc investigation
Question. Mr. Secretary, as you know, Ms. Gaffney, the HUD IG, is
currently the subject of an EEOC investigation centering on a complaint
that Ms. Gaffney discriminated in the promotion of a minority staff. It
has come to my attention that the Department has contracted with
outside counsel in a manner inconsistent with typical investigative
practices for EEOC complaints with the Department spending hundreds of
thousands of dollars in hiring a number of law firms to handle the
investigation. What are the normal costs associated with this type of
complaint at HUD?
Answer. The normal costs associated with the investigation of an
EEO complaint are described in the exhibits to the report prepared for
HUD by Donald Bucklin of Squire, Sanders & Dempsey. Copies of that
report and its attached exhibits are attached.
Question. How much has HUD spent and will spend on this
investigation? Also what firms have been hired and what have each of
these firms been hired to do?
Answer. The law firms Williams & Connolly and Day, Berry & Howard
submitted a joint proposal in response to HUD's request for proposals
for an EEO investigation and related legal services. The respective
responsibilities of these firms and the amounts of their contracts is
described in a report prepared for HUD by Donald Bucklin of Squire,
Sanders & Dempsey. Copies of that report and its attached exhibits are
attached.
Question. Finally, why did HUD feel it necessary to not follow the
normal investigative procedures? Does this mean that the normal
procedures are inadequate and that other parties in the EEOC process
are receiving less justice?
Answer. The specific reasons for HUD's decision to select a new
contract investigator for Mr. Newsome's complaint are detailed in a
report prepared for HUD by Donald Bucklin of Squire, Sanders & Dempsey.
A copy of that report and its attached exhibits are enclosed.
[Clerk's note.--The following report ``HUD EEO Complaint IG-98-01:
Review of HUD Actions Relating to the Investigation of the Newsome
Allegations,'' prepared for HUD by Donald Bucklin of Squire, Sanders &
Dempsey can be found in the subcommittee files.]
eeoc complaints
Question. Please provide a breakdown of all EEOC complaints since
January of 1993 by each HUD office, including the Office of the
Inspector General, Office of the General Counsel and Office of the
Secretary.
Answer. An EEO complaint inventory summary is attached.
TABLE I.--COMPLAINT INVENTORY SUMMARY
[Reporting period from 10/01/93 to 09/30/98]
------------------------------------------------------------------------
Complaints
-------------------------------------
HUD regions On hand Files Closed On hand
beginning during during at end
------------------------------------------------------------------------
1................................. 6 1 7 .......
2................................. 6 2 8 .......
3................................. 16 3 19 .......
4................................. 49 16 65 .......
5................................. 39 14 53 .......
6................................. 104 20 124 .......
7................................. 14 4 18 .......
8................................. 42 2 44 .......
9................................. 49 10 59 .......
10................................ 6 2 8 .......
OSEC.............................. 2 19 5 16
ADSFM............................. ......... 10 7 3
CPD............................... 4 39 29 14
OGC............................... 1 26 15 12
OLCR.............................. ......... 1 1 .......
GNMA.............................. ......... 2 2 .......
HOUS.............................. 24 270 154 140
PIH............................... 16 90 58 48
FHEO.............................. 13 129 78 64
PDR............................... ......... 1 ....... 1
ADMIN............................. 12 62 40 34
GIG............................... 7 41 36 12
CFO............................... ......... 5 5 .......
LBP............................... ......... 5 2 3
-------------------------------------
Total....................... 410 774 837 347
------------------------------------------------------------------------
Question. Please identify all actions taken to reduce any concerns
identified through EEOC complaints determined to be valid.
Answer. For each EEO complaint which results in an administrative
or judicial finding of discriminatory conduct, HUD complies with any
resulting orders to remedy the injury suffered by the complainant. Such
remedies can include reinstatement, promotion, transfer, money damages,
amendments to personnel records and changes to agency personnel
practices. In addition, the vast majority of EEO complaints are
resolved by agreement between the complainant and the agency. In such
cases, without conceding that discriminatory conduct has occurred, HUD
negotiates appropriate responses and/or remedies with the complainant
to address the concerns underlying the original complaint.
rental assistance overpayments
Question. The HUD IG's fiscal year 1997 financial statements audit
found a number of material weaknesses in HUD's internal controls. For
example, HUD reported in 1997 that it spent some $18 billion to provide
rent and operating subsidies through a variety of programs. On the
basis of data for calendar year 1996, HUD estimated that it had
provided over $900 million in overpayments. This is a huge amount of
funds lost to the Department--funds that could, for example, be used
for section 8 assistance. What has HUD done to reduce subsidy
overpayments?
Answer. The $900 million indicated in the question represents the
potential for excess payments, which even if true, may not be
recoverable by the Department. The potential overpayments arise from a
number of factors, including but not limited to: tenants under
reporting or unreported income and underpayment of rent, falsifying
deductions which on which rent is based, errors in data base
information, etc.
To overcome the problem of potential excess payment, The Secretary
has directed the Department's Real Estate Assessment Center to lead a
task force to analyze several income verification techniques with
potential for expanded use of Federal tax return data. In recent years
HUD has used computer matching to Federal tax return (Form W-2 and Form
1099 data obtained from the Social Security Administration and the
Internal Revenue Service), to identify unreported tenant income and
excessive housing assistance for tenants who receive rental assistance
from housing agencies, owners and agents. Use of Federal tax return
data has been effective in identifying prior underreported income.
However, to date use of Federal tax return data has been limited to
random samples of households and to selected housing agencies and
owners/agents. Various techniques for expanding the use of the
alternative techniques are being assessed during 1999 by the Task
Force. The Department is aggressively working at putting in place the
information technology and human resources necessary to implement a
large scale computer matching program.
Through the implementation of new systems and reforms, it is
expected that the task force will address any policies or procedures
which created the climate for either overpayments or the potential for
overpayments. Six action teams chartered by the Task Force, comprised
of staff from CFO, CPD, Housing, OGC, PIH and REAC, will address the
following areas: 1. continue and expand income matching programs; 2.
strengthen re-certification efforts; 3. expand the Social Security
Administration computer matching; 4. ensure full population and data
integrity of HUD's systems; and 5. institute penalties for overpayments
of rental assistance, and perform monitoring and oversight.
HUD's Office of Policy Development and Research also is contracting
for an evaluation of housing agencies'/owners'/agents' effectiveness in
(re)certifying tenants for rental assistance.
However, it should be noted that there are various legal, technical
and administrative barriers to HUD's efforts to fully and
comprehensively implement income matching and verification of tenant
reported income during the eligibility certification and
recertification processes.
Further, the implementation of various provisions of the 1998
Housing Act will significantly impact tenant income verification.
Examples of such provisions include flat rents and minimum rents.
Extensive efforts have been made to improve the accuracy and timely
reporting of information to the tenant data bases.
HUD with the support of the Social Security Administration, has
implemented social security (SS) and supplemental security income (SSI)
computer matching for all housing agencies. This computer matching is
highly effective in detecting past unreported SS and SSI for tenants
and in preventing future unreported income. HUD also has modified the
computer system it uses to facilitate SS and SSI matching and reporting
for tenants who receive rental assistance from owners and agents who
administer programs of the Office of Housing. A pilot of SS and SSI
matching for the Office of Housing's rental assistance programs
commenced in September 1998. It is anticipated that the SS and SSI
computer matching program will be expanded to all owners and agents
during fiscal year 1999.
All of these initiatives are on-going and are expected to yield
results during fiscal year 2000. To supplement the initial statement in
this response, it should also be noted that the Task Force's full scale
review also has the potential to uncover instances where tenants
overpaid their rent due to not being given credit for eligible
deductions, inaccuracies in the recertification process, errors in the
database, etc.
public housing issues
Question. We understand that the PHA in San Juan, Puerto Rico was
permitted to privatize and is now under review by Justice and the HUD
IG for criminal fraud. What steps has HUD taken to limit fraud at this
PHA?
Answer. HUD's Atlanta Office of the Inspector General (OIG) is
preparing a comprehensive report of their findings. Pending the release
of that report, the Department has been informed that the following
issues were raised by the Caribbean Office OIG: (1) weak internal
controls; (2) some procurements were selected without sufficient
competition; (3) advertising of competitive procurements was below
standard; (4) cost analyses were incomplete, (5) procurement actions
were not properly documented; and (6) procurement staff were not
properly trained.
Pending the completion of the Atlanta OIG report, the Department
developed a ``work out'' plan with the HA and has initiated the
following interim steps:
--Increased monitoring and oversight of procurement activity at the
Puerto Rico Housing Authority (PRHA) by the field office;
--Required the PRHA to hire an independent firm to run the day-to-day
operation of the modernization program ($180 million--largest
source of funding, and the program that is the focus of the
investigation);
--Required the PRHA to retain an Independent Public Accounting (IPA)
firm to audit the accounting operations. The IPA has completed
an audit of the PRHA's fiscal year 1997 and issued a qualified
letter of opinion. The fiscal year 1998 audit of the PRHA
operations has not been completed. The IPA has been requested
to examine and reconcile all accounts/expenditures called into
question during the period 1993-1996;
--Insured that the PRHA's accounting operations conform with
Generally Accepted Accounting Principles (GAAP) (the PRHA
complied with this requirement this month, 6 months ahead of
the time established in the ``work out'' plan);
--Required the PRHA to create an Office of Internal Auditing to
monitor and enforce compliance with internal controls (based on
a proposed restructuring plan developed by the IPA); and
--Took steps to establish a training program to permit procurement
staff from the PRHA to learn from another housing authority
that has a model procurement system.
Question. What tools does HUD have to limit this type of problem
and what has HUD done in this case?
Answer. Some of the tools available to the Department are noted
above in the response to the specific actions that the Department has
taken in the specific instance of the alleged fraud at the PRHA.
However, this question and the response deals specifically with tools
from a preventive perspective.
Under the new Public Housing Assessment System (PHAS), which
replaced PHMAP, the annual audit of HAs by an Independent Public
Accounting firm will be more stringent. In addition, pursuant to
Management Reform 2020, HA accounting practices are now required to
conform with the GAAP. Further, HUD will continue to require risk-based
Field Office monitoring, and more responsive public trust (i.e.,
earlier reporting of perceived discrepancies, inconsistencies or
potential fraud). Finally, as appropriate, the Department will request
assistance from the OIG in uncovering procurement irregularities.
homeless assistance
Question. HUD moved over $20 million from the fiscal year 1999
homeless assistance funds to fund fiscal year 1998 supportive housing
applications. Congress was not advised of this funding decision before
the transfer of funds and the decision runs counter to how we budget
for activities under appropriation accounts within the Subcommittee.
What is HUD's legal justification for this action and was the action
reviewed for consistency with the HUD Reform Act as well as relevant
appropriation requirements?
Answer. The Department acted in full accordance with all
programmatic statutory and regulatory requirements, HUD Reform Act
requirements and all applicable appropriation requirements in the award
of 65 non-competitive Supportive Housing Program (SHP) grants in fiscal
year 1999. As detailed in the January 19, 1999 opinion by Associate
General Counsel Robert Kenison, the legal authority for non-competitive
awards under SHP is expressly identified in Section 583.235(a) of the
Code of Federal Regulations. Additionally, as specified in Associate
General Counsel Kenison's opinion, HUD published notice in the Federal
Register on February 4, 1999 identifying the legal basis for awarding
SHP funds non-competitively and advising all applicants of the funding
action being taken.
Question. Please identify the legal citation for this action?
Answer. As stated immediately above, the legal basis for the
funding action taken in awarding SHP funds non-competitively is found
at 24 CFR 583.235(a). This provision specifically provides that SHP
projects ``may be renewed on a non-competitive basis.''
Question. Were conversations held with jurisdictions before awards
were made? Please identify all conversations--the dates, subject matter
and parties.
Answer. It is normal, routine, and expected practice that
applicants not selected during the award of McKinney Act funding make
contact with various HUD officials in both Headquarters and Field
Offices following the grant announcement process seeking an explanation
for their non-selection. That pattern was maintained following the
December 1998 announcement of McKinney Act project selections. Please
find attached, to the extent this information could be recollected by
the individuals involved, a listing of conversations by date, subject
and individuals that we believe is responsive to your request.
REQUESTED CHART OF CONVERSATIONS WITH APPLICANTS SUBSEQUENTLY AWARDED FUNDS NON-COMPETITIVELY
----------------------------------------------------------------------------------------------------------------
Date Spoke with Regarding
----------------------------------------------------------------------------------------------------------------
HUD Participant: Jean Whaley
December 29, 1998.............. Bob Durando City of Portland, Maine.... Debriefing on lack of award.
December 29, 1998.............. Matthew Eddy & Dana Totmann, City of Other resources for homeless
Portland & State of Maine. assistance review team process
comparison of last year's
applications.
January 4, 1999................ Bob Duraslo, City of Portland, Maine... Request for faxing of Gaps Chart
Matthew Eddy, City of Portland, Maine.. submitted.
Bill Johnson congressional staff (No notes).
(Maine). Explanation of award process.
January 5, 1999................ Matthew Eddy, City of Portland, Maine.. No notes.
January 6, 1999................ Bill Johnson, congressional staff Arranging meeting between Maine
(Maine). officials and HUD.
January 7, 1999................ Bill Johnson, congressional staff Confirm meeting.
(Maine).
January 11, 1999............... Matthew Eddy, City of Portland, Maine.. Questions on (1) S+C 10 percent set
aside; (2) PRN for 1998; (3) Scores;
and (4) Differences in Gaps Chart.
January 11, 1999............... Penny Madrey Johnson, Director of Debriefing Dayton applicants via
Housing, Dayton, OH. phone.
January 13, 1999............... Stacy Austin & Bob Durando's assistant, Faxing Bob Durando the scores for
City of Portland, Maine. Maine.
January 13, 1999............... Unknown Participants from Oklahoma Debriefing Oklahoma City applicants
City, Oklahoma. via phone.
January 15, 1999............... Stacy Austin, City of Portland, Maine.. (No notes).
January 19, 1999............... Penny Madrey Johnson-Director of Debriefing phone call for applicants
Housing, Dayton, OH. in Dayton.
January 20, 1999............... Delegation of representatives from both Attended meeting between HUD and Maine
the City of Portland and the State of delegation.
Maine.
HUD Participant: Cliff Taffet
January 20, 1999............... Delegation of representatives from both Failure of any projects in either
the city of Portland and the State of Portland, Maine or State of Maine to
Maine. be funded.
HUD Participant: John Garrity
January 13, 1999............... Unknown participants from Oklahoma Conference call to debrief applicant
City, Oklahoma. on reasons for low score in the
homeless competition.
January 19, 1999............... Penny Madrey Johnson, Director of Conference call to debrief applicant
Housing; Dayton, OH. on reasons for low score in the
homeless competition.
Numerous calls (uncertain of Matthew Eddy, City of Portland, Maine.. Information on reasons the City of
exact dates) between January Portland, Maine and the State of
11-19. Maine failed to be selected for any
award in the homeless competition.
January 20, 1999............... Delegation of representatives from both Failure of any projects in either
the city of Portland and the State of Portland, Maine or State of Maine to
Maine. be funded.
----------------------------------------------------------------------------------------------------------------
empowerment zones
Question. A recent IG audit concluded that HUD does not have an
effective program of oversight and control of the program. What is HUD
doing to ensure that empowerment zones are functioning according to
their local plan?
Answer. On March 12, 1999, the Empowerment Zone/Enterprise
Community (EZ/EC) Initiative Office fully responded to the finding and
conclusions reached in the recent IG audit report. The report was based
on audits in four Empowerment Zones and a review of HUD's EZ/EC
Initiative Office. The EZ/EC Initiative Office found that the report
came to a number of erroneous conclusions.
HUD's oversight and controls are consistent with its statutory and
regulatory responsibilities. HUD has two main statutory and regulatory
responsibilities related to the EZ/EC Initiative. First, HUD is
responsible for designating new urban EZ/ECs. See 26 U.S.C. 1391. 24
CFR 597.300-597.302. Second, HUD is responsible for ``regularly''
assessing the progress of the urban EZ/ECs so it can make a periodic
determination as to the continuing eligibility of the EZ/EC.
HUD's monitoring responsibility derives primarily from section
1391(d)(2) of the Omnibus Budget Reconciliation Act of 1993, which
provides for the revocation of an EZ/EC's designation if the HUD
Secretary determines among other things, that a designated EZ/EC is not
complying substantially with, or has failed to make progress in
achieving the benchmarks set forth in the strategic plan. The
implication of this responsibility is that HUD will collect and review
information relating to the progress of the EZ/EC toward achieving its
strategic plans.
The Department has issued regulations to implement this
requirement. See 24 CFR 597.400-597.403. Pursuant to regulation, EZ/ECs
must submit ``periodic'' reports to HUD detailing the actions they have
taken to implement their strategic plans. HUD uses this information
along with other information to evaluate the progress of the EZ/ECs.
To keep abreast of the EZ/EC activities, HUD requires each EZ/EC to
submit performance reports that detail the progress made toward
implementation of the strategic plan. To date, HUD has formally
evaluated the progress of the EZ/ECs once and released the results of
that determination in March 1997. As a result of the first biennial
evaluation, five of the 72 EZ/ECs were issued warning letters requiring
them to improve their performance or risk losing their designation.
HUD uses a number of tools to keep track and oversee the interim
progress of the EZ/ECs. For example, the EZ/EC Office receives feedback
based upon annual field office assessments. In addition the annual
reports from EZ/ECs and field office assessments, HUD receives
information from the following:
--the applicable HUD Secretary's Representative who is responsible
for helping the particular EZ/EC implement its strategic plan;
--monthly telephone conferences with the EZ/ECs;
--residents or other stakeholders associated with the EZ/EC;
--HHS--the agency that funds the EZ/EC Initiative;
--the States that are responsible for distributing the funds to the
EZ/ECs;
--the lead entity responsible for implementing the EZ/EC strategic
plan; and
--news accounts relating to the EZ/EC.
As noted above, one of the unique aspects of the EZ/EC initiative
is its reliance on performance measurements to ensure local
implementation efforts are a success. The HUD EZ/EC Office works
closely with the EZ/ECs to ensure they fully understand the principles
of performance measurement and the importance of accurate reporting. In
fact, the EZ/EC Office has implemented a new automated Performance
Measurement System (PERMS) to improve the understanding of EZ/ECs and
the accuracy of reporting. Training and technical assistance to
grantees on performance measurement is scheduled for July. This will
include hands-on instruction from a staff and a consultant who will
review EZ reporting for accuracy and appropriateness.
The next ``periodic'' performance report is due at HUD the end of
August 1999. At that time, it will be forwarded electronically to the
appropriate field office for review and evaluation. The field offices
will evaluate the progress or lack of progress and the status of each
implementation plan and report to Headquarters that information.
In addition, each EZ/EC keeps track of the projects and programs it
uses to meet the goals of its strategic plan. In addition, the
individual projects and programs have implementation plans formerly
called ``benchmarks'' that track the results such as the number of jobs
created, the number of loans provided to businesses, and the number of
child care slots provided to residents. The implementation plans, which
are approved by the local EZ/EC governance structure, provide a
blueprint for action by and evaluation of the EZ/EC. Together with
State and local government oversight these efforts result in continuous
tracking of EZ/EC progress.
Question. Please provide a status review of each empowerment zone--
achievements and failures.
Answer. Since its inception in 1994, the Clinton/Gore
Administration's EZ/EC Initiative has produced outstanding results by
empowering people to create business opportunities and jobs, leverage
public and private partnerships, provide affordable housing and make
their communities safer and better places to live. Distressed
neighborhoods--with some of the deepest pockets of poverty in the
nation--are now on the road to recovery. After decades of decline,
there are now great opportunities and brighter futures for residents
and families living in the EZ/EC neighborhoods.
Hundreds of individual EZ/EC achievements are featured in our three
best practice publications called, ``What Works!--Volume 1, Volume 2 &
Volume 3.'' The following EZ/EC-reported accomplishments provide a
national snapshot of the cumulative accomplishments of the Empowerment
Zones and Enterprise Communities as reported by the EZ/ECs. The EZ/ECs
reported this information using the new Internet-based EZ/EC
Performance Measurement System (PERMS). The cumulative results shown
below are based on the inaugural submissions by the EZ/ECs. We expect
the quality and quantity of reporting to improve over time as the EZ/
ECs become more familiar with PERMS and more sophisticated in the art
of performance measurement in general.
Projects and Programs.--The EZ/ECs report that 2,600 neighborhood-
based projects and programs have been developed and are underway as a
result of each EZ/ECs' locally-derived strategic plan. Federal EZ/EC
seed money has leveraged over $10 billion in additional public and
private sector investments related to the implementation of local EZ/EC
strategic plans.
Workforce Development.--The Empowerment Zones and Enterprise
Communities report that they are engaged in more than 550 job training
programs with over 42,000 Zone residents having received job training.
Nearly 30,000 Zone residents have been placed in jobs as a result of
these job training programs. Zone residents have attended approximately
270 job fairs resulting in 16,000 job placements.
Access to Capital.--As a result of the Empowerment and Enterprise
Zone initiative, access to cheap sources of capital--the lifeblood of
commerce--has greatly improved. Loan pools totaling $2 billion dollars
have been created with 1,700 loans processed and 5,000 jobs created
from those loans. The EZ/ECs report that over 4,300 businesses have
been served by the capital access/credit access programs and 4,500
businesses have received technical assistance. In addition, the EZ/EC
Initiative has created the largest community development bank in the
nation--the $430 million dollar Los Angeles Community Development
Bank--which has loaned over $70 million to businesses that could not
obtain conventional bank financing.
Housing.--The Empowerment Zone and Enterprise Communities report
that they have completed 2,400 housing units and have rehabilitated
another 11,000. Nearly 14,000 homeless people have been served under
the ``homeless to housing'' program. Within the Zones and Communities,
there are 146 homeownership programs that have served 8,600 residents.
Private Sector Involvement.--Private sector involvement has played
a vital role in the Empowerment Zones and Enterprise Communities.
Countless corporations have hired Zone residents and actively
participated in EZ/EC governance, as well as provided funds and in-kind
technical assistance to the Zones. Well-known companies involved in the
Zones include General Motors, Ford, Chrysler, Home Depot, The Walt
Disney Company, GAP, Inc., Ameritech, Rite Aid, Microsoft, Starbucks,
MCI/Worldcom, IBM, and scores of others.
Environment.--The EZ/ECs report that they are engaged in 39
Brownfield's projects--transforming abandoned and contaminated
commercial and industrial sites into clean, reusable parcels of land.
Forty-three sites have been transformed to date. The EZ/EC's are also
involved in approximately 180 beautification programs.
Public Safety.--The EZ/ECs report that nearly 380,000 people have
been served by the 300 public safety programs operating in the
Empowerment Zones and Enterprise Communities. There are 580 crime
prevention programs which have served 310,000 residents.
Health Care.--There are 220 health-related programs in the EZ/ECs
serving 94,000 residents. Seven new health-care facilities have opened
in the EZ/EC neighborhoods and four have been remodeled which has
expanded service to 9,000 EZ/EC residents.
Human Services.--Within the Empowerment Zones and Enterprise
Communities, there are a number of human services underway serving
residents including:
--369 recreation programs serving over 116,000 Zone residents;
--157 child care programs serving over 4,850 Zone families;
--21 elderly programs serving over 2,480 Zone residents; and
--339 youth programs serving over 65,000 Zone youth.
Education.--Vital to the well-being and economic development in the
EZ/EC's is education and as a result of the EZ/EC initiative, many
education and training programs have served Zone residents. The EZ/ECs
report:
--residents have been served in 641 K-12 education programs;
--residents have been served in 106 vocational education programs;
--residents have been served in 74 post-secondary assistance
programs; and
--Approximately 13,300 residents have been served in 152 head-start/
pre-school programs.
fha single family property insurance
Question. What steps has HUD made to reduce actuarial risk to the
Mutual Mortgage Insurance Fund. For example, insurance claims increased
over 25 percent between 1996 and 1998, from 60,884 claims to 76,086
claims. In addition, the total claim payments increased 38 percent,
from $4.2 billion to $5.8 billion during this period.
Answer. MMI claims have increased from 53 thousand claims for $4.1
billion in 1996 to 59 thousand claims for $5.3 billion in 1998, an
increase of 12 percent in the number of claims and 29 percent in cost.
In order to reduce the risk from claims, the Department has analyzed
the reasons for the increases.
1. The average dollar value of an MMI insured mortgage has risen 34
percent between the 1992 book of business and the 1998 book, even while
the loan limits locked FHA into a lower value portion of the market in
many areas.
2. The very large 1993 and 1994 books-of-business are approaching
their peak claim period (estimated to be in years 5-8 after
endorsement).
3. The economic downturn in California led to increased reliance on
FHA insurance during the 1990s, since FHA does not reduce the level of
business in economically troubled areas. In 1992, California loans
comprised only 9 percent of the dollar volume of MMI portfolio; steady
growth brought this to 19 percent in 1998. Additionally, much of
California also qualifies as high cost area, so that the average loan
is higher than much of the rest of the U.S. and the continuing economic
problems in some areas of the State have produced higher claim rates.
4. The increased use of adjustable rate mortgages (ARMs)--rising
from 16 percent in 1992 to 35 percent in 1997--has led to increases in
both costs and numbers of claims in MMI. Currently the low mortgage
interest rates on fixed-rate mortgages (FRMs) in 1998, combined with
FHA actions changing underwriting for ARMs, have reduced the percentage
of ARMs to about 20 percent in 1998.
As a result of this analysis FHA has taken several steps to
mitigate these risks which include:
1. In 1998, FHA started requiring that borrowers qualify for ARMs
at 1 percent above the initial interest rate, and prohibiting
``buydowns'' of the ARM interest rate. This change will not be an
immediate cure, as FHA cannot change the terms of loans already
written, but we expect ARM claim rates should be more similar to the
FRMs in the future.
2. The FHA loan limits were increased to a 48 percent floor and an
87 percent ceiling relative to the Fannie/Freddie conforming loan
limit. These increases are also expected to reduce the rate of FHA
claims relative to the Insurance in Force (IIF), and increase
recoveries on claims. FHA experience has shown that loans in the middle
of a market are less likely to go to claim, and are less costly. They
also result in higher recoveries, as the properties are more salable.
Increasing the loan limit allows FHA more participation in the lower-
risk mid-market loans.
3. FHA has increased the use of loss mitigation which allows
homeowners to stay in their homes where possible, and preforeclosure
sales which reduce the magnitude of loss to the Fund. Making incentive
payment to a lender for modifying a loan; engaging in special
forbearance action; or filing partial claims are substantially less
expensive than the cost of foreclosing, holding, and selling a
property. There are substantial savings to the MMI Fund and benefits to
the homeowners and communities in applying loss mitigation techniques
to allow the homeowners the chance to keep their homes.
4. The Department has implemented an REO disposition method which
uses management and marketing contractors. This is also expected to
reduce expenses by providing a higher recovery on FHA properties than
previously received.
5. The Department has implemented the Homebuyer Protection Plan.
This plan was designed to address the issue of inadequate FHA
appraisals. The plan has the following components:
--Appraisals will be more thorough and will identify basic physical
conditions and potential problems;
--Homebuyers will be notified of defects and the FHA insured loan
cannot be closed until all conditions are satisfied;
--Appraisers will be accountable and tougher sanctions will be
imposed for deficient appraisals;
--The appraiser will recommend a full home inspection if a
significant problem is present;
--Home inspection costs up to $300 may be financed in FHA mortgages;
--Homeowner counseling will be emphasized;
--The FHA loan evaluation system will be available to all FHA-
approved lenders;
--FHA up-front premiums will be reduced for homebuyers who receive
counseling and/or purchase center city properties after
counseling; and
--A system to refer homeowners who are in danger of serious default
to counseling or other assistance will be developed.
These actions are expected to ensure that homebuyers get good
quality homes that will prevent major unexpected costs which might lead
to early claims and to give more timely access to counseling or other
assistance before a homeowner is enmeshed deeply in debt. Where a claim
is unavoidable, the actions are also expected to provide a better
return to the MMI Fund.
Question. In addition, REO properties have risen over 25 percent
over the last two years, with ``on-hand'' properties of 31,000 and
40,000 properties in 1997 and 1998.Has HUD implemented the property
disposition reform legislation included as part of the VA/HUD 1999
Appropriations bill? What other steps is HUD taking to reduce its HUD-
owned inventory?
Answer. HUD has not yet implemented the new property disposition
legislation; and, as stated in the 1999 and 2000 Budgets, does not
intend to begin implementation before fiscal year 2002, with a phase-in
period through fiscal year 2004. One of the lessons of the assignment
reform legislation is that FHA needs sufficient time to implement major
changes to the FHA programs to involve the community and to allow
lenders and credit counselors to become familiar with the changes. This
legislation was requested to give FHA an additional tool to increase
returns to the fund, to be applied as conditions warrant.
An additional reason for delaying the implementation of the
legislation is that FHA implemented, in March of 1999, the Management
and Marketing contracts which allow private concerns to maintain and
sell HUD-held properties. Some time will be required to evaluate the
effectiveness of this effort.
Question. Also, GAO's high-risk review of HUD indicated that there
are serious issue with regard to the use of appraisals (based on audits
in New Jersey and Ohio), where the appraisals did not take into account
structural soundness and continued marketability of Housing. What is
HUD doing to ensure that appraisals reflect the market value of a
property?
Answer. The Management and Marketing contracts are a major step HUD
has taken to reduce the property inventory. As of March 31, 1999, 16
contractors have been managing the FHA-held single family properties,
each handling a region of the country. The contractors have bid to
receive a percentage of the selling price, so they have a real
incentive to sell the properties for the highest possible price and as
fast as possible. These contracts are expected to reduce inventories,
lower holding time and costs, provide better security and maintenance
while properties are in the inventory, and increase sales proceeds.
Note: Senator Bond is using claim numbers somewhat at variance with
our budget numbers. MMI claims shown in the actual columns of the
Budgets were:
--53,111 and $4,113M in 1996 (1998 Budget) and
--59,275 and $5,291M in 1998 (2000 Budget) and
--The total SF number of properties shown on the roll-forward tables
from accounting is 26,837 on 9/30/96; 34,116 on 9/30/97, and
39,370 on 9/30/98.
fair housing insurance investigations
Question. HUD is trying to micromanage CDBG, HOME and public
housing through fair housing policy. For example, HUD recently issued a
proposed rule that conditioned the receipt of CDBG funds on an
acceptable (as approved by HUD) fair housing policy by the state or
locality. HUD also has interfered with the ability of PHAs to address
discrimination complaints by prohibiting PHAs from using public housing
funds to investigate or litigate complaints. HUD also has threatened to
cut off public housing funds to PHAs unless PHAs settle any
discrimination complaints. Mr. Secretary, your comments.
Answer. A ``charge'' of a violation of the Fair Housing Act by HUD
is not mere accusation or allegation. Pursuant to the Fair Housing Act
regulations, HUD may only issue a charge after HUD has:
--determined that the allegations state a claim under the Fair
Housing Act;
--determined that the claim is timely;
--determined that the complainant has standing to assert the
violation;
--notified the respondent of the Fair Housing Act complaint;
--permitted the person to submit any evidence that responds to the
allegations;
--investigated the complaint, including exculpatory evidence;
--attempted to conciliate the complaint; and
--based upon its full investigation and all evidence submitted by
both parties, determined that reasonable cause exists to
believe a discriminatory housing practice has occurred.
The Department has a statutory duty to affirmatively further fair
housing in all HUD programs, including the Community Development Block
Grant program. When the Department has credible evidence that a
jurisdiction has violated the Fair Housing Act or other civil rights
authorities administered by the Department, it is obligated not only to
pursue the case under civil rights authorities, but to ensure that HUD
is not furthering the discrimination by funding the jurisdiction that
is violating a fair housing law. HUD has been sued for its failure to
ensure such affirmative furthering of the fair housing laws in the
past.
If a jurisdiction has been charged with a Fair Housing Act
violation, this serves as evidence challenging the jurisdiction's
certification that it is complying with fair housing laws. HUD
regulations require that the jurisdiction be consulted and be given an
opportunity to cure the suspect certification. In many instances, the
Department will require the jurisdiction to provide special assurances
of compliance with fair housing laws prior to obligating the CDBG
funding. If the jurisdiction does not cure the suspect certification by
resolving the fair housing charge or providing adequate special
assurances, then the Department will reallocate the CDBG funding to
other jurisdictions that are complying with fair housing laws.
Once a court renders a judgment in a fair housing case, the matter
is resolved and there is no need for the Department to take further
action.
HUD issued a proposed rule in order to obtain public comment. The
Administrative Procedures Act requires this and the Department was
evaluating the public comments. HUD fully complied with the
Administrative Procedure Act requirements. In fact, HUD extended the
comment period and invited numerous groups (including a briefing with
representatives from the House Majority staff of the Housing
Subcommittee on Housing and Community Opportunity) to discuss their
views during this comment period.
HUD does not require submission and approval of a jurisdiction's
analysis of impediments to fair housing choice. However, HUD provided
extensive training and developed a guide to provide information on
developing an analysis of impediments. In 1996, HUD published a Fair
Housing Planning Guide which provided information on how to conduct an
Analysis to Fair Housing Choice, undertook activities to correct the
identified impediments, and the types of documentary records to be
maintained. In addition to HUD field staff working with communities,
HUD conducted 22 training sessions nationwide during the summer, fall,
and winter of 1997. These sessions were attended by over 1,700 people
representing CDBG and HOME grantees, public housing agencies, fair
housing organizations, and housing industry groups. These sessions
educated participants about the rights of their constituents to fair
housing planning.
home improvement loans
Question. GAO in July 1998 reported problems with HUD's oversight
of the lenders' compliance of the home improvement loan program, noting
that in fiscal year 1997, HUD conducted on-site quality assurance
reviews of only 4 of the 3,700 lenders in the program. What is HUD
doing to ensure that lenders' comply with the home improvement loan
program and homeowners are not being defrauded?
Answer. FHA has charged the Home-Ownership Centers (HOCS) with
reviewing a portion of the 203(k) home improvement loans, as well as
other FHA loans, for compliance with FHA regulations. If substantial
violations are found the case is forwarded for remediation and/or
penalties. This April, FHA furnished additional information to GAO
regarding oversight of the 203(k) program. A summary of this
information follows: from January 1, 1996 through February 28, 1999,
FHA performed 52 quality assurance reviews on lenders originating
203(k) loans, resulting in 3 referrals for Limited Denial of
Participation, 6 Referrals for Debarment, 9 lenders referrals to the
Mortgagee Review Board, and 3 additional firms referred to the HUD OIG
for violations.
Based on data for January 1996 through February 1999 period, 203(k)
loans are concentrated among a relatively few lenders. While 2,158
different lenders made these loans, 89 lenders (4 percent) wrote 60
percent of the 50 thousand loans. The Quality Assurance Divisions
monitored 19 percent of these high volume lenders in this period.
On Title I cases, a training program is being developed so that
staff can exercise closer scrutiny on cases going to claim to ensure
that the proper underwriting standards were applied when the loan was
written. FHA plans to review cases going to claim in 1998 and 1999,
with further reviews depending on the results.
home warranties
Question. HUD is revising the requirement that new homes covered by
FHA mortgage insurance be protected through 10-year structural
warranties; in the future, the warranties will not have to exceed a 1-
year period. Why is HUD reducing the time that new homes must be
covered by structural warranties?
Answer. HUD published the Builder Warranty Rule for High-Ratio FHA-
insured Single Family Mortgages for New Homes in the Federal Register
on March 25, 1999, as an interim rule in order to avoid elimination of
all warranties under the terms of the Downpayment Simplification
provisions (Sec. 212) of the fiscal year 1999 Appropriations Act.
Congress extended this legislation for Downpayment Simplification for
loans executed for insurance in fiscal years 1998, 1999 and 2000.
Statutory provisions of the Downpayment Simplification program would
override and eliminate all existing FHA high ratio requirements.
However, instead of eliminating warranty requirements entirely, FHA
changed the requirement to a comprehensive, 1-year builder warranty.
This type of warranty, which is standard in the home building industry,
is consistent with the intent of the Down Payment Simplification
legislation, which was to bring FHA requirements more in line with the
private sector practices.
The background and rationale behind the Builder Warranty Interim
Rule also provide perspective on the interim rule. Prior to approval of
the 1999 HUD/VA Appropriations Act, FHA required new homes (a year old
or less) to meet certain conditions in order to qualify for a high
ratio loan (defined as those loans with a loan-to-value ratio greater
than 90 percent), including pre-approval of plans and specifications
for the home or the requirement of a home warranty ``acceptable to the
Secretary of HUD.''
FHA believes that the warranty change is sound policy for several
additional reasons:
1. The 10-year warranty requirement costs FHA borrowers hundreds of
dollars more than a standard 1-year builder's warranty, yet it provides
relatively little effective protection to consumers in the later years.
Rather than force FHA borrowers to pay for this warranty, HUD is
bringing its requirements into line with the rest of the home finance
industry.
2. FHA is not prohibiting 10-year warranties; rather it would no
longer require these warranties to qualify for high ratio loans. The
builder or 10-year warranty provider can still provide these warranties
and homebuyers can still purchase them. New construction represents
approximately 3 percent of FHA business in the recent past, so the
overall impact of the elimination of the 10-year warranty requirement
is slight.
3. Building industry standards and local code enforcement practices
have progressed substantially since the 10-year warranty was first
instituted, providing much greater protection to consumers.
Furthermore, local government agencies are much more aggressive in
enforcing local building codes, further mitigating the risk of
significant problems with a newly constructed home.
That being said, the Department is sensitive to the issues outlined
in the comments we have received, and, as a result, has withdrawn the
Builder Warranty interim rule, effective April 23, 1999. Although the
points outlined still represent the position of the Department, it has
agreed to further consider this issue.
financial audit of hud's fiscal year 1998 financial statements.
Question. Clean Financial Audit of HUD's fiscal year 1998 Financial
Statements. For the first time, the HUD IG (and KPMG) was able to
conclude that HUD's consolidated financial statements were reliable in
all material aspects. Nevertheless, while HUD deserves praised for this
result, the final audit reflects serious and continued weaknesses in
HUD's internal controls and financial management systems. For example,
HUD remains unable to ensure the reliability of income data for
purposes of determining the Federal subsidy payment. As discussed
elsewhere, HUD estimated that it overpaid rental subsidies by $900
million in 1997 because of poor data control. This audit also
determined that HUD was unable to substantially comply with the Federal
Financial Management Improvement Act (FFMIA).
Nevertheless, KPMG's March 9, 1999 report on FHA's financial
statements concluded that (1) FHA must address staff and administrative
resource issues; (2) FHA must place additional emphasis on early
warning and loss prevention systems for insured mortgages; (3) FHA must
improve federal basis and budgetary accounting; and (4) Information
technology systems must be improved. KPMG raised a number of other
serious FHA issues, especially with regard to HUD-held properties. What
steps has HUD taken to address these concerns?
Answer. Local administrators of HUD's rental assistance programs
(i.e., public housing agencies and private owners/management agents)
determine rental assistance eligibility and level of benefits based
primarily on household income data. Long-standing problems have been
that: (a) some tenants fail to report all income as required, and
therefore receive excess rental assistance, and (b) local
administrators generally do not have access to income data needed to
determine if tenants failed to disclose all their income.
As a partial solution to the problem, in recent years HUD has
supplied local administrators with social security and supplemental
security income data that HUD receives from the Social Security
Administration, for tenants scheduled to recertify for rental
assistance. The income data provides up-front income data to prevent
future abuses, and to detect past abuses.
Because of various legal, technical and administrative constraints,
local administrators generally cannot obtain access to other income
data, i.e., wages and unearned income data, needed to detect income
amounts that tenants fail to report. The excess rental assistance
tenants receive from failing to report their income occurs primarily
from the legal, technical and administrative constraints--not from poor
data control. HUD plans to implement a large-scale computer matching
program in calendar year 1999 that will aid significantly in detecting
and deterring program abuses involving unreported income. This
initiative involves the use of wage and unearned income data that HUD
receives from the Social Security Administration and the IRS.
Hopefully, by the end of July, detailed Corrective Action Plans
will be established to address all of the deficiencies identified in
both the FHA and HUD audits. In most cases, the Department has already
initiated, or is well on its way in accomplishing recommended
improvements. For example, FHA developed and implemented an approach in
the past year to meet Federal accounting standards for the fiscal year
1998 Financial Statements, in addition to continued compliance with
commercial standards. This was a major accomplishment and enabled the
auditor to render a clean opinion on the Department's consolidated
financial statement. FHA has formulated detailed workplans to refine
and make further improvements. For example, for the material weakness
``Federal Basis and Budgetary Accounting Must Be Improved'' identified
in the audit of 1998 FHA financial statement and noted in the question,
KPMG made five specific recommendations. FHA responded with a
management workplan to implement each, with which the independent
auditor agreed. The audit recommendations and workplan are as follows:
1. Implement routine procedures to analyze unliquidated obligations
for contracts and purchase orders and de-obligate those items which
have expired, timely;
--FHA plans to implement routine procedures, as recommended, to
analyze unliquidated obligations for contracts and purchase
orders and de-obligate those items which have expired, all in a
timely manner. Although details of the new procedures have yet
to be worked out, the three offices to be involved in
coordinating the new procedures have all agreed in writing to
ensure that the task is accomplished.
2. Reconcile the accounting and budget systems for loan guarantee
commitments and endorsements, to ensure all credit subsidy amounts are
recorded properly;
--FHA is reconciling the accounting and budget systems for loan
guarantee commitments and endorsements and has reissued to the
field the established procedures related to positive credit
subsidy. Beginning with fiscal year 1999, regular
reconciliation of obligational and disbursement reports are
being conducted to resolve discrepancies and to correct records
on an on-going basis. Prior-year disbursements and obligations
are being reconciled to determine whether a cumulative
adjustment is needed. Additionally, a comprehensive examination
of reporting systems, field guidance, and budget execution
procedures is underway, including implementation of a new
Development Application Processing (DAP) System to provide
integrate loan application processing by field offices with on-
line funds assignment and control.
3. Prepare formal documentation of the process to prepare Federal
basis financial statements and the SF-133, which includes cross walks
of GAAP accounts to the Federal basis, and identify all required
sources of budgetary system information;
--Last year FHA recognized the need for documentation of the process,
and included the requirement in the statement of work provided
to the contractor responsible for preparation of the fiscal
year 1998 financial statements. The contractor has documented
the process to prepare Federal basis Financial Statements and
the SF 133s. Also, the contractor is implementing the use of
budgetary accounts in the FHA accounting system.
4. Prepare formal documentation of the cost allocation time survey
process, and conduct the survey periodically during the year; and
--FHA agrees that a routine cost allocation time survey must occur.
The process used to conduct the cost allocation survey for
fiscal year 1998 was not formally documented because FHA had
not decided whether to continue using the same survey
methodology, however, this documentation was completed in
March. FHA plans to conduct a mid-year and an year-end time
allocation survey for fiscal year 1999 using the same approach
used last year. The mid-year survey will be initiated shortly
using an updated list of approximately 150 survey recipients.
In fiscal year 2000 and future years, FHA will continue to
utilize the time allocation survey approach periodically
throughout the fiscal year, while also investigating alternate
sources of full cost identification and time allocation data
such as Activity Based Costing (ABC).
5. Implement existing plans to address identified financial
management issues related to the LLG.
--FHA's contractor has completed documentation of model data sources
and assumptions, as well as LLG methodology and sensitivity
analysis. Policies and procedures are currently being
developed.
los angeles community development bank (cdb)
Question. This CDB was funded by HUD with $430 million as part of
the Federal efforts to rebuild LA after the 1992 riots. The bank was
created to help businesses rejected by commercial lenders and assisting
unsophisticated borrowers into the banking world while requiring them
to hire residents of the urban core. While the bank is still operating,
it is troubled with more than a third of its major borrowers out of
business or in trouble with their loans. Also, only about 132 jobs for
residents in the poorest areas obtained jobs as a result of bank
investments. Currently, the bank is subject to a number of lawsuits
which claim intrusive requirements by the bank caused defaults and
business failures. This is a HUD-funded entity and HUD retains
responsibility for oversight of the use of the HUD funds used to
capitalize this institution. What has HUD done to provide oversight of
this institution and what steps has HUD taken to prevent continued
losses and possible misuse of funds.
Answer. HUD's designation of the Los Angeles City and County
Empowerment Zone application as a supplemental Empowerment Zone was not
part of the Federal government's initial commitment to rebuild Los
Angeles after the 1992 riots. Rather, it grew out of the
Administration's Empowerment Zone/Enterprise Community initiative.
The city cited the need for the CDB as the lack of financial
assistance from commercial lenders to new and existing businesses in
the EZ target area. However, there was no requirement in the EDI grant
or Section 108 Loan Guarantee that the CDB assist businesses rejected
by commercial lenders or to assist unsophisticated borrowers.
The Los Angeles Community Development Bank was funded as part of
HUD's designation of the Los Angeles City and County empowerment zone
competition in December 1994. The City of Los Angeles received $100
million in Economic Development Initiative (EDI) grant funding to be
matched with an equal amount of Section 108 Loan Guarantee funding and
the County of Los Angeles received $25 million in EDI grant funding to
be used in conjunction with $25 million in Section 108 Loan Guarantees.
Note that of the amounts provided to LA County, $15 million in EDI and
$15 million in funds guaranteed by Section 108 were pledged to the CDB.
Thus, the LA CDB was to be capitalized with $115 million in EDI grant
funds and $115 million in Section 108 Loan guarantees.
Seventy-five percent of these funds were to be used within the
City's and County's Empowerment Zone (EZ) target area. The remainder of
the funds could be used for activities in an area up to a one mile
radius around the EZ target area as long as 51 percent of the jobs
created went to Zone residents. Overall, the funds were to create jobs
primarily for Empowerment Zone residents.
In addition to this funding, the City and County of Los Angeles had
received pledges from private banks in Los Angeles to contribute an
additional $200 million to the CDB for its lending operations. Finally,
at the time that the City applied for the EDI grant funds, it also
advised HUD that it intended to request an additional $200 million in
Section 108 Loan Guarantee commitments. The CDB would administer this
amount in areas which are outside of the EZ target area and are not
part of HUD's original EZ supplemental designation.
With respect to the CDB's performance, the CDB, as of March 1999,
has accomplished the following:
--approved 132 loans totaling $73.1 million, consistent with the
CDB's 10-year business plan;
--funded businesses that are projected to create or retain 2,148
jobs;
--created 744 jobs of which 19 percent have gone to residents who
live within the boundaries of the federally designated
Empowerment Zone (and though 51 percent of the jobs created to
date have not gone to EZ target area residents, the CDB
believes that this percentage can be met).
Note that HUD's expectations are that over the 10-year projected
life of the funds provided to the CDB, the jobs created or retained
will go predominantly to target area residents. The CDB has introduced
new measures to work with businesses to achieve this target.
Through January 31, 1999, the CDB has charged off 8 loans out of
more than 100 loans. Those 8 loans total $2.5 million. Of the 8, 50
percent were for loan amounts of less than $100,000 each. To the best
of the CBD's knowledge, two of the remaining 4 have gone out of
business.
With regard to the subject of lawsuits and intrusive requirements
by the bank, it is our understanding that these requirements relate to
the HUD federal program requirements emanating from the EDI grant
program and the Section 108 Loan Guarantee program generally and this
specific EDI grant developed for the CDB in particular, especially
those requirements regarding location in or within the one-mile radius
of the EZ target area and job requirements.
In May of 1999, HUD carried out an intensive review of the CDB for
compliance with the program regulations, EDI grant and Section 108 Loan
Guarantee regulations and related contracts. Based upon preliminary
information from those reviews, HUD believes that the CDB and Los
Angeles City and County are generally in compliance with such
requirements. It is expected that some recommendations will be made to
improve the quality of record-keeping.
With regard to the particular steps HUD has taken to prevent
continued losses and possible misuse of funds, HUD has not found that
any funds have been misused. HUD believes that the CDB has established
generally acceptable underwriting and due diligence criteria. However,
we expect to make some observations on the issue.
Finally, the initial CDB proposal had $200 million, a dollar-for-
dollar match, in commitments from private financial institutions to co-
lend and otherwise participate with the CDB in assisting businesses. To
date, the co-lending commitments have provided a tiny fraction of that
amount. In fact, $28 million in such commitments have been realized
from other commercial banking institutions that had not originally made
such pledges.
This lack of private market participation has placed additional
burdens on the CDB in terms of loan origination and shared security and
risk. As a result, the CDB appears to be taking on a greater level of
responsibility for the economic revitalization of the target area than
originally contemplated. At the moment, HUD believes that the CDB's
performance is consistent with its original business plan projections.
We believe that operations to date are generally within the original
parameters of the EDI grant agreements and the Section 108 Loan
Guarantee contracts.
section 108
Question. Please provide a status of all section 108 loan
guarantees by amount and project use. Also, identify the failure rate
and the reasons for any failures.
Answer. A list of all commitments approved under Section 108 (to
May 31, 1999) is attached. A breakdown of projects by activity
classification is available for commitments approved during fiscal year
1996 and fiscal year 1997. The results are as follows:
[Percent]
------------------------------------------------------------------------
Fiscal year
-------------------
1996 \1\ 1997 \1\
------------------------------------------------------------------------
Economic development................................ 61 56
Housing activities.................................. 16 23
Public facilities/improvements...................... 15 13
Acquisition (and related activities)................ 7 9
------------------------------------------------------------------------
\1\ Does not equal 100 percent due to rounding.
With respect to the ``failure'' rate, it is assumed that
information is requested regarding default and loss rates. A few
technical defaults have occurred on Section 108 loans, but no loss has
ever been incurred by the Federal Government.
This does not mean that communities who use Section 108 funds to
make loans to third parties (e.g., economic development loans) have not
experienced defaults on those loans or incurred losses due to
inadequate collateral. However, to the extent these losses created a
shortfall in the amount necessary to service the Section 108 loans,
that shortfall has always been covered by pledged CDBG funds.
In a survey conducted in 1998, the Department received more
detailed information regarding the use of CDBG funds for 332 Section
108 projects funded between 1992 and 1997. Of the 332 projects
surveyed, 202 were characterized as being for economic development
assistance. Of these 202 projects, 39 involved the unplanned use of
CDBG funds to make a required Section 108 Loan repayment and of these
39 projects, 30 were project-specific and 9 were revolving loan funds.
The 30 project-specific projects had 15 defaults or a calculated
default rate from this survey for all economic development loans of
approximately 7.4 percent. The 9 revolving loan funds funded 106 loans
and had 16 defaults or an approximately 15.1 percent default rate.
For all of the 332 projects surveyed, loan advances totaled
approximately $1.116 billion. Advances for economic development
assistance totaled approximately $736.3 million.
The defaults for the economic development project-specific grants
represented approximately 6.5 percent of the advances for economic
development assistance and approximately 4.3 percent of all advances
made by HUD between 1992 and 1998. These defaults can be attributed to
factors that influence defaults on loans made by all private and public
lenders. These factors are both endogenous (e.g., the business
competence of the borrower) and exogenous (e.g., international trade
policies that might adversely affect some lines of business). However,
given that Section 108 assistance can only be used where communities
have been unable to obtain financing without the Federal guarantee and
are frequently carried out in distressed areas, the default and loss
rates disclosed by the survey are not out of line.
SECTION 108 COMMITMENTS
Approved to May 31, 1999
------------------------------------------------------------------------
FISCAL
RECIPIENT AMOUNT YEAR
APPROVED
------------------------------------------------------------------------
ABILENE, TX.................................. $250,000 89
ABILENE, TX.................................. 190,000 90
ABILENE, TX.................................. 1,865,000 92
ABILENE, TX.................................. 7,000,000 95
AGUADILLA, PR................................ 4,850,000 86
AGUADILLA, PR................................ 3,200,000 90
AGUAS BUENAS, PR............................. 2,300,000 96
AKRON, OH.................................... 1,000,000 81
AKRON, OH.................................... 1,210,000 84
AKRON, OH.................................... 1,700,000 95
ALBANY, NY................................... 3,000,000 81
ALBANY, NY................................... 3,000,000 81
ALBANY, NY................................... 640,000 83
ALBANY, NY................................... 3,358,838 85
ALBANY, NY................................... 3,500,000 85
ALBANY, NY................................... 91,000 85
ALBANY, GA................................... 2,200,000 88
ALBANY, NY................................... 500,000 89
ALBANY COUNTY, NY............................ 660,000 97
ALBANY COUNTY, NY............................ 650,000 98
ALBANY COUNTY, NY............................ 100,000 98
ALBION, NY................................... 480,000 97
ALBION, NY................................... 265,000 98
ALBION, NY................................... 255,000 99
ALHAMBRA, CA................................. 1,370,285 85
ALHAMBRA, CA................................. 3,000,000 95
ALHAMBRA, CA................................. 2,025,000 97
ALLENTOWN, PA................................ 954,107 80
ALLENTOWN, PA................................ 600,000 85
ALLENTOWN, PA................................ 1,900,000 91
ALLENTOWN, PA................................ 4,000,000 95
ALTOONA, PA.................................. 1,500,000 81
AMSTERDAM, NY................................ 150,000 97
ANAHEIM, CA.................................. 3,000,000 97
ANDERSON, SC................................. 200,000 86
ANDERSON, SC................................. 200,000 89
ANDERSON, SC................................. 1,500,000 96
ANDERSON, SC................................. 2,000,000 97
ANDERSON, IN................................. 1,000,000 97
ANNAPOLIS, MD................................ 210,000 94
ARCADIA, NY.................................. 20,000 97
ARCADIA, NY.................................. 500,000 98
ARECIBO, PR.................................. 4,500,000 88
ARECIBO, PR.................................. 2,000,000 89
ARECIBO, PR.................................. 9,575,000 94
ASHEVILLE, NC................................ 1,500,000 98
ASHLAND, KY.................................. 600,000 82
ATHENS-CLARKE COUNTY, GA..................... 5,000,000 95
ATLANTA. GA.................................. 3,500,000 82
ATLANTA, GA.................................. 2,600,000 84
ATLANTA, GA.................................. 1,600,000 85
ATLANTA, GA.................................. 1,715,000 89
ATLANTA, GA.................................. 4,980,000 93
ATLANTA, GA.................................. 500,000 96
ATLANTA, GA.................................. 6,170,000 95
ATLANTA, GA.................................. 6,825,000 95
ATLANTA, GA.................................. 4,400,000 98
ATLANTA, GA.................................. 500,000 99
ATLANTIC CITY, NJ............................ 2,000,000 95
ATTLEBORO, MA................................ 180,000 85
AUGUSTA, GA.................................. 1,600,000 89
AUSTIN, TX................................... 8,785,000 95
AUSTIN, TX................................... 9,035,000 95
AUSTIN, TX................................... 2,000,000 96
BABYLON, NY.................................. 1,600,000 94
BABYLON, NY.................................. 600,000 95
BABYLON, NY.................................. 1,500,000 95
BAKERSFIELD, CA.............................. 2,500,000 94
BALDWIN PARK, CA............................. 800,000 82
BALDWIN PARK, CA............................. 1,700,000 83
BALDWIN PARK, CA............................. 150,000 84
BALTIMORE, MD................................ 2,000,000 81
BALTIMORE, MD................................ 1,333,000 85
BALTIMORE, MD................................ 3,000,000 85
BALTIMORE, MD................................ 1,575,187 86
BALTIMORE, MD................................ 750,000 86
BALTIMORE, MD................................ 20,500,000 88
BALTIMORE, MD................................ 5,000,000 88
BALTIMORE, MD................................ 6,750,000 91
BALTIMORE, MD................................ 4,700,000 93
BALTIMORE, MD................................ 14,000,000 95
BALTIMORE, MD................................ 34,100,000 96
BALTIMORE, MD................................ 2,100,000 96
BALTIMORE, MD................................ 13,000,000 97
BALTIMORE, MD................................ 6,700,000 98
BARBERTON, OH................................ 2,225,000 93
BARCELONETA, PR.............................. 2,800,000 95
BARNSTABLE, MA............................... 500,000 95
BATTLE CREEK, MI............................. 2,000,000 86
BAXTER SPRINGS, KS........................... 7,000,000 94
BAY CITY, MI................................. 350,000 90
BAY CITY, MI................................. 375,000 95
BAY CITY, MI................................. 590,000 97
BAY CITY, MI................................. 3,500,000 99
BAYAMON, PR.................................. 6,600,000 86
BAYAMON, PR.................................. 3,400,000 88
BEAUMONT, TX................................. 1,800,000 83
BEAUMONT, TX................................. 1,050,000 82
BEAUMONT, TX................................. 2,175,000 87
BEAUMONT, TX................................. 820,000 88
BEAUMONT, TX................................. 700,000 88
BEAUMONT, TX................................. 11,000,000 98
BEAVER COUNTY, PA............................ 400,000 80
BEAVER COUNTY, PA............................ 1,200,000 98
BELLFLOWER, CA............................... 415,000 85
BELLFLOWER, CA............................... 1,725,000 85
BELLINGHAM, WA............................... 1,542,540 86
BELLINGHAM, WA............................... 1,755,000 90
BELLINGHAM, WA............................... 700,000 95
BENTON HARBOR, MI............................ 260,000 98
BERKELEY COUNTY, SC.......................... 12,000,000 95
BERKS COUNTY, PA............................. 2,000,000 94
BESSEMER, AL................................. 840,000 88
BESSEMER, AL................................. 1,000,000 92
BESSEMER, AL................................. 4,000,000 96
BETHLEHEM, PA................................ 633,000 85
BETHLEHEM, PA................................ 800,000 89
BETHLEHEM, PA................................ 1,364,000 91
BILLINGS, MT................................. 400,000 90
BILOXI, MS................................... 2,100,000 85
BINGHAMTON, NY............................... 7,780,000 82
BINGHAMTON, NY............................... 4,205,000 92
BINGHAMTON, NY............................... 800,000 94
BIRMINGHAM, AL............................... 2,500,000 81
BIRMINGHAM, AL............................... 3,300,000 95
BIRMINGHAM, AL............................... 1,200,000 98
BOCA RATON, FL............................... 230,000 81
BOCA RATON, FL............................... 700,000 94
BOSTON, MA................................... 6,250,400 81
BOSTON, MA................................... 5,000,000 82
BOSTON, MA................................... 5,000,000 82
BOSTON, MA................................... 40,000,000 94
BOSTON, MA................................... 2,000,000 95
BOSTON, MA................................... 22,000,000 95
BOSTON, MA................................... 2,000,000 95
BOULDER, CO.................................. 4,200,000 98
BOWLING GREEN, OH............................ 2,000,000 99
BRIDGEPORT, CT............................... 250,000 94
BRIDGEPORT, CT............................... 5,000,000 95
BRIDGEPORT, CT............................... 1,750,000 95
BRIDGEPORT, CT............................... 7,295,000 97
BRIDGETON, NJ................................ 300,000 83
BRISTOL, VA.................................. 508,000 84
BRISTOL, RI.................................. 2,000,000 97
BROWNSVILLE, TX.............................. 1,200,000 85
BROWNSVILLE, TX.............................. 450,000 89
BROWNSVILLE, TX.............................. 2,560,000 96
BRYAN, TX.................................... 500,000 94
BRYAN, TX.................................... 200,000 95
BRYAN, TX.................................... 3,200,000 97
BRYAN, TX.................................... 1,200,000 99
BUCKS COUNTY, PA............................. 4,500,000 98
BUENA VISTA TOWNSHIP, NJ..................... 1,400,000 93
BUFFALO, NY.................................. 2,500,000 81
BUFFALO, NY.................................. 1,500,000 82
BUFFALO, NY.................................. 5,000,000 86
BUFFALO, NY.................................. 5,000,000 89
BUFFALO, NY.................................. 5,000,000 89
BUFFALO, NY.................................. 8,000,000 90
BUFFALO, NY.................................. 5,000,000 92
BUFFALO, NY.................................. 1,000,000 93
BUFFALO, NY.................................. 3,000,000 94
BUFFALO, NY.................................. 2,200,000 94
BUFFALO, NY.................................. 5,000,000 95
BUFFALO, NY.................................. 1,290,000 95
BUFFALO, NY.................................. 8,500,000 95
BUFFALO, NY.................................. 2,235,000 95
BUFFALO, NY.................................. 2,465,000 97
BUFFALO, NY.................................. 7,675,000 97
BUFFALO, NY.................................. 1,325,000 98
BURLINGTON, VT............................... 5,400,000 96
BURLINGTON, NC............................... 300,000 96
CAGUAS, PR................................... 452,000 85
CAGUAS, PR................................... 8,070,000 89
CAGUAS, PR................................... 2,800,000 91
CAGUAS, PR................................... 8,000,000 99
CALDWELL COUNTY, NC.......................... 2,000,000 97
CAMBRIA COUNTY, PA........................... 3,000,000 94
CAMBRIDGE, MA................................ 5,000,000 93
CAMBRIDGE, MA................................ 1,000,000 94
CAMDEN, NJ................................... 4,000,000 82
CAMDEN, NJ................................... 1,000,000 89
CAMDEN, NJ................................... 2,750,000 89
CAMDEN, NJ................................... 3,000,000 90
CAMDEN, NJ................................... 180,000 92
CAMDEN, NJ................................... 475,000 92
CANAJOHARIE, NY.............................. 800,000 97
CANAJOHARIE, NY.............................. 130,000 99
CANANDAIGUA, NY.............................. 1,480,000 97
CANANDAIGUA, NY.............................. 2,100,000 98
CANOVANAS, PR................................ 4,770,000 97
CANTON, OH................................... 5,000,000 94
CARLISLE, PA................................. 800,000 98
CARLSBAD, CA................................. 1,200,000 94
CAROLINA, PR................................. 5,221,000 80
CAROLINA, PR................................. 4,240,000 87
CAROLINA, PR................................. 9,340,000 89
CAROLINA, PR................................. 8,000,000 93
CAYEY, PR.................................... 5,000,000 95
CAYEY, PR.................................... 4,800,000 95
CAYUGA COUNTY, NY............................ 380,000 97
CAYUGA COUNTY, NY............................ 2,000,000 98
CHARLESTON, SC............................... 4,250,000 94
CHARLOTTE, NC................................ 1,645,000 95
CHARLOTTE, NC................................ 3,000,000 99
CHEBOYGAN, MI................................ 3,000,000 93
CHEEKTOWAGA, NY.............................. 2,000,000 85
CHESAPEAKE, VA............................... 6,830,000 95
CHEYENNE, WY................................. 800,000 95
CHICAGO, IL.................................. 1,500,000 82
CHICAGO, IL.................................. 12,500,000 85
CHICAGO, IL.................................. 50,000,000 95
CHICAGO, IL.................................. 20,000,000 96
CHICAGO, IL.................................. 30,000,000 96
CHINO, CA.................................... 860,000 95
CHULA VISTA, CA.............................. 1,000,000 79
CHULA VISTA, CA.............................. 750,000 91
CHULA VISTA, CA.............................. 1,000,000 99
CHULA VISTA, CA.............................. 215,000 99
CINCINNATI, OH............................... 2,000,000 81
CINCINNATI, OH............................... 9,400,000 90
CINCINNATI, OH............................... 1,300,000 96
CLEVELAND, OH................................ 7,320,500 81
CLEVELAND, OH................................ 2,000,000 82
CLEVELAND, OH................................ 260,000 95
CLEVELAND, OH................................ 2,100,000 95
CLEVELAND, OH................................ 590,000 95
CLEVELAND, OH................................ 87,000,000 95
CLEVELAND, OH................................ 2,100,000 95
CLEVELAND, OH................................ 3,000,000 97
CLEVELAND, OH................................ 1,200,000 97
CLEVELAND, OH................................ 2,500,000 97
CLEVELAND, OH................................ 12,000,000 98
CLEVELAND HEIGHTS, OH........................ 700,000 92
CLYDE, NY.................................... 270,000 97
CLYDE, NY.................................... 1,500,000 98
CLYDE, NY.................................... 205,000 99
COLLEGE STATION, TX.......................... 400,000 83
COLUMBIA, SC................................. 500,000 81
COLUMBIA, SC................................. 1,515,000 94
COLUMBIA, SC................................. 1,515,000 95
COLUMBIA, SC................................. 200,000 95
COLUMBIANA COUNTY, OH........................ 600,000 95
COLUMBUS, OH................................. 2,700,000 82
COLUMBUS, OH................................. 1,500,000 89
COLUMBUS, OH................................. 8,360,000 95
COLUMBUS, OH................................. 9,000,000 96
COLUMBUS, GA................................. 14,465,000 96
COMPTON, CA.................................. 5,000,000 95
COSTA MESA, CA............................... 2,451,000 86
COUNCIL BLUFFS, IA........................... 2,000,000 84
COVINGTON, KY................................ 900,000 81
CRANSTON, RI................................. 285,000 93
CUMBERLAND, MD............................... 550,000 94
CUMBERLAND COUNTY, NC........................ 1,500,000 99
CUYAHOGA COUNTY, OH.......................... 10,000,000 95
DADE COUNTY, FL.............................. 5,300,000 82
DADE COUNTY, FL.............................. 3,120,000 86
DADE COUNTY, FL.............................. 5,750,000 97
DADE COUNTY, FL.............................. 13,000,000 98
DADE COUNTY, FL.............................. 25,000,000 99
DALLAS, TX................................... 25,000,000 94
DALLAS, TX................................... 25,000,000 95
DANVILLE, VA................................. 2,000,000 86
DANVILLE, VA................................. 2,000,000 97
DAYTON, OH................................... 860,000 95
DEARBORN HEIGHTS, MI......................... 500,000 84
DECATUR, IL.................................. 2,500,000 95
DECATUR, IL.................................. 6,000,000 95
DELAWARE COUNTY, NY.......................... 375,000 99
DELRAY BEACH, FL............................. 200,000 95
DENVER, CO................................... 1,300,000 93
DENVER, CO................................... 15,000,000 93
DENVER, CO................................... 7,000,000 94
DENVER, CO................................... 10,000,000 95
DENVER, CO................................... 1,200,000 97
DENVER, CO................................... 7,000,000 97
DES MOINES, IA............................... 750,000 82
DES MOINES, IA............................... 407,000 90
DES MOINES, IA............................... 1,000,000 94
DES MOINES, IA............................... 1,000,000 95
DETROIT, MI.................................. 38,000,000 80
DETROIT, MI.................................. 3,626,487 81
DETROIT, MI.................................. 16,000,000 82
DETROIT, MI.................................. 60,500,000 80
DETROIT, MI.................................. 39,500,000 81
DETROIT, MI.................................. 35,000,000 86
DETROIT, MI.................................. 16,000,000 88
DETROIT, MI.................................. 7,000,000 89
DETROIT, MI.................................. 2,000,000 90
DETROIT, MI.................................. 2,000,000 92
DETROIT, MI.................................. 2,570,000 95
DETROIT, MI.................................. 3,060,000 95
DETROIT, MI.................................. 1,150,000 95
DETROIT, MI.................................. 450,000 96
DETROIT, MI.................................. 400,000 97
DETROIT, MI.................................. 1,500,000 97
DETROIT, MI.................................. 2,900,000 98
DETROIT, MI.................................. 60,000,000 99
DORADO, PR................................... 4,105,000 95
DOWNEY, CA................................... 1,700,000 91
DOWNEY, CA................................... 1,400,000 96
DUBUQUE, IA.................................. 400,000 80
DUBUQUE, IA.................................. 1,200,000 90
DUBUQUE, IA.................................. 1,000,000 91
DUBUQUE, IA.................................. 4,040,000 97
DURHAM, NC................................... 3,940,000 85
DUTCHESS COUNTY, NY.......................... 250,000 96
EAST CHICAGO, IN............................. 3,500,000 95
EAST CHICAGO, IN............................. 3,565,000 98
EAST HARTFORD, CT............................ 3,000,000 97
EAST LIVERPOOL, OH........................... 125,000 95
EAST ORANGE, NJ.............................. 8,500,000 95
EASTON, PA................................... 1,000,000 94
EDINBURG, TX................................. 3,000,000 95
EGG HARBOR CITY, NJ.......................... 3,550,000 93
EGG HARBOR TOWNSHIP, NJ...................... 5,000,000 98
EL MONTE, CA................................. 5,685,000 86
EL MONTE, CA................................. 1,550,000 96
EL MONTE, CA................................. 2,200,000 98
ELIZABETH, NJ................................ 635,000 84
ELIZABETH, NJ................................ 5,000,000 91
ELIZABETH, NJ................................ 350,000 98
ELMIRA, NY................................... 8,775,000 96
ELYRIA, OH................................... 500,000 99
ERIE, PA..................................... 1,000,000 81
ERIE, PA..................................... 1,000,000 82
ERIE, PA..................................... 1,000,000 82
ERIE, PA..................................... 6,000,000 92
ERIE, PA..................................... 2,000,000 93
ERIE COUNTY, PA.............................. 3,000,000 89
ESOPUS, NY................................... 140,000 97
ESOPUS, NY................................... 2,000,000 98
ESSEX COUNTY, NJ............................. 535,000 98
EUCLID, OH................................... 1,250,000 93
FAIRFAX, VA.................................. 1,000,000 98
FAIRFAX COUNTY, VA........................... 3,480,000 79
FAIRFAX COUNTY, VA........................... 3,325,000 88
FAIRFAX COUNTY, VA........................... 1,700,000 89
FAIRFAX COUNTY, VA........................... 5,690,000 90
FAIRFAX COUNTY, VA........................... 2,120,000 91
FAIRFAX COUNTY, VA........................... 4,755,000 92
FAIRFAX COUNTY, VA........................... 500,000 94
FAIRFAX COUNTY, VA........................... 80,000 95
FAIRFAX COUNTY, VA........................... 500,000 95
FAIRFAX COUNTY, VA........................... 1,000,000 95
FAIRFAX COUNTY, VA........................... 9,300,000 96
FAJARDO, PR.................................. 3,700,000 91
FAJARDO, PR.................................. 2,500,000 95
FALL RIVER, MA............................... 1,800,000 88
FALL RIVER, MA............................... 1,210,000 95
FALL RIVER, MA............................... 5,000,000 96
FAYETTEVILLE, NC............................. 500,000 84
FAYETTEVILLE, NC............................. 900,000 96
FILLMORE CITY, UT............................ 650,000 95
FLINT, MI.................................... 4,500,000 82
FLORENCE, SC................................. 1,100,000 85
FLORENCE, AL................................. 800,000 95
FORT BEND COUNTY, TX......................... 1,030,000 95
FORT EDWARD, NY.............................. 595,000 97
FORT EDWARD, NY.............................. 250,000 98
FORT MYERS, FL............................... 800,000 90
FORT MYERS, FL............................... 750,000 93
FORT MYERS, FL............................... 500,000 95
FORT WAYNE, IN............................... 6,500,000 82
FORT WAYNE, IN............................... 1,200,000 96
FORT WORTH, TX............................... 6,600,000 95
FORT WORTH, TX............................... 5,000,000 98
FRANKFORT, NY................................ 850,000 97
FRANKFORT, NY................................ 1,700,000 98
FRANKFORT, NY................................ 300,000 98
FRESNO, CA................................... 3,150,000 95
FRESNO, CA................................... 4,900,000 95
FRESNO COUNTY, CA............................ 500,000 97
FRESNO COUNTY, CA............................ 1,800,000 98
FRESNO COUNTY, CA............................ 500,000 98
FULTON, NY................................... 1,600,000 97
FULTON, NY................................... 2,200,000 98
FULTON COUNTY, GA............................ 600,000 85
FULTON COUNTY, GA............................ 1,000,000 96
GADSDEN, AL.................................. 1,000,000 90
GARDEN GROVE, CA............................. 4,200,000 84
GARDEN GROVE, CA............................. 13,580,000 97
GARY, IN..................................... 2,342,000 80
GARY, IN..................................... 7,440,000 94
GARY, IN..................................... 2,550,000 95
GARY, IN..................................... 3,470,000 95
GASTONIA, NC................................. 3,305,000 94
GENEVA, NY................................... 4,500,000 96
GLENVILLE, NY................................ 940,000 99
GLOUCESTER, MA............................... 175,000 93
GLOUCESTER, MA............................... 1,750,000 94
GLOUCESTER COUNTY, NJ........................ 525,000 97
GLOUCESTER COUNTY, NJ........................ 2,500,000 98
GRAND RAPIDS, MI............................. 400,000 82
GRAND RAPIDS, MI............................. 400,000 88
GREELEY, CO.................................. 700,000 85
GREELEY, CO.................................. 500,000 95
GREENCASTLE, IN.............................. 25,000,000 95
GREENE COUNTY, AL............................ 9,000,000 95
GREENE COUNTY, NY............................ 425,000 97
GREENE COUNTY, NY............................ 400,000 98
GREENE COUNTY, NY............................ 400,000 99
GREENSBORO, NC............................... 1,640,000 94
GREENVILLE, MS............................... 2,445,000 93
GREENVILLE, SC............................... 750,000 95
GREENVILLE COUNTY, SC........................ 880,000 95
GUAYNABO, PR................................. 2,800,000 85
GUAYNABO, PR................................. 9,870,000 95
GULFPORT, MS................................. 235,000 82
GULFPORT, MS................................. 1,000,000 88
HAMMOND, IN.................................. 4,193,970 81
HAMMOND, IN.................................. 500,000 82
HAMMOND, IN.................................. 1,050,000 93
HAMMOND, IN.................................. 1,495,000 96
HARLINGEN, TX................................ 2,700,000 87
HARRIS COUNTY, TX............................ 1,290,000 95
HARRISBURG, PA............................... 1,474,951 85
HARRISBURG, PA............................... 830,100 85
HARRISBURG, PA............................... 150,000 86
HARRISBURG, PA............................... 650,000 86
HARRISBURG, PA............................... 1,680,000 90
HARRISBURG, PA............................... 2,795,000 95
HARRISBURG, PA............................... 930,000 98
HARRISBURG, PA............................... 4,205,000 99
HARTFORD, CT................................. 2,400,000 95
HAVERHILL, MA................................ 4,000,000 97
HAZLETON, PA................................. 476,000 78
HESPERIA, CA................................. 3,000,000 96
HIALEAH, FL.................................. 4,655,000 81
HIALEAH, FL.................................. 850,000 84
HIDALGO COUNTY, TX........................... 335,000 90
HIDALGO COUNTY, TX........................... 1,000,000 95
HIDALGO COUNTY, TX........................... 1,000,000 97
HIDALGO COUNTY, TX........................... 1,500,000 98
HIDALGO COUNTY, TX........................... 3,000,000 99
HOLLEY, NY................................... 340,000 97
HOLLEY, NY................................... 685,000 98
HOLLYWOOD, FL................................ 8,285,000 98
HOQUIAM, WA.................................. 3,300,000 94
HOUSTON, TX.................................. 175,000,000 95
HUDSON, NY................................... 217,000 97
HUDSON, NY................................... 1,200,000 97
HUDSON, NY................................... 310,000 98
HUDSON, NY................................... 200,000 98
HUDSON COUNTY, NJ............................ 2,000,000 89
HUDSON COUNTY, NJ............................ 5,000,000 92
HUDSON COUNTY, NJ............................ 8,300,000 96
HUDSON COUNTY, NJ............................ 6,690,000 98
HUNTINGTON, WV............................... 3,500,000 96
HUNTINGTON BEACH, CA......................... 2,570,000 99
HUNTINGTON BEACH, CA......................... 6,000,000 99
HUNTINGTON PARK, CA.......................... 550,000 88
HUNTINGTON PARK, CA.......................... 2,970,000 95
HUNTINGTON PARK, CA.......................... 1,800,000 96
HUNTSVILLE, AL............................... 3,540,000 92
ILION, NY.................................... 270,000 97
ILION, NY.................................... 500,000 99
INDIANAPOLIS, IN............................. 2,000,000 79
INDIANAPOLIS, IN............................. 4,500,000 83
INDIANAPOLIS, IN............................. 14,424,571 84
INDIANAPOLIS, IN............................. 5,841,429 86
INDIANAPOLIS, IN............................. 3,200,000 95
INDIANAPOLIS, IN............................. 7,600,000 95
INDIANAPOLIS, IN............................. 6,000,000 99
INGLEWOOD, CA................................ 5,808,000 84
INGLEWOOD, CA................................ 10,000,000 95
ISLIP, NY.................................... 2,000,000 97
ITHACA, NY................................... 700,000 97
JACKSON, MI.................................. 2,110,000 95
JACKSON, MS.................................. 1,845,000 96
JACKSON, MS.................................. 1,870,000 97
JACKSONVILLE, FL............................. 500,000 80
JACKSONVILLE, FL............................. 4,400,000 89
JACKSONVILLE, FL............................. 2,850,000 90
JACKSONVILLE, FL............................. 10,000,000 94
JACKSONVILLE, FL............................. 3,845,000 95
JACKSONVILLE, FL............................. 1,065,000 96
JACKSONVILLE, FL............................. 1,700,000 96
JACKSONVILLE, FL............................. 3,400,000 96
JACKSONVILLE, FL............................. 700,000 96
JACKSONVILLE, FL............................. 2,850,000 96
JACKSONVILLE, FL............................. 550,000 97
JACKSONVILLE, FL............................. 775,000 97
JACKSONVILLE, FL............................. 1,220,000 98
JACKSONVILLE, FL............................. 10,750,000 98
JANESVILLE, WI............................... 400,000 85
JAYUYA, PR................................... 4,690,000 96
JEFFERSON COUNTY, KY......................... 9,500,000 81
JEFFERSON PARISH, LA......................... 6,800,000 90
JEFFERSON PARISH, LA......................... 2,625,000 94
JERSEY CITY, NJ.............................. 26,400,000 82
JERSEY CITY, NJ.............................. 8,000,000 95
JERSEY CITY, NJ.............................. 7,000,000 96
JOHNSTOWN, PA................................ 2,000,000 88
JOHNSTOWN, PA................................ 5,500,000 94
JUNCOS, PR................................... 4,220,000 96
KANKAKEE, IL................................. 600,000 85
KANKAKEE, IL................................. 1,600,000 98
KANSAS CITY, MO.............................. 4,000,000 79
KANSAS CITY, MO.............................. 1,000,000 80
KANSAS CITY, MO.............................. 3,000,000 83
KANSAS CITY, MO.............................. 7,000,000 83
KANSAS CITY, MO.............................. 1,000,000 85
KANSAS CITY, MO.............................. 1,500,000 85
KANSAS CITY, MO.............................. 1,755,000 88
KANSAS CITY, MO.............................. 3,000,000 90
KANSAS CITY, MO.............................. 3,250,000 92
KANSAS CITY, MO.............................. 2,000,000 92
KANSAS CITY, MO.............................. 4,500,000 92
KANSAS CITY, MO.............................. 5,000,000 94
KANSAS CITY, MO.............................. 500,000 94
KANSAS CITY, MO.............................. 250,000 94
KANSAS CITY, MO.............................. 1,500,000 94
KANSAS CITY, MO.............................. 1,500,000 95
KANSAS CITY, MO.............................. 3,500,000 95
KANSAS CITY, MO.............................. 1,600,000 95
KANSAS CITY, KS.............................. 7,800,000 95
KANSAS CITY, MO.............................. 14,200,000 95
KANSAS CITY, MO.............................. 10,000,000 99
KENNER, LA................................... 750,000 89
KENNER, LA................................... 300,000 90
KENNER, LA................................... 250,000 90
KENNER, LA................................... 700,000 92
KENOSHA, WI.................................. 1,100,000 81
KENOSHA, WI.................................. 500,000 82
KETTERING, OH................................ 515,000 88
KETTERING, OH................................ 2,255,000 96
KING COUNTY, WA.............................. 8,000,000 96
KINGSTON, NY................................. 3,700,000 95
KINGSTON, NY................................. 436,000 97
KIRYAS JOEL, NY.............................. 2,280,000 96
KIRYAS JOEL, NY.............................. 220,000 97
KITSAP COUNTY, WA............................ 1,500,000 96
KITSAP COUNTY, WA............................ 2,700,000 96
KNOXVILLE, TN................................ 4,280,000 89
LAFAYETTE, LA................................ 100,000 90
LAFAYETTE, IN................................ 3,300,000 95
LAKE COUNTY, OH.............................. 3,000,000 93
LAKELAND, FL................................. 310,000 94
LAKEWOOD, CO................................. 2,805,000 94
LAKEWOOD, CO................................. 2,050,000 95
LANCASTER, OH................................ 300,000 89
LANCASTER, PA................................ 1,500,000 94
LANCASTER, CA................................ 4,000,000 95
LANCASTER, OH................................ 1,750,000 97
LANCASTER, CA................................ 3,100,000 99
LANSING, MI.................................. 500,000 82
LANSING, MI.................................. 3,500,000 83
LARAMIE, WY.................................. 1,500,000 95
LAREDO, TX................................... 1,700,000 99
LAS MARIAS, PR............................... 1,300,000 96
LAWRENCE, MA................................. 3,800,000 80
LAWRENCE, MA................................. 3,316,000 83
LAWRENCE, MA................................. 700,000 93
LAWRENCE, MA................................. 12,000,000 95
LAWTON, OK................................... 445,000 99
LEAVENWORTH, WA.............................. 2,220,000 95
LEWIS COUNTY, NY............................. 3,000,000 99
LEWISTON, ME................................. 500,000 95
LEXINGTON COUNTY, SC......................... 12,000,000 94
LINCOLN, NE.................................. 270,000 82
LINCOLN, NE.................................. 446,000 85
LINCOLN, NE.................................. 1,000,000 85
LINCOLN, NE.................................. 1,000,000 86
LINCOLN, NE.................................. 675,000 91
LINCOLN, NE.................................. 315,000 94
LITTLE FALLS, NY............................. 850,000 97
LITTLE FALLS, NY............................. 900,000 98
LITTLE ROCK, AR.............................. 1,800,000 91
LITTLE ROCK, AR.............................. 1,800,000 96
LITTLE ROCK, AR.............................. 830,000 97
LITTLE ROCK, AR.............................. 3,000,000 98
LIVERMORE, CA................................ 185,000 94
LOCKPORT, NY................................. 1,000,000 97
LOCKPORT, NY................................. 750,000 98
LONG BEACH, CA............................... 5,000,000 80
LONG BEACH, CA............................... 8,000,000 82
LONG BEACH, CA............................... 5,000,000 85
LONG BEACH, CA............................... 5,000,000 95
LONG BEACH, CA............................... 40,000,000 95
LORAIN, OH................................... 1,000,000 84
LORAIN, OH................................... 700,000 85
LORAIN, OH................................... 500,000 88
LORAIN, OH................................... 350,000 91
LORAIN, OH................................... 170,000 92
LORAIN, OH................................... 2,200,000 92
LOS ANGELES, CA.............................. 795,000 80
LOS ANGELES, CA.............................. 9,532,684 87
LOS ANGELES, CA.............................. 60,000,000 93
LOS ANGELES, CA.............................. 300,000,000 95
LOS ANGELES, CA.............................. 5,915,000 95
LOS ANGELES, CA.............................. 40,000,000 96
LOS ANGELES COUNTY, CA....................... 600,000 83
LOS ANGELES COUNTY, CA....................... 400,000 84
LOS ANGELES COUNTY, CA....................... 218,400 85
LOS ANGELES COUNTY, CA....................... 2,300,000 86
LOS ANGELES COUNTY, CA....................... 1,414,000 87
LOS ANGELES COUNTY, CA....................... 500,000 89
LOS ANGELES COUNTY, CA....................... 1,060,000 90
LOS ANGELES COUNTY, CA....................... 305,000 94
LOS ANGELES COUNTY, CA....................... 4,000,000 95
LOS ANGELES COUNTY, CA....................... 2,180,000 94
LOS ANGELES COUNTY, CA....................... 25,000,000 95
LOS ANGELES COUNTY, CA....................... 30,000,000 95
LOS ANGELES COUNTY, CA....................... 2,000,000 96
LOUISVILLE, KY............................... 4,064,000 81
LOUISVILLE, KY............................... 7,280,000 83
LOUISVILLE, KY............................... 2,150,000 85
LOUISVILLE, KY............................... 7,000,000 95
LOUISVILLE, KY............................... 4,000,000 97
LOUISVILLE, KY............................... 5,000,000 97
LOWELL, MA................................... 10,000,000 94
LYNN, MA..................................... 10,500,000 82
LYNN, MA..................................... 7,890,000 92
LYNN, MA..................................... 3,400,000 95
LYNN, MA..................................... 3,000,000 95
LYNN, MA..................................... 1,200,000 95
LYNN, MA..................................... 1,750,000 98
LYNWOOD, CA.................................. 1,500,000 89
LYONS, NY.................................... 500,000 98
LYONS, NY.................................... 200,000 99
MACEDON, NY.................................. 130,000 97
MACON, GA.................................... 1,130,000 87
MACON, GA.................................... 750,000 89
MACON, GA.................................... 280,000 89
MACON, GA.................................... 2,500,000 93
MACON, GA.................................... 500,000 95
MADISON, WI.................................. 2,900,000 98
MADISON COUNTY, NY........................... 725,000 97
MAHONING COUNTY, OH.......................... 1,000,000 95
MALDEN, MA................................... 500,000 85
MALDEN, MA................................... 475,000 90
MALDEN, MA................................... 1,800,000 92
MALDEN, MA................................... 500,000 95
MALDEN, MA................................... 3,000,000 95
MANATI, PR................................... 8,915,000 95
MANSFIELD, OH................................ 1,100,000 83
MANSFIELD, OH................................ 4,000,000 98
MASSILLON, OH................................ 800,000 85
MASSILLON, OH................................ 2,250,000 99
MAURICE RIVER TOWNSHIP, NJ................... 660,000 98
MAYAGUEZ, PR................................. 2,942,080 80
MAYAGUEZ, PR................................. 2,785,000 85
MAYAGUEZ, PR................................. 5,000,000 89
MCKEESPORT, PA............................... 3,000,000 96
MEDFORD, MA.................................. 4,425,000 82
MEDFORD, MA.................................. 1,665,000 88
MEDFORD, MA.................................. 3,500,000 94
MEDFORD, MA.................................. 1,100,000 95
MEDINA, NY................................... 790,000 97
MEDINA, NY................................... 1,880,000 98
MEMPHIS, TN.................................. 3,350,000 94
MEMPHIS, TN.................................. 3,000,000 96
MEMPHIS, TN.................................. 12,000,000 98
MERCED, CA................................... 2,600,000 97
MERCER COUNTY, PA............................ 4,200,000 92
MIAMI, FL.................................... 5,958,400 85
MIAMI, FL.................................... 8,000,000 90
MIAMI, FL.................................... 2,500,000 93
MIAMI, FL.................................... 2,000,000 95
MIAMI, FL.................................... 2,700,000 95
MIAMI, FL.................................... 5,500,000 95
MIAMI, FL.................................... 4,500,000 96
MIAMI, FL.................................... 5,600,000 96
MIAMI BEACH, FL.............................. 3,120,000 85
MIAMI BEACH, FL.............................. 14,870,000 95
MIDDLETOWN, NY............................... 70,000 95
MIDDLETOWN, NY............................... 325,000 96
MIDDLETOWN, NY............................... 355,000 96
MIDDLETOWN, NY............................... 305,000 96
MIDDLETOWN, NY............................... 285,000 98
MIDDLETOWN, NY............................... 225,000 99
MILLVILLE, NJ................................ 725,000 86
MILLVILLE, NJ................................ 1,500,000 99
MILWAUKEE, WI................................ 21,500,000 95
MINNEAPOLIS, MN.............................. 800,000 80
MISSION, TX.................................. 2,010,000 95
MOBILE, AL................................... 2,000,000 91
MOBILE, AL................................... 1,000,000 94
MOBILE, AL................................... 1,380,000 94
MOBILE, AL................................... 1,200,000 96
MOBILE, AL................................... 1,325,000 95
MOBILE, AL................................... 1,470,000 97
MOBILE, AL................................... 1,450,000 97
MOLINE, IL................................... 3,000,000 92
MONROE COUNTY, NY............................ 4,000,000 89
MONROE COUNTY, NY............................ 6,345,000 94
MONTEBELLO, CA............................... 6,840,000 98
MONTEREY PARK, CA............................ 2,225,000 88
MONTGOMERY COUNTY, PA........................ 5,000,000 85
MONTGOMERY COUNTY, PA........................ 4,000,000 85
MONTGOMERY COUNTY, PA........................ 500,000 90
MONTGOMERY COUNTY, PA........................ 3,850,000 97
MOSS POINT, MS............................... 1,900,000 95
MOUNT MORRIS, NY............................. 875,000 98
MUSKEGON, MI................................. 700,000 84
MUSKEGON, MI................................. 650,000 92
MUSKEGON, MI................................. 1,500,000 97
MUSKEGON HEIGHTS, MI......................... 305,000 88
MYRTLE BEACH, SC............................. 1,475,000 95
NASHUA, NH................................... 250,000 91
NASHVILLE, TN................................ 2,500,000 82
NASHVILLE, TN................................ 2,500,000 90
NASHVILLE, TN................................ 2,000,000 95
NASHVILLE, TN................................ 6,000,000 98
NASSAU COUNTY, NY............................ 6,025,000 92
NASSAU COUNTY, NY............................ 20,000,000 96
NASSAU COUNTY, NY............................ 10,000,000 96
NASSAU COUNTY, NY............................ 6,000,000 99
NATIONAL CITY, CA............................ 700,000 87
NEW BRUNSWICK, NJ............................ 2,781,000 83
NEW HAVEN, CT................................ 2,000,000 81
NEW HAVEN, CT................................ 5,000,000 91
NEW HAVEN, CT................................ 5,000,000 95
NEW ORLEANS, LA.............................. 12,000,000 86
NEW ORLEANS, LA.............................. 5,200,000 89
NEW ORLEANS, LA.............................. 23,520,000 90
NEW ORLEANS, LA.............................. 5,600,000 91
NEW ORLEANS, LA.............................. 5,000,000 95
NEW ORLEANS, LA.............................. 15,000,000 95
NEW ORLEANS, LA.............................. 10,300,000 98
NEW ROCHELLE, NY............................. 10,690,000 95
NEW YORK, NY................................. 15,000,000 95
NEW YORK, NY................................. 8,000,000 96
NEWARK, OH................................... 500,000 84
NEWARK, NJ................................... 1,290,000 95
NEWARK, NJ................................... 4,000,000 96
NEWARK, NY................................... 875,000 97
NEWARK, NY................................... 1,000,000 98
NEWARK, NY................................... 760,000 99
NEWBURGH, NY................................. 660,000 82
NEWBURGH, NY................................. 1,500,000 92
NEWBURGH, NY................................. 365,000 97
NEWBURGH, NY................................. 2,125,000 99
NEWPORT, RI.................................. 1,350,000 94
NEWPORT, RI.................................. 3,650,000 95
NEWPORT BEACH, CA............................ 1,200,000 88
NEWPORT NEWS, VA............................. 6,000,000 82
NEWPORT NEWS, VA............................. 1,725,000 97
NIAGARA FALLS, NY............................ 3,500,000 80
NIAGARA FALLS, NY............................ 4,500,000 82
NIAGARA FALLS, NY............................ 1,000,000 82
NORFOLK, VA.................................. 32,815,000 95
NORRISTOWN, PA............................... 550,000 90
NORTH TONAWANDA, NY.......................... 60,000 97
NORTHAMPTON, MA.............................. 750,000 99
NORTON SHORES, MI............................ 250,000 94
NORWALK, CA.................................. 2,500,000 95
OAKLAND, CA.................................. 2,500,000 81
OAKLAND, CA.................................. 2,500,000 82
OAKLAND, CA.................................. 2,500,000 94
OAKLAND, CA.................................. 10,945,000 95
OAKLAND, CA.................................. 27,000,000 95
OCEAN SHORES, WA............................. 3,600,000 94
OCEANSIDE, CA................................ 2,450,000 88
OGDEN, UT.................................... 644,772 81
OGDEN, UT.................................... 2,600,000 84
OGDEN, UT.................................... 525,000 91
OGDEN, UT.................................... 1,470,000 95
OGDEN, UT.................................... 1,700,000 98
OKLAHOMA CITY, OK............................ 4,000,000 89
OKLAHOMA CITY, OK............................ 3,850,000 89
OKLAHOMA CITY, OK............................ 20,000,000 93
OKLAHOMA CITY, OK............................ 9,000,000 95
OMAHA, NE.................................... 650,000 85
OMAHA, NE.................................... 350,000 85
ONEIDA COUNTY, NY............................ 150,000 97
ONEIDA COUNTY, NY............................ 2,500,000 97
ONTARIO, CA.................................. 1,000,000 97
ONTARIO, NY.................................. 150,000 99
ONTARIO COUNTY, NY........................... 90,000 97
OREM, UT..................................... 3,230,000 95
OSHKOSH, WI.................................. 1,300,000 81
OSWEGO, NY................................... 420,000 97
OSWEGO, NY................................... 600,000 98
OSWEGO COUNTY, NY............................ 675,000 97
OWENSBORO, KY................................ 1,000,000 82
OXNARD, CA................................... 14,000,000 95
PALM BEACH CO., FL........................... 5,000,000 83
PALM SPRING, CA.............................. 2,000,000 95
PALM SPRINGS, CA............................. 400,000 94
PALMDALE, CA................................. 5,000,000 98
PALMYRA, NY.................................. 600,000 97
PALMYRA, NY.................................. 500,000 98
PALMYRA, NY.................................. 735,000 99
PASADENA, CA................................. 3,110,000 84
PASADENA, CA................................. 710,000 85
PASADENA, CA................................. 3,725,000 93
PASCAGOULA, MS............................... 1,173,000 85
PATERSON, NJ................................. 1,800,000 81
PATERSON, NJ................................. 350,000 81
PATERSON, NJ................................. 2,000,000 82
PEORIA, IL................................... 5,945,000 81
PHILADELPHIA, PA............................. 5,000,000 79
PHILADELPHIA, PA............................. 10,000,000 80
PHILADELPHIA, PA............................. 4,910,000 82
PHILADELPHIA, PA............................. 3,000,000 88
PHILADELPHIA, PA............................. 5,000,000 88
PHILADELPHIA, PA............................. 5,400,000 92
PHILADELPHIA, PA............................. 800,000 92
PHILADELPHIA, PA............................. 8,915,000 94
PHILADELPHIA, PA............................. 3,000,000 94
PHILADELPHIA, PA............................. 20,000,000 95
PHILADELPHIA, PA............................. 16,000,000 95
PHILADELPHIA, PA............................. 30,000,000 95
PHILADELPHIA, PA............................. 24,000,000 96
PHILADELPHIA, PA............................. 4,500,000 97
PHILADELPHIA, PA............................. 15,000,000 97
PHILADELPHIA, PA............................. 14,000,000 97
PHILADELPHIA, PA............................. 19,500,000 98
PHILADELPHIA, PA............................. 20,750,000 98
PHILADELPHIA, PA............................. 40,875,000 98
PHILADELPHIA, PA............................. 40,000,000 99
PHILADELPHIA, PA............................. 20,000,000 99
PHOENIX, AZ.................................. 10,840,000 81
PHOENIX, NY.................................. 40,000 97
PICO RIVERA, CA.............................. 1,850,000 96
PIERCE COUNTY, WA............................ 1,100,000 88
PIERCE COUNTY, WA............................ 1,440,000 89
PIMA COUNTY, AZ.............................. 1,200,000 90
PITTSBURGH, PA............................... 2,000,000 81
PITTSBURGH, PA............................... 1,500,000 82
PITTSBURGH, PA............................... 13,450,000 97
PITTSFIELD, MA............................... 2,000,000 98
PITTSFIELD, MA............................... 1,050,000 99
PLATTSBURGH, NY.............................. 450,000 97
POHATCONG TOWNSHIP, NJ....................... 4,495,000 93
POMONA, CA................................... 1,500,000 82
POMONA, CA................................... 5,238,000 85
POMONA, CA................................... 2,445,000 96
POMONA, CA................................... 500,000 96
POMPANO BEACH, FL............................ 2,000,000 91
PONCE, PR.................................... 3,500,000 83
PONCE, PR.................................... 6,820,000 85
PONCE, PR.................................... 10,450,000 88
PONCE, PR.................................... 20,600,000 95
PORT ARTHUR, TX.............................. 565,000 94
PORT HENRY, NY............................... 250,000 97
PORTERVILLE, CA.............................. 3,885,000 96
PORTLAND, OR................................. 13,750,000 91
PORTLAND, OR................................. 8,000,000 98
PORTSMOUTH, NH............................... 820,000 94
PORTSMOUTH, VA............................... 2,400,000 96
PRICHARD, AL................................. 1,300,000 96
PRINCE GEORGE'S CO., MD...................... 450,000 81
PRINCE GEORGE'S CO., MD...................... 1,800,000 82
PRINCE GEORGE'S CO., MD...................... 1,600,000 93
PRINCE GEORGE'S COUNTY, MD................... 6,000,000 95
PRINCE WILLIAM COUNTY, VA.................... 150,000 94
PRINCE WILLIAM COUNTY, VA.................... 300,000 94
PRINCE WILLIAM COUNTY, VA.................... 2,230,000 95
PRINCE WILLIAM COUNTY, VA.................... 500,000 95
PROVIDENCE, RI............................... 1,000,000 88
PROVIDENCE, RI............................... 600,000 89
PROVIDENCE, RI............................... 2,000,000 88
PROVIDENCE, RI............................... 9,000,000 92
PROVIDENCE, RI............................... 2,000,000 93
PROVIDENCE, RI............................... 2,000,000 94
PROVIDENCE, RI............................... 1,500,000 94
PROVIDENCE, RI............................... 5,000,000 95
PROVO, UT.................................... 4,500,000 84
PUEBLO, CO................................... 1,165,000 87
QUINCY, MA................................... 7,800,000 97
RAMSEY COUNTY, MN............................ 3,000,000 96
RAYMOND, WA.................................. 1,960,000 97
READING, PA.................................. 2,500,000 88
READING, PA.................................. 5,000,000 88
READING, PA.................................. 580,000 92
READING, PA.................................. 920,000 96
RENO, NV..................................... 1,500,000 97
RICHMOND, VA................................. 3,500,000 83
RICHMOND, VA................................. 15,000,000 92
RINCON, PR................................... 3,500,000 97
RIVERSIDE, CA................................ 3,400,000 88
RIVERSIDE, CA................................ 4,130,000 95
RIVERSIDE, CA................................ 4,800,000 98
RIVERSIDE COUNTY, CA......................... 25,000,000 94
ROANOKE, VA.................................. 3,015,000 83
ROANOKE, VA.................................. 922,300 85
ROANOKE, VA.................................. 3,470,000 91
ROANOKE, VA.................................. 2,530,000 92
ROCHESTER, NY................................ 2,500,000 82
ROCHESTER, NY................................ 2,500,000 81
ROCHESTER, NY................................ 5,000,000 82
ROCHESTER, NY................................ 15,000,000 85
ROCHESTER, NY................................ 4,000,000 91
ROCHESTER, NY................................ 5,000,000 92
ROCHESTER, NY................................ 500,000 94
ROCHESTER, NY................................ 10,000,000 94
ROCHESTER, NY................................ 2,000,000 94
ROCHESTER, NY................................ 2,000,000 95
ROCHESTER, NY................................ 5,000,000 95
ROCHESTER, NY................................ 1,300,000 97
ROCHESTER, NY................................ 600,000 97
ROCK HILL, SC................................ 1,578,000 85
ROCKFORD, IL................................. 250,000 94
ROCKY MOUNT, NC.............................. 650,000 99
ROME, NY..................................... 3,000,000 96
ROYAL OAK, MI................................ 3,097,000 90
ROYAL OAK, MI................................ 2,400,000 92
SACRAMENTO, CA............................... 1,000,000 85
SACRAMENTO, CA............................... 750,000 85
SACRAMENTO, CA............................... 500,000 89
SACRAMENTO, CA............................... 1,250,000 90
SACRAMENTO, CA............................... 805,000 93
SACRAMENTO, CA............................... 1,000,000 93
SACRAMENTO, CA............................... 400,000 94
SACRAMENTO, CA............................... 1,000,000 95
SACRAMENTO, CA............................... 8,000,000 95
SACRAMENTO, CA............................... 5,445,000 97
SACRAMENTO COUNTY, CA........................ 500,000 81
SACRAMENTO COUNTY, CA........................ 1,500,000 82
SACRAMENTO COUNTY, CA........................ 500,000 84
SACRAMENTO COUNTY, CA........................ 805,302 85
SACRAMENTO COUNTY, CA........................ 500,000 87
SACRAMENTO COUNTY, CA........................ 1,500,000 89
SACRAMENTO COUNTY, CA........................ 360,000 90
SACRAMENTO COUNTY, CA........................ 1,500,000 90
SACRAMENTO COUNTY, CA........................ 2,020,000 93
SACRAMENTO COUNTY, CA........................ 1,000,000 94
SACRAMENTO COUNTY, CA........................ 1,000,000 95
SAGINAW, MI.................................. 1,500,000 84
SAGINAW, MI.................................. 2,000,000 85
SAGINAW, MI.................................. 2,500,000 87
SAGINAW, MI.................................. 1,715,000 93
SAGINAW, MI.................................. 1,500,000 96
SAGINAW, MI.................................. 375,000 98
SAGINAW, MI.................................. 500,000 99
SAINT PAUL, MN............................... 5,000,000 81
SAINT PAUL, MN............................... 4,000,000 95
SALEM, MA.................................... 600,000 89
SALEM, MA.................................... 600,000 95
SALT LAKE CITY, UT........................... 1,825,000 89
SALT LAKE COUNTY, UT......................... 5,000,000 93
SAN ANGELO, TX............................... 660,000 97
SAN ANTONIO, TX.............................. 1,000,000 81
SAN ANTONIO, TX.............................. 5,000,000 94
SAN ANTONIO, TX.............................. 38,700,000 98
SAN BENITO, TX............................... 525,000 89
SAN BENITO, TX............................... 820,000 90
SAN BERNARDINO, CA........................... 500,000 94
SAN BERNARDINO, CA........................... 7,350,000 95
SAN BERNARDINO, CA........................... 2,295,000 95
SAN BERNARDINO, CA........................... 7,000,000 98
SAN BERNARDINO COUNTY, CA.................... 1,360,000 96
SAN BUENAVENTURA, CA......................... 1,000,000 82
SAN DIEGO, CA................................ 7,134,000 80
SAN DIEGO, CA................................ 6,016,900 84
SAN DIEGO, CA................................ 1,215,000 89
SAN DIEGO, CA................................ 20,000,000 94
SAN DIEGO, CA................................ 4,400,000 94
SAN DIEGO, CA................................ 990,000 94
SAN DIEGO, CA................................ 1,760,000 95
SAN DIEGO, CA................................ 7,200,000 95
SAN DIEGO, CA................................ 5,050,000 96
SAN DIEGO, CA................................ 6,835,000 97
SAN DIEGO, CA................................ 3,600,000 98
SAN FRANCISCO, CA............................ 6,000,000 95
SAN FRANCISCO, CA............................ 50,000,000 95
SAN JOSE, CA................................. 5,200,000 95
SAN JUAN, PR................................. 4,650,000 79
SAN JUAN, PR................................. 10,700,000 86
SAN JUAN, PR................................. 7,040,000 88
SAN LEANDRO, CA.............................. 1,800,000 81
SAN LUIS OBISPO, CA.......................... 1,650,000 98
SAN MATEO COUNTY, CA......................... 2,000,000 95
SANDY CITY, UT............................... 2,515,000 95
SANTA ANA, CA................................ 13,500,000 84
SANTA ANA, CA................................ 20,000,000 93
SANTA ANA, CA................................ 13,900,000 95
SANTA ANA, CA................................ 10,000,000 95
SANTA CLARITA, CA............................ 1,385,000 93
SANTA CLARITA, CA............................ 2,300,000 99
SANTA CRUZ, CA............................... 150,000 87
SANTA ISABEL, PR............................. 1,700,000 96
SANTEE, CA................................... 2,000,000 97
SARASOTA, FL................................. 1,200,000 91
SAVANNAH, GA................................. 700,000 85
SAVANNAH, GA................................. 1,855,000 92
SAVANNAH, GA................................. 3,500,000 94
SAVANNAH, GA................................. 1,500,000 95
SCHAUMBURG, IL............................... 550,000 93
SCHENECTADY, NY.............................. 1,500,000 82
SCHUYLER COUNTY, NY.......................... 485,000 97
SCHUYLER COUNTY, NY.......................... 185,000 99
SCHUYLERVILLE, NY............................ 290,000 97
SCOTTSBORO, AL............................... 615,000 97
SCOTTSBURG, IN............................... 25,000,000 95
SCOTTSDALE, AZ............................... 2,220,000 81
SCRANTON, PA................................. 800,000 87
SCRANTON, PA................................. 4,000,000 86
SCRANTON, PA................................. 3,000,000 88
SCRANTON, PA................................. 9,957,000 91
SCRANTON, PA................................. 1,000,000 92
SCRIBA, NY................................... 1,805,000 99
SEASIDE, CA.................................. 833,700 85
SEASIDE, CA.................................. 3,030,000 96
SEATTLE, WA.................................. 2,500,000 85
SEATTLE, WA.................................. 24,200,000 94
SEATTLE, WA.................................. 2,400,000 95
SEATTLE, WA.................................. 6,860,000 96
SELMA, AL.................................... 2,200,000 95
SELMA, AL.................................... 450,000 96
SENECA COUNTY, NY............................ 880,000 97
SENECA COUNTY, NY............................ 1,200,000 98
SHARON, PA................................... 700,000 92
SHAWNEE, OK.................................. 450,000 95
SHEBOYGAN, WI................................ 1,000,000 99
SHREVEPORT, LA............................... 1,185,000 97
SHREVEPORT, LA............................... 2,200,000 98
SIMI VALLEY, CA.............................. 2,000,000 82
SIMI VALLEY, CA.............................. 1,650,000 98
SIOUX CITY, IA............................... 600,000 92
SIOUX FALLS, SD.............................. 600,000 80
SIOUX FALLS, SD.............................. 700,000 81
SIOUX FALLS, SD.............................. 370,000 81
SIOUX FALLS, SD.............................. 1,275,000 83
SOMERVILLE, MA............................... 1,000,000 81
SOMERVILLE, MA............................... 2,229,592 83
SOMERVILLE, MA............................... 5,580,000 89
SOMERVILLE, MA............................... 1,500,000 97
SOUTH BEND, IN............................... 1,920,000 80
SOUTH BEND, IN............................... 2,590,000 83
SOUTH BEND, IN............................... 600,000 89
SOUTH BEND, IN............................... 750,000 90
SOUTH BEND, IN............................... 450,000 92
SOUTH BEND, IN............................... 1,050,000 94
SOUTH BEND, IN............................... 2,400,000 98
SOUTH GATE, CA............................... 3,625,000 95
SOUTH GATE, CA............................... 5,000,000 96
SOUTH SAN FRANCISCO, CA...................... 3,785,000 98
SPOKANE, WA.................................. 5,555,000 91
SPOKANE, WA.................................. 22,650,000 97
SPRINGFIELD, IL.............................. 3,000,000 82
SPRINGFIELD, MA.............................. 3,000,000 85
SPRINGFIELD, MA.............................. 350,000 94
SPRINGFIELD, MA.............................. 900,000 94
SPRINGFIELD, MA.............................. 2,000,000 95
SPRINGFIELD, MA.............................. 2,200,000 95
SPRINGFIELD, MA.............................. 12,000,000 96
ST. CLAIR SHORES, MI......................... 500,000 84
ST. CLAIR SHORES, MI......................... 1,250,000 91
ST. JOSEPH, MO............................... 2,400,000 88
ST. JOSEPH, MO............................... 1,260,000 93
ST. LOUIS, MO................................ 2,175,000 80
ST. LOUIS, MO................................ 2,500,000 81
ST. LOUIS, MO................................ 1,500,000 82
ST. LOUIS, MO................................ 500,000 84
ST. LOUIS, MO................................ 15,000,000 84
ST. LOUIS, MO................................ 2,000,000 88
ST. LOUIS, MO................................ 2,000,000 88
ST. LOUIS, MO................................ 15,000,000 90
ST. LOUIS, MO................................ 1,000,000 95
ST. PETERSBURG, FL........................... 4,350,000 82
ST. PETERSBURG, FL........................... 1,600,000 83
ST. PETERSBURG, FL........................... 2,000,000 89
ST. PETERSBURG, FL........................... 6,250,000 98
STOCKTON, CA................................. 10,000,000 99
STOCKTON, CA................................. 3,000,000 99
SUFFOLK COUNTY, NY........................... 1,500,000 95
SULLIVAN, NY................................. 30,000 97
SUNNYSIDE, WA................................ 2,500,000 92
SUPERIOR, WI................................. 500,000 81
SYRACUSE, NY................................. 1,200,000 81
SYRACUSE, NY................................. 1,000,000 82
SYRACUSE, NY................................. 1,000,000 84
SYRACUSE, NY................................. 3,000,000 85
SYRACUSE, NY................................. 10,185,000 89
SYRACUSE, NY................................. 14,395,000 92
SYRACUSE, NY................................. 1,290,000 95
SYRACUSE, NY................................. 3,250,000 95
SYRACUSE, NY................................. 3,000,000 99
TACOMA, WA................................... 3,000,000 79
TACOMA, WA................................... 2,500,000 81
TACOMA, WA................................... 5,180,000 93
TACOMA, WA................................... 1,135,000 95
TACOMA, WA................................... 7,500,000 95
TAMPA, FL.................................... 9,920,000 96
TAMPA, FL.................................... 1,500,000 97
TAMPA, FL.................................... 4,500,000 98
TAMPA, FL.................................... 9,070,000 98
TEMPE, AZ.................................... 1,665,500 81
TERRE HAUTE, IN.............................. 3,500,000 88
TICONDEROGA, NY.............................. 120,000 97
TICONDEROGA, NY.............................. 250,000 99
TIPTON, IN................................... 25,000,000 95
TOA BAJA, PR................................. 3,150,000 86
TOA BAJA, PR................................. 3,000,000 89
TOA BAJA, PR................................. 7,600,000 92
TOA BAJA, PR................................. 9,550,000 95
TOLEDO, OH................................... 6,937,390 79
TOLEDO, OH................................... 2,000,000 81
TOLEDO, OH................................... 650,000 95
TOLEDO, OH................................... 550,000 96
TOLEDO, OH................................... 40,000,000 99
TRENTON, NJ.................................. 6,000,000 92
TRENTON, NJ.................................. 200,000 97
TRENTON, NJ.................................. 230,000 98
TROY, NY..................................... 3,610,000 88
TROY, NY..................................... 500,000 90
TRUJILLO ALTO, PR............................ 1,600,000 90
TRUMBULL COUNTY, OH.......................... 2,000,000 95
TUCSON, AZ................................... 8,200,000 80
TULSA, OK.................................... 10,053,000 88
TULSA, OK.................................... 2,800,000 95
TYLER, TX.................................... 400,000 90
ULSTER COUNTY, NY............................ 2,000,000 96
ULSTER COUNTY, NY............................ 2,500,000 97
UNION, NY.................................... 2,000,000 95
UNION CITY, CA............................... 3,900,000 97
UPLAND, CA................................... 3,200,000 95
UTICA, NY.................................... 504,000 81
UTICA, NY.................................... 740,000 84
UTICA, NY.................................... 1,750,000 86
UTICA, NY.................................... 1,500,000 88
UTICA, NY.................................... 9,000,000 92
UTICA, NY.................................... 6,000,000 95
VACAVILLE, CA................................ 555,000 92
VACAVILLE, CA................................ 1,200,000 98
VALPARAISO, IN............................... 25,000,000 95
VEGA BAJA, PR................................ 4,500,000 94
VEGA BAJA, PR................................ 6,455,000 95
VEGA BAJA, PR................................ 2,370,000 99
VERNON, AL................................... 1,785,000 98
VIEQUES, PR.................................. 5,000,000 94
VILLALBA, PR................................. 2,440,000 95
VIRGINIA BEACH, VA........................... 2,000,000 93
VISTA, CA.................................... 5,675,000 99
WALTHAM, MA.................................. 2,350,000 95
WANAQUE, NJ.................................. 2,310,000 95
WARREN, OH................................... 3,000,000 87
WARREN, OH................................... 650,000 90
WARREN, OH................................... 1,000,000 95
WARREN COUNTY, NY............................ 130,000 97
WASHINGTON, DC............................... 4,000,000 89
WASHINGTON, DC............................... 5,000,000 92
WASHINGTON, DC............................... 11,500,000 95
WASHINGTON, DC............................... 5,000,000 97
WASHINGTON CO., PA........................... 2,500,000 81
WATERBURY, CT................................ 13,000,000 95
WATERFORD, MI................................ 255,000 93
WATERFORD, NY................................ 180,000 97
WATERFORD, NY................................ 500,000 98
WATERVLIET, NY............................... 40,000 97
WAUKEGAN, IL................................. 1,500,000 84
WAUKEGAN, IL................................. 250,000 86
WAUSAU, WI................................... 2,000,000 95
WAYNE COUNTY, MI............................. 225,000 88
WAYNE COUNTY, NY............................. 720,000 97
WAYNE COUNTY, NY............................. 600,000 98
WAYNE COUNTY, MI............................. 535,000 98
WEST PALM BEACH, FL.......................... 710,500 85
WEST PALM BEACH, FL.......................... 1,095,000 94
WEST PALM BEACH, FL.......................... 900,000 99
WEST VALLEY CITY, UT......................... 1,150,000 88
WEST WINDSOR TOWNSHIP, NJ.................... 870,00 96
WESTFIELD, MA................................ 2,200,000 94
WESTLAND, MI................................. 625,000 85
WESTLAND, MI................................. 530,000 96
WESTLAND, MI................................. 300,000 97
WESTMINSTER, CA.............................. 2,900,000 95
WESTMORELAND CO., PA......................... 750,000 80
WESTMORELAND COUNTY, PA...................... 1,810,000 98
WESTPORT, NY................................. 190,000 97
WHEELING, WV................................. 2,000,000 97
WHITEHALL, NY................................ 630,000 97
WHITEHALL, NY................................ 1,295,000 98
WHITTIER, CA................................. 743,000 79
WICHITA, KS.................................. 3,645,000 96
WILLIAMSPORT, PA............................. 1,600,000 95
WILMINGTON, DE............................... 1,000,000 81
WILMINGTON, NC............................... 215,000 89
WILMINGTON, NC............................... 1,000,000 95
WINCHENDON, MA............................... 2,900,000 95
WINSTON-SALEM, NC............................ 2,198,000 85
WOODLAND, CA................................. 800,000 95
WOONSOCKET, RI............................... 230,000 85
WORCESTER, MA................................ 23,000,000 93
WORCESTER, MA................................ 5,935,000 95
YATES COUNTY, NY............................. 300,000 97
YONKERS, NY.................................. 3,947,000 82
YONKERS, NY.................................. 18,000,000 95
YORK COUNTY, PA.............................. 300,000 90
YOUNGSTOWN, OH............................... 500,000 89
YOUNGSTOWN, OH............................... 1,250,000 90
YOUNGSTOWN, OH............................... 1,275,000 90
YOUNGSTOWN, OH............................... 810,000 92
YOUNGSTOWN, OH............................... 4,000,000 93
YOUNGSTOWN, OH............................... 2,500,000 93
YOUNGSTOWN, OH............................... 850,000 94
YOUNGSTOWN, OH............................... 650,000 94
YOUNGSTOWN, OH............................... 300,000 95
YOUNGSTOWN, OH............................... 2,000,000 95
YOUNGSTOWN, OH............................... 2,300,000 96
YOUNGSTOWN, OH............................... 675,000 96
YOUNGSTOWN, OH............................... 1,500,000 96
YOUNGSTOWN, OH............................... 200,000 98
YOUNGSTOWN, OH............................... 1,000,000 99
YUMA, AZ..................................... 1,500,000 94
------------------------------------------------------------------------
community builders
Question. Please identify the number and function of community
builders by office. Please identify all costs associated with the
program, including salaries, education expenses, and travel expenses.
Please provide the legal opinion and the hiring requirements used.
Answer. As of June 19, 1999, there were 784 Community Builders
currently employed, which included 376 internal and 408 external hires.
Of the total external hires, 78 are Community Builder Specialists, who
are located in select program cylinders.
The grade levels of Community Builders are: GS-7/12 (Associate
Community Builders); GS-13/15 (Career Community Builders); and GS-13/15
(Community Builder Fellows).
In fiscal year 1998, the Department spent $576,000 in travel funds
in support of its Community Builder Program. In fiscal year 1999, the
Department has spent $1,098,785 through June 21, 1999, in travel funds
to support the program. In fiscal year 2000, approximately $87 million
is expected to be spent by Community Builders as follows:
Salaries & Benefits..................................... $82,620,000
Travel.................................................. 1,800,000
Training................................................ 2,783,500
--------------------------------------------------------
____________________________________________________
Total............................................. 87,203,500
There are four types of Community Builders: Senior Community
Builder (GS-14/15--career); Community Builder (GS-13/14/15--career);
Community Builder Fellow (GS-13/14/15--term appointment); and Associate
Community Builder (GS 7/9/11/12--career). The Senior Community
Builders, Community Builders, and Associate Community Builders are all
career employees. The Community Builder Fellows are all term employees
with a 2-year term appointment. They are eligible for a second 2-year
appointment at the discretion of HUD management. The authority and
duties of Community Builders are as follows:
General Description
In the past, HUD employees were asked to be facilitators as well as
monitors. These dual responsibilities were inconsistent or
contradictory. As many HUD watchers have noted, the demand that HUD
employees provide helpful, timely and responsive customer service while
at the same time acting as tough, detail-oriented regulators, monitors
and referees was unrealistic and led to increase vulnerability to
waste, fraud and abuse in HUD programs. A top priority in reforming
HUD--as suggested by both the GAO and HUD's Inspector General--was to
focus the attention of HUD employees on monitoring HUD programs to
ensure that they are well run and on ensuring compliance with HUD
regulations. Only by removing the customer service functions and giving
them to Community Builders was HUD able to effectively focus the rest
of its employees on monitoring and compliance. Thus, the position of
the Community Builder was created because HUD realizes that both roles
have a place in the Department, but that they are distinct functions
which are better performed by different individuals--in different
divisions--within the HUD organization. With the creation of the
Community Builder cadre of employees, there is now, for the first time
at HUD, a separation between customer service and program monitoring/
enforcement functions. Community Builders provide direct customer
service which addresses real community needs. All other HUD employees,
known as Public Trust Officers, are responsible for program monitoring,
compliance and enforcement. This division of responsibilities, Booz-
Allen & Hamilton concluded, ``enables HUD to focus its training and
development efforts on enhancing each group's capacity to more
effectively perform its assigned role.''
The primary responsibilities of all Community Builders are to serve
as HUD's links to communities, assisting them in identifying their
local needs through HUD programs. Community Builder customers include,
but are not limited to, taxpayers, homebuyers, renters, homeless
people, state and local government, housing authorities, lenders,
mortgage bankers, home builders, realtors, not-for-profit
organizations, and the faith-based community.
Senior Community Builder (SCB)
The Senior Community Builder (SCB) is the head of a field office
and coordinates the accomplishment of program and management priorities
included in the office's Business and Operating Plan. The SCB, who
reports to the Secretary's Representative, has direct line authority
over the Community Builders), Community Builder Fellows (CBF),
Associate Community Builders (ACB), and related support staff in the
area of Labor Relations. In addition, the SCB manages the work of field
Environmental Specialists, even though these positions are
organizationally part of the Office of Community Planning and
Development. The primary duties of the Senior Community Builder are to:
--represent the Department for all programs within the office's
geographic jurisdiction;
--serve as the Department's liaison with state and local officials,
private sector organizations and public interest groups;
--coordinate the development and implementation of the Business and
Operating Plan for their geographic jurisdiction; and
--evaluate the efficiency and effectiveness of HUD programs within
their jurisdiction.
Community Builders
Community Builders serve as the initial point of contact for all
elected officials and the critical link for HUD customers to access the
full range of HUD programs and services. They serve on the staff of the
Secretary's Representative or Senior Community Builder (SCB). Community
Builders serve as HUD's outreach arm to communities, and work to
achieve the goals and objectives contained in the local Business and
Operating Plan (BOP). Community Builders provide a wide variety of
services to communities and customers in their jurisdiction, but have
no role in the preparation, review or approval of applications for HUD
assistance. Their work is done in collaboration with Public Trust
Officers (PTOs). The work of Community Builders is guided by the
Department's new focus on community consulting and collaboration,
community-focused planning, fostering neighborhood-based empowering
partnerships, building local capabilities for problem solving, and
facilitating the development of comprehensive and integrated service
strategies within the community and at HUD. Community Builders are
responsible for:
--representing HUD at public events; educating customer groups and
the general public on HUD issues and priorities;
--educating and explaining HUD programs and special initiatives;
--performing a broad variety of marketing, liaison and related
community activities on behalf of the Offices of Housing,
Public and Indian Housing, Community Planning and Development,
Fair Housing and Equal Opportunity, and the Real Estate
Assessment Center (REAC), the Departmental Enforcement Center
(DEC) and the Office of Multifamily Housing Assistance
Restructuring (OMHAR);
--assisting in the development of field office BOPs;
--monitoring the Plan's implementation and promoting timely and
effective cross-program coordination in carrying out BOP
implementation at the local level;
--organizing and marketing all Notice of Fund Availability (NOFA) and
SuperNOFA training sessions to clients and prospective
grantees;
--providing information and consultative services to communities to
solve problems;
--identifying community needs and assessing community assets and
resources to promote HUD's strategic objectives--fight for fair
housing; increase affordable housing and homeownership; reduce
homelessness; promoting jobs and economic opportunity and
empowering people and communities;
--assisting agencies and community organizations in developing
comprehensive community development and housing priorities and
strategies;
--collaborating with community organizations and providing technical
assistance to foster local public/private partnerships to
achieve community goals and to develop local capabilities to
achieve those goals;
--providing leadership in responding to natural disasters and
implementing special Departmental initiatives;
--consulting and coordinating with other Federal and state agencies
on housing and community development initiatives;
--organizing HUD's response to controversial local issues; meeting
with special interest and advocacy groups to discuss their
issues and concerns; coordinating and facilitating meetings
between HUD program specialists and advocacy groups;
--assessing HUD customer service performance and the impact of
programs in addressing local needs through regular meetings
with housing industry, community and government organizations;
and
--identifying and addressing customer service and program delivery
deficiencies through communication and coordination with
Secretary's Representatives, Senior Community Builders and
appropriate program office officials.
Community Builders Fellows
Community Builder Fellows serve on the staff of the Secretary's
Representative or Senior Community Builder (SCB). The authority and
duties of Community Builder Fellows (CBFs), who serve on a 2-year term
appointment, are identical to those described above for career
Community Builders. The primary difference is that they bring to the
job a non-HUD perspective, expertise and experience in solving local
housing and community development problems. Working collaboratively
with career Community Builders and Public Trust Officers, the Community
Builder Fellows will augment the knowledge of community needs and
resources and enhance the capacity of HUD staff to be more effective
partners with communities in finding practical solutions to local
issues. In addition to the general Community Builder Fellows, the
Department has hired Community Builder Fellows who are Specialists in
particular program areas or initiatives.
Associate Community Builders
Associate Community Builders (ACBs) serve on the staff of the
Secretary's Representative or Senior Community Builder (SCB) in all HUD
field offices. They provide a broad-range of administrative and
clerical support to the SCB, Community Builders and Community Builder
Fellows assigned to the office. Associate Community Builders are
responsible for:
--serving as the initial point of contact for telephone inquiries and
``walk-in'' customers and being a source of general information
on HUD programs and services;
--providing support in resolving customer complaints and analyzing
customer service trends;
--assisting in the development and updating of community profiles;
--assisting in the preparation of Business and Operating Plan
progress reports; and
--supporting the Community Builders and Community Builder Fellows on
a broad range of tasks related to outreach for HUD programs and
services.
Community Builders were hired to meet Departmental human resource
requirements. Hence, a legal opinion was not required to justify the
hiring of this staff.
Attached is a listing of Community Builders, by office.
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT--SALARIES AND EXPENSES
[Staffing Data as of June 19, 1999]
----------------------------------------------------------------------------------------------------------------
Internal Community Ext. Cmty.
Builders Bldrs.
---------------------------------------- Total Public Total
Office location Assoc. Sr. Cmty. Cmty. Cmty. Trust S&E
Cmty. Cmty. Cmty. Bldr. Bldr. Bldrs. Officers Staff
Bldr. Bldr. Bldr. Fellow Spec.
----------------------------------------------------------------------------------------------------------------
Headquarters:
Departmental Mgmt......................... ...... ...... ...... ...... ...... ...... 100 100
Admin.(CBs--Special Action)............... ...... ...... ...... ...... 13 13 334 347
Comm. Plng. & Develop..................... ...... ...... ...... ...... 28 28 226 254
Real Estate Assess. Center................ ...... ...... ...... ...... 3 3 146 149
Housing................................... ...... ...... ...... ...... 11 11 596 607
Policy Develop. & Research................ ...... ...... ...... ...... 1 1 102 103
Public & Indian Housing................... ...... ...... ...... ...... 11 11 478 459
Fair Housing & Eq. Oppor.................. ...... ...... ...... ...... ...... ...... 117 117
Govt. Natl. Mtge. Assn.................... ...... ...... ...... ...... ...... ...... 56 56
Enforcement Center........................ ...... ...... ...... ...... ...... ...... 152 152
Dept. Eq. Employ. Oppor................... ...... ...... ...... ...... ...... ...... 20 20
Dept. Opers. & Coord...................... ...... ...... ...... ...... ...... ...... 27 27
Lead Hazard Control....................... ...... ...... ...... ...... ...... ...... 23 23
Chief Financial Offcer.................... ...... ...... ...... ...... ...... ...... 222 222
General Counsel........................... ...... ...... ...... ...... ...... ...... 191 191
Chief Procurement Offcer.................. ...... ...... ...... ...... ...... ...... 42 42
Chief Information Offcer.................. ...... ...... ...... ...... ...... ...... 4 4
Ofc. M/F Hsg. Assist. Restruc............. ...... ...... ...... ...... ...... ...... 19 19
-----------------------------------------------------------------
Subtotal, Headquarters.................. ...... ...... ...... ...... 67 67 2,855 2,922
Field:
Albany.................................... 1 2 1 4 ...... 8 52 60
Albuquerque............................... 2 1 1 2 ...... 6 18 24
Anchorage................................. 1 1 1 1 ...... 4 27 31
Atlanta................................... 7 8 ...... 5 ...... 20 441 461
Baltimore................................. 2 3 1 6 ...... 12 81 93
Bangor.................................... 1 ...... 1 1 ...... 3 1 4
Boise..................................... 1 ...... 1 1 ...... 3 1 4
Boston.................................... 5 3 ...... 8 ...... 16 168 184
Bimmingham................................ 1 2 1 4 ...... 8 69 77
Buffalo................................... 3 5 ...... 5 ...... 13 104 117
Burlington................................ ...... 1 1 ...... ...... 2 ........ 2
Camden.................................... 2 2 1 3 ...... 8 1 9
Casper.................................... 1 ...... 1 1 ...... 3 2 5
Charleston................................ 1 1 1 2 ...... 5 14 19
Chicago................................... 5 7 ...... 14 ...... 26 318 344
Cleveland................................. 2 2 1 8 ...... 13 78 91
Cincinnati................................ 4 1 1 3 ...... 9 4 13
Columbia.................................. 2 1 1 3 ...... 7 61 68
Columbus.................................. 2 3 1 4 ...... 10 94 104
Coral Gables.............................. 3 3 1 7 ...... 14 51 65
Dallas.................................... 1 2 1 6 ...... 10 3 13
Denver.................................... 5 4 ...... 6 10 25 536 561
Des Moines................................ 2 4 1 3 ...... 10 19 29
Detroit................................... 2 5 1 6 ...... 14 124 138
Fargo..................................... 2 ...... ...... 1 ...... 3 1 4
Flint..................................... 1 ...... 1 1 ...... 3 1 4
Fresno.................................... 2 ...... 1 4 ...... 7 1 8
Ft. Worth................................. 2 7 ...... 4 ...... 13 285 298
Greenboro................................. 1 ...... 2 9 ...... 12 118 130
Grand Rapids.............................. 1 1 1 3 ...... 6 7 13
Hartford.................................. 2 1 1 3 ...... 7 51 58
Helena.................................... 1 1 1 1 ...... 4 1 5
Honolulu.................................. 1 1 1 1 ...... 4 18 22
Houston................................... 3 4 1 5 ...... 13 57 70
Indianapolis.............................. 1 3 1 7 ...... 12 66 78
Jacksonville.............................. 1 2 1 3 ...... 7 110 117
Jackson................................... 2 2 1 3 ...... 8 47 55
Kansas City............................... 2 2 ...... 5 1 10 127 137
Knoxville................................. 1 1 1 2 ...... 5 38 43
Los Angeles............................... 2 4 1 14 ...... 21 136 157
Las Vegas................................. 2 3 1 5 ...... 11 9 20
Louisville................................ 2 ...... 1 5 ...... 8 59 67
Little Rock............................... 1 1 1 2 ...... 5 47 52
Lubbock................................... 1 ...... 1 2 ...... 4 1 5
Manchester................................ 1 1 1 1 ...... 4 21 25
Memphis................................... 3 ...... 1 3 ...... 7 5 12
Minneapolis............................... 2 1 1 8 ...... 12 72 84
Milwaukee................................. 1 1 1 4 ...... 7 64 71
Nashville................................. 2 4 1 3 ...... 10 43 53
New Orleans............................... 2 3 1 4 ...... 10 80 90
New York.................................. 6 9 ...... 11 ...... 26 230 256
Newark.................................... 1 4 1 5 ...... 11 100 111
Oklahoma City............................. 1 3 1 2 ...... 7 77 84
Omaha..................................... 1 1 1 2 ...... 5 34 39
Orlando................................... 2 ...... 1 3 ...... 6 3 9
Philadelphia.............................. 4 3 ...... 9 ...... 16 335 351
Phoenix................................... 2 3 1 5 ...... 11 59 70
Pittsburgh................................ 1 2 1 5 ...... 9 68 77
Portland.................................. 1 2 1 2 ...... 6 46 52
Providence................................ 2 1 1 1 ...... 5 12 17
Puerto Rico............................... 1 1 1 8 ...... 11 56 67
Reno...................................... 1 ...... 1 2 ...... 4 ........ 4
Richmond.................................. 2 2 1 8 ...... 13 50 63
Sacramento................................ 1 1 1 4 ...... 7 3 10
San Diego................................. ...... 1 1 2 ...... 4 3 7
San Francisco............................. 5 6 ...... 9 ...... 20 195 215
Seattle................................... 4 5 ...... 5 ...... 14 139 153
Shreveport................................ 1 ...... 1 2 ...... 4 2 6
Sioux Falls............................... 1 ...... 1 2 ...... 4 ........ 4
Salt Lake City............................ 1 2 1 3 ...... 7 1 8
San Antonio............................... 1 2 1 7 ...... 11 82 93
Santa Ana................................. ...... ...... 1 5 ...... 6 186 192
Spokane................................... 1 ...... 1 1 ...... 3 2 5
Springfield............................... ...... ...... 1 3 ...... 4 ........ 4
St. Louis................................. 1 2 1 3 ...... 7 43 50
Tampa..................................... 1 3 1 3 ...... 8 1 9
Tucson.................................... 1 ...... 1 1 ...... 3 ........ 3
Tulsa..................................... 1 ...... 1 2 ...... 4 1 5
Washington, D.C........................... 3 5 ...... 8 ...... 16 58 74
Wilmington................................ 1 ...... 1 1 ...... 3 ........ 3
-----------------------------------------------------------------
Subtotal, Field......................... 146 162 68 330 11 717 5,518 6,235
Total, S&E Staff........................ 146 162 68 330 78 784 8,373 9,157
----------------------------------------------------------------------------------------------------------------
staffing
Question. There are major staffing issues in how HUD has allocated
resources. Please describe how staff resources have been allocated by
function and office over the last 3 years as well as a cost-benefit
analysis for all staff decisions.
Answer. Recent allocations of staff are done pursuant to the HUD
2020 plans and other reorganizations within each component
organization. All staffing actions are reviewed by each Assistant
Secretary and by the Deputy Secretary's office. These staffing actions
are reviewed to ensure that the Department maintains and improves its
current capabilities and is positioned to effectively leverage the
current workforce to meet changing needs.
In 1997, HUD announced its plan to implement a Resource Estimation
and Allocation Process (REAP) that would link resources to results as
required by the Government Performance and Results Act (GPRA). Congress
asked the National Academy of Public Administration (NAPA) to conduct a
study of HUD's procurement activities and practices for estimating
human resource needs. The scope of the study was later increased to
include review of HUD's compliance with GPRA. In 1998, the Academy
developed plans to demonstrate a method which would estimate, allocate
and validate resources. In 1999, NAPA reviewed the results of pilot
demonstrations conducted in Housing and Community Planning and
Development and developed formal recommendations for HUD. The
Department will begin utilizing the results of the pilot in fiscal year
2000.
emergency cdbg funding
Question. The fiscal year 1999 supplemental appropriations
transferred authority for allocating emergency disaster funds for unmet
disaster needs from HUD to FEMA. Nevertheless, the subcommittee remains
concerned over HUD's oversight on the use of the emergency funds that
have already been allocated. Please provide a description of all
oversight actions taken by the Department. For example, Grand Forks,
North Dakota received over $200 million in fiscal year 1997 funds.
There is anecdotal evidence that a large number of houses have been
built through a buy-out program but remain unoccupied. Please provide a
status report of all funds allocated in fiscal years 1996 and 1997
under the emergency CDBG program.
Answer. HUD carries out oversight of CDBG supplemental disaster
appropriations principally through review of the grantees' performance
reporting via HUD's web-based Disaster Recovery Grant Reporting (DRGR)
system and monitoring visits. In the case of Grand Forks, North Dakota,
HUD recently completed a month-long monitoring visit and the HUD field
office staff is in the process of writing a report on that visit. There
are a number of issues that came up as a result of the monitoring visit
that are being addressed with the city.
With respect to the anecdote about a large number of houses being
built in Grand Forks and remaining unoccupied, this is what HUD's
oversight found. What is called the Congressional Subdivision includes
189 newly constructed houses. The houses sell between $90,000 to
$124,000. New houses in the area sell for a median sales price of
$130,000.
Sixty-five of the houses had been sold as of June 17, 1999. Offers
have been made for an additional 53 of the houses, pending applicant
approval. The remaining 71 houses are in various stages of
construction. The city has mounted a vigorous marketing effort to sell
the remaining houses as quickly as possible, including a radio
campaign. The location of the development outside of the traditional
city boundaries (i.e. on the west side of the Interstate, versus the
traditional location of Grand Forks on the east side) has been somewhat
of an issue in convincing residents to relocate to the new development.
This location, however, is further from the Red River and much less
likely to be affected by flooding.
Attached is a status report of CDBG disaster grants funded by
appropriations under the Omnibus Consolidated Rescissions and
Appropriations Act of 1996 (Public Law 104-134) and by the 1997
Emergency Supplemental Appropriations Act for Recovery from Natural
Disasters, and for Overseas Peacekeeping Efforts, Including Those in
Bosnia (Public Law 105-18).
CDBG DISASTER GRANTS
[Data as of the End of May, 1999--Ordered by Disaster Type]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Appropriated Obligated Disbursed Undisbursed Percent
amount Awarded amount amount Under contract amount amount disbused
--------------------------------------------------------------------------------------------------------------------------------------------------------
1997 Disaster Grants.................... $500,000,000 $488,648,776 $488,648,776 $488,648,776 $238,468,842 $250,179,934 48.8
1996 Floods............................. 50,000,000 50,000,000 50,000,000 50,000,000 28,346,098 21,653,902 56.7
---------------------------------------------------------------------------------------------------------------
Grand Totals...................... 550,000,000 538,648,77 538,648,776 538,648,776 266,814,940 271,833,836 49.5
--------------------------------------------------------------------------------------------------------------------------------------------------------
CDBG DISASTER GRANTS--DATA AS OF THE LAST WORKING DAY OF MAY, 1999
[Ordered by Disaster Type, Region, State, and Jurisdiction]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Obligated
Grantee Appropriation Obligation Grant number Awarded Obligated Under Disbursed undisbursed Percent
code date amount amount contract amount amount disbursed
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Disaster Type: 1997 Disaster Grants
Region: 01
Massachusetts:
STATE OF MASSACHUSETTS........................................ 868/00162 10/01/1998 B-98-DU-25-0001 4,297,444 4,297,444 4,297,444 ........... 4,297,444 ...........
LAWRENCE...................................................... 868/00162 03/09/1999 B-98-MU-25-0012 333,300 333,300 333,300 ........... 333,300 ...........
SALEM......................................................... 868/00162 04/06/1998 B-98-MU-25-0029 505,421 505,421 505,421 20,344 485,077 4.0
Maine: STATE OF MAINE............................................. 868/00162 07/16/1998 B-98-DU-23-0001 782,332 782,332 782,332 25,239 757,093 3.2
New Hamshire: STATE OF NEW HAMPSHIRE.............................. 868/00162 12/23/1998 B-98-DU-33-0001 557,750 557,750 557,750 ........... 557,750 18.1
Vermont: STATE OF VERMONT......................................... 868/00162 06/21/1998 B-98-DU-50-0001 1,219,587 1,219,587 1,219,587 220,251 999,336
Region: 03
Maryland: STATE OF MARYLAND....................................... 868/00162 12/01/1998 B-98-DU-24-0001 469,601 469,601 469,601 ........... 469,601 ...........
Pennsylvania:
STATE OF PENNSYLVANIA......................................... 868/00162 12/16/1998 B-98-DU-42-0001 287,832 287,832 287,832 ........... 287,832 ...........
MONTGOMERY COUNTY............................................. 867/00162 03/18/1997 B-97-UU-42-0005 650,797 650,797 650,797 525.362 125,435 80.7
West Virginia:
STATE OF WEST VIRGINIA........................................ 868/00162 04/21/1998 B-98-DU-54-0001 2,333,420 2,333,420 2,333,420 9,242 2,324,178 0.4
KANAWHA COUNTY................................................ 868/00162 05/08/1998 B-98-NU-54-0001 581,547 581,547 581,547 18,954 562,593 3.3
Region: 04
Alabama:
MOBILE........................................................ 868/00162 03/04/1999 B-98-MU-01-0006 679,777 679,777 679,777 ........... 679,777 ...........
BALDWIN COUNTY................................................ 868/00162 12/07/1998 B-98-NU-01-0002 981,301 981,301 981,301 ........... 981,301 ...........
MOBILE COUNTY................................................. 868/00162 12/02/1998 B-98-NU-01-0001 935,102 935,102 935,102 208,951 726,151 22.3
Florida: STATE OF FLORIDA......................................... 868/00162 04/24/1998 B-98-DU-12-0001 512,116 512,116 512,116 ........... 512,116 ...........
Kentucky:
STATE OF KENTUCKY............................................. 867/00162 01/29/1998 B-97-DU-21-001 4,484,904 4,484,904 4,484,904 3,694,813 790,091 82.4
CYNTHIANA/HARRISON COUNTY..................................... 867/00162 02/20/1998 B-97-NU-21-0003 867,560 867,560 867,560 648,501 219,059 74.7
FALMOUTH...................................................... 867/00162 03/02/1998 B-97-NU-21-0001 2,186,005 2,186,005 2,186,005 566,366 1,619,639 25.9
FRANKFORT/FRANKLIN COUNTY..................................... 867/00162 03/02/1998 B-97-NU-21-0004 717,760 717,760 717,760 286,203 431,557 39.9
HOPKINSVILLE.................................................. 867/00162 01/27/1998 B-97-MU-21-0002 447,174 447,174 447,174 157,632 289,542 35.3
LOUISVILLE.................................................... 867/00162 05/21/1998 B-97-MU-21-0005 2,000,197 2,000,197 2,000,197 472,467 1,527,730 23.6
OWENSBORO..................................................... 867/00162 01/27/1998 B-97-MU-21-0006 336,116 336,116 336,116 119,473 216,643 35.5
SHEPHERDSVILLE/BULLITT COUNTY................................. 867/00162 02/26/1998 B-97-NU-21-0006 1,488,753 1,488,753 1,488,753 1,325,482 163,271 89.0
BOURBON COUNTY................................................ 867/00162 05/27/1998 B-97-NU-21-0002 587,852 587,852 587,852 461,000 126,852 78.4
JEFFERSON COUNTY.............................................. 867/00162 01/29/1998 B-97-W-21-0001 2,068,840 2,068,840 2,068,840 1,772,884 295,956 85.7
PENDLETON COUNTY.............................................. 867/00162 05/07/1998 B-97-NJ-21-0005 567,439 567,439 567,439 197,439 370,000 34.8
North Carolina:
STATE OF NORTH CAROLINA....................................... 867/00162 12/19/1997 B-97-DU-37-0001 6,569,270 6,569,270 6,569,270 1,660,213 4,909,057 25.3
FAYETTEVILLE.................................................. 868/00162 03/24/1999 B-98-MU-37-0005 320,093 320,093 320,093 ........... 320,093 ...........
GOLDSBORO..................................................... 868/00162 05/19/1998 B-98-MU-37-0019 648,674 648,674 648,674 456,919 191,755 70.4
JACKSONVILLE.................................................. 868/00162 06/23/1998 B-98-MU-37-0014 308,188 308,188 308,188 1,293 306,895 0.4
RALEIGH....................................................... 867/00162 12/23/1997 B-97-MU-37-0009 3,002,052 3,002,052 3,002,052 230,672 2,771,380 7.7
WILMINGTON.................................................... 868/00162 06/23/1998 B-98-MU-37-0010 740,794 740,794 740,794 ........... 740,794 ...........
BEAUFORT COUNTY............................................... 868/00162 04/20/1998 B-98-NU-37-0003 1,421,128 1,421,128 1,421,128 558,742 862,386 39.3
CRAVEN COUNTY................................................. 868/00162 04/30/1998 B-98-NU-37-0004 1,338,999 1,338,999 1,338,999 127,446 1,211,553 9.5
JOHNSTON COUNTY............................................... 868/00162 02/17/1999 B-98-NU-37-0006 1,519,812 1,519,812 1,519,812 ........... 1,519,812 ...........
LENOIR COUNTY................................................. 868/00162 02/04/1998 B-98-NU-37-0001 10,922,932 10,922,932 10,922,932 4,139,149 6,783,783 37.9
ONSLOW COUNTY................................................. 868/00162 03/03/1998 B-98-NU-37-0002 1,347,205 1,347,205 1,347,205 113,848 1,233,357 8.5
PENDER COUNTY/SURF CITY....................................... 868/00162 09/28/1998 B-98-NU-37-0005 3,670,386 3,670,386 3,670,386 ........... 3,670,386 ...........
WAKE COUNTY................................................... 868/00162 02/04/1998 B-98-W-37-0001 1,332,066 1,332,066 1,332,066 302,483 1,029,583 22.7
Puerto Rico:
COMMONWEALTH OF PUERTO RICO................................... 868/00162 09/15/1998 B-98-DU-72-0001 15,172,960 15,172,960 15,172,960 373,552 14,799,408 2.5
BAYAMON MUNICIPIO............................................. 867/00162 01/20/1998 B-97-MU-72-0004 5,404,219 5,404,219 5,404,219 2,991,999 2,412,220 55.4
CAGUAS MUNICIPIO.............................................. 868/00162 07/21/1998 B-98-MU-72-0001 273,646 273,646 273,646 ........... 273,646 ...........
CAYEY MUNICIPIO............................................... 868/00162 05/21/1998 B-98-MU-72-0015 1,552,491 1,552,491 1,552,491 139,003 1,413,488 9.0
PONCE MUNICIPIO............................................... 868/00162 12/02/1998 B-98-MU-72-0003 4,590,285 4,590,285 4,590,285 1,990 4,588,295 ...........
SAN JUAN MUNICIPIO............................................ 868/00162 12/07/1998 B-98-MU-72-0007 315,218 315,218 315,218 ........... 315,218 ...........
Region: 05
Illinois:
STATE OF ILLINOIS............................................. 867/00162 12/03/1997 B-97-DU-17-0001 607,052 607,052 607,052 83,637 523,415 13.8
CHICAGO....................................................... 868/00162 10/19/1998 B-98-MU-17-0006 900,000 900,000 900,000 900,000 ........... 100.0
Indiana: STATE OF INDIANA......................................... 868/00162 03/18/1998 B-98-DU-18-0001 6,511,863 6,511,863 6,511,863 1,046,403 5,465,461 16.1
Michigan:
STATE OF MICHIGAN............................................. 868/00162 ........... B-98-DU-26-0001 ........... ........... ........... ........... ........... ...........
DETROIT....................................................... 868/00162 04/30/1998 B-98-MU-26-0006 3,336,146 3,336,146 3,336,146 133,536 3,202,610 4.0
WAYNE COUNTY.................................................. 868/00162 04/17/1998 B-98-UU-26-0003 975,582 975,582 975,582 491,330 484,252 50.4
Minnesota:
STATE OF MINNESOTA............................................ 867/00162 10/27/1997 B-97-DU-27-0001 71,567,909 71,567,909 71,567,909 46,662,662 24,905,247 65.2
EAST GRAND FORKS.............................................. 868/00162 01/29/1998 B-98-NU-27-0001 20,469,522 20,469,522 20,469,522 3,334,890 17,134,632 16.3
Ohio:
STATE OF OHIO................................................. 868/00162 06/18/1998 B-98-DU-39-0001 1,263,631 1,263,631 1,263,631 206,000 1,057,631 16.3
CINCINNATI.................................................... 868/00162 07/02/1998 B-98-MU-39-0003 423,621 423,621 423,621 ........... 423,621 ...........
SCIOTO COUNTY................................................. 868/00162 07/03/1998 B-98-NU-39-0002 588,670 588,670 588,670 29,338 559,332 5.0
Wisconsin:
STATE OF WISCONSIN............................................ 867/00162 03/05/1999 B-97-DU-55-0001 171,261 171,261 171,261 ........... 171,261 ...........
MILWAUKEE..................................................... 868/00162 09/30/1998 B-98-MU-55-0006 1,455,474 1,455,474 1,455,474 458,949 996,525 31.5
WAUWATOSA..................................................... 868/00162 08/10/1998 B-98-MU-55-0010 831,325 831,325 831,325 430,568 400,757 51.8
MILWAUKEE COUNTY.............................................. 868/00162 02/12/1999 B-98-W-55-0001 936,469 936,469 936,469 ........... 936,469 ...........
WAUKESHA COUNTY............................................... 868/00162 12/18/1998 B-98-W-55-0002 677,135 677,135 677,135 ........... 677,135 ...........
Region: 06
Arkansas:
STATE OF ARKANSAS............................................. 867/00162 04/01/1998 B-97-DU-05-0001 686,446 686,446 686,446 ........... 686,446 ...........
PULASKI COUNTY/COLLEGE STATION................................ 867/00162 11/19/1997 B-97-NU-05-0001 687,989 687,989 687,989 461,868 226,121 67.1
Texas: STATE OF TEXAS............................................. 868/00162 07/02/1998 B-98-DU-48-0001 2,223,138 2,223,138 2,223,138 298,299 1,924,839 13.4
Region: 08
Colorado:
STATE OF COLORADO............................................. 868/00162 05/18/1998 B-98-DU-08-0001 156,829 156,829 156,829 ........... 156,829 ...........
FORT COLLINS.................................................. 868/00162 10/18/1998 B-98-MU-08-0008 511,740 511,740 511,740 46,740 465,000 9.1
Montana: STATE OF MONTANA......................................... 868/00162 07/23/1998 B-98-DU-30-0001 863,522 863,522 863,522 2,446 861,076 0.3
North Dakota:
STATE OF NORTH DAKOTA......................................... 867/00162 01/13/1998 B-97-DU-38-0001 10,200,140 10,200,140 10,200,140 8,084,803 2,115,337 79.3
DEVIL'S LAKE/RAMSEY COUNTY.................................... 867/00162 12/30/1997 B-97-NU-38-0005 3,500,000 3,500,000 3,500,000 3,500,000 ........... 100.0
FARGO......................................................... 867/00162 09/26/1997 B-97-MU-38-0001 5,943,963 5,943,963 5,943,963 4,452,482 1,491,481 74.9
GRAND FORKS................................................... 867/00162 07/08/1997 B-97-MU-38-0002 50,000,000 50,000,000 50,000,000 50,000,000 ........... 100.0
868/00162 02/25/1998 B-98-MU-38-0002 121,567,707 121,567,707 121,567,707 60,000,000 61,567,707 49.4
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Grantee totals.............................................. ............. ........... .................. 171,567,707 171,567,707 171,567,707 110,000,000 61,567,707 64.1
=============================================================================
CASS COUNTY................................................... 867/00162 01/06/1998 B-97-NU-38-0001 1,400,000 1,400,000 1,400,000 780,840 619,160 55.8
GRAND FORKS COUNTY............................................ 867/00162 03/19/1998 B-97-NU-38-0009 2,176,049 2,176,049 2,176,049 2,176,049 ........... 100.0
MERCER COUNTY................................................. 868/00162 09/15/1998 B-98-NU-38-0003 500,000 500,000 500,000 131,227 368,773 26.2
PEMBINA COUNTY................................................ 867/00162 04/13/1998 B-97-NU-38-0004 1,000,000 1,000,000 1,000,000 601,793 398,207 60.2
RICHLAND COUNTY/WAHPETON...................................... 867/00162 03/03/1998 B-97-NU-38-0006 3,470,759 3,470,759 3,470,759 1,920,298 1,550,461 55.3
TRAILL COUNTY................................................. 868/00162 03/03/1998 B-98-NU-38-0007 1,000,000 1,000,000 1,000,000 253,417 746,583 25.3
WALSH COUNTY.................................................. 867/00162 12/23/1997 B-97-NU-38-0008 504,504 504,504 504,504 369,903 134,601 73.3
South Dakota:
STATE OF SOUTH DAKOTA......................................... 867/00162 02/11/1998 B-97-DU-46-0001 57,794,124 57,794,124 57,794,124 25,713,747 32,080,377 44.5
RAPID CITY.................................................... 867/00162 03/03/1998 B-97-MU-46-0002 642,102 642,102 642,102 473,822 168,280 73.8
Region: 09
California:
STATE OF CALIFORNIA........................................... 867/00162 01/23/1998 B-97-DU-06-0001 5,338,112 5,338,112 5,338,112 592,529 4,745,583 11.1
MODESTO....................................................... 868/00162 02/13/1998 B-98-MU-06-0002 650,426 650,426 650,426 608,337 42,089 93.5
SACRAMENTO COUNTY............................................. 868/00162 07/20/1998 B-98-UU-06-0005 400,704 400,704 400,704 317,481 83,223 79.2
SAN JOAQUIN COUNTY............................................ 867/00162 02/03/1998 B-97-UU-06-0009 1,174,098 1,174,098 1,174,098 13,183 1,160,915 1.1
SONOMA COUNTY................................................. 867/00162 01/07/1998 B-97-UU-06-0008 547,804 547,804 547,804 62,535 485,269 11.4
STANISLAUS COUNTY............................................. 868/00162 02/19/1998 B-98-UU-06-0109 575,921 575,921 575,921 324,435 251,486 56.3
YUBA COUNTY................................................... 868/00162 05/21/1998 B-98-NU-06-0030 2,563,780 2,563,780 2,563,780 ........... 2,563,780 ...........
Nevada:
STATE OF NEVADA............................................... 868/00162 05/01/1998 B-98-DU-32-0001 386,714 386,714 386,714 28,198 358,516 7.3
RENO.......................................................... 868/00162 05/13/1998 B-98-MU-32-0002 651,733 651,733 651,733 ........... 651,733 ...........
SPARKS........................................................ 867/00162 01/10/1998 B-97-MU-32-0004 988,442 988,442 988,442 48,333 940,109 4.9
Region: 10
Oregon:
STATE OF OREGON............................................... 868/00162 01/25/1999 B-98-DU-41-0001 3,721,775 3,721,775 3,721,775 ........... 3,721,775 ...........
ASHLAND....................................................... 868/00162 08/25/1998 B-98-MU-41-0008 573,391 573,391 573,391 573,391 ........... 100.0
Washington:
STATE OF WASHINGTON........................................... 868/00162 06/25/1998 B-98-DU-53-0001 2,420,113 2,420,113 2,420,113 407,104 2,013,009 16.8
YAKIMA........................................................ 867/00162 06/26/1998 B-97-MU-53-0008 204,646 204,646 204,646 ........... 204,646 ...........
KING COUNTY................................................... 868/00162 08/27/1998 B-98-UU-53-0001 613,353 613,353 613,353 ........... 613,353 ...........
KITSAP COUNTY................................................. 868/00162 05/08/1998 B-98-UU-53-0005 387,225 387,225 387,225 44,835 342,390 11.6
SNOHOMISH COUNTY.............................................. 868/00162 10/05/1998 B-98-UU-53-0003 575,522 575,522 575,522 575,522 ........... 100.0
-----------------------------------------------------------------------------
1997 Disaster Grants........................................ ............. ........... .................. 488,648,776 488,648,776 488,648,776 238,468,842 250,179,934 48.8
=============================================================================
Disaster Type: 1996 Floods
Region: 03
Maryland: STATE OF MARYLAND....................................... 866/80162 01/30/1997 B-96-DR-24-0001 988,638 988,638 988,638 607,414 381,224 61.4
Pennsylvania:
STATE OF PENNSYLVANIA......................................... 866/80162 01/30/1997 B-96-DR-42-0001 1,849,234 1,849,234 1,849,234 1,302,766 546,468 70.4
WESTMORELAND COUNTY........................................... 866/80162 01/30/1997 B-96-UR-42-0100 314,436 314,436 314,436 299,911 14,525 95.4
Virginia: STATE OF VIRGINIA....................................... 866/80162 01/30/1997 B-96-DR-51-0001 760,747 760,747 760,747 395,452 365,295 52.0
West Virginia: STATE OF WEST VIRGINIA............................. 866/80162 01/30/1997 B-96-DR-54-0001 1,388,201 1,388,201 1,388,201 407,204 980,997 29.3
Region: 04
Florida:
STATE OF FLORIDA.............................................. 866/80162 10/07/1996 B-96-DR-12-0001 6,337,634 6,337,634 6,337,634 3,161,225 3,176,409 49.9
FORT WALTON BEACH............................................. 866/80162 10/07/1996 B-96-MR-12-0030 388,174 388,174 388,174 27,748 360,426 7.1
LEE COUNTY.................................................... 866/80162 10/07/1996 B-96-UR-12-0013 1,986,965 1,986,965 1,986,965 1,045,965 941,000 52.6
Georgia: STATE OF GEORGIA......................................... 866/80162 10/07/1996 B-96-DR-13-0001 1,776,156 1,776,156 1,776,156 ........... 1,776,156 ...........
North Carolina: STATE OF NORTH CAROLINA........................... 866/80162 10/22/1996 B-96-DR-37-0001 636,674 636,674 636,674 611,455 25,219 96.0
Region: 05
Illinois: STATE OF ILLINOIS....................................... 866/80162 09/27/1996 B-96-DR-17-0001 2,522,685 2,522,685 2,522,685 938,267 1,584,418 37.2
Ohio: STATE OF OHIO............................................... 866/80162 10/18/1996 B-96-DR-39-0001 924,029 924,029 924,029 ........... 924,029 ...........
Region: 08
North Dakota: STATE OF NORTH DAKOTA............................... 866/80162 09/30/1996 B-96-DR-38-0001 267,421 267,421 267,421 267,421 ........... 100.0
Region: 10
Idaho: STATE OF IDAHO............................................. 866/80162 10/04/1996 B-96-DR-16-0001 2,553,110 2,553,110 2,553,110 1,998,201 554,909 78.3
Oregon:
STATE OF OREGON............................................... 866/80162 09/30/1996 B-96-DR-41-0001 4,526,401 4,526,401 4,526,401 3,919,565 606,836 86.6
SALEM......................................................... 866/80162 09/30/1996 B-96-MR-41-0004 1,674,705 1,674,705 1,674,705 1,093,410 581,295 65.3
CLACKAMAS COUNTY.............................................. 866/80162 09/27/1996 B-96-UR-41-0001 1,038,065 1,038,065 1,038,065 1,038,065 ........... 100.0
MULTNOMAH COUNTY.............................................. 866/80162 09/30/1996 B-96-UR-41-0003 2,616,787 2,616,787 2,616,787 1,729,296 887,491 66.1
WASHINGTON COUNTY............................................. 866/80162 09/30/1996 B-96-UR-41-0002 877,198 877,198 877,198 552,517 324,681 63.0
Washington:
STATE OF WASHINGTON........................................... 866/80162 10/29/1996 B-96-DR-53-0001 10,793,566 10,793,566 10,793,566 5,187,741 5,605,825 48.1
CLARK COUNTY.................................................. 866/80162 10/04/1996 B-96-UR-53-0100 308,346 308,346 308,346 294,478 13,868 95.5
KING COUNTY................................................... 866/80162 10/28/1996 B-96-UR-53-0001 3,001,852 3,001,852 3,001,852 1,253,626 1,748,226 41.8
PIERCE COUNTY................................................. 866/80162 11/07/1996 B-96-UR-53-0002 1,889,333 1,889,333 1,889,333 1,634,728 254,605 86.5
SNOHOMISH COUNTY.............................................. 866/80162 10/16/1996 B-96-UR-53-0003 579,643 579,643 579,643 579,643 ........... 100.0
-----------------------------------------------------------------------------
Total for 1996 Floods....................................... ............. ........... .................. 50,000,000 50,000,000 50,000,000 28,346,098 21,653,902 56.7
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
new initiatives
Question. HUD's budget request for fiscal year 2000 includes over
19 new programs and initiatives with funding of $731 million. Many of
these initiatives and activities, such as the redevelopment of
abandoned programs and Metro Job Links, can be handled under such broad
programs as the CDBG program. Why not let states and localities decide
their own funding priorities?
Also, there are significant concerns about HUD's capacity to
administer its core programs. Has HUD conducted a staffing evaluation
on staffing and capacity to ensure that these new initiatives will not
reduce HUD's ability to meet its own program responsibilities? Please
provide a review of the staffing needs created by these proposals and
how HUD plans to address these concern?
Answer. Although HUD's budget requests increases in virtually every
existing program, the only funds being requested for new programs are
for HUD's participation in new administration initiatives--APIC,
Regional Connections and Abandoned Buildings. Other increases are for
expansions of initiatives within existing programs or programs we have
requested previously. In many cases, our initiatives only represent
refocusing of resources to meet evolving needs within existing
programs.
Local development needs are so great that even without set-asides
the demands for housing and community development funding would exceed
that which is available under the CDBG and HOME programs. If the set-
asides proposed in fiscal year 2000 were divided among all CDBG and
HOME recipients, the additional funding per community would be
relatively small. Providing set-asides within these broad programs
enables localities with demonstrated capacity to acquire a sufficient
amount of extra funding to finance critical targeted activities that
would otherwise be ``crowded out'' by local demands for more general
housing and community development activities. This facilitates the
creation of ``best practices'' and national models. Once the success of
these activities is proven communities across the country are more
likely to adopt them as a part of their regularly-funded CDBG and HOME
activities. Since funding under these programs is awarded
competitively, it is the communities, not HUD, that determine the
activities to be a priority.
By and large, all funding increases are designed to go directly to
local communities and their partners, thus, they require minimal
additional staff resources for HUD. The staff resources necessary to
manage the three new programs, as well as the initiatives embedded or
connected to existing programs are extremely modest. These staffing
resources are estimated at less than a quarter of 1 percent of HUD's
total S&E resources.
Finally, we want to restate as per our letter of March 11, 1999
that the Department proposes to redirect funding requested for Metro
Job Links to remain within the CDBG account but to be used instead to
fund the successful SHOP program. The Department is also proposing that
the $25 million earmarked for the Regional Affordable Housing
Initiative within the HOME program be used for other purposes, with
$17.5 million of the funding to be provided as regular HOME formula
funding and $7.5 million of the setaside to provide funding for
Capacity Building for Habitat for Humanity. The sole intent and impact
of this change in policy is to provide funding for already proven
effective housing programs supported in the past by both the Department
and the Congress.
The requested funding as set-asides within such programs as
Community Development Block Grants reflects the priority of these
efforts, the desire to establish ``best practices'' and national
models. In addition, programs such as the Community Development Block
Grant and HOME Program provide funding for housing, economic
development and other flexible local needs but the available funding is
far outshipped by the demand. The requested set-asides allow localities
to address priority efforts that would otherwise be ``crowded out'' by
the shortfall in funding for more general housing and economic
development efforts.
hud section 8 project-based inventory
Question. What is the physical status of HUD's Section 8 Project-
based inventory? How many projects have been reviewed and what is the
status of these projects? How many projects have failed to meet HUD's
Housing Quality Standards (HQS)? What are the procedures for projects
that fail HQS and how many projects have been terminated from section 8
for failing HQS?
Answer. HUD Section 8 Project-based inventory includes 22,000
properties receiving project-based Section 8 rental assistance. Last
year, utilizing state-of-the art technology and a carefully designed
system of performance indicators, REAC began the process of conducting
the first-ever complete inspection and assessment of Federally
subsidized housing. To date, REAC has inspected over 6,022 multifamily
properties and is on track to complete the baseline inspection of all
22,000 project-based section 8 properties by 1999 year-end. The vast
majority of properties are in good physical condition. Overall, the
inspection results show that 80 percent of the project-based Section 8
properties are in acceptable physical condition, 17 percent are in poor
condition, and 3 percent are in unacceptable condition. The physical
condition of these projects is summarized below.
Number of
Condition Projects
Unacceptable Condition--Potential Referral to Enforcement Center.. 188
Poor Condition--Need HUD Monitoring............................... 1,027
Acceptable Condition.............................................. 4,807
HUD believes that all its housing, regardless of the subsidy or
assistance source, should be assessed using uniform physical condition
standards. The REAC Physical Inspection protocol covers virtually all
facets of HQS inspection and is both more objective and considerably
more defined in identifying and classifying deficiencies. It includes
60 types of items to be inspected and about 400 potential deficiencies.
With consistent criteria defined for each possible defect, HUD can be
sure that its grades for housing quality really mean what they say.
All the section 8 properties with REAC score of 30 or below are
referred to the Enforcement Center for evaluation. So far, no section 8
contract has been terminated due to low REAC score. However, they are
under advisory notice. Projects scoring above 30 but less than 60 are
required to make needed repairs within 90 days--when feasible--or
provide the local HUD Multifamily office with a plan for remedial
action. Field offices then monitor the completion of repair over time.
Life threatening health and safety violations discovered as part of the
REAC inspection must be repaired or mitigated within 72 hours. Lastly,
projects with scores above 60 are considered to be in acceptable
condition, and no further action is required. There are some exceptions
such as reports from Community builders, local press articles, results
of routine , management visits, tenant complaints, or similar
subsequent events trigger the need to request a reinspection.
fannie mae/freddie mac
Question. How many people currently are employed in HUD's Office of
Government Sponsored Enterprises? What are their responsibilities? How
is the $10 million request justified?
Answer. HUD's Office of Government Sponsored Enterprises Oversight,
working under the direction of the Assistant Secretary, Office of
Housing, employs five full-time staff to administer the Secretary's
programmatic authorities under the Federal Housing Enterprises
Financial Safety and Soundness Act of 1992 (FHEFSSA) and to coordinate
the work of an interdisciplinary team of HUD Offices charged with
carrying out the Secretary's mission oversight responsibilities with
regard to Fannie Mae and Freddie Mac (the GSEs). In addition to Office
of Housing staff, this interdisciplinary team is comprised of staff
from the Office of Policy Development and Research, the Office of
General Counsel, and the Office of Fair Housing and Equal Opportunity.
In fiscal year 1998, HUD spent approximately $3.4 million for 16.9
full-time equivalent inter-Office HUD staff which, collectively, carry
out mission regulation under FHEFSSA.
With regard to responsibilities, HUD's inter-Office staff develop
and implement regulations which establish the GSEs' affordable housing
goals under FHEFSSA. In addition, to achieve statutorily mandated
objectives, staff carry out broad oversight functions that include:
monitoring performance of the GSEs in meeting the housing goals;
enforcing compliance with the goals; reviewing new GSE programs;
monitoring the GSEs for consistency with fair lending statutes;
developing and managing mortgage finance and housing market research
and analysis to ensure effective targeting of the GSE housing goals;
monitoring non-mortgage investments for consistency with public
purposes; and monitoring affordable housing performance trends to
determine impact of the housing goals on the GSEs' operations and on
the public. The attached letter to Valerie Baldwin, who is on the staff
of the House Appropriations Subcommittee on VA, HUD and Independent
Agencies, contains additional discussion regarding key areas of HUD's
regulatory responsibilities. Also attached is a budget justification,
dated January 6, 1999, which sets forth the Department's regulatory
initiatives relevant to mission oversight and the estimated costs of
this regulation for fiscal year 2000.
HUD is proposing this assessment on the GSEs in order to recover
the cost of regulating these entities. This approach is consistent with
a long-established and standard practice for the Federal government to
charge the financial institutions it regulates for the costs of that
regulation, rather than have the taxpayers bear the cost. For example,
the Office of the Comptroller of the Currency, the Office of Thrift
Supervision, and the National Credit Union Administration all assess
the financial institutions within their purview for the costs of
regulation. Similar arrangements exist with respect to the GSE
regulatory work of the Federal Housing Finance Board and the Farm
Credit Administration. Even within HUD, the Office of Federal Housing
Enterprises Oversight was granted the authority in 1992 to assess
Fannie Mae and Freddie Mac for costs of ensuring safety and soundness,
but the law did not apply the same principle to HUD's mission
regulation of the GSEs. It is time to eliminate that anomaly.
prepared statement from hal c. decell, iii
I want to take this opportunity to amplify the Department's
thinking with respect to the proposal contained in the fiscal year 2000
budget to allow HUD to assess Fannie Mae and Freddie Mac for the costs
of mission regulation. As you know, the budget proposes that the
Secretary be granted authority to charge the Government-Sponsored
Enterprises for these costs, up to an aggregate of $10 million per
fiscal year. Legislative language to effect this change to the 1992 Act
has been submitted. Congress has charged HUD with important oversight
responsibilities which include setting and enforcing GSE housing goals,
reviewing new GSE programs, monitoring the GSEs for consistency with
fair lending statutes, and other tasks noted below. HUD's mission
regulation is needed to ensure that the GSEs offer their benefits
fairly to all citizens and all areas of the nation.
First, let me review the philosophy underlying this proposed
change. It has been a long-established and standard practice for the
Federal government to charge the financial institutions it regulates
for the costs of that regulation, rather than have the taxpayers bear
the cost. For example, the Office of the Comptroller of the Currency,
the Office of Thrift Supervision, and the National Credit Union
Administration all assess the financial institutions within their
purview for the costs of regulation. Similar arrangements exist with
respect to the GSE regulatory work of the Federal Housing Finance Board
and the Farm Credit Administration. Even within HUD, the Office of
Federal Housing Enterprise Oversight was granted the authority in the
1992 Act to assess Fannie Mae and Freddie Mac for costs of ensuring
safety and soundness, but the law did not apply the same principle to
HUD's mission regulation of the GSEs. It is time to eliminate that
anomaly.
Secondly, HUD's proposal would allow for a much-needed expansion of
HUD's capability to meet its mission-related regulatory
responsibilities. For fiscal year 1999 the Department projects expenses
of about $3.5 million for mission regulation, a tiny percentage of the
GSEs' combined annual net income of $5.1 billion in 1998. The expanded
effort would concentrate on the following key areas:
Monitoring performance of the GSEs in meeting their affordable housing
goals
With new GSE affordable housing goals expected to be in place
shortly, the Department needs to expand its capability to provide
accurate and timely review of GSE performance. A key component of this
effort will be greatly increased monitoring to ensure that the
transactions properly qualify for goal counting purposes, as well as
verification of the loan level data provided to HUD by the GSEs.
Fair lending
HUD has begun to step up our oversight activities to ensure that
the GSEs are not discriminating in their mortgage purchases, as
prohibited under both the 1992 Act and the Fair Housing statutes. We
aim to ensure that GSE business practices including automated
underwriting do not discriminate on any unlawful basis. This will be a
major focus of our attention in fiscal year 2000.
Mortgage Finance and Housing Market Research and Analysis
In the rapidly changing environment of mortgage finance, it is
vital for the Department to keep abreast of new developments, and to
understand their short and long term implications. Expanded research
will help the Department exercise its mission regulation authority
wisely with a view to effectively targeting the GSE housing goals and
thereby expanding credit availability and housing affordability
throughout the nation.
Non-mortgage investments
We plan to enhance our monitoring of the GSEs' non-mortgage
investments and activities to ensure that they are consistent with the
public purposes stated in the GSEs' Congressional charters. The
Department needs strengthened financial expertise to support its
mission oversight efforts in this area.
New Business Activity and Program Reviews
The Department is responsible for reviewing GSE new program
requests to ensure that they are in the public interest and consistent
with the GSEs' Congressional charters. Additional funds will allow the
Department to strengthen its monitoring of GSE business activities and,
as appropriate, to review them as new programs in accordance with the
1992 Act.
This expansion would apply across the various categories of mission
regulation expense-staff salaries and benefits, research, and
contractor support for data analysis. The Office of Housing, the Office
of Policy Development and Research, the Office of General Counsel, and
the Office of Fair Housing and Equal Opportunity would all incur
additional expenses. HUD will establish a separate account which will
keep track of all amounts spent on GSE oversight.
In summary, the Department-strongly believes that the GSEs, not the
taxpayers, should bear the costs for HUD's mission regulation. The
proposal is consistent with the way in which OFHEO and other Federal
financial regulators are funded, it is fiscally prudent, and it would,
for relatively small costs assessed against the GSEs, permit a needed
strengthening of HUD's capacity to assure that they fulfill their
charter objectives.
We would be happy to meet with you at your convenience to provide
more detail and to answer your questions.
memorandum
MEMORANDUM TO: Michael Deich, PAD, OMB
FROM: Richard F. Keevey, CFO HUD
RE: Justification for Increase in HUD's Budget for Oversight of Fannie
Mae and Freddie Mac
DATE: January 6, 1999
Per your request we have reviewed our current and expected
expenditures relating to HUD's oversight of the GSEs. What follows
fully explains and supports the estimated $10 million in fees that will
be required to carry out our mission in fiscal year 2000.
In fiscal year 1998, HUD spent approximately $3.4 million,
involving 16.9 full-time equivalent HUD positions, $1,065 thousand for
research contracts and, $262 thousand for computer support contracts on
oversight of Fannie Mae and Freddie Mac. These estimates were included
in a recent GAO Report ``Federal Housing Enterprises: HUD's Mission
Oversight Needs to be Strengthened ``As the title suggests, the GAO
report concluded that HUD implementing its oversight responsibility.
The Department has indicated in Congressional testimony that it is
committed to allocating additional resources to enhance its regulation
of these government-sponsored enterprises (GSEs). In order to fulfill
that commitment, it is essential that HUD's outlays for GSE--oversight
be funded by assessments on the GSEs.
Specific initiatives that the Department will undertake or areas
where it will expand upon its current oversight activities are listed
in the following table. Due to the short deadline, we have made
accurate estimates of the cost to accomplish the individual initiatives
listed but have not broken out the costs as to whether they would
involve contract dollars and additional staff resources. Further, the
estimated additional costs have not been allocated among Housing, PD&R,
OGC, and FHEO, all of whom are involved in GSE oversight activities and
participated in developing these activities.
------------------------------------------------------------------------
Estimated
Initiative additional
cost
------------------------------------------------------------------------
Fair Lending. Increased analysis and oversight of the $1,500,000
GSEs underwriting practices from a fair lending
perspective. This analysis would include assessing the
impact of underwriting standards (automated and
traditional), business practices, repurchase
requirements, pricing, fees and procedures that affect
the purchase of mortgages to ensure that they do not
have a disparate impact on protected groups. Also, to
pursue fair lending investigations with the assistance
of the GSEs and carry out other fair lending
requirements of the 1992 GSE Act.......................
Data Verification. Review and verification of the 1,000,000
accuracy of the loan level data on mortgages purchased
by the GSEs that are provided to the Department for
purposes of monitoring compliance with the housing
goals..................................................
New Program Threshold Reviews. Increased monitoring and 600,000
more proactive evaluation of the GSEs' operations to
identify and assess new activities as possible new
programs requiring review; i.e., identifying and
analyzing individual business activities to determine
whether they meet the new program criteria.............
Additional Support for New Program Reviews. Obtain 750,000
necessary specialized expertise to assist in analyzing
new programs identified and submitted by the GSEs.
Additional staff support to conduct new program reviews
Non-Mortgage Investments. Enhanced monitoring of the 500,000
GSEs' non-mortgage investments and activities to ensure
that they are consistent with their public purpose
missions and charters. This monitoring includes regular
and on-going analysis of their non-mortgage investment
policies and portfolios................................
Affordable Housing Performance Trends. Analyze and 500,000
monitor performance trends of the GSEs' mortgage loan
portfolios to determine impact of housing goals on GSEs
operations.............................................
Enhanced Goal Performance Monitoring. Increased goal 500,000
performance monitoring and analysis of trends in GSE
mortgage purchases Research............................
Research. Expanded research on the impact of the housing 500,000
goals on housing affordability.........................
Special Studies. On-going research on the GSE's trends 500,000
as they relate to industry trends and issues such as
subprime lending, multifamily securitizations and
trends, manufactured housing, rural housing, automation
in mortgage banking, lending to minorities and impact
of housing counseling on homeownership.................
Training and Additional Resources. Training for staff 250,000
and resources for monitoring GSE and mortgage market
trends and activities..................................
---------------
Total additional expenditures..................... 6,600,000
Total current expenditures........................ 3,400,000
Total proposed budget for GSE oversight........... 10,000,000
------------------------------------------------------------------------
staffing
Question. The Secretary has proposed reducing the staffing at HUD
to 7,500. However, recently staffing has been increasing towards the
10,000 FTE level without justification or a cost-benefit analysis.
Please provide a staff needs analysis by office and function.
Answer. The goal of reducing HUD's S&E staffing level to 7,500 FTE
by 2000 was announced in 1994 by then Secretary Henry Cisneros. This
staff level was deemed achievable only if Congress passed proposed
legislation to consolidate 60 major programs into three performance-
based accounts--a Community Opportunity Fund, an Affordable Housing
Fund and the Housing Certificate Fund. It would also require
transforming the Federal Housing Administration (FHA) into a government
corporation, streamlining HUD program operations throughout the
Department and reducing the number of field offices from 81 to 60.
Congress has not enacted most of these proposals and most of the other
initiatives are in various stages of development and/or implementation.
Subsequently, Secretary Cuomo made the decision not to close any of
HUD's field offices. Also, in May 1998, Secretary Cuomo publicly
announced to Congress that without Congressional action on HUD's
legislative proposals for program consolidation, a more appropriate
staffing level for the Department would be approximately 9,300 FTE.
The 7,500 FTE level established in 1994 was for Salaries and
Expenses (S&E) employees only. The referenced 10,000 current staffing
level appears to include staff from the Office of Inspector General,
the Office of Federal Housing Enterprise Oversight, and the Working
Capital Fund. As of July 3, 1999, the S&E staffing level was 9,200.
It is anticipated that a staff needs analysis by office and
function will be a product of the new Resource Estimation Allocation
Process (REAP) which is discussed in further detail in the previous
staffing response. This type of information will be available upon
completion of 1 full-year utilizing REAP, i.e., from initial resource
estimation through allocation and validation.
The Department's fiscal year 2000 budget justification, submitted
to the Congress in February 1999, includes the following staffing
assumptions.
FULL-TIME EQUIVALENT (FTE) EMPLOYMENT
[Excludes Overtime and Terminal Leave]
------------------------------------------------------------------------
Estimate fiscal year
-------------------------- Increase or
1999 2000 decrease \1\
------------------------------------------------------------------------
Salaries and Expenses, HUD...... $9,386 $9,383 -$3
Other Funds..................... 1,182 1,195 +13
---------------------------------------
Total, HUD FTE............ 10,568 10,578 +10
------------------------------------------------------------------------
\1\ Fiscal year 2000 vs. fiscal year 1999.
Note: Other funds include Working Capital Fund, Office of Inspector
General, and Federal Housing Enterprise Oversight.
These staffing estimates are consistent with the overall program
proposed for HUD, and with the detailed budget justifications for
individual program activities, which were submitted to the Congress as
part of the fiscal year 2000 budget.
Moreover, these estimates should be viewed in the context of the
longer term trend where total HUD staffing has declined significantly.
The total HUD staffing level of 10,578 FTE for fiscal year 2000 is a
reduction of 25 percent from the level of 14,073 FTE in fiscal year
1992. Similarly, the Salaries and Expenses, HUD account staffing level
of 9,383 FTE for fiscal year 2000 is a reduction of 29 percent from the
level of 13,167 FTE in fiscal year 1992. For comparison, these staffing
reductions are taking place while HUD's outlays are projected to
increase by 33 percent from fiscal year 1992 to fiscal year 2000.
Also, HUD's staffing can be viewed in the context of broader,
governmentwide employment trends. HUD's 25 percent staffing reduction
from fiscal year 1992 to fiscal year 2000 is taking place while, over
the same time period, Executive Branch civilian employment is
decreasing by 16 percent and, excluding the Department of Defense,
total civilian agency employment is decreasing by less than 4 percent.
(The historical comparisons of HUD outlays, Executive Branch civilian
employment, and civilian agency employment are found in Historical
Tables that accompany the Budget of the United States Government,
fiscal year 2000.)
HUD's current staffing levels must reflect programmatic needs and
reflect current policies and programs, as legislated by the Congress.
Future reductions in HUD's staffing levels will depend on improvements
in the housing portfolio, with commensurate reductions in the number of
troubled properties, and will depend on future Congressional
legislation to modify HUD mandates. HUD will continue to work
cooperatively with the Congress to consider ways to attain these
critical prerequisites for making future staffing reductions.
public housing costs
Question. What are the actual costs needed to administer public
housing as opposed to the current funds provided through formula?
Answer. The current Performance Funding System (PFS) for public
housing is based on the operating expenses of a well-managed Public
Housing Authority (PHA) in 1974, updated to reflect changes in
inflation, and with additional funding provided for costs of employee
benefits and insurance. Utility costs are now handled separately with
actual utility costs forming the basis for HUD subsidy in this area.
Under this system, HUD provides subsidy to PHAs to make up the
difference between PHA income, principally tenant rent, and the amount
of funds needed to bring the PHAs up to their Allowable Expense Levels
under the PFS and pay for utilities.
Under this system, most PHAs are operating at a satisfactory or
higher level of performance and have operating reserves of 40 percent
or more. Obviously, the system provides a reasonable level of funding
for most PHAs, and pays for the actual costs PHAs are incurring in
running their public housing.
There is interest in the PHA community in exploring a system that
is based on the actual cost to a PHA of undertaking the range of
activities associated with operating public housing, including
administration, maintenance, security and tenant services. This
approach would call for setting standards for conducting each of the
activities, input measures, and determining the cost of the activities.
Standards and costs using this approach have not been established by
HUD. A long-term study would be needed to develop this information.
Question. Because of the new flexibility provided to PHAs in the
fiscal year 1999 Appropriations Bill, how much less funding will PHAs
need to operate?
Answer. The fiscal year 1999 Appropriations Bill provides new
flexibility to PHAs in many areas, including admissions, and rent-
setting. It encourages admission of families with a wide-range of
incomes and provides for PHAs to establish incentives to help move
resident households from welfare to work. Over time this could result
in higher tenant rents, and thus in lower subsidy needs. At the same
time, the fiscal year 1999 Appropriations Bill mandates new
responsibilities on PHAs, so that overall PHA operating costs are not
expected to decline.
Question. Please provide a salary analysis of staffing by each PHA?
Answer. HUD does not collect this information, since HUD does not
review and approve PHA salaries, believing that would be
micromanagement of this program.
Question. How do costs of operating public housing compare with
privately owned rental housing?
Answer. It is not possible to directly compare public housing costs
with the costs of privately owned rental housing for several reasons.
First, public housing costs include elements not found in the
private sector, such as the extensive administrative costs associated
with required functions such as verification of tenant income, rent-
setting based on income, lease and grievance requirements, planning and
reporting requirements, and the need to arrange for the provision of
services to residents. Private housing costs do not usually include
these requirements, but do include elements not found in public
housing, such as property taxes and principal and interest on debt
financing for the housing. Thus, the costs are not comparable, and a
number of assumptions and adjustments must be made to attempt to
compare them.
Second, data for public housing is generally available by PHA, that
is for the entire aggregate of projects. The private sector data is
reported on a project-by project basis. To compare the two would
require the development of a ``synthetic PHA,'' aggregating data for a
number of projects.
Third, available private sector data is limited and reported
voluntarily, and therefore may or may not reflect actual costs in the
market place.
Given these constraints, we do not think it is possible to compare
public housing and private rental housing costs in any meaningful way.
A fuller discussion of these issues is contained in Chapter 3,
``Alternative Funding Systems: A System based on Private Market
Operating Costs,'' of the HUD report Revised Methods of Providing
Federal Funds for Public Housing Agencies: Final Report, June 1994.
(copy attached)
[Clerk's note.--The HUD report ``Revised Methods of
Providing Federal Funds for Public Housing Agencies: Final
Report,'' can be found in the subcommittee files.]
mark-to-market
Question. I remain concerned about the progress the Office of
Multifamily Housing and Assistance Restructuring (OMHAR) has made in
developing and implementing the Mark-to-Market Program. I cannot stress
enough how important this program is to residents and communities and
that the implementation of Mark-to-Market will be one standard that
many in Congress will be measuring the Department's credibility in its
management reform efforts. What is your expected timeline in completing
negotiations with the state HFA's?
Answer. We have made tremendous progress in implementing the Mark-
to-Market program. As of today, we have agreements with 19 public
housing finance authorities, including Missouri, and expect to have
agreements with another 13 within the next month. We have been
consulting with state and local housing finance authorities for over 6
months. This consultative process resulted in the development of
important documents such as the operating guide and a generic contract
(called a Portfolio Restructuring Agreement, or PRA) for use by public
entities participating in our program as a PAE (or Participating
Administrative Entity). A high priority for the past several months has
been the negotiation and signing of PRAs with individual state and
local housing authorities and, thereafter, the actual assignment of
properties for restructuring. We are continuing to make every effort to
successfully negotiate contracts with interested state and local HFAs.
No deadline on such discussions exists and none will be established to
curtail our efforts to sign public PAEs. At the same time, we remain
cognizant of our responsibility to manage this important program to
restructure low-income residential properties for the benefit of
tenants, owners and taxpayers and we will take appropriate and
necessary actions to assure that properties in our program are
restructured without inordinate delay.
As of today, approximately 500 properties are in our portfolio
available for restructuring. With these actions and with the actions
detailed below, approximately 400 of these properties will be assigned
for restructuring.
Question. Has OMHAR begun discussions with the private sector
entities that have qualified for the program?
Answer. With OMHAR's emphasis on signing contracts (PRAs) with
public entities, it has had only limited discussions with private
sector entities (including nonprofit organizations). However, we had
only recently engaged in a formal solicitation to award assets.
Contracts to three firms were awarded through a competitive bidding
process.
There were several reasons for this. Among them, there are states
in which a housing finance authority decided not to become a PAE. These
include: Alaska, Arkansas, Hawaii, Kansas, Mississippi, Montana,
Nebraska, Nevada, and Wyoming.
OMHAR has also awarded properties for restructuring to private PAEs
under special circumstances. In two cases, we were told by the state
that, although they were still interested in being a PAE, their
organization needed more time to process the contract and receive
approval from their respective Boards. Here, with the informal assent
of these states, we awarded a limited number of assets in order to give
them the time they needed.
In one other case, OMHAR has awarded a contract to a PAE during
lengthy but, to date, inconclusive discussions with a potential public
PAE due to the rapid accumulation of properties eligible for immediate
restructuring that became a matter of mutual concern to both OMHAR and
the potential PAE. To address this urgent situation, and faced with the
prospect of an anticipated deluge of additional properties, OMHAR took
the measured step of assigning a portion of the backlog of properties
to a nonprofit organization for immediate restructuring. However, we
reserved the number of assets which the PAE stated was its quarterly
capacity in the event an agreement could be reached. The firm that was
selected was a not-for-profit organization with significant experience
in restructurings and with a history of valuing tenant and community
relationships.
Queston. What is the disposition of these discussions?
Answer. OMHAR is not involved in general or ongoing contract
discussions with private sector entities. Our focus remains on signing
PRAs, wherever possible, with public entities. The use of private
sector organizations (including nonprofits) to date has been limited to
the following instances:
--there is no public PAE in the jurisdiction and eligible properties
await restructuring;
--a public entity has declined, or is unable, to participate as a PAE
(i.e., some state laws operate to prevent potential public PAEs
from complying with the terms of the contract, or for other
reasons); or
--urgent and immediate attention is required, for problems such as
the high volume of properties already in the pipeline and
either no contract is in place to allow a public entity to
provide restructuring services or the restructuring workload
would strain and perhaps even exceed the resources and
capabilities of the public entity.
single family property disposition
Question. One of the areas of concern that the recent financial
statement audit identified in FHA's single family property disposition
program, Over a year ago, GAO revealed numerous case examples where HUD
contractors were not securing or repairing foreclosed properties and
HUD was failing to perform its basic oversight functions over the
contractors. A recent NBC Nightly News ``Fleecing of America'' feature
displayed the same problems that GAO had identified.
Here is a clear example of where HUD is not performing its basic
functions and is acting as a bad landlord. I believe recent HUD OIG
testimony illustrated clearly this problem. Instead of meeting HUD's
REO mission to reduce its foreclosed inventory in a manner that (1)
expands homeownership, (2) strengthens neighborhoods and communities,
and (3) ensures maximum return to the mortgage insurance fund, HUD is
doing the opposite. For example, HUD's foreclosed inventory has
increased 70 percent from about 24,700 properties in 1996 to over
43,000 in 1999.
Because we realized HUD's current system was broken, we passed
legislation in last year's appropriation to address this problem. What
is HUD doing currently to address its foreclosed inventory both in
property disposition and loss mitigation? Does HUD have any evidence
that problems identified in the NBC feature are being resolved? Has
FHA's foreclosure inventory and turnover rate gone down? Why or why
not?
Answer. HUD's contracts for private sector Marketing and Management
(M&M) contracts, which became effective in March of 1999, are expected
to reduce the current problems with property inventories, and to
mitigate losses by providing greater recoveries. The contractors, who
receive their remuneration from a percentage of the sales price, have a
strong economic incentive to secure and maintain the properties, market
them vigorously, and turn them around as fast as possible for as high a
price as possible. These contracts are expected to reduce inventories
by faster sales, and reduce losses to HUD by lower holding costs and by
higher sales prices. While the number of single family properties in
inventory increased by about 4,000 properties from the end of fiscal
year 1998 through March 1999, the inventory is expected to start to
decline by the end of 1999.
FHA is strengthening and expanding monitoring of the performance of
property disposition activities under the M&M contractor. First, the
M&M contractors have a strong financial incentive to maintain and
turnover properties, since their fee is based on a bid percentage of
the sales cost of the properties. Second, other contractors are
monitoring the M&M contractors performance. Third, the Homeownership
Centers (HOCs) are required to issue monthly reports on the activity in
the areas for which they are responsible, including field checks of the
contractors records, and on-site examination of a portion of the
properties involved.
year 2000
Question. In a recent Associated Press news article, issues were
raised with a number of Federal government agency ``Year 2000'' or Y2K
efforts. One of the agencies cited was HUD. According to this article,
in August 1997, the government listed 231 computer systems at HUD as
``mission-critical.'' However, since then HUD had dropped from 231
systems to 62. As a result, Y2K compliance jumped from 22 percent to 73
percent. Some of the systems reclassified by HUD was the Multifamily
Data Warehouse, which was phased out last November without a
replacement, and the Funding and Contracting System, replaced in March
by the Grants Evaluation Management System. How does the Department
define ``mission-critical'' in context of the Y2K problem?
Answer. A HUD application system is assigned Year 2000 ``mission-
critical'' status if it supports HUD's mission to provide a decent,
safe, and sanitary home and suitable living environment for every
American. Specifically it includes the critical application systems
that support the following strategic objectives:
--fighting for fair housing;
--increasing affordable housing and home ownership;
--reducing homelessness;
--promoting jobs and economic opportunity;
--empowering people and communities; and
--restoring public trust.
Question. Please explain why HUD dropped 169 formally classified
``mission-critical'' systems and what functions these dropped systems
play in the Department's operations and management. Also, please
explain if any of the dropped systems are still being used by the
Department and if there are any plans to address their compliance
needs.
Answer. Senator, the Associated Press was in error when making this
statement. The 231 systems referenced earlier included both ``mission-
critical'' and ``non mission-critical'' application systems. Since HUD
established its application inventory in 1997, only 75 HUD systems were
identified as ``mission-critical.'' The Office of Management and Budget
(OMB) defines ``mission-critical'' differently than HUD (OMB excludes
systems that are ``Being Built Compliant'') and that is how the 62
systems (75-13 ``Being Built Compliant'') mentioned in your question
were identified. HUD has completed the Renovation, Validation, and
Implementation of its entire application inventory (mission-critical
and non mission-critical) on or ahead of all OMB Year 2000 mandated
goals. In addition, HUD has deactivated all ``mission-critical''
systems whose disposition was Phase Out-No Replacement or Phase Out-
With Replacement.
fha single family property disposition
Question. New legislation was included in last year's
appropriations to improve FHA's single family property disposition
program. A significant component of the legislation is to enable
communities to designate areas where a nonprofit or local government
can negotiate an agreement with HUD for the bulk purchase and sale of
all FHA foreclosed single family properties. What steps has HUD taken
to engage nonprofit and government organizations in the process of
implementing this new legislation?
Answer. FHA has been dealing with localities and non-profits on
revitalization areas, and developing asset control areas. Currently,
these organizations can buy HUD-held properties at a discount, and, by
bulk purchases with simultaneous closings, qualify for greater savings
than on individual properties.
Question. Given the important role of nonprofit organizations in
the new program, has HUD given any thought to providing technical
assistance to such entities?
Answer. HUD has several program areas involved with technical
assistance, including the new Community Builder positions. FHA, as an
insurance operation, would not appear to be the organization best
suited to offer technical assistance.
Question. Has the Department examined ways that it might cooperate
to share risk and thereby promote the goal of neighborhood
stabilization?
Answer. FHA has tried over several years, without success, to
achieve feasible risk sharing agreements. The Secondary Market
Demonstration project, for which FHA is currently evaluating proposals,
is a risk-sharing program with grants for $10 million. Awards are
expected to be made in about 60 days.
Question. The conference report also requested the Department to
provide any statutory changes necessary to implement a comprehensive
loss mitigation program. What is the Department's current thinking on
this matter?
Answer. Current increases in loss mitigation activity indicate that
the program is a success and that major legislative changes are not
necessary. The loss mitigation activity, excluding preforeclosure
sales, has gone from about 700 cases in 1997, to 4,400 cases in 1998,
to an estimated 20,000 cases in fiscal year 1999. Fiscal year 1999 loss
mitigation cases through May total over 13,000--over 20 percent of
total single family claims to date.
Question. Will the Department be sending any statutory
recommendations?
Answer. The Department is currently examining possible substantive
legislative proposals, as part of the budget process, and will propose
changes as needed. A proposal to raise the fiscal year 2000 MMI
commitment limitation to $140 billion, the same as contained in the
fiscal year 1999 Emergency Supplemental, is currently under review.
fair housing activities re: property insurance
Question. In our past four Committee Reports on HUD appropriations,
we have addressed the use of funds for enforcement of the Fair Housing
Act against property insurers. We have repeatedly pointed out that the
Fair Housing Act, while expressly applicable to landlords, real estate
brokers, and mortgage lenders, makes no mention of property insurers or
their business practices. In light of that, and because the statute's
legislative history indicates that the law does not apply to insurance,
we have urged that HUD not spend fair housing funds on activities
relating to insurers. In particular, with respect to Fair Housing
Initiatives Program--the ``FHIP''--our Reports have stated that, in
light of the limited resources available, FHIP funds should ``be used
only to address such forms of discrimination in the sale, rental, and
financing of housing as they are explicitly identified and specifically
described'' in the Fair Housing Act. This statement clearly indicates
that we intend that FHIP funds not be used for activities relating to
enforcement of the Fair Housing Act against insurers. What steps has
HUD taken to ensure compliance with our intent in this regard?
Answer. We understand the concerns of the Committee and are
sensitive to them. As you know, however, HUD and the Department of
Justice believe the Fair Housing Act (FHAct) covers discrimination by
property insurers. In implementing the Fair Housing Amendments Act of
1988, HUD issued regulations in 1989 making explicit that such
insurance discrimination constitutes prohibited conduct. Since issuing
these regulations, all circuit court decisions have supported the
application of the FHAct to property insurance discrimination and have
not found the Department's interpretation inconsistent with the
McCarran-Ferguson Act. Nationwide Mut. Ins. Co. v. Cisneros, 52 F.3d
1351 (6th Cir. 1995) (Kennedy, J., dissenting), cert. denied, 516 U.S.
1140 (1996). As HUD is required to enforce all provisions of the FHAct,
it must enforce the law with respect to insurance discrimination.
Moreover, individuals who believe they have suffered insurance
discrimination continue to seek the assistance of organizations HUD
funds through its competitive grant program. Requirements for the
program are highlighted annually in the Notice of Funds Availability
(NOFA). In light of the Committee's concerns, since 1997, FHIP NOFAs
have made clear that HUD will not fund activities aimed solely at
insurance discrimination. Instead, it funds organizations which propose
enforcement-related activities which are broad-based and full-service.
Broad-based means projects are not limited to a single fair housing
issue, i.e., they must cover multiple issues related to housing
discrimination covered under the FHAct (e.g., insurance, mortgage
lending, advertising, sales, and rentals). Full-service means they
cannot be restricted to testing activities, but also must include
complaint intake, investigation, etc.
We believe this approach is sensitive to the Committee's
congressional concerns and is consistent with HUD's statutory
obligation to enforce the FHAct.
use of fhip funds for homeowners' insurance-related purposes
Question. Despite our directive against the use of FHIP funds for
insurance-related purposes, HUD apparently has failed to inform FHIP
grant applicants and grantees that they are not to use the grants for
activities aimed at homeowners' insurers. Moreover, in HUD's most
recent announcements of FHIP awards, the agency has not provided any
indication of how the funds will be used whereas such uses previously
were specifically identified. Why are you not informing the public
regarding the uses to which FHIP funds will be put, and how are we to
know whether you are adhering to our intent that they not be used in
the insurance area?
Answer. In the past, the Department published in the Federal
Register an announcement identifying the organizations selected for
FHIP awards each year. Although the Department did not publish the
announcement of the 1998 awardees in the Federal Register, the HUD Web
site did inform the public of the recipients of the 1998 grants, and
provided a brief description of each project. We believe the utilizing
the HUD web site is a very effective means of communicating with the
general public and simultaneously informing our stakeholders. Although,
the HUD web site have been publicly recognized as singularly effective,
we will certainly revisit the policy of publishing the awards in the
Federal Register as well. We also want to state again that we have
responded to Congressional concerns regarding property insurance issues
and that since 1997, FHIP NOFA, have made clear that HUD will not fund
activities aimed solely at insurance discrimination. Instead, we fund
organizations where enforcement-related activities are broad-based and
full service. We believe this approach is sensitive to the Committee's
concerns and is consistent with HUD's statutory obligation to enforce
the Fair Housing Act.
[Press Release, November 24, 1998]
president clinton announces $11.5 million in grants to help groups in
42 cities crack down on housing discrimination
(HUD News, HUD No. 98-628)
WASHINGTON--President Clinton today announced $11.5 million in
grants to groups in 42 cities to help them carry out his crackdown on
all types of housing discrimination, including a new focus on reducing
discrimination against recent immigrants, who are predominantly
minorities.
``Members of every family in America want to be able to live in any
neighborhood and in any home they can afford, free from
discrimination,'' President Clinton said. ``The Fair Housing Act gives
families this legal right, and we are determined to enforce it as part
of our initiative to create One America of equal opportunity.''
Housing and Urban Development Secretary Andrew Cuomo said that in
addition to continuing efforts to wipe out housing discrimination
against minorities and others born in the United States, many of the
HUD grants are targeted to groups that have not traditionally sought
assistance in fighting housing discrimination, particularly new
immigrants.
``The Statue of Liberty doesn't have an inscription saying `Give me
your tired, your poor, but keep them out of nice white neighborhoods,'
Cuomo said. ``People who flee persecution elsewhere in search of the
American Dream shouldn't have to suffer discrimination in our
country.''
Cuomo said private, non-profit fair housing groups in the following
states will get the $11.5 million in grants from HUD to investigate
allegations of housing discrimination, educate the public and housing
industry about housing discrimination laws, and work to promote fair
housing.
Alabama....................................................... $294,005
Arizona....................................................... 200,000
California.................................................... 1,700,000
Colorado...................................................... 305,158
Dist. of Columbia............................................. 93,259
Georgia....................................................... 277,000
Illinois...................................................... 899,966
Indiana....................................................... 218,366
Kentucky...................................................... 349,995
Louisiana..................................................... 350,000
Massachusetts................................................. 243,430
Michigan...................................................... 350,000
Minnesota..................................................... 337,750
Missouri...................................................... 421,282
Montana....................................................... 448,626
Nevada........................................................ 204,679
New Jersey.................................................... 350,000
New York...................................................... 616,112
North Carolina................................................ 448,557
Ohio.......................................................... 300,000
Oregon........................................................ 182,847
Pennsylvania.................................................. 810,000
Tennessee..................................................... 474,493
Texas......................................................... 932,883
Virginia...................................................... 350,000
Washington.................................................... 350,000
``Housing discrimination is illegal, intolerable and un-American''
Cuomo said. ``The grants we're awarding today will strengthen our
partnership with local groups around the country working to put a stop
to this outrageous conduct.''
The Fair Housing Act bars housing discrimination on the basis of
race, color, religion, sex, disability, family status and national
origin. The Act covers the sale, rental, financing and advertising of
almost all housing in the nation. Fair housing investigations are
conducted by HUD investigators, state and city agencies working with
HUD, and private fair housing groups that receive HUD funds.
Unlike past years, today most immigrants to the United States are
minorities. While 85 percent of immigrants were white Europeans in
1900, only 16 percent of immigrants were Europeans in 1996.
Studies show that minority immigrants experience worse housing
conditions than European immigrants. In addition, recent immigrants are
less likely to be homeowners than earlier immigrants, and non-English
speaking immigrants face special difficulties in understanding their
fair housing rights.
Cuomo said all types of housing discrimination are much harder to
detect today than they were years ago, making it more important than
ever for HUD to work in partnership with local groups to root out
illegal acts of discrimination.
``Today housing discrimination is subtle, not blatant,'' Cuomo
said. ``For example, landlords usually don't say openly that they don't
rent to blacks or Hispanics--they just say there are no vacancies when
a minority shows up. Then, miraculously, several vacancies suddenly
appear when a white person walks in five minutes later.''
The grants, which are funded under HUD's Fair Housing Initiatives
Program, will address sophisticated and subtle forms of discrimination
through paired testing as well as other investigative tools.
During testing, people of different backgrounds--based on their
race, ethnicity, family status, sex, religion or disability--pose as
prospective renters or homebuyers. Testers--who state they have similar
incomes, assets and credit ratings--check to see if they are treated
differently from one another by landlords, people selling homes,
lenders making mortgage loans, or companies selling homeowners
insurance.
Just last month, a Richmond, VA, fair housing group using HUD funds
for testing won a record $100 million racial discrimination judgment
against Nationwide Insurance Co.
The grants announced today will also be used to investigate housing
discrimination complaints, to educate members of the public about their
rights, and to train housing industry groups and local governments on
their responsibilities under the Fair Housing Act.
A total of $800,000 of the grant money, which went to five groups,
was set aside to expand fair housing services to people with
disabilities.
Cuomo last week announced the most comprehensive and sophisticated
nationwide audit ever conducted to test for and evaluate housing
discrimination in urban, suburban and rural communities around the
nation. The audit will include 3,000 to 5,000 tests for housing
discrimination. Testers will examine and evaluate patterns and trends
in housing sales, rentals, and mortgage lending to minorities.
Since 1993, HUD has received nearly 44,000 fair housing complaints
and has helped obtain over $150 million in settlements and court
judgments in housing discrimination cases. This year HUD has also
obtained commitments from lenders to make over $3 billion in home
mortgage loans to minorities and low-income families to settle
accusations of housing discrimination.
As part of his One America Initiative, President Clinton directed
Cuomo to double enforcement efforts brought against perpetrators of
housing discrimination by the year 2001. HUD has already doubled its
enforcement actions to a rate of 60 to 70 a month, compared with less
than 30 enforcement actions per month during the Clinton
Administration's first term.
Cuomo said HUD will be able to continue moving aggressively against
housing discrimination as the result of an increase in the budget of
its Office of Fair Housing and Equal Opportunity from $30 million in
the 1998 fiscal year to $40 million in the current fiscal year.
People who believe they've been harmed by housing discrimination
can file complaints with HUD by calling 1-800-669-9777 or on the
Internet at http://www.hud.gov/hdiscrim.html
Fighting Housing Discrimination fiscal year 1998 Fair Housing
Initiatives Program (FHIP) Awards
fighting housing discrimination--fiscal year 1998 fair housing
initiatives program (fhip) awards
(alphabetical by state, and city within the state)
ALABAMA
The Fair Housing Agency of Alabama, based in Mobile, received
$94,718 to continue maintenance and enforcement of fair housing laws in
Southern Alabama and assist residents to exercise their fair housing
rights.
The Mobile Fair Housing Center received $199,287 to provide fair
housing activities in Southern Alabama. Enforcement action will be
conducted in both the State's metropolitan and rural areas. The grant
will enable the organization to expand its capacity to provide fair
housing enforcement services that address the needs of people with
disabilities.
ARIZONA
The Arizona Center for Disability Law, with offices in both Phoenix
and Tucson, received $200,000 to enforce fair housing rights for
persons with disabilities in Arizona.
CALIFORNIA
California Rural Legal Assistance, based in San Francisco, received
$100,000 to develop, implement and coordinate a fair housing public
education campaign in agricultural regions of the state.
The Fair Housing Council of Riverside County received $202,357 to
expand and enhance private enforcement and education outreach
components of its present fair housing program and to expand services.
The Fair Housing Council of Fresno received $100,000 for outreach
and education to consumers, housing providers and government officials
in the Central Valley of California. The Council will also provide
individual assistance to consumers.
The Fair Housing Council of San Gabriel Valley in Pasadena received
$291,850 to help remove barriers to fair housing.
Sentinel Fair Housing of Oakland received $349,900 to provide
technical assistance, recruit and train new rental housing testers,
provide for complaint intake, and undertake tests for accessibility.
Community Legal Services, based in San Jose, received $350,000 to
provide fair housing advocacy for people of various protected classes.
The organization will also investigate complaints, undertake testing
and do referrals.
The Fair Housing Council of Marin, in San Rafael, received $297,485
to work with traditional civil rights groups located in Sonoma City, an
area underserved by fair housing organizations.
COLORADO
Newsed Community Development Corporation of Denver received
$305,158 for testing, complaint referral, pre-application tests of non-
regulated lenders and regulated lenders, and referrals of fair housing/
fair lending complaints to HUD.
DISTRICT OF COLUMBIA
The Judge David L. Bazelon Center for Mental Health Law of
Washington, DC received $93,259 to conduct an 18-month campaign of
testing, administrative enforcement and litigation in northern
Virginia. The Mental Health Center will work with Independent Living
Centers to assist people with disabilities to exercise their fair
housing rights.
GEORGIA
Metropolitan Fair Housing Services received $277,000 to address all
discriminatory housing practices against Georgia's Hispanic
communities.
ILLINOIS
Access Living of Metropolitan Chicago received $350,000 for
disability projects that address the fair housing enforcement needs of
persons with disabilities.
The John Marshall Law School received $349,972 to contribute to the
goal of substantially increasing enforcement actions with vigorous
testing and enforcement.
Latinos United of Chicago received $100,000 to develop a
comprehensive Latino suburban fair housing program.
St. Clair County received $99,994 to target predominantly African-
American inner city, low- and moderate-income people for rental, sales,
and lending education and to provide outreach to the homeless for
rental education.
INDIANA
Northwest Indiana Open Housing received $218,366 to employ rental
and sales tests in an effort to stamp out housing discrimination.
KENTUCKY
The Lexington Fair Housing Council received $349,995 to continue
enforcement of fair housing laws through testing, filing of complaints,
complaint processing, enforcement, and analysis of impediments and
related activities.
LOUISIANA
The Greater New Orleans Fair Housing Action Center received
$350,000 to counteract housing discrimination on behalf of all
protected classes in all housing markets, through a variety of methods.
MASSACHUSETTS
The Housing Demonstration Project in Holyoke received $243,430 to
work with traditional civil rights groups and the Legal Assistance
Corporation of Massachusetts, to work on fair housing issues and
concerns.
MICHIGAN
The Fair Housing Center of Metropolitan Detroit received $350,000
to conduct housing discrimination activities in 11 counties served by
regional fair housing organizations.
MINNESOTA
Southern Minnesota Regional Legal Services received $337,750 for a
fair housing enforcement project that will extend enforcement services
to reach all protected classes.
MISSOURI
Metropolitan St. Louis Equal Housing Opportunity Council received
$71,282 to increase work on discrimination complaints from immigrants
and homebuyers through seminars, focus groups and public forums.
The Kansas City Fair Housing Center received $350,000 to continue
its outreach and collaboration with local consortiums and to extend
partnerships with community education programs.
MONTANA
Montana Fair Housing, based in Missoula, received $350,000 to
conduct education and outreach and perform testing and other
investigative activities that can lead to the filing of fair housing
complaints, particularly from Native Americans.
Billings Community Housing Resource Board received $98,626 to
provide people with disabilities, Native Americans, women and the
housing industry with information on fair housing laws and rights.
NEVADA
The Nevada Fair Housing Center in Las Vegas received $204,679 to
conduct private enforcement activities including complaint intake,
referral, testing, and conciliation of fair housing claims.
NEW JERSEY
The Fair Housing Council of Northern New Jersey received $350,000
to conduct fair housing testing in Northern New Jersey.
NEW YORK
Asian Americans for Equality, based in New York City, received
$213,626 for fair housing efforts targeted to the growing Asian
American community in New York City.
The Open Housing Center in New York City received $350,000 for
testing, to investigate complaints of discrimination, and for education
efforts.
Greater Upstate Law Project of Rochester received $52,486 to
develop a statewide Electronic Center for fair housing; service areas
in semi-rural New York with its web site and to train social workers in
fair housing complaint intake and processing.
NORTH CAROLINA
The Winston-Salem Human Relations Commission received $100,000 to
provide education and outreach to African Americans, Hispanics, elderly
and disabled, and households with children that have unmet fair housing
needs.
The North Carolina Fair Housing Center received $348,557 to
investigate all areas of housing discrimination, refer complaints to
appropriate enforcement agencies including HUD and to investigate and
test the nature and level of predatory lending and racial steering.
OHIO
The Fair Housing Center of Toledo received $300,000 to enhance its
fair housing programs, combat illegal housing practices and to
affirmatively further fair housing. The grant to the Fair Housing
Center of Toledo will also enable it to enter into partnership with
private enforcement organizations, local government agencies or
traditional civil rights organizations and focus on systemic
investigations of housing discrimination.
OREGON
The Oregon Advocacy Center received $182,847 to build on existing
services of community training, information, referral of fair housing
complaints and legal representation for victims of housing
discrimination. The Center will work with the Fair Housing Council of
Oregon to build upon its existing enforcement services.
PENNSYLVANIA
The Tenant's Action Group (TAG) in Philadelphia received $350,000
to expand regional fair housing activities performed by TAG under four
previous FHIP grants, which also included a Delaware Valley Fair
Housing Partnership. This regional partnership consists of five
agencies that collectively enforced federal, state and local fair
housing laws in the city of Philadelphia and its suburban counties in
Delaware and southern New Jersey.
The Public Interest Law Center of Philadelphia received $300,000
for fair housing enforcement actions and to conduct investigations of
systemic housing discrimination.
The Reading-Berks Human Relations Council of Reading received
$160,000 to provide community-based fair housing intake,
investigations, mediation, conciliation, testing and education
services.
TENNESSEE
The Tennessee Fair Housing Council, based in Nashville, received
$349,875 to continue its efforts of enforcement through testing, filing
of fair housing complaints, complaint processing and the gathering and
dissemination of fair housing information and data.
Memphis Area Legal Services received $124,618 to implement a
program to identify and take action to remove architectural barriers to
fair housing for individuals with disabilities.
TEXAS
A Fair Housing Center in Houston will be started by the National
Fair Housing Alliance, which received $399,989 for the project. Houston
is regarded as an underserved area--one that currently is not served by
a private or public fair housing enforcement organization. Activities
being funded under the grant will address the fair housing needs of new
immigrant groups and those of other underserved populations.
Hidalgo County received $88,895 to promote equal opportunities and
to eliminate fair housing barriers through a newly created fair housing
center for Hildalgo County.
The San Antonio Fair Housing Council received $350,000 to sustain
its relatively new organization. Funds will also be used to recruit and
train testers, conduct 282 tests, investigate fair housing complaints
and to undertake litigation.
The Austin Tenant's Council received $93,999 to address a high
denial rate for minority home mortgage applicants and to address the
lack of accessible housing in Austin, Texas.
VIRGINIA
Housing Opportunities Made Equal of Richmond received $350,000 to
undertake an enforcement project which covers two thirds of the
Commonwealth of Virginia. Fair Housing protections will be provided for
African-Americans, Hispanics and other protected classes under the Fair
Housing Act.
WASHINGTON
The Northwest Fair Housing Alliance (NWFHA) received $350,000 to
continue its enforcement activities in Spokane and to extend its
services to immigrants and American Indian citizens.
use of fhip funding
Question. For the hearing record, could you please provide a
detailed accounting for the agency's expenditures in the past three
years on any and all activities relating to alleged discrimination by
homeowners' insurers?
Answer. HUD does not fund projects which focus solely on property
insurance discrimination or any other single practice prohibited by the
Fair Housing Act. The broad-based projects which have been funded over
the past three years may include property insurance matters among the
issues they review. Although we are unable to identify the specific
dollars each project has spent on such activities (and sometimes such
activity may be as minimal as responding to a telephone call from the
public seeking information about their rights), we can provide you with
FHIP dollars assigned to the enforcement-related initiatives for the
past 3 years. We estimate that less than 1 percent of the funds below
have supported insurance-related activity in fiscal years 1997 and
1998.
[In millions of dollars]
Private Enforcement Initiative Funds, by fiscal year:
1999.......................................................... 9.3
1998.......................................................... 9.3
1997.......................................................... 10.5
Fair Housing Organizations Initiative, by fiscal year:
1999.......................................................... 1.2
1998.......................................................... 1.6
1997.......................................................... 4.05
use of fhip funding
Question. For the hearing record, could you please identify the
uses to which FHIP grants funded with fiscal year 1998 appropriations
were put?
Answer. For fiscal year 1998, HUD awarded a total of $15 million to
grantees under the FHIP. Of this total, $3.5 million went for the
National Education and Outreach Program. The objectives of this program
are to: (1) provide fair housing information to the public and (2)
develop and implement methods for preventing and responding to the
community tensions arising from persons exercising their fair housing
rights.
The other $11.5 million of the $15 million total went for the
regional, local, and community based programs. HUD allocated this $11.5
million as follows:
(1) $9.3 million for the Private Enforcement Initiative:
--$7.8 million is the ``General Component,'' used for 24-month
projects. Each project has a $350,000 cap.
--$1.5 million went for the ``Joint Enforcement Project Component,''
used to promote partnerships between private fair housing
enforcement organizations, FHAP agencies and/or traditional
civil rights organizations to focus on systemic investigations
of discrimination. The projects are for 18 month projects, with
caps of $300,000 per project.
(2) $1.2 million to the Fair Housing Organizations Initiative:
--$800,000 went for the ``Continued Development Component,'' which
enhances the ability of organizations to help persons with
disabilities pursue their rights under the FHAct.
--$400,000 went for the ``Establishing New Organizations
Initiative,'' which funds the creation of a new fair housing
enforcement organization in an underserved area. This is a 24-
36 month project.
(3) $1 million for the ``Education and Outreach Initiative'' which
supports regional, local and community-based education and outreach
efforts. The projects run for 18 months. The award cap is $100,000.
______
Questions Submitted by Senator Burns
indian housing block grant program
Question. The population on Indian reservations has been growing
lately and will continue to grow in the future, especially now with the
implementation of the ``Welfare to Work'' program. This increase in
population will, in turn, exacerbate the housing problems on our
reservations and the demand for housing will grow. The funding for
Indian housing programs has been flatlined for fiscal year 2000. Why
isn't there an increase in funding for Indian Housing in fiscal year
2000? What are your plans to combat the impact of this population
influx?
Answer. The President's fiscal year 2000 Budget request continues
to support budget increases that were provided in fiscal year 1999 for
the Indian Housing Block Grant (IHBG) program, the Section 184 Indian
Housing Loan Guarantee Fund and the Indian Community Development Block
Grant program. Other programs proposed for fiscal year 2000 from which
Indian Tribes and their Tribally Designated Housing Entities are
expected to benefit include the Welfare-to-Work (WTW) Section 8 Voucher
Program (25,000 units), and Service Coordinators for the Elderly,
proposed to be funded at $50 million.
As the implementation of IHBG progresses, the Department must
ensure that tribal management and operational capability exists. Some
larger tribes now receive significantly more funding post-NAHASDA than
they received under pre-NAHASDA programs. The Department is confident
that the funding proposed in the President's fiscal year 2000 budget
request is the optimum amount that can be prudently managed in Indian
Country while maintaining the integrity of both the (1) programs and
(2) Federal funds.
To date, there is no evidence of any large influx of Indians
returning to their home reservations due to Welfare-to-Work
initiatives. Should such a trend develop, however, it is expected that
Indian tribes and TDHEs would compete favorably with PHAs for the WTW
housing assistance funds.
rural housing
Question. How much of HUD's annual budget is dedicated to rural
housing? What is HUD's record in serving isolated rural communities? Of
HUD's overall $2.5B increase proposed in the President's budget, what
percentage of this increase will be going to rural America? I would
like to see statistics and dollar amounts regarding urban versus rural
housing.
Answer. Introduction. Historically, as the Department of Housing
and Urban Development, urban affairs have been our primary focus for
most of the agency's existence. While the U.S. Department of
Agriculture (USDA) continues to have the lead through the Rural
Development Agency, HUD's involvement in rural affairs has increased in
recent years. For purposes of this response, the term ``rural'' has
been interpreted to mean an area outside of a Metropolitan area OR an
area outside urbanized areas within a Metropolitan area. This response
does not include Native American Housing programs with the exception of
Rural Housing. Research showed that our rural customers consist of:
--26.1 million households occupy units in rural areas; \1\
---------------------------------------------------------------------------
\1\ American Housing Survey, 1995, hereafter referred to AHS.
---------------------------------------------------------------------------
--37.3 million households occupy units outside areas that are not a
part of central cities (AHS);
--non-entitlement recipients of CDBG, HOME and Emergency Shelter
Grants;
--owners and managers of approximately 1,460 FHA-insured multifamily
projects in non-metro areas; \2\
---------------------------------------------------------------------------
\2\ Assessment of the HUD-Insured Multifamily Housing Stock Final
Report, 1993.
---------------------------------------------------------------------------
--over 100 State local and regional PHAs that operate public housing
(17 percent of the approximately 1.3 million units) and
administer (with State Housing Finance Agencies) certificates
and vouchers (19 percent of the approximately 1.35 million
units).\3\
---------------------------------------------------------------------------
\3\ Characteristics of HUD-Assisted Renters and Their Units in
1989, March 1992.
---------------------------------------------------------------------------
i. community and planning development
The most specific instrument for distribution of funding to rural
areas within CPD programs is through the Rural Housing and Economic
Development program. In addition, assistance is provided to rural areas
through many other of CPD's programs, as discussed below.
The fiscal year 2000 budget proposes $20 million for the Rural
Housing Economic Development program to encourage new and innovative
approaches to addressing the housing and economic development needs of
the Nation's rural populations. There is a great need to expand the
supply of affordable housing in our rural communities. In addition,
because of out-migration and disinvestment, many rural areas suffer
from severe economic distress, with few employers and limited
commercial activity. Rural areas must be able to attract and retain
firms in economic growth sectors--innovative manufacturers, for
example--to revitalize commercial streets where demand clearly exists
but infrastructure has aged and capacity building is needed, and to
carry out flexible micro-lending that supports promising enterprises.
HUD has significant experience in the funding and development of
housing and community economic development programs in rural areas-
through the CDBG and HOME programs and others. The Department has
special expertise in delivering technical assistance and building
institutional capacity. The new Office of Rural Housing and Economic
Development at HUD will effectively integrate the impact of HUD's
formula grant programs with highly targeted new funding for innovative
projects. HUD will continue to work closely with USDA, the Department
of Interior, the Appalachian Regional Commission, other Federal
agencies, and leading rural development groups to design more effective
responses to the housing and economic development needs of our Nation's
rural communities.
This will include examining our own programs to see if legislative
and/or regulatory changes may be necessary to make them more responsive
to rural needs. In addition, HUD plans to devote a number of our new
Community Builder ``specialists'' to providing coordination and cross-
state solutions to the problems facing rural areas including people
living in Colonias, Native Americans, migrant farm workers and others.
While the population is growing in some rural areas, especially
those focused on retirement or recreation, and particularly due to the
foreign immigration and movement of urban/suburban residents away from
central cities, the population continues to decline in most rural
areas. This is in part due to the lack of industry relocations to these
areas and the resulting lack of jobs. While some rural areas are
benefiting from the strong economy nationwide, many are experiencing
extremely high unemployment rates. Rural areas need to be able to
increase the community and economic development funds that flow their
way, to learn how to attract manufacturing, and to improve the capacity
of nonprofit and other partners in determining the overall well-being
of the area.
HUD has significant and historic experience in managing housing,
community and economic development programs in rural areas, and
continues to demonstrate this experience with and commitment to rural
communities through several of its housing, community and economic
development programs such as the Community Development Block Grant and
HOME Investment Partnerships programs. This experience and the
established partnerships that HUD has with organizations such as the
Housing Assistance Council provide the basis for creating innovative
approaches to the particular problems of people and families in the
Nation's rural areas. Moreover, this new program will allow for the
effective integration of HUD's formula and other existing community and
economic development programs with the highly specific and targeted new
funding. This integration of existing and new efforts will provide a
strong synergy which will leverage the results of both the existing
programs as well as the new program.
Homeless Programs/Continuum of Care
Between 10 and 15 percent of Homeless Assistance program funding
goes to rural areas annually. In the 1998 competition, 383 of 2,644
projects (14 percent) were by applicants from rural areas. Of the $724
million awarded in the 1998 competition, $83 million (11 percent) were
awarded to projects serving rural areas. Projects in rural areas fared
well in the competition. Nationally, 56 percent of all projects were
awarded funding; 56 percent of all projects serving rural areas were
awarded funding. Nationally, 57 percent of total dollars requested were
awarded; 51 percent of dollars requested for rural projects were
awarded.
HOPWA
HOPWA funds are awarded to States and local governments for
projects in jurisdictions which do not qualify for a formula
allocation.
Approximately 10 to 15 percent of funds go to non-metropolitan
areas. Data from the Center for Disease Control shows that 5.6 percent
of cumulative AIDS cases are in rural counties. Of the 97 formula
grants, 34 are for areas outside of qualifying metropolitan areas and
states in aggregate received $30.862 million out of $200.475 million
allocated in fiscal year 1999 by formula (15.4 percent). Thus, the $15
million increase is expected to provide about $2.3 million to $3
million for expanding HOPWA efforts in non-metropolitan areas.
For example, in 1998, a HOPWA Special Project of National
Significance Award for $1,118,150 was given to the AIDS Task Force of
Alabama, Inc., to operate the Alabama Rural AIDS Project. For very
detailed information, we recommend going to our web page, www.hud.gov/
cpd/hopwahon.html, where all HOPWA program descriptions (over 300
pages) can be found, including all of the State-wide programs that will
involve activities in rural areas.
Community Development Block Grants
CDBG formula funds are split 70-30, with approximately 30 percent
going to State and small city funding. Therefore, $38.79 million of the
increase requested under CDBG will go to State and small city funding.
Based on historical data, about 52 percent of State CDBG money is
awarded to municipalities with populations of 10,000 or less; about 14
percent to municipalities of over 10,000 and about 33 percent to
counties. The 10,000 population cutoff used for CDBG reporting
approximates the population ceiling for several USDA programs.
States spend about 50 to 55 percent of their money on public
facilities with half of this going for water and sewer projects; about
22 to 26 percent for housing (over \2/3\ of that for housing
rehabilitation); about 16 to 22 percent is used for economic
development and about 4 percent goes for planning and administration.
In addition, the State CDBG program includes a requirement that the
border States of Texas, New Mexico, Arizona and California use up to 10
percent of the State CDBG funds for Colonias. The Colonias and Migrant
Task Force was created in 1995 to better coordinate HUD's efforts to
serve the Colonias and farmworkers. Key accomplishments of this inter-
agency working group include: a $1.3 million contract to provide
technical assistance toward development of 500 units of housing in
South Texas area and another 500 units in various farm worker locations
in California; a 1996 internship program for young colonias residents
interested in learning about the workings of government (10 positions).
From 1991 to 1994, HUD provided nearly $40 million in CDBG funds
specifically for colonias matters. These funds went to Texas, New
Mexico, Arizona and California. The four States budgeted a total of
$12,683,380 (fiscal year 1995), $13,516,850 (fiscal year 1996),
$13,471,000 (fiscal year 1997) and $11,815,300 (fiscal year 1998).
Regional Connections
The fiscal year 2000 budget proposed $50 million for a Regional
Connections program to expand capacity and provide incentives for
``smart growth.'' Concern about growth, disinvestment, and decline has
moved far beyond the central cities' borders. Even rural areas, the
home of small town America, are exhibiting new concern about
development patterns. Farmland across the country is being sold and
subdivided into high-cost residential communities. In fact, since 1960,
outward growth has led to an average loss of 1.5 million acres of
farmland a year. As this outward expansion reaches rural areas, taxes
are often driven up from rising real estate values and increased costs
of services.
The good news is that across the country, regional leaders are
joining together to forge strategies to address the concerns discussed
above. They are attempting to design and implement regional approaches
to regional problems and opportunities.
Community Empowerment Fund
HUD's fiscal year 2000 proposal would fund the Community
Empowerment Fund (CEF)at $125 million, to substantially increase
capital for business investment and job creation in underserved inner
city and rural areas. By combining $125 million in Economic Development
Initiative (EDI) grants with an estimated $625 million in Section 108
guaranteed private loans, the CEF will provide a total of $750 million
in grants and low-cost loans in these communities. The program is thus
expected to leverage up to five times the guaranteed loan amount in
additional private sector financing, and this will create an estimated
100,000 jobs through direct business development and other spill-over
effects.
Job creation projects funded through the CEF will include: loans
for business expansion and modernization; start-up costs for new and
small medium-sized businesses; preservation and expansion of existing
industrial facilities; and retail and commercial revitalization
initiatives, such as grocery stores and neighborhood shopping centers.
America's Private Investment Companies (APIC)
The CEF will be complemented by a second major vehicle for
expanding investment capital for distressed areas, both urban and
rural. The Administration is proposing a major equity incentive program
to fill that gap. For fiscal year 2000, HUD has requested $37 million
in credit subsidy budget authority for $1 billion in privately issued
investment capital loans that the Federal Government will guarantee to
go with $500 million in private equity commitments for new investment
partnerships-for-profit venture capital funds known as America's
Private Investment Companies (APICs). APICs will, in turn, make equity
investments in larger businesses that are expanding or relocating in
inner cities and rural areas. The $37 million in Federal credit subsidy
would thus leverage an estimated $1.5 billion in private funds,
creating an estimated 200,000 jobs in distressed areas. Private
investors' funds would be at risk ahead of Government funds, but the
individual investment decisions would be approved by Government for
consistency with the public policy purpose of the program. The APIC
program will be jointly administered by HUD and the Small Business
Administration (SBA). Its financing structure will be modeled after the
current Small Business Investment Company (SBIC) program. Five
potential organizations will be selected, each with a minimum of $100
million in private equity capital and each eligible for twice that much
in additional Federal loan guarantees. The Government leverage will be
provided by using debenture securities similar to the SBIC debentures
and funded through the same process. Key targets will be leveraged
buyouts, corporate divestitures, roll-ups, and focused market expansion
that could be relocated to serve low- and moderate-income communities
with the appropriate financial tools.
HOME Investment Partnerships Program
The HOME Investment Partnerships Program (HOME) provides assistance
to State and local governments to address housing needs of low-income
and very low-income persons. Forty percent of HOME funds are allocated
by formula to States. Although States may spend these funds anywhere in
the state, much of their money goes to rural areas.
HOME, HUD's successful housing rehabilitation and production
program, is a key tool for increasing the availability of decent, safe
and affordable housing in both urban and rural America. HUD has found
that HOME exceeds the program's own affordability targets as well as
the targets for funding local nonprofit housing organizations and
creating mixed-income housing opportunities. The program works through
local governments to finance the construction and rehabilitation of
multifamily rental housing, improve substandard housing for current
owners, and assist new home buyers through acquisition, construction
and rehabilitation. HOME also provides rental-based assistance to
families. Beyond its impact in bricks and mortar terms, HOME has been
an important tool for enhancing the capacity and experience of the
nation's affordable housing producers. In fiscal year 2000, the HOME
program is requested at $1.610 billion, an increase of $10 million over
the 1999 enacted level. This program level will provide 85,400
additional units of decent, safe and affordable housing for both owners
and renters through the combination of new construction (34 percent),
rehabilitation (48 percent) and acquisition (15 percent). About 3
percent will be used for tenant based-assistance.
ii. fair housing and equal opportunity
Fair Housing activities are available in both urban and rural
areas. Increased funding is in part targeted as expending services to
both unserved and underserved localities. The Fair Housing Initiatives
Program (FHIP) will increase by $3.5 million in 2000 to a level of $27
million. Funds are for three major components. First, ``private
enforcement'' efforts include testing and other investigative
activities such as audits of new construction to determine compliance
with accessibility requirements, and testing in real estate market
transactions. Second is ``education and outreach'' focusing on national
campaigns to educate protected classes and to educate the housing
industry about the Fair Housing Act. The 2000 FHIP budget also includes
$7.5 million for the second year funding of a national audit of
discrimination in housing rental and sales. This audit will create the
first ever report card at both the national and local levels of the
extent of discrimination against the Nation's major racial and ethnic
groups. The national audit will include urban, suburban and rural
areas.
The budget proposed a joint partnership between FHIP and Fair
Housing Assistance Program (FHAP). This FHIP/FHAP partnership
initiative is proposed to focus on new and underserved populations by
ensuring the full protection of the Fair Housing Act and other civil
rights laws for persons who face language, cultural, and other barriers
that currently limit the utility of these laws to address persistent
housing discrimination. This request includes a $3.5 million set-aside
that will be added to the FHIP to support a fair housing partnership
between the private and public fair housing sectors. This fair housing
partnership effort will be funded equally by the Fair Housing
Assistance Program (FHAP) through an equal $3.5 million contributions,
for a combined $7 million set-aside. The Budget will also support other
fair housing enforcement and education activities.
An additional $2 million will be used to fund the establishment of
new fair housing organizations. It is envisioned that the focus of the
funding for fiscal year 2000 will be on underserved groups. One group
that has been in dire need of more fair housing activity is the
residents of non-metropolitan areas, especially rural areas. Another
group that has been underserved by existing fair housing organizations
is non-English speaking minorities. It is envisioned that the outreach
initiative funding could enable the creation of fair housing
organizations to assist such populations.
The Private Enforcement Initiative, as a major component of FHIP,
has a total proposed level of funding of $7.75 million in fiscal year
2000. Under this component, $6 million is for the following multiyear
projects: (a) carry out testing and other investigative activities,
such as regional audits of new construction to determine compliance
with accessibility requirements; (b) discover and remedy discrimination
in public and private real estate markets and real estate-related
transactions through assisting victims to identify practices that
denied them equal housing opportunity, and; (c) respond to individual
complaints of discrimination from home seekers.
FHAP agencies and private groups will jointly engage in strategic
planning to focus their fair housing enforcement activities. They will
be required to coordinate their activities with HUD to ensure no
duplication exists and that the results of their partnerships make a
maximum contribution to the doubling of enforcement effort.
The fiscal year 2000 Budget request for FHAP is $20 million. This
is an increase of $3.5 million over the fiscal year 1999 appropriation
which will be used to fund an innovative Fair Housing Partnership
between State and local government fair housing enforcement agencies
and private fair housing groups. The Department is proposing this
Partnership focus on underserved populations to ensure that persons who
face language, cultural, and other barriers have the full protection of
the Fair Housing Act. The focus is expected to include racial and
ethnic minorities, rural populations, persons with disabilities, and
homeless persons. The Department will carry out this initiative through
the existing FHAP and FHIP programs.
This Partnership initiative will be funded equally by the FHAP and
FHIP through a combined $7 million set-aside. Through its support of
joint efforts by governmental and private entities, the partnership
initiative will foster substantial and new fair housing results that
individual organizations could not achieve alone.
The balance of the $20 million requested for fiscal year 2000 will
support the activities of approximately 90 substantially equivalent
fair housing enforcement agencies, an increase of 5 over the 1999
level. These agencies will process housing discrimination complaints
based on race, color, religion, sex, familial status, disability, and
national origin.
The total funding requested for both FHAP and FHIP programs in
fiscal year 2000 is $47 million. Together, these two programs form a
national comprehensive fair housing strategy against housing
discrimination based upon greater cooperation between the public and
the private sectors.
iii. housing
The Section 203(b) program, enacted in the National Housing Act of
1934, provides mortgage insurance for one- to four-family residences.
This program has contributed to expanding the opportunities for both
urban and rural homeownership in the United States and will continue to
meet the needs of first-time homebuyers, working families, and minority
families, as well as underserved communities, especially central city
and rural areas. Under the 203(b) program, any person able to meet the
cash investment, mortgage payments and credit requirements may obtain
an FHA-insured loan from a private lending institution to purchase a
home. Since its inception through September 30, 1998, the MMI Fund has
insured approximately $988 billion in mortgages for about 22.5 million
families. There are no statistics on the break-out between urban and
rural areas.
iv. public and indian housing
Small (sometimes rural) PHAs receive approximately 12 percent,
which translates into $23.5 million of the Public Housing Operating
Fund annual appropriation.
Participation in the Section 8 certificate and voucher program by
rural residents or persons living in non-metro areas has not been
examined in recent years. It is not known how much of the overall
outlay of Section 8 housing funds have gone to rural or non-metro
areas. What is known though, is that a sizeable proportion of the
rural/non-metro Section 7 certificate and voucher area administered by
a small proportion of PHAs. A study undertaken by the Housing
Assistance Council in 1989 estimated that approximately 283,000 rural
households have been in some way involved in the Section 8 program, and
that the state and regional PHAs that serve rural areas administer at
least 40 percent of certificate and vouchers in rural/non-metro areas.
v. policy development & research
The 2000 research plan will build on the 1999 agenda. It will focus
PD&R's efforts on current policy topics of significance to the Nation
while continuing the housing market surveys and other core activities.
One proposed activity 2000 will be studies of effective and ineffective
approaches to regional problem-solving that partner cities, suburbs,
and rural areas.
In addition to the above information, the Housing Assistance
Council has produced the following studies with HUD assistance which
might be of interest:
-- Welfare Reform and Rural Housing Case Studies
--Elderly Housing in Rural Areas
--State of Rural Housing (annual report 97 and 98)
--Rural Housing and Economic Development in Boomtowns
--Migrant Farmworker Housing
--HOME Program Use in Rural Areas
--State Plan's Coverage of Rural Housing
--HOME, CDBG, and Farmworker Housing Development
--Analysis of Fair Housing Discrimination Cases in Rural Areas
--A Report on Lending Data for Rural Parts of Metro Areas
--Mobility and Economic Self Sufficiency of Section 8 Participants in
Rural Areas
--Non Profit/For Profit Joint Ventures in Rural Affordable Housing:
Case Studies
--Updated Guide to Housing Organizations for Rural Areas
--A Study of Fair Market Rates in Rural Areas stop
lead-based paint grants
Question. In fiscal year 1999, the Missoula Housing Authority
applied for a lead-based paint grant for low-income housing and was
told that HUD would be awarding grants in November. HUD did not award
grants until March. The indecision and lack of communication is
frustrating to local organizations. HUD needs to honor its commitments
so that local organizations can honor their commitments to local
communities. What can be done about this situation? How does HUD intend
to honor their commitments?
Answer. We regret any misunderstandings between HUD and the
Missoula Housing Authority and that they experienced frustration as a
result. HUD attempts to estimate when grant announcements will be made
based upon workload and historical experience, but projected grant
announcement dates are only estimates and are described as such. In the
future, we will make certain that recipients fully understand that
announcement dates provided in advance are tentative dates.
rural housing
Question. HUD now has a new office and $25 million for rural
housing and economic development. What is the status of this office and
when does HUD expect to make grant funds available to rural
development?
Answer. The Office of Rural Housing and Economic Development is
located in the Office of Community Planning and Development under the
Deputy Assistant Secretary for Economic Development. A Rural Housing
and Economic Development Coordinator will be selected shortly. A
listing of the awards made pursuant to the March 8, 1999, Notice of
Funding Availability is attached.
FISCAL YEAR 1999 RURAL HOUSING AND ECONOMIC DEVELOPMEMT GRANT WINNERS
------------------------------------------------------------------------
Name of organization Applicant City-State Grant amount
------------------------------------------------------------------------
Capacity Building:
Upper Sand Mountain Un. Meth. Sylvania, AL........ $47,300
Larger Parish Inc.
Housing America Corporation... Somerton, AZ........ 75,000
Bishop Indian Tribal Council.. Bishop, CA.......... 88,201
Coachella Valley Housing Indio, Ca........... 200,000
Coalition.
Yurok Tribe................... Eureka, CA.......... 200,000
Kentucky Mountain Hsg Dev Manchester, KY...... 200,000
Corp, Inc.
Three Rivers Community Action, Zumbrota, MN........ 150,000
Inc.
Fort Belknap College.......... Harlem, MT.......... 200,000
Fort Peck Assiniboine & Sioux Poplar, MT.......... 148,633
Tribes.
Rocky Mountain Development Helena, MT.......... 109,369
Council.
Native Council on Economic and Walthill, ME........ 150,000
CDC.
WREN-Women's Rural Bethlehem, NH....... 150,000
Enterpreneurial Network.
Citizens For Affordable Homes, Carson City, NV..... 69,075
Inc.
Adirondack Economic Saranac Lake, NY.... 150,000
Development Corporation.
Bishop Sheen Ecumenical Rochester, NY....... 150,000
Housing Foundation, Inc.
Sullivan County Partnership Monticello, NY...... 150,000
for Economic Development.
Portage Area Development Ravenna, OH......... 137,860
Corporation.
Kiowa Tribe of Oklahoma....... Anadarko, OK........ 143,660
Otoe-Missouria Tribe.......... Red Rock, OK........ 97,805
CASA of Oregon................ Newberg, OR......... 200,000
Technical College of the Low Beaufort, SC........ 193,000
Country Foundation, Inc.
Oti Kaga, Inc................. Eagle Butte, SD..... 188,796
Virginia Eastern Shore Nassawadox, VA...... 115,000
Economic Empowerment & Hsgn
Corp.
Swinomish Indian Tribal La Conner, WA....... 150,000
Community.
Catholic Charities Bureau, Inc Superior, WI........ 200,000
Mountain Partners in Community Elkins, WV.......... 151,701
Development.
Innovative:
Alaska Native Village of Tanacross, AK....... 600,000
Tanacross.
Metlakatla Indian Community... Metlakatia, AK...... 500,000
Community Resource Group, Inc. Fayetteville, AR.... 467,500
Comite de Bien Estar.......... San Luis, AZ........ 600,000
Coachella Valley Housing Indio, CA........... 600,000
Coalition.
Community Housing Improvement Chico, CA........... 451,397
Program, Incorpora- ted.
Coyote Valley Band of Pomo Redwood Valley, CA.. 32,345
Indians.
I-5 Social Services Mendota, CA......... 509,500
Corporation.
Peoples' Self-Help Housing San Luis Obispo, CA. 500,000
Corporation.
South County Housing Gilroy, CA.......... 500,000
Corporation.
Everglades Community Miami, FL........... 500,000
Association, Inc.
Iowa Finance Authority........ Des Moines, IA...... 600,000
MidAmerica Housing Partnership Cedar Rapids, IA.... 500,000
Inc.
Lincoln Hills Development Tell City, IN....... 160,000
Corporation.
Federation of Appalachian Berea, KY........... 482,374
Housing Enterprises.
Kentucky Highlands Investments London, KY.......... 461,854
Corporation.
Garrett County, Maryland, Oaklands, MD........ 504,000
Community Action Committee,
Inc.
Five C, Inc................... Scottville, MI...... 500,000
Bi-County Community Action Bemidji, MN......... 500,000
Programs, Inc.
Blackfeet Tribe............... Browning, MT........ 600,000
The Heriatge Institute........ Poplar, MT.......... 501,219
Housing & Economic Rural Las Cruces, NM...... 165,445
Opportunities, Inc.
New Mexico Mortgage Finance Albuquerque, NM..... 600,000
Authority.
Pojoaque Housing Corportation. NM.................. 500,000
Partnership for Economic Monticello, NY...... 500,000
Development.
Rural Opportunities, Inc...... Rochester, NY....... 390,065
Portage Area Development Ravenna, OH......... 500,000
Corporation.
Catawba Indian Nation......... Catawba, SC......... 600,000
Rosebud Sioux Tribe........... Rosebud, SD......... 500,000
The Lakota Fund............... Kyle, SD............ 538,266
ACClON Texas, Inc............. San Antonio, TX..... 600,000
Amigos Del Valle, Inc......... Mission, TX......... 600,000
Rio Valle Rainbow, Inc........ El Paso, TX......... 44,960
The Center for Economic San Juan, TX........ 500,000
Opportunities, Inc.
Community Health Center La Pasco, WA........... 600,000
Clinica.
Dept. of Community, Trade & Olympia, WA......... 600,000
Economic Development.
Seed Support:
Design Corps.................. Newbern, AL......... 224,190
Fereration of Southern Epes, AL............ 207,800
Cooperatives/Land Assistance
Fund.
Community Resource Group, Inc. Fayetteville, AR.... 222,000
Fort Defiance Housing Window Rock, AZ..... 200,000
Corporation.
White Mountain Apache CDC..... Mc Nary, AZ......... 250,000
Rural Communities Housing Ukiah, CA........... 194,877
Development Corporation.
Neighborhood Housing Services, Boise, ID........... 200,000
Inc.
Kentucky Farmworker Programs, Bowling Green, KY... 209,519
Inc.
Pendelton County Industrial Falmouth, KY........ 200,000
Authority.
Northlake Community Hammond, LA......... 176,008
Development Corp.
Eastern Maine Development Bangor, ME.......... 129,500
Corporation.
Action for Eastern Montana, Glendive, MT........ 126,766
Inc.
Blackfeet Tribe............... Browning, MT........ 200,000
Montana Community Development Missoula, MT........ 199,058
Corporation.
Haliwa-Saponi Indian Tribe.... Hollister, NC....... 250,000
Central Nebraska Community Loup City, NE....... 195,632
Services, Inc.
North Central NE Resource Bassett, NE......... 237,800
Conservation Dev. & Plgn
Council.
Citizen Potawatomi Nation..... Shawnee, OK......... 198,928
Langston Community Development Langston, OK........ 200,000
Corporation.
Little Dixie Community Action Hugo, OK............ 199,700
Agency.
Wa-Ro-MaTri-County Action Claremore, OK....... 225,710
Foundation, lnc.
Catawba Indian Nation......... Catawba, SC......... 250,000
Cangleska, Inc................ Kyle, SD............ 211,764
Rosebud Sioux Tribe........... Rosebud, SD......... 196,800
El Paso Collaborative for El Paso, TX......... 200,000
Community & Economic Dev.
VA Eastern Shores Economic Nassawadox, VA...... 175,000
Empowerment & Housing Corp.
Institute for Washington's Renton, WA.......... 199,500
Future.
Okanogan County Community Okanogan, WA........ 196,665
Action Council.
The Jamestown S'Klallam Tribe. Sequim, WA.......... 117,702
------------------------------------------------------------------------
section 8 housing
Question. I hear from Montana that the private sector is pulling
out of the Section 8 housing. Our elderly and handicapped need to feel
secure where they live. What will be done to keep housing inventory
stable and reassure the most needy that they will not have to move
every year?
Answer. The Department shares your concern over the possible loss
of quality assisted housing stock. Therefore, the Department took the
initiative of issuing an emergency renewal policy in June 1999, which
is designed to target increases in rental subsidy assistance to those
developments most in risk of opting-out. This effort maximizes the use
of existing statutory authority and available resources to maintain our
inventory of valuable multifamily housing stock. Also, the Department
is pursuing a cooperative effort with Congress to enact a more
comprehensive solution to the loss of HUD-subsidized multifamily
housing. Finally, since some owners will chose to opt-out, despite
improved policies to encourage renewal, the Department is seeking
authority to offer ``enhanced'' vouchers to all residents in projects
that opt-out. This will avoid the potential for displacement of
currently assisted residents when owners raise rents to local market
levels.
welfare to work
Question. Is HUD thinking about dedicating funding to those folks
who are trying to break the welfare cycle? What are HUD's housing
strategies for ``Welfare to Work'' and helping men and women get into
housing closer and to educational and job opportunities?
Answer. HUD has dedicated funding for two significant welfare-to-
work initiatives in the fiscal year 2000 budget, Welfare-to-Work Rental
Vouchers and the Welfare-to-Work Targeted Job Creation Initiative, a
component of the Community Empowerment Fund. Also, our public housing
reform is creating incentives in our existing housing programs to
encourage residents to make the transition from welfare to work.
Welfare-to-Work Rental Vouchers
In fiscal year 1999, Congress appropriated $283 million for 50,000
new incremental welfare-to-work rental vouchers. Our fiscal year 2000
budget proposes $144 million for 25,000 additional welfare-to-work
rental vouchers.
These new vouchers are targeted to families who are currently
receiving, are eligible for, or have left welfare within the last 2
years and for whom the housing assistance is essential to obtaining or
retaining employment. They will help families overcome a number of
challenges to self-sufficiency. These vouchers will provide a safe and
stable housing situation as a platform from which to find and keep a
job. They will reduce the rent burden for families paying too high a
percentage of their income for housing. The vouchers will also help
families overcome the spatial mismatch that separates them from
educational and job opportunities. Families will be able to move closer
to those opportunities, or near transportation centers so they can
easily get to those opportunities.
The welfare-to-work vouchers are being made available to
communities on a competitive basis that requires Housing Authorities to
develop their plans together with welfare and workforce development
agencies. This will make sure the housing assistance is combined with
the child care and other services families need for a successful
transition from welfare to work. It will also ensure that the vouchers
are provided to the families for whom they will be most critical to a
successful transition.
The Welfare-to-Work Targeted Job Creation Initiative, funded with
up to $75 million in direct Economic Development Initiative grants and
an estimated $375 million in Section 108 guaranteed private loans, as
part of the Community Empowerment Fund, is designed to help close the
``jobs gap'' facing many communities. HUD's 1998 State of the Cities
report indicated that despite significant recent increases in job
growth in many cities, there is still a sizable mismatch between the
number of low-skilled jobs available and the number of low-skilled
urban residents who need work-or who will need work over the next few
years as Temporary Assistance for Needy Families (TANF) time limits
take effect. This initiative is designed to help close this gap, with
special emphasis on welfare recipients entering the workforce.
This targeted job creation initiative will support the expansion of
businesses that emphasize hiring of those in transition from welfare to
work--projects like the state-of-the art Learning and Work Complex
opened by the Cessna company in a long-vacant industrial facility in
Wichita, Kansas. Funded with a HUD grant and a HUD-guaranteed loan, the
complex is helping TANF recipients prepare for well-paying
manufacturing jobs. Of the 237 graduates so far, 200 have moved into
Cessna jobs that start at more than $10/hour, and 26 are employed at
other companies. Like the Cessna project, communities competing
successfully under this targeted job creation initiative will combine
the HUD incentives for business development with local public and
private supports--like job training, child care, and--as needed. The
initiative will ensure that those facing the transition from welfare to
work get jobs that pay and that employers get the workers they need to
be competitive. The overall $125 million Community Empowerment Fund is
projected to support an estimated 100,000 in distressed community with
welfare related populations.
The Quality Housing and Work Responsibility Act (QHWRA) of 1998 is
reforming public housing. Much of the reform has to do with creating
greater financial and other incentives for public housing residents to
move from welfare to work. Some of the specific reforms are:
--Expanding mandatory earnings disregards to a larger pool of people.
This includes residents who are receiving or have received TANF
assistance in the past 6 months and residents who have been
unemployed for over a year. Residents usually pay 30 percent of
their income for rent, so as their earnings from work increase,
they pay 30 percent of that increased income as additional
rent. These new rules disregard 100 percent of the increased
income from rental calculations for the first year, and 50
percent for a second year.
--Permitting flat rents and ceiling rents so that rent will not
increase with increased earnings.
--Mandatory hardship exemptions from minimum rent payments for
families who lose welfare benefits because of time limits.
--No rent reductions for families who lose welfare benefits for
failure to comply with TANF work requirements. Previous law
lowered the rent in such cases. This was at odds with the
purpose of welfare sanctions.
--Exemptions from community work requirements for TANF recipients who
are in compliance with their TANF program.
--The continuation of the Family Self-Sufficiency (FSS) Program. This
program provides both case management for supportive services
and escrow accounts for additional rent due to participants'
increased work earnings. Rather than going to rent, these
earnings are deposited into savings accounts. The residents can
access the money when they complete the program and move to
unsubsidized housing.
______
Questions Submitted by Senator Craig
hud accessibility guidelines
Question. In April of 1998, your Department finalized and published
guidelines pertaining to accessibility standards for the disabled.
Before 1998, regulations issued by HUD contained disclaimers that there
was ``no guarantee of the accuracy or completeness of the
information.'' Builders, owners, and other involved parties in Idaho
are now having complaints filed against them for units built before the
finalized rules were published. How is it that you can hold people
liable for following guidelines when HUD did not provide any definite
requirements?
Answer. Congress and the Department have provided definitive
statements of the accessibility requirements of the Fair Housing Act
since the Fair Housing Amendment Act of 1988 was passed. The Department
has continued dialogue in the industry and has continued to expand our
efforts to communicate these legislated accessibility requirements.
The first guidance provided to the public and the building industry
regarding the Act's design and construction requirements was contained
in the Fair Housing Amendments Act of 1988 itself. In the Act, Congress
defined the coverage of the requirements, in Sections 804 (f)(3)(C) and
(f)(7) of the Act, and explicitly stated the required design features
for units covered under the Act. First, the Act required that:
--1. the public and common use portions of covered dwellings be
accessible to the disabled;
--2. all doors be sufficiently wide to permit passage by a person in
a wheelchair; and
--3. all premises within the dwelling have an accessible route into
and through the dwelling unit; light switches, electrical
outlets, thermostats and other environmental controls in
accessible locations; reinforcements in bathrooms for later
installation of grab bars; and usable kitchens and bathrooms.
The Act also stated that compliance with the American National
Standard accessible buildings and facilities (ANSI A117.1) satisfied
the accessibility requirements of the Act. [Section 804 (f)(4)].
The vast majority of the fair housing complaints filed in the past
2 years in the State of Idaho contain allegations that these basic
requirements of the Act have been violated. Many of the properties
involved in these complaints have such features as: (1) steps up to the
building, (2) steps at the entrances of the buildings, (3) thresholds
of 4 inches or higher at the front door of the covered units, (4) no
curb cuts for persons in wheelchairs in the sidewalks leading to units,
and (5) bathrooms and kitchens that cannot be entered or used by
persons in wheelchairs.
The Department published the Fair Housing Act Accessibility
Guidelines in the Federal Register on March 6, 1991, with extensive
participation by and comment from all of the major organizations
representing the building industry. The Preamble to the Guidelines,
which have been widely distributed to the building industry and the
public since they were issued, stated, in part:
``The design specification presented in the Fair Housing
Accessibility Guidelines provide technical guidance to builders and
developers in complying with the specific accessibility requirements of
the Fair Housing Amendments Act of 1988. The Guidelines are intended to
provide a safe harbor for compliance with the accessibility
requirements of the Fair Housing Amendments Act, as implemented by 24
CFR 100.205 of the Department's Fair Housing regulations. The
Guidelines are not mandatory. Additionally, the Guidelines do not
prescribe specific requirements which must be met, and which, if not
met, would constitute unlawful discrimination under the Fair Housing
Amendments Act. Builders and developers may choose to depart from the
Guidelines, and seek alternate ways to demonstrate that they have met
the requirements of the Fair Housing Act.'' [emphasis added]
This statement consistently has been, and remains, the Department's
position with respect to enforcement of the Fair Housing Act
accessibility requirements. In the State of Idaho, for example, if
HUD's investigation of a property indicates that the builder has not
relied on these guidelines, the builder and architect may present
evidence that they have satisfied the requirements of the Act through
alternative means.
On June 28, 1994, the Department published in the Federal Register
further official guidance on the accessibility requirements of the Act,
as ``Supplement to Notice of Fair Housing Accessibility Guidelines:
Questions and Answers about the Guidelines.''
In August 1996, the Department published a Fair Housing Act Design
Manual. The purpose of this Manual, stated in its title, was to provide
additional means by which designers and builders may meet the
accessibility requirements of the Fair Housing Act. The Manual
contained, explained, and illustrated the 1991 Fair Housing Act
Accessibility Guidelines. Additionally, the Manual contained non-
binding recommendations about how builders and developers could design
accessible housing that met and, in some cases, exceeded the
requirements of the Act.
In 1998, the Manual was revised to more clearly distinguish between
the requirements of the Act, on one hand, and design elements that were
merely recommended, on the other. The disclaimer was eliminated. The
revisions appear in approximately 25 of the Manual's 350 pages.
idaho fair housing council accessibility issues
Question. In addition, it seems that the HUD grantee in Idaho, the
Idaho Fair Housing Council, is suddenly filing large numbers of
complaints, when previously there were very few and we still don't have
a single case of a disabled individual being denied housing. Can you
explain the process that is used to control and oversee what the HUD
grantees are doing in the states?
Answer. The number of complaints may seem large until you consider
the number of Americans having disabilities. A 1997 Census Bureau
publication reported that, at the end of 1994, 20.6 percent of the
population, about 54 million people, had some level of disability, and
26 million people had a severe disability and 1.8 million Americans
used a wheelchair. An additional 5 million used a cane, crutches, or a
walker and had used these assistive devices for 6 months or longer.
The level of need for accessible units in Idaho is consistent with
these national statistics. In a 1999 article in the Idaho Statesman,
Kelly Buckland, Executive Director of the State Independent Living
Council, states: ``People with disabilities tell us over and over * * *
that accessible and affordable housing is one of the two top issues for
them in the state.'' Buckland added:
``What you'll hear from owners and builders is that there's not
that many people with disabilities. But 45 percent of the households in
Idaho contain someone with a disability.''
Similarly, a January 24, an 1999 Idaho Statesman article told of
two retirees who were evicted from their room in a home allegedly
because the husband's health deteriorated and he needed a ramp or
handrail to get into the house.
We see our FHIP grantees as pivotal in protecting the rights of
these Americans. The control and oversight for the FHIP grantees are
pretty typical for grantees of any Federal agency.
To be funded, grantees must demonstrate the need for the proposed
funding in their communities. HUD awards grants based on the extent to
which their application demonstrates the need for such funding, among
meeting other conditions, and then it negotiates a Statement of Work,
and monitors the performance under that Statement of Work. Please note
that in addition to the disability cases they brought, they referred to
HUD numerous cases from people alleging a broad range of discriminatory
practices, including discrimination on the basis of national origin and
gender. The 1999 FHIP NOFA has some new requirements, which strengthen
HUD oversight of the FHIP organizations. With two exceptions, all
complaints resulting from HUD-funded activities must be filed with HUD.
The exceptions are:
--a ``bona fide'' private complainant can opt-out by stating in
writing (s)he does not want the complaint filed with HUD; and
--FHIP grantees are not to refer any complaint to HUD unless it is
fully jurisdictional under the FHAct and supported by credible
and legitimate evidence.
HUD will use these standards in negotiations with grant recipients.
Moreover, HUD's upcoming GTR training in July will help HUD field staff
better assess the quality of the deliverables, including complaint
referrals.
fair housing educational and technical assistance to industry and
construction professions
Question. I also have concern over the educational efforts in this
area. GAO reports show that between 1989 and 1997, HUD made available
more than $98 million to private groups through the Fair Housing
Initiative Program (FHIP) to work on enforcement activities, staff
training and testing and complaint process. However, less than one
percent of this funding was targeted to provide educational and
technical assistance to the industry and construction professions. Can
you explain how you expect building contractors to comply with HUD
regulations if you don't educate and provide outreach to them?
Answer. We agree that education is critically important. In fact,
if you look closely at the $98 million figure cited in the GAO report,
you will see that it includes $23.4 million for the education and
outreach initiative. So in other words, 24 percent of the total FHIP
expenditures from 1989 to 1999 went to education and outreach. A
portion of that figure included education and outreach efforts to
industry and construction professions.
Ordinarily, education and outreach efforts are open to anyone
interested, and a full range of affected groups and organizations are
invited, which includes the various housing industry groups.
Generally, we would expect the building and construction industry
to be aware of the accessibility requirements; compliance with the
American National Standard Institute's standards (ANSI A117.1), which
have been the standards for the building industry since 1961,
constitutes compliance with the Fair Housing Act. This has been the
case since the Act was amended in 1988 to include the accessibility
standards. It is important to note again that the accessibility
requirements are embodied in the legislation. HUD issued guidelines
published in the Federal Register in 1991 and further guidance in the
Federal Register in 1994. The Department has continued to provide
additional guidance in a series of publications.
Looking at Idaho more specifically:
--HUD began holding seminars for local officials and the building
industry in Idaho on accessibility requirements in 1994. Other
seminars were held in 1996 and in 1997. The seminars covered
both federally assisted housing projects and private housing
developments. HUD continues to hold these seminars;
--In 1994, HUD's Idaho State office began distributing accessibility
brochures for builders and architects;
--In September 1996, the Idaho Fair Housing Council wrote local
officials throughout Idaho requesting their assistance in
advising the affected building industry of the FHAct's
requirements;
--Throughout 1997 and 1998, HUD engaged in dialogue with the City of
Boise and its building department about notifying builders of
the coverage and accessibility requirements of the Act;
--HUD awarded a Fair Housing Initiative Program grant to the National
Association of Home Builders to conduct accessibility seminars
across the country. One of those sessions was held in Boise,
Idaho in 1998; and
--Recently, as an outgrowth of a conciliation agreement, a builder in
Pocatello, Idaho sponsored a seminar on the accessibility
requirements for the industry in eastern Idaho. Although 400
people were notified, fewer than 40 people attended, and most
of those in attendance were code enforcement people.
real estate agents accessibility responsibilities
Question. I have heard from many real estate agents in Idaho who
are concerned that they will be held liable for facilitating
transactions of homes that do not meet the accessibility guidelines for
the disabled. Can you clarify for me what position HUD has taken on
this issue?
Answer. The Department's position is that real estate agents are
not liable under the Fair Housing Act for facilitating transactions of
homes that do not meet the accessibility guidelines for the disabled.
The Department would not accept a Fair Housing Act complaint seeking to
name a real estate agent as a respondent to the complaint based solely
on the fact that the real estate agent facilitated a real estate
transaction. Instead, a real estate agent or any other person who
participated in the design or construction of a covered multifamily
dwelling unit that does not meet the design and construction
requirements of the Act, including as an owner of the property or as a
property manager, however, would be an appropriate respondent to a Fair
Housing Act complaint. We expect that these instances will be
exceedingly rare.
available hud technical assistance on fair housing guidelines
Question. In addition if a Realtor, or a consumer, were going to
list a piece of property today, where would they go for technical
assistance to determine if a property complies with the Fair Housing
guidelines? Does HUD provide this information? If not, why not?
Answer. The Realtor or consumer seeking technical assistance on the
Fair Housing guidelines should come to HUD. The Department will respond
to telephone and written inquiries. As you can see from the listing
below, the Department provides a number of documents and technical
assistance materials that explain these requirements.
------------------------------------------------------------------------
Item Number Title
------------------------------------------------------------------------
2440................................... 24 CFR 1 Fair Housing
Accessibility Reg.-24 CFR,
Chapter 1 Questions and
Answers
2429................................... Federal Register--Monday
January 23, 1989 Part III 24
CFR 14 et al. Implementation
of the Fair Housing Amendments
Act of 1988; Final Rule
4826................................... June 28, 1994; Fair Housing:
Accessibility Guidelines;
Question and Answers;
Supplement to Notice
4682................................... Architects and Builders: Are
You in Compliance with the
Fair Housing Act
4703................................... Seven Technical Requirement
Brochure
4715................................... Fair Housing Act: Design Manual
(WIRE-PALETTED) (also order
item #4889 with this item)
4725................................... Federal Register-March 6, 1991
Part VI-24 CFR Chapter 1 Final
Fair Housing Accessibility
Guidelines
4734................................... Cost of Accessible Housing
4889................................... Revision Sheets of Fair Housing
Act Design Manual (also order
item #4715 with this item)
------------------------------------------------------------------------
In addition to the above, a 28:09 minute videotape ``Accessible
Housing: HUD Fair Housing Accessibility Guidelines'' is available.
Anyone can request any of these materials through:
-- http://www.hud.gov/ (under ``handbooks/forms'')
--(202) 708-2313
--(800) 767-7468
--(800) 877-8339 TDD
--U.S. Department of Housing and Urban Development Directives
Distribution Section Room B-100 451 Seventh Street, S.W.
Washington, D.C. 20410
Some items are out of print, but print orders can be placed if
there is demand for them.
management and marketing firms for property disposition
Question. As you know, last year Congress passed legislation that
allowed HUD to change the process of granting contracts to local REAMs.
Now HUD gives the contracts to companies known as ``M&M's. These
Management and Marketing firms were intended to increase the turnaround
time on reselling the homes. However, I have heard concerns from the
state that this process is not working. Mr. Secretary, I am interested
in how your would rate the success of this program so far and your
opinion on whether it is accomplishing its goals? Additionally, can you
tell me the current status of how Intown Marketing--the M&M in Idaho--
is performing?
Answer. On March 29, 1999, the seven management and marketing
contractors assumed responsibility for approximately 28,000 HUD-owned
properties nationwide. Prior to this date, the Department removed
approximately 16,000 properties from the market for sale to allow for
the transition to the management and marketing contractors. The
management and marketing contractors were required to resecure all of
the transferred properties, reclean the properties and prepare new
marketing plans for each property. Given this large-scale portfolio
transfer, the contractors have been able to list approximately 25,000
properties for sale and sell approximately 15,000 properties in this 3-
month period. Last fiscal year, the Department sold 64,536 properties.
This is early in the assessment of the performance of these
contractors. However, at the current rate of sales by the contractors,
they have the ability to surpass the Department's sales for a year by
as much as 12,000 properties. This is a promising trend and this type
of performance is expected to continue throughout the contract period.
With regard to the performance of the Intown Management Group in
Idaho, the Department initially transferred 28 properties to this
contractor. There are currently 29 properties listed for sale while 21
properties have been sold since contract inception. The current numbers
reflect the contractor's ability to list and sell properties in the
Idaho area.
hud's fair housing education efforts and measurement of its
effectiveness
Question. HUD's fiscal year 2000 annual performance plan contains a
goal to ensure equal opportunity in housing for all Americans. However,
the objectives and performance indicators are predominantly related to
managing complaints and enforcement actions. What strategies will HUD
use to increase awareness of the fair housing provisions?
Answer. The Department believes strong action is needed to rid this
nation of housing discrimination. Therefore, the Department is
stressing enforcement of the Fair Housing Act in its Annual Performance
Plan (APP).
As you suggest, however, enforcement actions are not the sole
method for eliminating housing discrimination. HUD's strategy is to
educate the housing industry and the public primarily through the FHIP
program. In fact, $15.75 million of the $27 million total requested for
FHIP programs in fiscal year 2000 would fund National Education and
Outreach Grants program.
The following efforts to educate the building industry in Idaho
about accessibility requirements exemplify HUD's strategies:
--HUD began holding seminars for local officials and the building
industry in Idaho on accessibility requirements in 1994. Other
seminars were held in 1996 and in 1997. The seminars covered
both federally assisted housing projects and private housing
developments. HUD continues to hold these seminars;
--In 1994, HUD's Idaho State office began distributing accessibility
brochures for builders and architects;
--In September 1997, the Idaho Fair Housing Council wrote local
officials throughout Idaho requesting their assistance in
advising the affected building industry of the FHAct's
requirements;
--Throughout 1997 and 1998, HUD engaged in dialogue with the City of
Boise and its building department about notifying builders of
the coverage and accessibility requirements of the Act;
--HUD awarded a Fair Housing Initiative Program grant to the National
Association of Home Builders to conduct accessibility seminars
across the country. One of those sessions was held in Boise,
Idaho in 1998; and
--Recently, as an outgrowth of a conciliation agreement, a builder in
Pocatello, Idaho sponsored a seminar on the accessibility
requirements for the industry in eastern Idaho. Although 400
people were notified, fewer than 40 people attended, and most
of those in attendance were code enforcement people.
Question. How will HUD measure the effectiveness of these efforts?
Answer. The APP states that the Department will conduct a survey to
assess public knowledge of fair housing law. It will take the form of a
random dialing telephone survey in 2000. The information resulting from
this survey will form a baseline against which progress in educating
the public about fair housing will be measured in subsequent surveys.
Question. Why doesn't the plan cover all these activities?
Answer. Outcome Indicator 2.1.3 of the APP calls for raising public
awareness of fair housing law. It states:
``Public awareness of the law concerning fair housing reduces
discriminatory actions, but no nationally available data exist to
estimate the extent of awareness. This indicator tracks the effect of
fair housing enforcement activities and of public information campaigns
such as the National Education and Outreach Grants program on public
understanding of their rights and responsibilities under the law.''
hud oversight of state disability related enforcement efforts
Question. In 1989, the Fair Housing Act was amended to cover
persons with disabilities. Shortly afterward, HUD delegated enforcement
authority for these amendments to each state that had a statute that
was equivalent to the federal law. Subsequently, HUD has issued more
guidelines that expanded the requirements for building units that would
comply with the amendments. What efforts has HUD taken to ensure that
the states to which enforcement authority was delegated comply with the
more recent guidelines?
Answer. State and local agencies are bound by their respective
laws/ordinances/regulations. The Fair Housing Act (FHAct) requires that
those laws be substantially equivalent--not identical to the FHAct. If
a difference in interpretation arises between the State/local law and
the FHAct after substantial equivalency status is awarded, the
Department may determine the change is of such consequence that the law
is no longer substantially equivalent or it may, by mutual consent,
retain jurisdiction over certain categories of claims (i.e., the state
would not handle certain categories of complaints). The Department
would become aware of such differences in one of two ways: (1) the
agency notifies the Department of the change, or (2) in assessing
complaints processed by the agency for payment.
The Department provides guidance to substantially equivalent
agencies in a variety of ways: annual HUD-sponsored training, technical
assistance from the Government Technical Representative or local HUD
enforcement office, direct mailings and on the HUD website.
Question. How does HUD monitor the enforcement activities in these
states?
Answer. HUD monitors the activities of the agencies through
technical assistance, on-site performance evaluations, review of the
cases submitted by the agencies for payment, and training.
Question. How does HUD ensure that its enforcement activities in
states where enforcement authority is not delegated is equivalent to
the activities in other states?
Answer. In states that are not substantially equivalent, there is
no delegation of enforcement authority. The Department maintains
responsibility for processing all such complaints under the Federal
Act.
______
Questions Submitted by Senator Kyl
violations of the fair housing act
Question. On October 28, 1998, HUD published a proposed Rule on
``Fair Housing Performance Standards for Acceptance of Consolidated
Plan Certifications and Compliance with Community Development Block
Grant Performance Criteria.'' It is my understanding that this Rule
would have denied CDBG funds to any locality that was so much as
accused of violating the Federal Fair Housing Act. In your view, is it
fair to penalize communities that are merely accused of being in
violation of the Fair Housing Act? Does the concept of due process not
require that an actual violation--not the allegation of one--be found
before communities are penalized?
Answer. HUD agrees it is not fair to penalize communities that are
merely accused of being in violation of the Fair Housing Act and has
never proposed any such approach. A ``charge'' of a violation of the
Fair Housing Act by HUD is not mere accusation or allegation. Pursuant
to the Fair Housing Act regulations, HUD may only issue a charge after
HUD has:
--determined that the allegations state a claim under the Fair
Housing Act;
--determined that the claim is timely;
--determined that the complainant has standing to assert the
violation;
--notified the respondent of the Fair Housing Act complaint;
--permitted the person to submit any evidence that responds to the
allegations;
--investigated the complaint, including exculpatory evidence;
--attempted to conciliate the complaint; and
--based upon its full investigation and all evidence submitted by
both parties, determined that reasonable cause exists to
believe a discriminatory housing practice has occurred.
The issuance of such a charge requires the concurrence of HUD's
Office of General Counsel.
The proposed rule does not address or change the existing due
process requirements in the Consolidated Plan and CDBG program
regulations. The due process already required by HUD regulations for
CPD actions would continue to apply to the disapproval of the
affirmatively furthering fair housing certification in the Consolidated
Plan and to the imposition of corrective actions to address deficient
affirmatively furthering fair housing performance under the CDBG
program. In other words, the fair housing matters would be subject to
exactly the same due process requirements that apply to CPD concerns.
Question. I understand that HUD did not adequately consult with
cities and fair housing advocates before drafting and publishing this
Rule. Given that the Rule has been withdrawn, does HUD intend to work
with city leaders and fair housing advocates to draft new fair housing
guidelines that have the understanding and support of the stakeholders?
Answer. HUD did not issue a final rule on this; HUD issued a
proposed rule. The Administrative Procedures Act normally calls for a
consultation process before an agency issues a final rule. The
consultation process ordinarily consists of notifying the public of the
proposed rule through publication in the Federal Register and giving
the public the opportunity to comment on the proposed rule. The issuing
agency then examines the comments and considers them.
HUD fully complied with these Administrative Procedures Act
requirements. In fact, HUD extended the comment period and invited
numerous groups (including a briefing with representatives from the
House Majority staff of the Housing Subcommittee on Housing and
Community Opportunity) to discuss their views during this comment
period. As a result of these consultations, HUD withdrew the proposed
rule. HUD intends to continue the process of consultation with
interested parties to arrive at a rule which more clearly states HUD's
policy.
Question. I understand that many communities never received
feedback from HUD on the adequacy of proposals to address impediments
to fair housing in their comprehensive plans. Don't you think there
should have been some constructive educational action taken before HUD
attempted to impose punitive measures as proposed in the Rule?
Answer. While HUD does not require prior submission and approval of
a jurisdiction's analysis of impediments to fair housing choice, it
promptly responds to complaints or concerns expressed by local citizens
and groups. This may involve a review of the analysis and supporting
documents. In addition, HUD will carefully review the performance
indicators under the Consolidated Plan to measure the jurisdiction's
progress toward meeting its fair housing goals.
To assist communities in implementing their analysis of impediments
to fair housing choice, HUD conducted 22 training sessions nationwide
during the summer, fall, and winter of 1997. These sessions were
attended by over 1,700 people representing CDBG and HOME grantees,
public housing agencies, fair housing organizations, and housing
industry groups. These sessions educated participants about the rights
of their constituents to fair housing planning.
In 1996, HUD published a Fair Housing Planning Guide which provided
information on how to conduct an Analysis to Fair Housing Choice,
undertake activities to correct the identified impediments, and the
types of documentary records to be maintained.
fair housing guidelines relating to group homes
Question. Many communities in Arizona feel that HUD's fair housing
guidelines do not grant them adequate authority to reasonably regulate
group homes within their boundaries. For example, minimum spacing
requirements and occupancy limits are routinely interpreted by the
federal government as being in violation of the Fair Housing Act. The
intent of these regulations is not to prevent group homes from being
able to operate and provide necessary services; rather, the intent is
to allow group homes to operate in greater harmony with the character
of the neighborhoods in which they exist. The fiscal year 2000 budget
proposed for HUD contains $47 million for ``Fair Housing Activities.''
Can you assure me that HUD will not expend funds to investigate
citizens who, in protesting the placement of group homes, are merely
exercising their First Amendment Rights?
Answer. HUD responsibilities for enforcement of the Fair Housing
Act are subject to the Constitutional protections of free speech. HUD
continues to adhere to specific guidelines that ensure that citizens'
First Amendment rights are protected as HUD processes claims that may
involve freedom of speech issues. All FHEO staff are bound by these
guidelines. Moreover, the Department acknowledges the Senate's
direction in our Appropriations Act for the last several years, which
states that the Department may not ``investigate or prosecute...any
otherwise lawful activity...engaged in solely for the purpose of
achieving or preventing action by a governmental official.''
Question. Why should the Fair Housing Act not be amended to allow
communities greater, but reasonable, control over the placement of, and
the number and type of occupants in, group homes within their
boundaries?
Answer. The issues localities raise regarding group homes are not
best addressed in statute. A cooperative effort among all parties
involved, including localities, housing provider groups, civil rights
organizations and federal enforcement agencies, rather than the
unnecessary restructuring of a historic civil rights statute, is a more
positive and productive approach.
A comprehensive, non-legislative approach to the group home issue
is appropriate because much of the controversy generated on the issue
involves such non-federal matters as licensing and monitoring. The
scope of community concerns regarding group homes go beyond Fair
Housing Act considerations and, in fact, consists mostly of concerns
regarding licensing, monitoring, and compliance with local ordinances.
Question. I understand that HUD had planned to release fair housing
guidelines in October1994 that would clarify for localities what
actions they could take or not take with respect to group homes. Those
guidelines were never issued. Why?
Answer. While HUD has not issued formal policy guidelines regarding
group homes, on October 4, 1995, HUD responded in detail to questions
from the League of Cities regarding the role of the Department on
zoning-related issues. HUD has taken other actions in several areas
regarding group homes, including:
--agreeing to coordinate discussion of the group home issue among
interested parties at the request of the U.S. Conference of
Mayors;
--meeting with key Department of Justice (DOJ) staff to discuss
appropriate, non-legislative responses to group home issues;
--meeting with representatives of the National League of Cities to
discuss group home concerns;
--meeting with representatives of the Coalition to Preserve the Fair
Housing Act, an ad hoc grouping of civil rights, disability and
national community organizations, to discuss group home
concerns;
--attending, in an ``observer'' capacity, a meeting organized by the
National League of Cities designed to discuss non-legislative
responses to issues raised by pending legislation;
--meeting with the Department of Health and Human Services Assistant
Secretary for Planning and Evaluation to discuss group homes,
and obtaining information from HHS on state regulation of group
homes; and
--reviewing HUD programs which may involve group homes.
______
Questions Submitted by Senator Campbell
nahasda
Question. Though you have repeatedly recognized the ``third world
conditions'' of Indian housing, fiscal year 2000 funding for the Native
American Housing Assistance and Self-Determination Act (NAHASDA) Block
Grant did not receive the requested 10 percent increase that the rest
of HUD and its programs received. If Native American housing represents
the worst in the nation, why did it not receive a 10 percent increase
in requested funding?
Answer. Although the Department's overall Budget request for fiscal
year 2000 reflects an increase, the increase was not spread evenly
across all programs. However, the President's fiscal year 2000 Budget
request continues to support the fiscal year 1999 Budget increases
provided for the Indian Housing Block Grant (IHBG) program, the Section
184 Indian Housing Loan Guarantee Fund and the Indian Community
Development Block Grant program. Other programs proposed for fiscal
year 2000 from which Indian Tribes and their Tribally Designated
Housing Entities are expected to benefit include the Welfare-to-Work
Section 8 Voucher Program (25,000 units requested), and Service
Coordinators for the Elderly, proposed to be funded at $50 million.
As the implementation of IHBG progresses, the Department must
ensure that tribal management and operational capability exists. Some
larger tribes now receive significantly more funding post-NAHASDA than
they received under pre-NAHASDA programs. The Department is confident
that the funding proposed for Indian programs in the President's fiscal
year 2000 Budget request is the optimum amount that can be prudently
managed in Indian Country while maintaining the integrity of both the
programs and Federal funds.
nahasda
Question. The Committee on Indian Affairs has received complaints
from tribes regarding the confusion over NAHASDA's environmental review
process, inadequate consultation, and lack of Title VI implementation.
Please describe the Department's proposals to address each of these
matters.
Answer. The Department's proposals to address (a) environmental,
(b) consultation and (c) Title VI implementation concerns of the
Committee on Indian Affairs are as follows:
a. Environmental Concerns.--The Department has taken a number of
initiatives to eliminate confusion about the tribal environmental
review process. Prior to the passage of NAHASDA, HUD maintained the
lead role in ensuring that affordable housing activities complied with
the National Environmental Protection Act (NEPA) and related laws.
Under NAHASDA, tribes may either perform such reviews or request HUD to
conduct them. While most tribes successfully perform their
environmental reviews, a few tribes have started projects without
completing the requisite environmental reviews. Of 27 environmental
problems discovered recently, virtually all have been resolved
successfully without any loss of grant funds.
Basic environmental training has been provided by the Department at
11 locations throughout the United States to over 300 NAHASDA grantees
and Office of Native American Programs (ONAP) staff. During the
remainder of this calendar year, HUD will conduct advanced training for
grantees and ONAP staff at approximately 12 additional locations. Other
actions include:
--1. each ONAP Office has a designated Environmental Liaison Officer
to provide technical assistance, and provide guidance, as
requested;
--2. publication and distribution of an Environmental Guidebook to
all grantees; and
--3. a memorandum to be issued shortly to all Area ONAP
Administrators detailing environmental review requirements,
along with technical guidance on how to proceed when defects in
environmental reviews are discovered.
The Department's primary objectives are twofold: (1) to continue to
work with tribes until they are capable of assuming the environmental
requirements, and (2) to monitor and promote environmental regulatory
compliance.
b. Consultation Concerns.--The Department strongly supports the
concepts of Indian self-determination and the government-to-government
relationship. The Department has had an American Indian and Alaska
Native Consultation Policy in place since 1994. That document, issued
in response to the President's Memorandum of April 29, 1994, reaffirmed
the government-to-government relationship between Federally recognized
Indian tribal governments and the United States government. The Office
of Native American Programs subsequently conducted regional
consultation sessions on the policy throughout Indian Country and
received input from tribal leaders on how best to implement it.
On May 14, 1998, the President issued Executive Order 13084, which
required Federal agencies to develop an effective process for elected
officials of tribal governments to provide meaningful and timely input
in the development of regulatory policies that would significantly or
uniquely affect Native American communities.
During the March 1999, ``Shared Visions: The Native American
Homeownership, Legal and Economic Development Summit I,'' in Chicago,
the Department presented a revised draft consultation policy and
procedures document to tribal leaders and other participants. At that
time, Secretary Cuomo met personally with tribal leaders to express the
Department's commitment to tribal consultation.
More recently, on June 4, 1999, the Department released a letter to
all tribal governments inviting them to participate in redrafting the
Department's consultation policy. The letter explained the Department's
initiative, included an Action Plan, and requested their active
participation in developing the final policy.
c. Title VI Implementation.--The Title VI Tribal Housing Activities
Loan Guarantee Program was announced on July 23, 1998. To ensure that
the $6 million loan guarantee program is implemented successfully, the
Department contracted with a TA and capacity-building provider using a
$3 million Rural Housing and Economic Development Initiative grant. The
contractor may work directly with tribes, or act in coordination with
another Technical Assistance (TA) provider of the applicant's choice.
In either case, TA will be provided free of charge to applicants. The
grant is expected to help ensure that proposals are well-conceived, and
should increase every applicant's chances for success.
As of June 12, 1999, the contractor, IHA Management Systems,
reports that they are assisting six tribes/tribally designated housing
entities develop a Title VI loan project plan. Three additional
potential participants have taken the required preliminary steps toward
project development.
nahasda
Question. Some tribes, including Lower Elwha, Yakima Nation, and
Coeur d'Alene have experienced situations where HUD has informed the
tribes that a one page environmental review document was `incomplete'
and consequently, all NAHASDA money was to be returned to HUD. What
will HUD do to ensure that the environmental review process is better
communicated to tribes?
Answer. In addition to the steps outlined in the above response on
this issue, the Department has issued guidance to the six Area ONAP
Administrators that no NAHASDA grant funds will be withdrawn due to
environmental infractions without a thorough and fair assessment of the
matter with the grantee.
nahasda
Question. Tribal leaders have expressed concerns to both the
Committee on Indian Affairs and HUD regarding the lack of consultation.
President Clinton has directed, through an Executive Order, that all
agencies promulgate a written consultation process. Though HUD states
that it has a written consultation process with American Indians and
Alaska Natives, obviously, this process has some wrinkles in it. What
tangible steps have been taken to improve the consultation process
after the implementation of NAHASDA?
Answer. The Department strongly supports the concepts of Indian
self-determination and the government-to-government relationship. The
Department has had an American Indian and Alaska Native Consultation
Policy in place since 1994. That document, issued in response to the
President's Memorandum of April 29, 1994, reaffirmed the government-to-
government relationship between Federally recognized Indian tribal
governments and the United States government. The Office of Native
American Programs subsequently conducted regional consultation sessions
on the policy throughout Indian Country and received input from tribal
leaders on how best to implement it.
On May 14, 1998, the President issued Executive Order 13084, which
required Federal agencies to develop an effective process for elected
officials of tribal governments to provide meaningful and timely input
in the development of regulatory policies that would significantly or
uniquely affect Native American communities.
During the March 1999, ``Shared Visions: The Native American
Homeownership, Legal and Economic Development Summit I,'' in Chicago,
the Department presented a revised draft consultation policy and
procedures document to tribal leaders and other participants. At that
time, Secretary Cuomo met personally with tribal leaders to express the
Department's commitment to tribal consultation.
More recently, on June 4, 1999, the Department released a letter to
all tribal governments inviting them to participate in redrafting the
Department's consultation policy. The letter explained the Department's
initiative, included an Action Plan, and requested their active
participation in developing the final policy.
nahasda
Question. Why has HUD eliminated funding for the Title VI program
under NAHASDA?
Answer. Although not requested as a separate program, the
President's fiscal year 2000 Budget request does, in fact, propose $5
million for Title VI within the requested appropriation for the Indian
Housing Block Grant.
______
Question Submitted by Senator Leahy
section 8 project-based contracts
Question. I have heard from many Vermonters about the affordable
housing crisis in our state. The number of Vermonters waiting for
federal housing assistance has steadily grown and the waiting list for
people seeking Section 8 rental subsidies has been as high as 2\1/2\
years. I support your efforts at addressing this crisis with the
addition of 100,000 new rental assistance vouchers.
However, I did notice in GAO's January report on HUD's Major
Performance and Management Issues, that there remains a concern
identified originally in a July 1998 GAO report. The concern is over
HUD's ability to adequately monitor funds that are no longer needed for
specific Section 8 project-based contracts. GAO reports that if HUD had
identified and deobligated these funds, it could have recaptured and
used them to reduce the Department's request for Section 8 funding.
Your budget summary mentions that the Department began last year with a
comprehensive reform of the administration of Section 8 project-based
contracts. What steps has the Department taken under the 2020 reform
plan to address this problem? Have you taken steps to recapture these
deobligated funds.
Answer. The principal reform proposed by the Department with
respect to the administration of project-based section 8 contracts is
our initiative to expand the use of contract administrators. Currently,
such contract administration is used only for state housing agency
financed projects. The Department now has issued a solicitation of
interest to identify potential administrator for the balance of our
project-based section 8 portfolio. These contracts will be performance-
based to provide incentives for more effective administration, and will
free up civil service personnel in our field offices for other pressing
multifamily management and development responsibilities.
With respect to the issue of recaptures of remaining balances on
section 8 contracts that have reached their initial expiration date,
the Department has focused considerable attention on developing a means
of identifying such balances available for recapture which minimizes
staff-intensive effort and avoids the potential for deobligating funds
needed to satisfy owner claims or adjustments which can occur following
contract termination. While these procedures are being refined, in
August, 1998, a total of $412 million was recaptured, and in November,
another $1.29 billion was identified and recaptured. These amounts are
being applied against the $1.65 rescission enacted in the fiscal year
1999 Appropriations Act. The Department is in the process of preparing
for another round of recaptures this summer which coincides with a
large number of additional initial contract expirations, particularly
in the Loan Management Setaside (LMSA) inventory. Initial estimates
indicate that up to $1.5 billion may be available for recapture from
these contracts. This recapture was anticipated in the Administration's
pending budget request for fiscal year 2000, which assumes the use of
$2 billion from such recaptures to offset the requirement for new
appropriations to meet program level requirements for contract renewals
and amendments.
subcommittee recess
Senator Bond. We thank you, Mr. Secretary----
Secretary Cuomo. Thank you.
Senator Bond [continuing]. For a worthwhile hearing.
And rather than ending with a whimper, we will end this
hearing with a bang. Thank you.
Secretary Cuomo. Thank you, sir.
[Whereupon, at 11:40 a.m., Thursday, April 22, the
subcommittee was recessed, to reconvene subject to the call of
the Chair.]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
THURSDAY, APRIL 29, 1999
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:30 a.m., in room SD-138, Dirksen
Senate Office Building, Hon. Christopher S. Bond (chairman)
presiding.
Present: Senators Bond, Burns, Craig, Kyl, Mikulski, Leahy,
Lautenberg, Harkin, and Byrd.
ENVIRONMENTAL PROTECTION AGENCY
STATEMENT OF CAROL M. BROWNER, ADMINISTRATOR
ACCOMPANIED BY:
SALLYANNE HARPER, CHIEF FINANCIAL OFFICER
PETER ROBERTSON, ACTING DEPUTY ADMINISTRATOR
OPENING STATEMENT OF CHRISTOPHER S. BOND
Senator Bond. Good morning, the subcommittee will come to
order. We meet this morning to take testimony from the
Environmental Protection Agency and the Council on
Environmental Quality for the Administration's fiscal year 2000
budget request for these agencies.
We also have three pieces of testimony for the record from
the General Accounting Office on EPA information management
concerns, the Superfund program, and the new Chemical Safety
and Hazard Investigation Board.
We welcome EPA Administrator Browner, Deputy Administrator
Peter Robertson, the Chief Financial Officer Sallyanne Harper
and the rest of the EPA team. We, also, welcome for the first
time before the subcommittee CEQ acting chairman George
Frampton.
Today marks the last day of hearings for the fiscal year
2000 cycle for this subcommittee. Our next step will begin to
craft the fiscal year 2000 VA-HUD bill. This is going to be a
very difficult task this year because the caps imposed by the
budget agreement will result in a real reduction of almost $30
billion in discretionary spending below the current level.
Within this subcommittee's portfolio there are many critical
requirements. One of our most significant concerns will be
veterans' medical care. The President's budget proposes no
increase for veterans' medical care despite increases in many
other programs and agencies. Yet VA has identified more than $1
billion in unbudgeted needs associated with treating patients
with Hepatitis C, providing emergency care in non-VA hospitals,
homelessness activities and long-term care for the aging
veteran population.
Without some increase in the budget, VA expects to lay off
about 8,500 personnel in its hospitals. This process has
already begun and many members of this subcommittee are hearing
from their constituents about the problems in their VA
facilities. We, on this subcommittee, are committed to ensuring
that the quality of care in VA medical facilities does not in
way deteriorate because of the budget situation, and based on
my prior experience with this bill, I can assure you that an
overwhelming bipartisan majority in the United States Congress
will feel the same way.
We can also expect FEMA disaster relief requirements for
fiscal year 2000 of several billion dollars which has not been
budgeted for. FEMA's annual disaster relief costs are running
close to $3 billion and we have no reason to believe we won't
have disaster costs next year in keeping with historical
averages.
In fact, there is a laundry list of other concerns I could
cite. Clearly with an allocation which is expected to be well
below last year's level, coupled with many critical
requirements within this subcommittee's portfolio, every
agency's budget request will be scrutinized closely and we'll
have a tough time meeting the President's request in many, if
not, most instances, for additional funding.
EPA's budget request totals $7.2 billion. This is a
reduction of $384 million below current levels because EPA has
cut the State Revolving Fund for clean water infrastructure by
$550 million as well as other congressional priorities.
However, many of other activities are slated for significant
increases and one major new program is proposed. The budget
includes $3.7 billion for the operating programs, an increase
of 5.5 percent over current levels; $1.6 billion for the trust
funds, including $1.5 billion for Superfund; and 1.9 billion
for air and water and infrastructure financing.
Unfortunately, once again there is no evidence that the
budget request is based on priorities which will best protect
the environment and improve human health. Instead it appears
that political considerations, pet projects and photo ops may
be guideposts used in putting this budget proposal together.
Let me give you one simple example. You proposed a $200 million
grant program called the Clean Air Partnership Fund for which
there is no specific authorization, no stated criteria, no
clearly defined goals. This program has been likened by some
early analysts to a ``funded unmandate.'' Meanwhile, after
funding the new unmandate with the catchy slogan, the
President's budget slashes the Clean Water State Revolving Fund
by over a half a billion dollars, a program which has a
specific purpose, a specific authorization and an enormous
identified unmet need.
I just do not believe that is right. We all know the Clean
Water SRF has a proven track record. It helps meet an EPA-
identified, nationwide need which last year was put at $140
billion for waste water infrastructure financing and which
results in demonstrable improvements in water quality of our
nation's rivers, lakes and streams. The Federal investment in
capitalization grants to date has been roughly doubled through
leverage bond proceeds and state matching funds, making this a
greater Federal state partnership. It is a program which works
and which is needed.
And we all understand what EPA's primary responsibilities
are supposed to be. It's on your Web site. The mission of the
EPA is to protect human health and safeguard the environment,
air, water and land upon which life depends. Apparently
somebody at OMB did not log on to the mission statement. The
Agency's budget request is only $800 million for clean water
infrastructure, a cut of some $550 million.
It's particularly curious that this effective program is
being cut despite the President's statements that clean water
is a top environmental priority. And even more astonishing is
that this cut comes about as your own agency is revising, we
believe upwards, the actual unmet need. While tremendous
progress has been made in improving water quality since passage
of the Clean Water Act 27 years ago, much remains to be done.
About 40 percent of surface waters today are not clean enough
to support such basic uses as fishing and swimming. To put it
plainly, EPA proposes a cut of 41 percent to the Clean Water
SRF, an effective program designed to meet specific Federal
water quality mandates.
Let's understand what we are talking about. Summer is just
around the corner. More than 46 million school children in this
country are getting ready for a vacation. The vacation spots of
their choice will be our nation's beaches, rivers, lakes and
streams. That is why I call on you and the EPA to get back to
the basics. Let's revisit the priorities. Let's ensure that our
children and families are protected, not backpedal on the
progress we've made. Let me assure everyone that one of the
highest priorities that I will pursue, to the extent our
allocation will allow, will be restoring the cut to the Clean
Water State Revolving Fund.
The second example I'd cite of concern is the President's
proposed doubling of the Climate Change Technology Initiative
to $216 million, again, as far as I can tell, not based on a
national assessment of rational priorities but seemingly due to
political considerations. At the same time, EPA proposes to cut
drinking water research even while the agency acknowledges it
will have insufficient data to meet the mandate to promulgate
new drinking water regulations in the next few years. Yet
compliance costs associated with some of the new regulations
likely will be great. EPA officials themselves told GAO
investigators that the new demands cannot be met by shifting
resources, without sacrificing quality or missing statutory
deadlines. Initial EPA estimates is that annual funding
shortfall for research and data collection will be in the range
of $10 million to $20 million per year for fiscal years 1999
through 2005. That this activity should be cut while doubling
the Climate Change Technology Initiative and creating a new
clean air program seems to defy logic.
Once again, it looks as though the EPA is more interested
in channeling money into new programs and questionable pet
projects while at the same time slashing the vital programs
that we have for our basic environmental needs. It begs a
question: Why? Why should we slash these programs when they are
the ones that are the basic mission and the ones that we know
work?
EPA has requested $63-plus million for children's health
but at the same time the scientific magazine Chemical and
Engineering News said as of June 1998, because all air
pollutants have fallen in the past 20 years, trying to
associate falling air pollution with increasing asthma rates
flies in the face of logic. We support activities to improve
the health and well-being of children but we must support
activities which are grounded in science, not simply what we
wish science to be.
The Inspector General has listed ten major management
concerns at EPA, number one being accountability. We are
concerned about EPA's forays into land use planning and
transportation issues. The IG has also raised considerable
concerns regarding inadequate oversight by EPA in its grants
and assistance agreements despite the recognition since at
least 1996 that this was a problem. We intend to hold EPA fully
accountable.
We also have concerns regarding EPA's implementation of the
Government Performance and Results Act. The Results Act needs
to be focused on effective outcomes, not bean counts.
One of the items in this accountability list is
environmental data systems. We have raised this question before
because we cannot know if environmental goals are being met if
data is of a questionable quality. Again, the EPA Inspector
General has cited information systems as a major management
issue.
We commend the starts that have been made but I've not seen
enough progress. We can't be confident about the quality of the
data. EPA often publicizes data without any stakeholder
consultation or even advanced notice and without taking any
responsibility for the accuracy for the data. There is still no
data correction process. We don't, in some instances, know how
useful the data is, even if it's accurate. EPA told us last
year it would be conducting a survey of the needs of American
households but we have not seen that. There has been a
suggestion that the number of EPA web site hits is a good
measure. I don't think that is the best performance measure for
EPA's right-to-know goals.
Finally, there still is no data quality action plan. We
acknowledge that EPA has begun to create the new information
office to be a one-stop shop. That is a good step but we need
to see EPA take aggressive action to establish the office
quickly and make sure it has the authority to see that all EPA
offices adhere to the standards set forth. We plan to hold the
head of this office accountable for the quality and integrity
of the data EPA releases.
I would, also, note in passing very serious concerns about
computer security. The Inspector General has said that the
preliminary results of ongoing work indicate a number of
significant and pervasive problems with the adequacy of
existing security plans for EPA's core financial systems and
regional systems.
Touching briefly on the Superfund program, I'm pleased that
EPA is meeting its site cleanup goals but we still have
significant concerns reflecting the GAO's concerns. And I'm
disappointed that the administration apparently is not willing
to engage in an honest, constructive dialogue on legislative
reforms.
We are, also, concerned about EPA's reinvention initiatives
and whether they are languishing. We have made little progress
on these as these activities continue to operate at the margins
of EPA.
Finally, in many agencies reinvention has meant carrying
out missions in a more cost-effective manner, doing more with
less. We have seen this in the Veterans Health Administration
which has lost some 20,000 employees in the past several years
while increasing the number of patients it treats by more than
10 percent. We have seen significant reductions at the
Department of HUD. Yet at EPA there has been a significant
growth in the workforce, but we don't know whether there has
been a commensurate increase in work performed. States have
taken on more and more of the responsibility for environmental
programs. More than 70 percent of the programs which can be
delegated are now being run by the States. And according to the
Environmental Council of the States, between 1993 and 1998 the
percent of the delegated programs grew from 41 percent to 71
percent. And in the past decade there has been an increase of
60 percent in the number of staff in state environmental
agencies.
Yet EPA's own workforce has grown tremendously. Since 1990
the EPA workforce has grown by more than 3,000 and in that time
we have seen only three new pieces of major environmental
legislation. In my 4 years as chairman of this subcommittee,
the number of EPA work-years has grown by about 500.
Ms. Browner, you have made the workforce your highest
priority. In the fiscal year 1999 operating plan you cut key
programs such as NPDES permits and the Reinventing
Environmental Information Initiative in favor of increasing
staff above the prior-year level. Given that States are doing
more and more, this priority raises questions with me. We have
to ask, what are all these people doing? Only EPA's workforce,
of all the major agencies' workforces under the jurisdiction of
this subcommittee, has been growing in the past few years.
Let me be clear that I believe that much of the work of the
subcommittee will be to set funding priorities for your agency
to ensure that our environmental programs work effectively and
efficiently. Congress has made a commitment to protecting our
environment both for this generation and for those to come. To
fulfill that commitment, we have to get back to the basics for
EPA.
prepared statement
There are many, many issues. Believe it or not, I had a
much longer opening statement which I ask unanimous consent to
submit in full in the record. Otherwise I will read it. Hearing
no objection, it will be so included in the record.
[The statement follows:]
Prepared Statement of Senator Christopher S. Bond
The Subcommittee will come to order. We meet this morning to take
testimony from the Environmental Protection Agency and the Council on
Environmental Quality on the administration's fiscal year 2000 budget
request for these agencies. We will also have 3 pieces of testimony for
the record from the General Accounting Office on EPA information
management concerns, the Superfund program, and the new Chemical Safety
and Hazard Investigation Review Board.
We welcome EPA Administrator Browner, Deputy Administrator Peter
Robertson, Chief Financial Officer Sallyanne Harper, and the rest of
the EPA team. We also welcome for the first time before this
subcommittee CEQ Acting Chairman George Frampton.
Today marks the last day of hearings for the fiscal year 2000
budget cycle for this subcommittee. Our next step will be to begin
crafting the fiscal year 2000 VA-HUD bill. It will be an arduous task,
as the caps imposed by the budget agreement will result in a real
reduction of almost $30 billion in discretionary spending below the
current level.
Within this subcommittee's portfolio, there are many critical
requirements. One of our most significant concerns will be veterans
medical care. The President's budget proposes no increase for veterans
medical care, despite increases in many other programs and agencies.
Yet VA has identified more than $1 billion in unbudgeted needs
associated with treating patients with hepatitis C, providing emergency
care in non-VA hospitals, homelessness activities, and long-term care
for the aging veteran population.
Without some increase in the budget, VA expects to lay-off about
8,500 personnel in its hospitals. This process has begun already, and
many members of this subcommittee are hearing from their constituents
about problems in their VA facilities. We are committed to ensuring
that the quality of care in VA medical facilities does not in any way
deteriorate because of the budget situation.
We can also expect FEMA disaster relief requirements in fiscal year
2000 of several billion dollars, which has not been budgeted for.
FEMA's annual disaster relief costs are running at close to $3 billion,
and we have no reason to believe we won't have disaster costs next year
in keeping with historical averages.
In fact there is a laundry list of other concerns I could cite.
Clearly, with an allocation which is expected to be well below last
year's level, coupled with the many critical requirements within this
subcommittee's portfolio, every agency's budget request will be
scrutinized closely and we will have a tough time meeting the
President's request in many--if not most--instances.
EPA's budget request totals $7.2 billion. This is a reduction of
$384 million below current levels because EPA has cut the state
revolving fund for clean water infrastructure by $550 million and other
Congressional priorities. However, many other activities are slated for
significant increases, and one major new program is proposed.
The budget includes $3.7 billion for the operating programs, an
increase of 5.5 percent over current levels; $1.6 billion for the trust
funds including $1.5 billion for Superfund; and $1.9 billion for air
and water infrastructure financing.
Unfortunately, once again, there is no evidence that the budget
request is based on priorities which will best protect the environment
and improve human health. Instead, it appears that political
considerations, pet projects and photo ops are the guideposts used in
putting together this budget proposal.
Let me give you one simple example--your proposed new $200 million
grant program--called the Clean Air Partnership Fund--for which there
is no specific authorization, no specific criteria, and no specific
goals. This program has been likened to a ``funded un-mandate.''
Meanwhile, after funding the new un-mandate with the catchy slogan
name, you slash the clean water state revolving fund by over a half
billion dollars, a program which has a specific purpose, a specific
authorization, and an enormous identified unmet need. That is just not
right.
We all know the clean water SRF has a proven track record, helps
meet an EPA-identified nationwide need of at least $140 billion for
water infrastructure financing, and results in demonstrable
improvements to the water quality of our nation's rivers, lakes and
streams. The federal investment in capitalization grants to date has
been roughly doubled through leveraged bond proceeds and state matching
funds, making this a greater federal-state partnership. It is a program
which works.
And we all understand what EPA's primary responsibility is supposed
to be. It is on your website: the mission of the EPA is to protect
human health and safeguard the environment--air, water and land--upon
which life depends. But apparently EPA does not log onto its own
mission, as Ms. Browner, your agency's budget request is only $800
million for clean water infrastructure. That's a cut of $550 million
for water infrastructure in this country.
It's particularly curious that this effective program is being cut
despite the President's statements that clean water is a top
environmental priority. And even more astonishing is that this cut
comes about as your own agency is revising--upwards--the actual unmet
need.
While tremendous progress has been made in improving water quality
since passage of the Clean Water Act 27 years ago, much remains to be
done. About 40 percent of surface waters today are not clean enough to
support such basic uses as fishing and swimming.
To put it plainly, EPA proposes a cut of 41 percent to the clean
water SRF, an effective program designed to meet specific federal water
quality mandates.
And let's understand what we are talking about. Summer is just
around the corner. More than 46 million schoolchildren in this country
are getting ready for vacation. The vacation spot of their choice will
be our nation's beaches, rivers' lakes and streams. That's why I am
calling on you, and the EPA, to get back to the basics. Revisit your
priorities. Let's ensure that our children and families are protected--
not backpedal on the progress we have made.
Let me assure everyone, one of our highest priorities to the extent
our allocation will allow, will be restoring the cut to the clean water
state revolving fund.
A second example of concern is the President's proposed doubling of
the Climate Change Technology Initiative to $216 million, again, not
based on any rational assessment of priorities, but seemingly due to
political concerns.
At the same time, EPA proposes to cut drinking water research even
while the agency acknowledges it will have insufficient data to meet
the mandate to promulgate new drinking water regulations in the next
few years. Yet compliance costs associated with some of the new
regulations likely will be great.
EPA officials themselves told GAO investigators that the new
demands cannot be met by shifting resources without sacrificing quality
or missing statutory deadlines. Initial EPA estimates are that the
annual funding shortfall for research and data collection will be in
the range of $10 million to $20 million per year for fiscal years 1999
through 2005.
That this activity should be cut while doubling the climate change
technology initiative and creating a new clean air program defies all
logic.
Once again it looks as though the EPA is more interested in
channeling money into dubious pet projects and undefined new programs,
while at the same time slashing the vital programs that ensure we have
safe and clean water. This not only unacceptable, it begs the question
WHY? Why would EPA slash these vital programs?
EPA also requests $63.2 million for its children's health
initiative, with a major emphasis on childhood asthma, which EPA
attributes to air pollution. It is interesting to note, however, that
air quality has steadily improved over the past decade. A June 1998
article in the scientific magazine Chemical & Engineering News said
``because all air pollutants have fallen in the past 20 years, trying
to tie falling air pollution with increasing asthma rates flies in the
face of logic ``
Let me be clear--we support activities to improve the health and
wellbeing of our children. But we must support activities which are
grounded in science--not simply what one wished the science to be.
Another major emphasis in EPA's budget is the Better America Bonds
Initiative. EPA would have authority to select proposals for $1.9
billion in bonding authority for projects aimed at creating open spaces
and restoring urban areas. While no specific request is made in EPA's
budget, EPA funding would be required for the administrative costs
associated with running the program.
There are major concerns with EPA playing a role in local land use
decisions. This is another example of EPA seeking to pursue new
activities, without any specific Congressional direction or authority,
while many other mandated activities go without adequate attention. We
must remember, local land use decisions are just that, local decisions.
The Inspector General in its list of 10 major management concerns
at EPA lists as Number 1, accountability. EPA's forays into land use
planning and transportation issues would seem to imply EPA does not
believe it is accountable to the Congress and the specific laws set out
for it. Before starting up new programs, the agency should consider the
many critical activities that come from specific statutory mandates
that seem to be getting short shrift.
With respect to concerns about the lack of accountability at EPA,
the I.G. tells us that regional offices are acting largely
autonomously, often not spending appropriated funds consistent with
designated purposes; and enforcing regulations inconsistently. These
are not new concerns, but apparently they have not been deemed
important enough to be addressed in an aggressive manner by EPA
leadership.
The I.G. has also raised considerable concerns regarding inadequate
oversight by EPA of its grants and assistance agreements. Despite EPA's
recognition since at least 1996 that this was a problem, it continues
to be a material management control weakness. We must be able to hold
EPA fully accountable for the billions of dollars in annual grants,
assistance agreements and contracts it oversees.
We also have concerns regarding EPA's implementation of the
Government Performance and Results Act, which relate closely to our
concerns about accountability. The Results Act was intended to see that
agencies be measured based on their performance, not ``bean counts.''
Yet in EPA's annual plan, only about 40 of the roughly 320 performance
measures--13 percent--that EPA has set forth are true environmental
indicators, as opposed to bean counts. EPA continues to focus heavily
on traditional measures such as the number of permits issued,
inspections conducted or reports written.
A significant aspect of EPA's ability to implement fully the
Results Act is having environmental data systems that are timely,
accurate and useful. We cannot know whether environmental goals are
being met if EPA data is of questionable quality. Yet again this year,
the Inspector General cites environmental data information systems as a
major management issue. This is an issue this subcommittee focused a
great deal on in last year's hearing, and while commitments were made,
I'm afraid not enough progress has been made.
EPA has 500 data systems, most of which operate with different
standards and definitions, and often contain data which is out of date
or simply inaccurate. One of EPA's 10 goals is ``Expansion of
American's right-to-know about their environment.''
Yet we can't be confident about the quality of the data. EPA often
publicizes data without any ``stakeholder'' consultation--or even
advance notice--and without taking any responsibility for the accuracy
of the data. There is still no data correction process. And data is
often put out for purposes other than that for which it was collected,
leading to possible inappropriate conclusions about the information.
In many instances, we don't know how useful the data is, even if it
is accurate. EPA last year told us it would be conducting a survey by
early this year of environmental information needs of American
households. Apparently this has become a lower priority as EPA does not
plan to complete a survey and report until the fall.
I would suggest that the number of EPA web site ``hits'' is not the
best performance measure for EPA's right-to-know goal. We need to find
out how useful the information is to Americans.
Moreover, there still is no final data quality action plan--which
was committed to last year; there is no information plan, which GAO
cites as a critical need; we have seen no actual burden reduction for
facilities reporting to EPA; and many activities, such as creating
common facility identifiers, have been in the pipeline for so long we
wonder whether they are losing momentum and whether there is commitment
to completing them.
We acknowledge that EPA has begun to create a new information
office ostensibly to be the ``one-stop shop'' to provide uniformity in
the agency's approach to information management, and to address the
need to ensure that data is accurate, reliable, and consistent. This is
a good step.
But we need to see EPA take aggressive action to establish the
office quickly, and ensure it is vested with the authority it needs to
see that all EPA offices adhere to the standards it sets forth. We
don't want to repeat the problem we've seen in the area of peer review,
where the office which developed the polio,--the R&D Office--followed
peer review procedures, but other program offices ignored it.
Let me be clear--We plan to hold the head of this office
accountable for the quality and integrity of the data EPA releases.
We also have serious concerns about computer security. The
Inspector General stated, ``The absence of a centralized validation
process leaves vast amounts of EPA information vulnerable to
unauthorized access, manipulation and potential destruction. The
preliminary results of ongoing work indicate a number of significant
and pervasive problems with the adequacy of existing security plans for
EPA's core financial systems and regional systems.''
While the I.G. recommended in 1997 that EPA implement formal
firewall technology and implement a Network Security Policy, EPA has
dragged its feet in responding. According to the I.G., the agency
firewall is not scheduled for implementation until the spring 2000.
Protecting sensitive business information and ensuring that appropriate
fireballs are in place must be an immediate top priority of the new
information office and top agency leadership.
Moving on to the Superfund program, I'm pleased EPA is meeting its
site cleanups goals. However, there remain significant concerns with
this program. GAO continues to list it as a high-risk program, as it
has for the past decade, citing concerns with the way its contracts are
managed, excessive overhead costs, and the cost-recovery program. In
addition, there remain significant impediments to fair and efficient
site cleanups, owing to the litigious nature of the program and other
problems that only legislative reforms can fix.
For that reason I'm very disappointed to have heard that this
administration is no longer willing to engage in honest, constructive
dialog on legislative reforms.
We also have concerns about EPA's so-called reinvention initiatives
and whether they are languishing. We have been talking for many years
now--and there have been scores of reports and studies on the need for
flexibility and innovative approaches. But it seems we've made very
little progress as these activities continue to operate at the margins
of EPA.
Finally, in many agencies reinvention has meant carrying out
missions in a more cost-effective manner--doing more with less. We have
seen this in VA, which has lost some 20,000 employees in the past
several years while increasing the number of patients it treats by more
than 10 percent.
Yet at EPA there has been significant growth in the workforce, but
I'm not sure we've seen a significant increase in work performed.
Indeed, in the past decade, states have taken on more and more of the
responsibility for environmental programs. More than 70 percent of
programs which can be delegated are now being run by the states.
According to the Environmental Council of the States, between 1993 and
1998 the percent of delegated programs grew from 41 percent to 71
percent. And in the past decade there has been an increase of 60
percent in the number of staff in state environmental agencies devoted
to carrying out EPA mandates.
Yet EPA's own workforce has grown tremendously at the same time.
Since 1990, EPA workforce has grown by more than 3,000, yet in that
time we have seen only 3 new pieces of major environmental legislation.
During my tenure as chairman of this subcommittee, total EPA workyears
have grown by about 500!
Ms. Browner, you have made the workforce your highest priority. In
the fiscal year 1999 operating plan, you cut key programs, such as
NPDES permits and the reinventing environmental information initiative
in favor of increasing staff above the prior year level. Given that
states are doing more and more, this priority seems not to make sense.
We must ask, what are all these people doing? Of all the major agencies
under this subcommittee, only EPA's workforce has grown in the past few
years.
In conclusion, let me be clear that I believe much of the work of
this subcommittee will be to set funding priorities for your agency to
ensure that our environmental protection programs work effectively and
efficiently. Congress has made a commitment to protecting our
environment both for this generation and those to come, and to fulfill
that commitment we must get EPA back to the basics.
There are clearly many issues we wish to discuss today. Before I
ask you, Ms. Browner to proceed with your opening statement, I will
turn to my distinguished ranking member Senator Mikulski for her
opening statement.
Senator Bond. And before I ask you to begin, Madam
Administrator, I will turn to my colleagues and first call on
the distinguished ranking member of the subcommittee, Senator
Mikulski.
statement of Senator Barbara Mikulski
Senator Mikulski. Thank you very much, Mr. Chairman. My own
remarks will be condensed in light of the fact that we have
many members here as well as a vote at 10:30.
I want to welcome Administrator Carol Browner and her team.
This is her seventh appearance before this subcommittee. And I
want to thank her for her efforts and leadership over the years
and also her tenacity in surviving this 7 years of attacks on
EPA. Her tenure has neither been boring nor uneventful. Budget
cuts, shutdowns and catastrophes have made her job quite
challenging. In addition, there is often been a kind of
hostility around protecting the environment. And I would hope,
as we examine the culture of attack in our society, we need to
learn more about civility among ourselves. Hopefully, it will
even start on the Senate floor.
Today I am going to focus on the issues related to the
environment because in my own home state, which I believe is a
cameo for the nation, first of all, good environment is good
business. Good environment is good business in Maryland because
of the Chesapeake Bay.
Whether it is the bounty that comes from the Bay that
sustains our watermen, our restaurants, our charter fishing and
our residential development; the Bay has been bountiful and we
need to protect the Bay and I'm very appreciative in Senator
Mathias, to myself, to President Reagan to President Clinton to
focus on the Bay.
But also, environmental protection has been good business
for Maryland. I want to get into also the whole issue of
environmental technology. In my own home state the development
of new technology to provide the private sector with tools for
either environmental cleanup, remediation or even detection for
early warning before it would get to a problem is resulting in
the fact that there are thousands of jobs being created, export
jobs that absolutely crucial.
The other is the issue around the cleanup of the
environment. And I want to, also, see what efforts and
progresses are being made in brownfields. From a legislative
standpoint, we're making very little progress on Superfund but
brownfields, I believe, offers a cornucopia of opportunity.
Again, in my own home state, there are 3,000 acres of
brownfields around the waterfront of three counties.
Redevelopment of these brownfields could result in commercial,
cargo, residential and other new types of office park
development that would really be a cornucopia of economic
development for my state.
So those are the kinds of things that we want to focus on.
But we, also, want to make sure that there continues to be the
establishment of a very clear link between public health and
the environment. We want to know about what is happening in
clean air, what is happening to our children with asthma. The
epidemiologists at Hopkins in Maryland tell me asthma is
skyrocketing throughout the nation and is probably one of the
number one health issues facing America's children.
In addition to that, again, looking at public health, there
is the issue of Pfiesteria in the Bay and several other waters.
So we want to go through the budget. We want to make sure the
budget does match policy, and policy matches national
priorities. And I believe our national priority is, we protect
the environment not only for itself, but because of its linkage
to public health and economic development.
So we look forward to hearing your testimony and, of
course, we want to know you are Y2K-ready. Thank you very much.
prepared statement
I ask you now with your consent that my entire statement go
into the record.
Senator Bond. Without objection, it will be.
[The statement follows:]
Prepared statement of Senator Barbara A. Mikulski
Thank you Mr. Chairman. I want to welcome EPA Administrator Carol
Browner and her team. This is Ms. Browner's seventh appearance before
the subcommittee. I want to thank her for her efforts and leadership
over the last seven years.
Administrator Browner's tenure has not been boring and uneventful.
Budget cuts and government shutdowns have made Ms. Browner's job--and
the job of EPA's employees--quite challenging.
In addition, there has often been a climate of hostility toward
environmental protection in the Congress as a whole, particularly in
the authorizing committees.
This has not made for the most constructive climate within which to
move our agenda. I believe that EPA has survived these challenges and
has taken many initiatives to make the long-term changes that are
necessary to keep up with a changing world.
As a Senator for Maryland, I have seen the positive results of
EPA's programs and initiatives on a firsthand basis.
As a Marylander, I am also well aware of the importance of one of
our most precious resources--water.
Water links the lives of all Marylanders--from the north branch of
the Potomac River, to the southern tip of the Wicomico River, water is
critical to Maryland's environment and economy. The EPA has been a
leader in keeping Maryland's Chesapeake Bay and waterways clean.
I also want to take this opportunity to highlight two sometimes
overlooked aspects of environmental protection. First, with the help of
the EPA, I believe we need to make all Americans aware of the strong
connection between public health and environmental protection.
Unfortunately, we have seen examples all across the country of the
negative effects of a poor environment on the health of our citizens.
We need to ensure that our environment and our people are protected.
We also need to do all we can to clear up the misconception that
our economy and our environment cannot prosper together. Nothing could
be further from the truth. Our economy and our environment can indeed
coexist. In fact, they must.
I believe that environmental protection goes hand in hand with
economic growth and job creation. Protecting our environment creates
jobs.
In Maryland, our watermen have always relied on a clean bay for
their livelihood. A clean bay means more jobs for our watermen.
But Maryland's economy is benefitting from a new industry--
environmental technology.
Environmental laws and regulations create the need for new
environmental technologies. New technologies means new jobs and new
markets. The United States sets the standards for many areas in
environmental protection.
In Maryland alone, there are 1,700 companies in the environmental
industry. These companies have created 21,000 jobs in Maryland, and
have exported $260 million worth of goods and services.
The demand for these types of businesses will only grow in the
coming years. According to the EPA, the global market for environmental
technologies and services is now estimated at $410 billion per year.
Current growth rates range from 3 to 4 percent a year in most
industrialized nations to 16 percent in parts of Asia.
This represents incredible opportunities for jobs in Maryland and
across the country.
As we move forward in today's hearing, let me note a few of the
things that I am pleased to see in EPA's fiscal year 2000 budget
request. First, I would like to note that the President has requested
$7.2 billion for EPA for fiscal year 2000.
I am pleased to see an increase in funding for the President's
clean water action plan.
I believe we must ensure the integrity of our core water programs,
while we seek to broaden our base of knowledge and understanding of
water issues.
I was pleased to join the President in my hometown of Baltimore
when he outlined this plan to ensure clear waterways and safe
ecosystems.
The President's clean water action plan will promote water quality
protection by emphasizing state initiatives and new guidelines for
regulating animal waste.
This is a critical issue in my state of Maryland as we wrestle with
how to respond to the pfiesteria outbreaks that ravaged our waterways--
waterways which are crucial to the economy of our state.
Mentioning the topic of pfiesteria leads me to note that I consider
this year's hearing in many ways a follow-up status check.
I would like to know what progress EPA has made in working
internally and with other agencies to address the pfiesteria problem.
I'd like to know what progress has been made in identifying not
only the problems, but workable solutions.
I know you are aware Ms. Browner, just how important the waterways
are to the Maryland economy. Thousands of Maryland watermen, commercial
fishermen, merchants and restaurants depend of the great seafood that
is harvested in our beautiful waters.
It is imperative that EPA and other relevant agencies work together
and with the states to continue to find workable solutions to the
pfiesteria problem--solutions that are based upon sound science.
This year is also a follow-up year on the brownfields program. I
know the chairman shares my concern about the need to revitalize our
nation's brownfields.
My hometown of Baltimore has over three thousand acres of
brownfields. This is land that could be cleaned and revitalized to help
create jobs and rebuild communities.
I want to hear this morning what progress EPA has made with its
brownfields initiative and what progress it has made in coordinating
activities with HUD.
This program is too important and too necessary to fall victim to
mismanagement or lack of clear direction.
I will continue to work with the chairman to stand sentry to ensure
that we have a brownfields program that works for the taxpayers and
works for the communities that receive brownfields dollars.
I am interested to learn what the EPA has done to implement the
NAPA recommendations. I'd like to know what has been done to date and
what plans are in place to accomplish those things remaining undone.
As you know, when I was chair I requested that NAPA do a report on
how EPA could improve its management and operations. That report became
the basis for yet another NAPA report that continued evaluating the
progress EPA had made.
These reports are not meant to be reports for reports sake. These
NAPA reports and the recommendations they include are to be blueprints
for positive, action and results oriented change.
I know the chairman shares my desire to see EPA use the NAPA
reports as frameworks for improved performance based management.
I am also aware of some concerns with the implementation of the
food quality protection act. I want to make sure that we have a program
that is open, uses the best science available, and works effectively to
protect consumers from illnesses and death caused by polluted foods.
So, Madame Administrator, I know that your plate is full and that
you are busy. I commend you again for your efforts and look forward to
working with you and the chairman on making the Environmental
Protection Agency one that truly fulfills its critical mission.
Thank you Mr. Chairman.
Senator Bond. We are very honored to have the ranking
member of the full committee with us today and I'd ask Senator
Byrd if he wishes to make some statements.
Senator Byrd. Mr. Chairman, that's very nice. I will take
my turn. I do thank you, however, very much.
Senator Bond. Thank you, Senator.
Senator Leahy.
Senator Leahy. Thank you, Mr. Chairman, I'll happy to yield
to the distinguished Senator.
Senator Byrd. You overwhelm me with praise. [Laughter.]
Senator Bond. Would one of you gentleman please proceed?
Senator Craig. Mr. Chairman, I would be happy----
Senator Byrd. Mr. Chairman, I am thoroughly enjoying this.
But I think I will wait. I will learn a lot by listening to my
peers.
statement of Senator Patrick J. Leahy
Senator Leahy. Thank you, Mr. Chairman.
Administrator Browner, it is good to have you here. As you
know, there will always be a lively debate over priorities of
your agency. Last week Secretary Babbitt was testifying before
this subcommittee. I think it is a toss-up probably as to who
has endured more bruises during your tenures, you or he. But I
see that as a credit to your leadership at EPA and your
commitment for improving our environment, not just for us but
for our children. They are the ones that are going to live most
of their lives in the next century.
That same perspective has motivated my agenda in the Senate
trying to improve my own state of Vermont for future
generations. We have been--we are very grateful for the fact
that in Vermont, that you have been up there and visited our
State. You have seen how the funding you have requested for
Lake Champlain is going to help us achieve this goal. Lake
Champlain's watershed covers more than half of our state. In
other words, revitalizing the health of Lake Champlain is
essential not only to our environment but also to our economy.
From the funding from your agency we are going to be able to
meet the challenge of improving both the environment and the
economy at the same time.
For example, one project that may seem mundane, but has a
great effect on the whole lake ecology, is a monitoring program
to help our dairy farmers choose the most effective way to
reduce agricultural runoff into Lake Champlain.
We have another project that I would like to see EPA get
involved in. I have scraped together some seed money for two
pilot projects that integrate economic and natural resource
data into a web-based interactive tool that could help
communities access everything from the impact of a new gas
station or shopping center on their watershed. I would like to
expand the pilot program to cover the entire Lake Champlain
basin. I hope EPA can be one of the primary Federal partners.
I want to compliment you also and your staff for your work
on two very high-profile issues in Vermont, the cleanup of the
Pownal Superfund site and the Lake Memphremagog partnership
with the Department of Agriculture.
My wife was born a hundred yards from the shore of Lake
Memphremagog on the Vermont side. Had she been born a hundred
yards further, she would have had the same Canadian citizenship
her parents had.
I was very impressed with how quickly and professionally
your staff developed remediation plans embraced by the
community and the State's environmental officials. And the Lake
Memphremagog partnership to reduce agriculture runoff is such a
success, we are going to try to replicate it for the
Connecticut River.
Mr. Frampton is not here. But I was going to thank him,
also, for his help with the Northern Forest funding. I will put
the whole statement in the record. Mr. Chairman, we will also
have a markup at the same time in the Judiciary Committee on a
constitutional amendment.
Senator Bond. Senator Lautenberg.
statement of Senator Frank R. Lautenberg
Senator Lautenberg. Thanks, Mr. Chairman. I will try to be
brief and ask unanimous consent that my full statement be
included in the record.
Mr. Chairman, I just briefly want to commend Carol Browner,
the EPA Administrator, for the great job that she's done. And
as Senator Mikulski noted that she is not either battle- or
weather-weary, despite the number of contests and conflicts she
has had to endure.
It strikes me as being rather peculiar that we are looking
at the reduction in funding for EPA that we are, when the
record of success is greatly astounding. We hear lots of
criticism and talk about the bureaucratic influence and
decision making and how tough it is to live with the rules and
regs. I would like to note, Mr. Chairman, that we have--by the
end of the fiscal year, that 95 percent of the Superfund sites
will have had signed records of decision. That 50 percent of
the contaminants that used to plague our air have been
eliminated. That 150 million people in this country breathe
cleaner air as a result of the work that's done at EPA. And we
are--that thousands of brownfield sites, whether it is those
that are cleaned up by State or Federal Government or private
contractors under the supervision of the Federal Government,
have been released for economic and community use.
I think the record is pretty darn good. And I must tell you
I find it discouraging--I know that we have other priorities--
but I think that we ought to be examining all of our priorities
in the same fashion. ``Look at the record'' used to be a
favorite expression. And I want to commend Administrator
Browner and her team for the great work that they're done,
again, sometimes under very severe pressure.
prepared statement
I hope, Mr. Chairman, that we are going to be able to find
of a way take care of the funding to get a Superfund bill. The
Chairman sits on the same committee that I do, the EPW
Committee, and I am hoping that we can enact sensible Superfund
legislation to keep that program going. It will help enormously
in terms of our financing the programs that we have to.
Thank you, Mr. Chairman.
[The statement follows:]
Prepared statement of Senator Frank R. Lautenberg
Mr. Chairman, I am pleased to be here to discuss EPA's fiscal year
2000 Budget with Administrator Browner, and the fiscal year 2000 Budget
for the Council on Environmental Quality with Acting Chairman George
Frampton.
I would like to take this opportunity to commend Ms. Browner for
the job she is doing at the helm of EPA. I have had the good fortune to
work with her closely over these last several years, but had the
distinction of spending even more time with her than usual during the
Superfund negotiations of the previous Congress.
She is an outstanding leader for environmental protection.
As the ranking member of the Budget Committee, I can understand the
difficulties this Subcommittee faces in trying to adequately fund its
environmental programs.
Even though we have erased the deficit, and are expecting large
surpluses in the next five years, we are still living with the tight
domestic discretionary caps from the Balanced Budget Agreement.
Despite this outlook, I hope that this Subcommittee will strongly
consider proper investment for EPA's environmental protection programs.
We need to do whatever we can to provide appropriate funding for
Superfund, the Clean Water Act, the Clean Air Act and other critical
programs. If not, we will not make enough progress in cleaning up our
land, water and air.
Mr. Chairman, I know it will be tough to fund all of the competing
priorities in this Subcommittee. I know you and the distinguished
ranking member will do your very best to fund EPA's critical programs
because environmental cleanup is needed in all states. You did an
outstanding job with this bill last year, and look forward to no less
this year.
But let's face facts, it will be very tough. But we can still work
together to make the right investments in environmental protection. And
I look forward to working with members on both sides of the aisle,
along with Administrator Browner, to make this happen.
Thank you
Senator Bond. Thank you, Senator Lautenberg. We will be
coming forward with some ideas. We will be working with your
staff on EPW. Now I turn to the distinguished Senator from West
Virginia.
Senator Byrd. Mr. Chairman, these two gentlemen who are
here were here before I was.
Senator Bond. No, sir. I watch them closely. You do not
think I actually listen to those statements I am reading, do
you? I'm watching who is coming into the room.
Senator Burns. We are not ready anyway, Senator.
Senator Byrd. I am not ready either, as a matter of fact.
[Laughter.]
Just so this time is not counted against me, Mr. Chairman.
Senator Bond. We are not so foolish as to put the lights
on.
Senator Byrd. Is there a vote at 10:30?
Senator Bond. Yes, sir.
Senator Byrd. Will we be coming back?
Senator Bond. I will. I hope that some of my colleagues
will. It gets lonely up here.
transportation partners program
Senator Byrd. Madam Administrator, you are very senior to
me in this area. Let me ask you about the EPA program known as
Transportation Partners. The EPA program known as
Transportation Partners has recently come to my attention
through some published reports that make some rather
disconcerting charges. Primary among those charges is that this
program is a source of funding for some purely anti-road
initiatives. I can certainly see the merit in a program that
helps local communities to help develop volunteer strategies
for transportation-related emission reductions and that assists
them in developing transportation alternatives that reduce
traffic volume and congestion.
It seems that if EPA is actually helping to underwrite
activities to block construction authorized, of desired, safer,
more modern highways, a critical line is being crossed. I have
no doubt that the public would be dismayed to hear it if, in
fact, as one Federal agency is spending millions of taxpayer
dollars to build modern infrastructure, another agency was
spending additional taxpayer money to help prevent such
construction.
The logical result of this kind of mess is that the
taxpayers end up paying several times over, including footing
the bill to fight court battles to defend the projects and
covering the costs of inflation resulting from lengthy
construction delays. The only beneficiaries from this kind of
scheme, it would seem, are the lawyers. This scenario simply
defies fiscal logic. I would like to know more about the
Transportation Partners program. Does anyone at EPA conduct
oversight of the program? What is the answer?
Ms. Browner. Do you want me to answer?
Yes, we do. It is a grant program and it is subject to all
of the requirements of our program and the oversights
associated with our grant programs.
Senator Byrd. Can you then tell the committee specifically
how this funding is being spent?
Ms. Browner. Yes, we can. I would be happy to spend a
moment to elaborate on the program, if that would be helpful at
this point.
Senator Byrd. Well, we have the time if you do.
Ms. Browner. Yes, certainly. [Laughter.]
I apologize, Senator Byrd, I had thought the chairman
wanted to finish with the opening statements. So I apologize.
Senator Byrd. Perhaps I am mistaken.
Senator Bond. We did have this time for opening statements,
Senator Byrd. We were going to go into the question round
later. This is an area in which I have a great interest. If you
wish to do that, I will ask the indulgence----
Senator Byrd. Mr. Chairman, I think it is unfair to the
other members to proceed with questions.
Senator Burns. Senator, I am submitting my statement. So
you may proceed. You are not walking on any toes over here.
Senator Craig. I concur.
Senator Byrd. Well, I am glad the Administrator is calling
my attention to my error.
Ms. Browner. Senator, that is not my intent. I simply want
to follow the lead of the Chairman and the subcommittee.
Senator Burns. We do want to let the Administrator make her
full statement before getting into full-blown questions. But
this is a question that I believe, Madam Administrator, you can
answer because this is of major concern to me and to Senator
Byrd.
Senator Byrd. Mr. Chairman, I am embarrassed to feel that,
being my first occasion to sit on this subcommittee, I have
misread the tea leaves and am proceeding out of order.
Senator Burns. No, you are not either.
Senator Mikulski. There no alligators from the Everglades
to worry about.
Ms. Browner. I would be happy to answer the question,
Senator Byrd.
Senator Byrd. Since our time is limited, I would prefer to
wait until the others have had a chance. I've got several
questions on this.
Senator Bond. Thank you very much, Senator. I assure you I
have concerns in this area. We look forward to working with
you.
We propose to introduce two pieces of legislation that will
protect the EPA's role and the Department of Transportation's
role. Since you and I had a great deal to do with the passage
of the Clean Air Act, the Byrd-Bond amendment, as it is known
up here, or the Bond-Byrd amendment as it's known in Missouri,
enabled to us to develop an emissions trading system which
facilitated the passage of the Clean Air Act and we want to see
the goals of clean air and safer highways achieved. So we will
be having many discussions on that.
Senator Burns, do you have an opening statement?
Senator Burns. I would ask that I may submit it in the
interests of time and protocol.
Senator Bond. I'd be delighted and without objection.
Senator Craig, do you have an opening statement?
Senator Craig. Under those conditions, welcome to the
committee.
Senator Bond. With that, Madam Administrator, would you
like to give your opening statement?
Ms. Browner. Yes. Before I do that I just want to assure
the committee that I am more than happy to answer any question,
but particularly the questions that have been proposed by
Senator Byrd and by the Chairman----
Senator Bond. There will be plenty of opportunity.
Ms. Browner [continuing]. Concerning transportation and
other important matters.
statement of carol m. browner
It is, indeed, a pleasure to appear again before you, Mr.
Chairman, Senator Mikulski and the members of this committee,
and it is a great honor to have Senator Byrd here and showing
an interest in our programs. We thank you for that.
I am here today to present the President's fiscal year 2000
budget request for the Environmental Protection Agency. The
President's $7.2 billion request for the EPA continues this
administration's efforts to protect both public health and our
environment while providing states and communities with new
innovative funding tools to build these strong, healthy and
safe communities that we all desire for the 21st century.
As you noted, Mr. Chairman, accompanying me today are many
of the senior managers from the Agency, including our Chief
Financial Officer, Sallyanne Harper, who is beside me at the
table. If I might, Mr. Chairman, just take a brief moment to
say a word about Sallyanne Harper. She just won a very, very
prestigious award from the Joint Financial Management
Improvement Program. They pick one Federal financial officer a
year, government-wide, one State officer, and one local
government officer for this award. Sallyanne Harper was the
winner this year for the entire Federal Government and she is
an outstanding public servant and she does a tremendous job for
us at EPA.
Senator Bond. Ms. Harper, we congratulate you and commend
you for your good work. You certainly have challenging
opportunities ahead of you, and we wish you the best.
Ms. Browner. We are very proud to have her.
Mr. Chairman, with the help of the members of this
subcommittee, you have provided essential funding for important
environmental programs. With that funding we have made
significant progress for the people of this country in
providing a safe and a healthy environment. During this
administration we have also worked with Congress to pass in a
bipartisan manner important environmental laws and to implement
earlier laws to carry out our common goal of stronger
environmental protections.
If I might just take a moment to cite a few examples. Over
the past 6 years we have worked together to pass environmental
laws such as the Safe Drinking Water Act Amendments of 1996. We
estimate today that 88 percent of the American population
receive drinking water from a system that meets all health-
based standards, 88 percent. That is a truly remarkable
statement about the commitment of the Congress, the commitment
of the EPA, to working with local communities to ensure that
every time their citizens turn on the tap, it is clean,
healthy, safe water that they receive.
Thanks to the resources provided by this committee, we have
also made significant progress in many of the key action items
in the Clean Water Action Plan which the President announced in
Maryland almost a year ago. We recently announced a joint
strategy with the USDA to protect waterways from nonpoint
source pollution associated with the largest animal feeding
operations. We have made significant progress to clean up toxic
waste sites. As of the end of 1998, 585 Superfund toxic waste
sites have been cleaned up. An additional 85 cleanups will
occur in 1999.
In addition, 227 communities have benefited from more than
$44 million in grants to revitalize brownfields, to see these
sites cleaned up, to see these sites redeveloped, to see them
made a productive part of the community. And, finally, because
of the Clean Air Act approximately 164 million Americans are
today breathing cleaner air.
The budget we present today is in the tradition of every
previous budget submitted by this administration. It is based
on what the President and Vice President have said time and
time again, and what we have proven over the last 6 years. We
do not, as a country, have to choose between our health, our
environment and our economy. That, in fact, a strong economy
and a healthy environment are goals in concert, not in
conflict.
Today we have some of the toughest environmental and public
health protections in the world and our economy is also strong.
It is literally soaring. Building on this record of success,
the Clinton-Gore 2000 budget request charts a new course to
meet the environmental challenges of the coming century.
The budget we put before you today is about communities. It
is about neighborhoods. It is about protecting where we live
our lives as Americans. It is about protecting how we live our
lives. It is about keeping communities healthy, strong and
prosperous. It is about families. It is about improving their
quality of life, especially for our children.
The President in his State of the Union address articulated
a new livability agenda to help communities grow in ways that
will ensure a high quality of life and strong sustainable
economic growth. A key part of this agenda is an innovative
financing tool called Better America Bonds. This plan offers a
creative way for states and communities, through zero interest
bonding authority, to preserve open space, create shared areas
and parks, clean up brownfields and improve water quality.
Mr. Chairman, I want to be very clear what this program is
not. It is not big government. It is not the Federal Government
owning anything. This is merely another tool for those
communities who want to preserve their open spaces, who want to
enhance their water quality. They choose whether or not to take
advantage of it. They are not required to participate. Across
the country many communities are looking for financing
mechanisms so they can provide these kind of open spaces, these
shared spaces, this enhanced quality of life.
The President's budget also includes $200 million for the
Clean Air Partnership Fund, another new tool to help
communities. You made reference to this, Mr. Chairman, in your
opening comments. This is a fund to allow those local
communities who want to look at creative alternative solutions
to local air pollution problems, with some modest resources so
they can develop these sorts of local solutions. No one is
required to participate. We hear from many communities, from
many mayors who would like to forge public and private sector
partnerships to develop local air pollution solutions. That is
what this is designed to do, to provide some modest resources
for those communities who want to take this approach to
enhancing their air quality and thereby their quality of life.
Third, this budget allows EPA to take a leading role in the
administration's important effort to fight the growing problem
of childhood asthma. Five million children suffer from this
debilitating disease, and the incidence is clearly on the rise.
Senator Mikulski made reference to the very, very good work
that is done at Johns Hopkins. The budget before you includes
$22.2 million for education, outreach and monitoring to reduce
children's exposure to the environmental toxins that can make
an asthma attack far worse.
I am aware that this is a concern, Mr. Chairman, that I
think we both share. Your work on children's issues as both
Governor and Senator has done much to ensure that our children
are well prepared for a healthy lifetime of achievement. I hope
that we can continue to work together as EPA reaches out to
communities to provide them with the tool to address this very
real, this growing problem of childhood asthma.
In addition to these three new initiatives, the President's
budget also continues our work on the nation's other
environmental and public health priorities. To implement the
Clean Water Action Plan $651 million, the national blueprint
announced last year to finish the job of restoring and
protecting our nation's rivers, lakes and coastal waters.
For the State Revolving Funds $1.6 billion, to upgrade
drinking water systems, and waste water systems. To help
communities address the very pressing problem of polluted
runoff, we are asking that this committee allow States to take
up to 20 percent of their waste water money and turn it into a
grant program.
There are many small and medium-sized communities, where
the next important step to protecting their river or lake is
addressing polluted runoff. A grant program funded through an
optimal 20 percent setaside of the Clean Water SRF administered
by the States, would be a very, very important tool for
communities.
To continue the cleanup of toxic waste sites, the budget
invests $1.5 billion in Superfund, of which almost $92 million
will go directly to support brownfields communities.
If I might, just in closing, call the committee's attention
to something that is a very, very important concern to me and
to the administration, and that is the agency's operating
programs. We are seeking an increase in those programs. That is
where we do almost everything, short of the money for Superfund
and brownfields and the money that goes to States. Everything
from setting a drinking water standard to rigorous science, to
a new information office, to getting an ``A'' on our Y2K
compliance efforts, all of what we do sits in the operating
program budget. We are very, very concerned that if we do not
have the resources in this section of our budget, the work that
is extremely important to the American people will be delayed
or in some instances, we will simply have to cease that work.
We are concerned about this because of the House- and Senate-
passed budget resolution that includes a 12-percent across-the-
board-cut in priority domestic programs. We are concerned that
that magnitude of a cut to our operating program will result in
a huge delay or stoppage of important efforts that we are
involved in.
For example, it would affect our ability to set drinking
water standards on target with the new law. We have not missed
a deadline. The budget before you allows us to continue that
record, but a 12-percent cut would be extremely difficult----
Senator Bond. Madam Administrator, let me assure you that
the assumptions in the budget have absolutely nothing to do
with what kind of 602B allocation EPA will receive or how this
committee will allocate it.
Ms. Browner. I appreciate that.
Senator Bond. I think you can disregard most of the
assumptions underlining the budget. It is the numbers that
count and we are the ones that deal with the numbers.
Ms. Browner. I appreciate that. I take it from your words
that you recognize the importance of our operating budget.
Senator Bond. Merely that we are going to have no intention
of being bound by those assumptions.
Ms. Browner. In closing, Mr. Chairman, we want to continue
to work with this committee. We do recognize that congressional
earmarks are a part of the budgeting process. I think many of
the projects are extremely worthwhile projects, and are
important to the local communities. But as the number of those
earmarks increases, it does function as a reduction in our
ability to meet our commitments, both to States and local
communities, and affect our ability to do the kind of work that
was envisioned by Congress as they passed and reauthorized and
strengthened the nation's environmental laws.
In the last 4 years, we have experienced a 300-percent
increase in congressional earmarks to our budget. I am not
suggesting that the earmarks are not important projects. I am
sure they are, but they do affect our ability to do our job.
Mr. Chairman, they also affect the money that is made available
to the States for their priorities. We provide a lot of funding
to the States and they manage it across a set of competing
needs. An earmark comes at the expense of the dollars we have
available to provide to the States.
I raise that concern to the committee. I understand the
realities. But I hope that we can work together to ensure that
we do not continue to experience the kind of growth in earmarks
and to really, if possible, look at the projects and determine
whether or not they are better funded through an existing set
of resources that we make available to a State.
prepared statement
In closing, let me thank you for the opportunity to be
here. Let me thank you for the opportunity to work with you. We
recognize it is a difficult budget year, and that there will be
difficult choices to make. We believe we have presented you
with a budget in keeping with the balanced budget agreement
that honors the commitment that the Congress and the President
made to the American people in reaching that balanced budget
agreement, which was to provide strong public health and
environmental protections for the American people.
[The statement follows:]
Prepared Statement of Carol M. Browner
Chairman Bond, Ranking Member Mikulski, and Members of the
Committee, I am very pleased to be here today to present the
President's fiscal year 2000 Budget Request for the Environmental
Protection Agency. The President's $7.2 billion request for the EPA
continues this Administration's efforts to protect public health and
the environment and provide states and communities with new, innovative
funding tools to help build strong, healthy communities for the 21st
century.
At the outset, Mr. Chairman, I would like to mention something we
at EPA are very proud of. Sallyanne Harper, the Agency's Chief
Financial Officer, has been named the recipient of the Joint Financial
Management Improvement Program's (JFMIP) 1998 Donald L. Scantlebury
Memorial Award. She receives this in recognition of sustained
leadership and a record of accomplishments in financial management at
EPA. This is an extremely prestigious government-wide award given by
the JFMIP, to recognize senior financial management executives who,
through outstanding and continuous leadership in financial management,
have been principally responsible for significant economies,
efficiencies, and improvements in federal, state, or local government.
Sallyanne has done a great job for us at EPA. I just wanted to share
with you our pride in Sallyanne and ask you to join me in
congratulating her.
Mr. Chairman, with the help of this Subcommittee, which has funded
essential environmental programs, we have made significant progress in
providing a safe, healthy environment for the American people. During
this Administration, we have also worked with Congress to pass
important environmental laws and to implement earlier laws to carry out
our common goal of stronger environmental protections. To cite just a
few recent examples:
This year, as a result of the Safe Drinking Water Amendments of
1996, we estimate that 88 percent of the American population will
receive drinking water from community water systems that meet all
health-based standards in effect since 1994. The Agency has had
remarkable success in carrying out those Amendments, and, to date, has
not missed a single deadline that Congress placed in the law. We are
honoring the commitments you made in passing this legislation, and we
are meeting the safe drinking water needs of the American people.
Because of the action of this Subcommittee, and particularly your
support Mr. Chairman, and that of Senator Mikulski, we have made
significant progress on many of the 111 key action items in the Clean
Water Action Plan and will soon announce a joint strategy with USDA to
protect waterways from non-point source pollution from animal feeding
operations. I would like to thank this Committee for its support and
funding for the Clean Water Action Plan, almost all of which goes to
the states.
Today, because of the Clean Water State Revolving Fund and
Construction Grants programs supported by this Committee, more than 176
million Americans receive the benefit of at least secondary treatment
of wastewater, keeping pollution out of our rivers, lakes and
coastlines.
We are making significant progress cleaning up toxic waste sites.
As of the end of 1998, 585 Superfund toxic waste sites have been
cleaned up. An additional 85 construction completions will occur in
1999. In addition, 227 communities have benefitted from more than $44
million in grants to revitalize Brownfields. The Brownfields program
has helped to leverage over $1 billion in private investments which
have gone a long way toward revitalizing communities.
Approximately 164 million Americans are breathing cleaner air
today, because of the Clean Air Act. I would like to thank this
Committee for providing funding to carry out this legislation which
provides crucial health protections.
Our fiscal year 2000 Budget, in the tradition of every previous
budget submitted by this Administration, is based on what the President
and Vice President have proved over the past six years--that we don't
have to choose between environmental protection and economic growth. A
strong economy and a healthy environment and a healthy economy go hand
in hand. They are inextricably linked.
Today, we have some of the toughest environmental and public health
protections in the world, and our economy is not only strong, it is
soaring. In 1992, this nation had a record high $290 billion deficit.
This year, we expect a $79 billion budget surplus. That's progress.
Building on this record of success, the Clinton-Gore 2000 budget
request charts a new course to meet the environmental challenges of the
coming century. This budget recognizes that protecting our environment
is about more than beautiful vistas and scenic rivers, and it's about
more than passing new environmental and public health laws. It's about
protecting our health, our air, our water, our land, our food, and our
children.
This budget reflects a new American ideal. It's about
neighborhoods, protecting where we live and how we live, and what we do
in the everyday life. It's about communities--and how we keep them
healthy, strong, and prosperous. It's about improving the quality of
our lives.
Three new landmark initiatives in this budget reflect President
Clinton's and Vice President Gore's commitment to America's
communities. These initiatives provide significant new, innovative
financial tools to give communities the flexibility they need to
address their most pressing environmental and public health needs. They
tap into our nation's greatest resources--our ingenuity and spirit of
collaboration. They protect our most precious resource first--our
children.
The Better America Bonds program puts the Agency in the forefront
of support for the President's and Vice President's initiative to build
livable American communities. This new, innovative, financial tool is
aimed at helping communities address problems associated with urban
sprawl--such as, traffic congestion, lost farmland, threatened water
quality, shrinking parkland and abandoned industrial sites, or
Brownfields. This is about flexibility. Communities can decide for
themselves how they will preserve their open spaces, protect their
water, revitalize their blighted urban areas, and improve their quality
of life. The Administration proposes federal tax credits that will
support $9.5 billion in bond authority over five years for investments
by state, local and tribal governments. Through this initiative, the
funds invested by local communities to protect the environment could go
farther. I urge you to give local communities this flexibility to
address their most urgent environmental needs.
The President's budget includes $200 million for a new Clean Air
Partnership Fund--an initiative that is part of the Administration's
efforts to clean the nation's air and meet the challenge of global
warming. The Clean Air Partnership Fund will promote innovative
technology demonstrations to help communities nationwide reduce harmful
air pollution and greenhouse gases. The Fund finances, through grants,
the creation of partnerships among local communities, states and
tribes, the private sector, and the Federal government. There is no
requirement to participate. These are simply grants designed to finance
projects that are locally managed and self-supporting and that enable
communities to achieve their clean air goals sooner. The Fund will
stimulate cost-effective pollution control strategies, spur
technological innovation, and leverage substantial non-federal
investment in improved air quality.
I am very excited to discuss this next issue: children's health. I
am aware that this is a concern we both share. Your work on children's
issues, as both Governor and Senator, has done much to help ensure that
our children are well prepared for a lifetime of achievement. Reducing
children's exposure to toxins in our environment, toxins that can
exacerbate asthma, is a top priority for the budget before you today
and is a central theme in this Administration's fiscal year 2000
budget. I look forward to finding opportunities for you and I to work
together on this very important issue. As a start, I'd like to describe
the Agency's fiscal year 2000 proposal for fighting childhood asthma.
The Agency will take a leadership role as part of an
Administration-wide effort to fight childhood asthma and address this
growing problem. Five million children suffer from this debilitating
disease. President Clinton has provided an additional $17 million, for
a total of $22 million, to reduce children's exposure to toxins in our
environment that can exacerbate asthma. This funding will implement an
inter-agency initiative for education, outreach, and air monitoring. An
additional $12 million, for a total of $40 million, focuses on other
chronic childhood afflictions, such as cancer and developmental
disorders. EPA's investment to protect children from environmental
threats totals $62 million.
In addition to these three new initiatives, the President's budget
also continues our work on the nation's other environmental and public
health priorities.
Last year, the President announced a national blueprint to restore
and protect our nation's rivers, lakes, and coastal waters--and we made
great progress. The President's budget allocates $651 million for the
Clean Water Action Plan, and related activities, to continue our
efforts to restore and protect watersheds across the country.
Because polluted runoff is one of the most serious problems facing
communities, the President proposes another important flexible funding
mechanism--this one designed to help communities provide clean water.
The President's proposal will allow states greater flexibility to
address their most pressing water quality problems: polluted runoff
from city streets, suburban lawns and rural areas. The proposal will
give states for the first time the option to set aside up to 20 percent
(or as much as $160 million) of their fiscal year 2000 Clean Water
State Revolving Fund allotment for grants to implement non-point source
pollution and estuary management projects. We will need the authority
to allow states to set aside these funds for this state-managed grant
program. I look forward to working with Congress to provide this
authority so that we can implement this important, new funding
mechanism.
In addition, the President's budget provides a combined $1.625
billion for the state revolving funds (SRF), of which $800 million
funds the Clean Water SRF and $825 million funds the Drinking Water
SRF. The Drinking Water SRF increases from last year, and will help
achieve the Administration's goal of capitalizing the Drinking Water
SRF until states can provide an average of $500 million in annual
financial assistance for drinking water projects.
The Clean Water SRF request is part of the Administration's overall
capitalization plan to ensure states can provide an average of $2
billion a year in financial assistance for water quality projects. We
plan to continue capitalization of the Clean Water SRF until this goal
is met. I would like to note that almost $16 billion in Federal
capitalization grants have been provided so far to the Clean Water SRF,
or almost 90 percent more than originally authorized.
The President's budget invests approximately $216 million at EPA,
and $1.8 billion government-wide, to help reduce the pollution that
causes global warming. This program will continue the Administration's
efforts to address the challenge of climate change through innovative,
cost-effective partnerships with businesses, schools, states and local
governments that voluntarily lower energy use--and energy bills, for
everyone. The Climate Change Technology Initiative proposed by the
President this year also offers tax credits for consumers who purchase
fuel efficient cars, homes, appliances and other energy-efficient
products. It also includes increased spending on research to develop
new, cleaner technologies in areas like the Partnership for a New
Generation of Vehicles and the Partnership for Advancing Technology in
Housing.
The President's budget invests $1.5 billion in Superfund to
continue cleanup of toxic waste sites. The Agency plans to complete
clean up construction at 85 sites for a total of 755 construction
completions by the end of 2000, with a target of 925 through 2002. The
Budget also invests approximately $92 million in the clean up and
redevelopment of abandoned industrial sites through our Brownfields
Program, including $35 million for the Brownfields Revolving Loan Fund
which helps communities leverage funds for actual cleanup of Brownfield
sites. Through 2000, the Agency will have funded Brownfields site
assessment pilots in 350 communities across our great nation.
Of special importance in this budget proposal is our request to
increase the Agency's Operating Programs by five percent over the
fiscal year 1999 Enacted level. This budget provides $3.7 billion for
the Operating Programs, which include most of the Agency's research,
regulatory and enforcement programs and funds our partnership programs
with states, tribes, and local governments. The Operating Programs,
which have grown 33 percent during this Administration, represent the
backbone of the nation's efforts to protect public health and the
environment through sound science, standard setting, and enforcement.
It is through these programs that the Agency works to ensure that our
water is pure, our air is clean and our food is safe. I cannot
emphasize enough the important contribution the Operating Programs make
to the Agency's ability to meet the expectations of the American public
for a safe, healthy environment.
As part of these important Operating Programs, the President
requests $19 million for the Chemical Right-To-Know Program. This
includes $14.4 million for the Chemical Right-to-Know Initiative to
focus on accelerating the screening and testing of the 2,800 highest
production volume chemicals used in the U.S. We will conduct this
initiative through a voluntary industry challenge program and a series
of test rules for those data not obtained through the voluntary
program. Information on these chemicals, many that we use daily in
virtually every aspect of our lives, will be broadly disseminated to
the public. The President's budget also provides $18 million for
Environmental Monitoring for Public Access and Community Tracking
(EMPACT) to provide citizens with access to real-time information about
the health of the air, land and water in their communities.
The President's budget supports sound science with $681 million for
developing and applying the best available science for addressing
current and future environmental hazards, as well as new approaches
toward improving environmental protection. The Agency will focus its
research efforts on areas such as Particulate Matter, Global Change,
Mercury and the Coastal Research Initiative.
The Air Toxics program increases by almost $18 million in new
funding, for a total of approximately $109 million. This program will
focus on urban air toxics to develop tools and data that will move the
air toxics program from an almost exclusively technology-based program
to a risk-based program. The program is geared to reduce risks for poor
and minority groups, who are more prevalent in urban areas, and will
increase protection to a larger number of more sensitive populations,
such as children and the elderly.
The budget request for the Mexican Border is $100 million, a $50
million increase, for projects there. The Agency will use these
resources for direct grant assistance intended to address the
environmental and public health problems associated with untreated
industrial and municipal sewage on the border.
These are the highlights of our fiscal year 2000 Request. Mr.
Chairman, I appreciate that this Subcommittee balances different
priorities which are all important to our nation, and that you do so
with the responsibility of stewardship over the taxpayers' dollars. I
look forward to discussing with you, as the year progresses, the
initiatives and innovative financing mechanisms in our budget request.
I believe they embody a common-sense, cost-effective approach to
environmental protection. I would be happy to answer your questions at
this time.
Environmental Protection
status of epa's efforts to create a central information office
Mr. Chairman and Members of the Subcommittee: We appreciate the
opportunity to present this statement for the record, which discusses
our preliminary observations based on our ongoing work for this
Subcommittee concerning the Environmental Protection Agency's (EPA)
information management initiatives. Specifically, this statement
provides information on (1) the status of EPA's efforts to create a
central office responsible for information management, policy, and
technology issues and (2) the major challenges that the new office
needs to address in order to achieve success in collecting, using, and
disseminating environmental information. Our final report will be
provided in August 1999.
EPA estimates that its central information office will be
operational by the end of August 1999 and will have a staff of about
350 employees. The office will address a broad range of information
policy and technology issues, such as improving the accuracy of EPA's
data, protecting the security of information that EPA disseminates over
the Internet, developing better measures to assess environmental
conditions, and reducing information collection and reporting burdens.
EPA recognizes the importance of developing an information plan showing
the goals of the new office and the means by which they will be
achieved but has not yet established milestones or target dates for
completing such a plan. Although EPA has made progress in determining
the organizational structure for the new office, it has not yet
finalized decisions on the office's authorities, responsibilities, and
budgetary needs. Nor has the agency performed an analysis to determine
the types and the skills of employees that will be needed to carry out
the office's functions. EPA officials told us that decisions on the
office's authorities, responsibilities, budget, and staff will be made
before the office is established in August 1999.
On the basis of our prior and ongoing reviews of EPA's information
management problems, we believe that the success of the new office
depends on the agency's addressing several key challenges as it
develops an information plan, budget, and organizational structure for
that office. Most importantly, EPA needs to (1) provide the office with
the resources and the expertise necessary to solve the complex
information management, policy, and technology problems facing the
agency; (2) empower the office to overcome organizational challenges to
adopting agencywide information policies and procedures; (3) balance
the agency's need for data on health, the environment, and program
outcomes with the call from the states and regulated industries to
reduce their reporting burdens; and (4) work closely with its state
partners to design and implement improved information management
systems.
background
In October 1998, the EPA Administrator announced plans to create an
office with responsibility for information management, policy, and
technology. This announcement came after many previous efforts by EPA
to improve information management and after a long history of concerns
that we, the EPA Inspector General, and others have expressed about the
agency's information management activities. Such concerns involve the
accuracy and completeness of EPA's environmental data, the
fragmentation of the data across many incompatible databases, and the
need for improved measures of program outcomes and environmental
quality.
The EPA Administrator described the new office as being responsible
for improving the quality of information used within EPA and provided
to the public and for developing and implementing the goals, standards,
and accountability systems needed to bring about these improvements. To
this end, the information office would (1) ensure that the quality of
data collected and used by EPA is known and appropriate for its
intended uses, (2) reduce the burden of the states and regulated
industries to collect and report data, (3) fill significant data gaps,
and (4) provide the public with integrated information and statistics
on issues related to the environment and public health. The office
would also have the authority to implement standards and policies for
information resources management and be responsible for purchasing and
operating information technology and systems.
progress is being made, but key questions on resources and strategies
remain unresolved
Under a general framework for the new office that has been approved
by the EPA Administrator, EPA officials have been working for the past
several months to develop recommendations for organizing existing EPA
personnel and resources into the central information office.
Nonetheless, EPA has not yet developed an information plan that
identifies the office's goals, objectives, and outcomes. Although
agency officials acknowledge the importance of developing such a plan,
they have not established any milestones for doing so. While EPA has
made progress in determining the organizational structure of the
office, final decisions have not been made and EPA has not yet
identified the employees and the resources that will be needed. Setting
up the organizational structure prior to developing an information plan
runs the risk that the organization will not contain the resources or
structure needed to accomplish its goals.
information plan is needed
Although EPA has articulated both a vision as well as key goals for
its new information office, it has not yet developed an information
plan to show how the agency intends to achieve its vision and goals.
Given the many important and complex issues on information management,
policy, and technology that face the new office, it will be extremely
important for EPA to establish a clear set of priorities and resources
needed to accomplish them. Such information is also essential for EPA
to develop realistic budgetary estimates for the office.
EPA has indicated that it intends to develop an information plan
for the agency that will provide a better mechanism to effectively and
efficiently plan its information and technology investments on a
multiyear basis. This plan will be coordinated with EPA's agencywide
strategic plan, prepared under the Government Performance and Results
Act. EPA intends for the plan to reflect the results of its initiative
to improve coordination among the agency's major activities relating to
information on environment and program outcomes. It has not yet,
however, developed any milestones or target dates for initiating or
completing either the plan or the coordination initiative.
organizational structure is not yet determined
In early December 1998, the EPA Administrator approved a broad
framework for the new information office and set a goal of completing
the reorganization during the summer of 1999. Under the framework
approved by the EPA Administrator, the new office will have three
organizational units responsible for (1) information policy and
collection, (2) information technology and services, and (3)
information analysis and access, respectively. In addition, three
smaller units will provide support in areas such as data quality and
strategic planning.
A transition team of EPA staff has been tasked with developing
recommendations for the new office's mission and priorities as well as
its detailed organizational and reporting structure. In developing
these recommendations, the transition team has consulted with the
states, regulated industries, and other stakeholders to exchange views
regarding the vision, goals, priorities, and initial projects for the
office.
One of the transition team's key responsibilities is to make
recommendations concerning which EPA units should move into the
information office and in which of the three major organizational units
they should go. To date, the transition team has not finalized its
recommendations on these issues or on how the new office will operate
and the staff it will need.
needed resources are still unknown
Even though EPA has not yet determined which staff will be moved to
the central information office, the transition team's director told us
that it is expected that the office will have about 350 employees. She
said that the staffing needs of the office will be met by moving
existing employees in EPA units affected by the reorganization. The
director said that, once the transition team recommends which EPA units
will become part of the central office, the agency will determine which
staff will be assigned to the office. She added that staffing decisions
will be completed by July 1999 and the office will begin functioning
sometime in August 1999.
The funding needs of the new office were not specified in EPA's
fiscal year 2000 budget request to the Congress because the agency did
not have sufficient information on them when the request was submitted
in February 1999. The director of the transition team told us that in
June 1999 the agency will identify the anticipated resources that will
transfer to the new office from various parts of EPA. The agency plans
to prepare the fiscal year 2000 operating plan for the office in
October 1999, when EPA has a better idea of the resources needed to
accomplish the responsibilities that the office will be tasked with
during its first year of operation. The transition team's director told
us that decisions on budget allocations are particularly difficult to
make at the present time due to the sensitive nature of notifying
managers of EPA's various components that they may lose funds and staff
to the new office.
Furthermore, EPA will soon need to prepare its budget for fiscal
year 2001. According to EPA officials, the Office of the Chief
Financial Officer will coordinate a planning strategy this spring that
will lead to the fiscal year 2001 annual performance plan and proposed
budget, which will be submitted to the Office of Management and Budget
by September 1999.
epa's new information office will face significant challenges
The idea of a centralized information office within EPA has been
met with enthusiasm in many corners not only by state regulators, but
also by representatives of regulated industries, environmental advocacy
groups, and others. Although the establishment of this office is seen
as an important step in improving how EPA collects, manages, and
disseminates information, the office will face many challenges, some of
which have thwarted previous efforts by EPA to improve its information
management activities. On the basis of our prior and ongoing work, we
believe that the agency must address these challenges for the
reorganization to significantly improve EPA's information management
activities. Among the most important of these challenges are (1)
obtaining sufficient resources and expertise to address the complex
information management issues facing the agency; (2) overcoming
problems associated with EPA's decentralized organizational structure,
such as the lack of agencywide information dissemination policies; (3)
balancing the demand for more data with calls from the states and
regulated industries to reduce reporting burdens; and (4) working
effectively with EPA's counterparts in state government.
obtaining sufficient resources and expertise
The new organizational structure will offer EPA an opportunity to
better coordinate and prioritize its information initiatives. The EPA
Administrator and the senior-level officials charged with creating the
new office have expressed their intentions to make fundamental
improvements in how the agency uses information to carry out its
mission to protect human health and the environment. They likewise
recognize that the reorganization will raise a variety of complex
information policy and technology issues.
To address the significant challenges facing EPA, the new office
will need significant resources and expertise. EPA anticipates that the
new office will substantially improve the agency's information
management activities, rather than merely centralize existing efforts
to address information management issues. Senior EPA officials
responsible for creating the new office anticipate that the information
office will need ``purse strings control'' over the agency's resources
for information management expenditures in order to implement its
policies, data standards, procedures, and other decisions agencywide.
For example, one official told us that the new office should be given
veto authority over the development or modernization of data systems
throughout EPA.
To date, the focus of efforts to create the office has been on what
the agency sees as the more pressing task of determining which
organizational components and staff members should be transferred into
the new office. While such decisions are clearly important, EPA also
needs to determine whether its current information management
resources, including staff expertise, are sufficient to enable the new
office to achieve its goals.
overcoming problems associated with epa's decentralized organizational
structure
EPA will need to provide the new office with sufficient authority
to overcome organizational obstacles to adopt agencywide information
policies and procedures. As we reported last September, EPA has not yet
developed policies and procedures to govern key aspects of its projects
to disseminate information, nor has it developed standards to assess
the data's accuracy and mechanisms to determine and correct errors.\1\
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\1\ ``Environmental Information: Agencywide Policies and Procedures
Are Needed for EPA's Information Dissemination'' (GAO/RCED-98-245,
Sept. 24, 1998).
---------------------------------------------------------------------------
Because EPA does not have agencywide polices regarding the
dissemination of information, program offices have been making their
own, sometimes conflicting decisions about the types of information to
be released and the extent of explanations needed about how data should
be interpreted. Likewise, although the agency has a quality assurance
program, there is not yet a common understanding across the agency of
what data quality means and how EPA and its state partners can most
effectively ensure that the data used for decision-making and/or
disseminated to the public is of high quality. To address such issues,
EPA plans to create a Quality Board of senior managers within the new
office in the summer of 1999.
Although EPA acknowledges its need for agencywide policies
governing information collection, management, and dissemination, it
continues to operate in a decentralized fashion that heightens the
difficulty of developing and implementing agencywide procedures. EPA's
offices have been given the responsibility and authority to develop and
manage their own data systems for the nearly 30 years since the
agency's creation. Given this history, overcoming the potential
resistance to centralized policies may be a serious challenge to the
new information office.
balancing the need to collect more data and efforts to reduce reporting
burdens
EPA and its state partners in implementing environmental programs
have collected a wealth of environmental data under various statutory
and regulatory authorities. However, important gaps in the data exist.
For example, EPA has limited data that are based on (1) the monitoring
of environmental conditions and (2) the exposures of humans to toxic
pollutants. Furthermore, the human health and ecological effects of
many pollutants are not well understood. EPA also needs comprehensive
information on environmental conditions and their changes over time to
identify problem areas that are emerging or that need additional
regulatory action or other attention.
In contrast to the need for more and better data is a call from
states and regulated industries to reduce data management and reporting
burdens. EPA has recently initiated some efforts in this regard. For
example, an EPA/state information management workgroup looking into
this issue has proposed an approach to assess environmental information
and data reporting requirements based on the value of the information
compared to the cost of collecting, managing, and reporting it. EPA has
announced that in the coming months, its regional offices and the
states will be exploring possibilities for reducing paperwork
requirements for EPA's programs, testing specific initiatives in
consultation with EPA's program offices, and establishing a
clearinghouse of successful initiatives and pilot projects.
However, overall reductions in reporting burdens have proved
difficult to achieve. For example, in March 1996, we reported that
while EPA was pursuing a paperwork reduction of 20 million hours, its
overall paperwork burden was actually increasing because of changes in
programs and other factors.\2\ The states and regulated industries have
indicated that they will look to EPA's new office to reduce the burden
of reporting requirements.
---------------------------------------------------------------------------
\2\ ``Environmental Protection: Assessing EPA's Progress in
Paperwork Reduction'' (GAO/T-RCED-96-107, March 21, 1996).
---------------------------------------------------------------------------
working more effectively with state counterparts
Although both EPA and the states have recognized the value in
fostering a strong partnership concerning information management, they
also recognize that this will be a challenging task both in terms of
policy and technical issues. For example, the states vary significantly
in terms of the data they need to manage their environmental programs,
and such differences have complicated the efforts of EPA and the states
to develop common standards to facilitate data sharing. The task is
even more challenging given that EPA's various information systems do
not use common data standards. For example, an individual facility is
not identified by the same code in different systems.
Given that EPA depends on state regulatory agencies to collect much
of the data it needs and to help ensure the quality of that data, EPA
recognizes the need to work in a close partnership with the states on a
wide variety of information management activities, including the
creation of its new information office. Some partnerships have already
been created. For example, EPA and the states are reviewing reporting
burdens to identify areas in which the burden can be reduced or
eliminated. Under another EPA initiative, the agency is working with
states to create data standards so that environmental information from
various EPA and state databases can be more readily shared.
Representatives of state environmental agencies and the Environmental
Council of the States have expressed their ideas and concerns about the
role of EPA's new information office and have frequently reminded EPA
that they expect to share with EPA the responsibility for setting that
office's goals, priorities, and strategies. According to a Council
official, the states have had more input to the development of the new
EPA office than they typically have had in other major policy issues
and the states view this change as an improvement in their relationship
with EPA.
observations
Collecting and managing the data that EPA requires to manage its
programs have been major long-term challenges for the agency. The EPA
Administrator's recent decision to create a central information office
to make fundamental agencywide improvements in data management
activities is a step in the right direction. However, creating such an
organization from disparate parts of the agency is a complex process
and substantially improving and integrating EPA's information systems
will be difficult and likely require several years. To fully achieve
EPA's goals will require high priority within the agency, including the
long-term appropriate resources and commitment of senior management.
______
[General Accounting Office, April 29, 1999]
Hazardous Waste: Observations on EPA's Cleanup Program and Budget
Management Practices
(By Peter F. Guerrero)
Mr. Chairman and Members of the Subcommittee: We are pleased to
provide you with information on the Environmental Protection Agency's
(EPA) hazardous waste cleanup programs to assist in your deliberations
on the agency's budget request for fiscal year 2000. Our work has
determined that EPA faces several management challenges in implementing
two of its hazardous waste cleanup programs--the Superfund program,
under the Comprehensive Environmental Response, Compensation, and
Liability Act, commonly known as CERCLA, and the Corrective Action
program, under the Resource Conservation and Recovery Act, commonly
known as RCRA. For the Superfund program, we found that the agency
needs to better control cleanup costs, especially contractors' costs.
For the Corrective Action program, we found that four key factors are
hampering the progress of cleanups, including companies' reluctance to
begin cleanups without an economic incentive and EPA's lack of
resources to direct more companies to conduct cleanups. These
management challenges demonstrate that the agency could more cost-
effectively implement the Superfund program but needs more resources
for the Corrective Action program--findings that are relevant to your
decisions on the levels of new funding for these programs.
More specifically, you asked us to provide information on three
management issues confronting these cleanup programs: (1) the amount of
contracts that EPA has awarded to private companies that conduct
Superfund cleanup activities for the agency, (2) the extent to which
EPA is using its ``Contracts 2000'' initiative as a vehicle to improve
the agency's Superfund contract management practices, and (3) our
perspective on the potential effects of transferring $25 million from
the Superfund program's budget to the Corrective Action program's
budget as a means of increasing the number of cleanups under RCRA. Our
observations are based predominantly on two reports. In October 1997,
we reported on the progress of cleanups under the Corrective Action
program. Today, we are issuing a report discussing the progress that
EPA and other federal agencies have made in resolving Superfund program
management issues.\1\
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\1\ Superfund: Progress Made by EPA and Other Federal Agencies to
Resolve Program Management Issues (GAO/RCED-99-111, Apr. 30, 1999) and
Hazardous Waste: Progress Under the Corrective Action Program is
Limited, but New Initiatives May Accelerate Cleanups (GAO/RCED-98-3,
Oct. 21, 1997).
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In summary, we observed the following:
EPA may be retaining more contractors than it needs to conduct its
Superfund cleanup work. As a result, contractors often have low levels
of work and high program support costs, such as those for rent and
managers' salaries. Given that EPA expects its future Superfund
workload to decrease as states take on more cleanups that the agency
would otherwise have managed under Superfund and as cleanup
construction is completed at more sites, contractors will continue to
incur high program support costs unless EPA makes adjustments in the
number of contracts it awards.
EPA could use the team that is managing its Contracts 2000
initiative--an effort designed to help the agency put in place the
Superfund cleanup contracts it needs and assess its contract management
practices--to address some of the recurring contract management issues
we have identified, such as high program support cost rates. However,
the agency could not provide us with documentation describing the (1)
overall plan that the team would use to determine what options it would
recommend that the agency adopt for improving Superfund contract
management practices, and (2) time frames for implementing these
improvements.
Transferring $25 million from Superfund to the Corrective Action
program could help EPA achieve more RCRA cleanups; however, we cannot
determine with certainty what impact this transfer would have on
Superfund. When we assessed the progress of cleanups under the
Corrective Action program, we found that it was slow, in part because
companies responsible for conducting cleanups at their facilities did
not begin the cleanups unless they had a business incentive to do so,
such as wanting to sell or redevelop the property, or until EPA
directed them to do so. At the same time, we found that EPA lacked the
resources it needs to direct more companies to begin cleanups.
Therefore, providing more funds for corrective actions could increase
cleanup activities. In our report on Superfund program management
issues, we observed that for fiscal year 1998, EPA had more sites ready
to begin the construction of a cleanup method than funds available.
Thus, reducing the program's budget could further delay cleanups.
Nevertheless, EPA has the flexibility to propose how it will use the
funds it receives for Superfund, such as the relative amounts it would
like to use for remedial work and enforcement actions. Therefore, EPA
might be able to manage a reduction in its budget by cutting its
administrative costs rather than performing fewer cleanup activities.
background
When EPA awards a Superfund contract, it specifies that the
contractor will obtain up to a certain dollar amount of cleanup work
over a given time period. As the contractor conducts the work, it
incurs costs--both direct costs that can be attributed to an individual
site and indirect costs that are not site specific. EPA pays the
contractor for both types of costs. EPA tracks the amount of non-site-
specific costs it pays as a percentage, or rate, of the total contract
costs that it covers. One subset of these indirect costs is the
contractor's program support costs, for items such as rent and
managers' salaries. Since the mid-1990s, EPA has used 11 percent as its
target for program support costs.
Within the Superfund program, EPA established a long-term
contracting strategy to identify and implement needed contract
management improvements. An outgrowth of this strategy is EPA's
Contracts 2000 initiative. Under this initiative, a team of EPA staff
are helping the agency put in place the contracts it will need to
manage its future cleanup workload and to assess and update its
Superfund contract management practices. One of the issues that the
team has identified as needing resolution is the type and number of
contracts to use in the program. How EPA resolves this issue could
affect the program support cost rate that it pays.
contractors' superfund program support costs are still high, in part,
because epa has too many contracts for its cleanup workload
In a 1997 report on contract management issues,\2\ we stated that
the percentage of funds EPA was paying contractors for program support
costs (e.g., rent and salaries) was high relative to the percentage it
was paying for cleanup costs. Specifically, the program support costs
ranged from 21 to 38 percent of the total costs for some of the new
Superfund contracts that EPA was awarding as its old contracts expired.
These amounts exceeded EPA's target of 11 percent. In August 1998, we
further reported that, overall, contractors' program support costs
averaged about 29 percent of total contract costs.\3\ For our report on
contract management issues, we reviewed the 15 new Response Action
Contracts that EPA had awarded and determined that the program support
cost rates for 5 of them were below EPA's target and the rates for 10
of them exceeded EPA's target, ranging from 16 to 76 percent with a
median of 28 percent.\4\ According to several EPA contracting officers,
the agency expects such high rates for new contracts until it has had
time to award enough work to all of the contractors. The officials
predict that as EPA awards more work assignments, these program support
cost rates should decrease.
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\2\ Superfund Program Management (GAO/HR-97-14, Feb. 1997).
\3\ Superfund: Analysis of Contractor Cleanup Spending (GAO/RCED-
98-221, Aug. 4, 1998).
\4\ Five of these 15 contracts were less than a year old and two
additional ones were just awarded at the time of our review. EPA plans
to eventually award a total of 19 contracts nationwide.
---------------------------------------------------------------------------
However, the uncertain future of the program may make such a
decrease difficult to achieve. When EPA began replacing its expiring
contracts with new contracts, it had to decide how many contracts to
award. In September 1992, it used the number of work assignments under
its 45 expiring contracts to project the number of work assignments it
would have in the future. Because the agency expected the number of
work assignments to remain steady, it believed that if it reduced the
number of contracts it awarded, it could give its contractors more work
and their program support cost rates would decrease. Initially, EPA
decided to reduce the number of contracts from 45 to 22; later, it
further reduced the number to 19 because it no longer expects to have
the workload it originally predicted. However, EPA may still have more
contracts in place than it needs. For example, EPA has been enrolling
fewer sites in the program in recent years. In addition, the four EPA
regions with the highest Superfund workload indicated that, as the
states take on greater cleanup responsibilities, fewer sites will enter
the program. With fewer sites, contractors will have less work and EPA
will have less chance to reduce its program support cost rates.
EPA will soon have an opportunity to review the number of contracts
it should have in place and to try to better control program support
costs. EPA designed the current Superfund contracts to last 5 years,
with an option to renew them for another 5 years. The 5-year base
period will be up for 11 of the current contracts within about 2 years
and EPA will have to determine whether to exercise its option to renew
them.
recurring problems raise broader questions about superfund contracting
that could be addressed through epa's contracts 2000 initiative
While reviewing EPA's progress in resolving Superfund program
management issues, including contractors' high program support cost
rates, we determined that these problems may be symptoms of more
systemic issues associated with EPA's Superfund contracting. EPA could
use its Contracts 2000 initiative to address some of the following
issues we identified:
Could the agency more quickly and aggressively test and implement
alternative types of contracts, such as fixed-price or performance-
based contracts, in addition to or instead of using cost-reimbursable
contracts as it now does? A cost-reimbursable contract, under which EPA
agrees to pay all of a contractor's allowable costs, places most of the
financial risk on the government because the work to be performed at a
site is uncertain in nature and extent and EPA therefore cannot
accurately predict its costs. A fixed-price contract, used for clearly
defined and more routine cleanup actions, reduces the financial risk to
the government because the parties agree on a price for the
contractor's activities and the contractor bears the risk of performing
at the agreed price. The Office of Management and Budget has also been
urging EPA to make more use of performance-based contracts, which
establish a price structure for a contractor's services that rewards
the contractor for superior performance, allowing the government to
better ensure the receipt of high-quality goods and services at the
best price. EPA has begun to use both fixed-price and performance-based
contracts on a limited basis at pilot sites.
Is it cost-effective for EPA to duplicate the infrastructure
necessary to manage contracts in each of its 10 regional offices as it
is now doing?
Are there new and more effective ways to build more competition
into EPA's contracting process? Allowing multiple contractors to bid on
portions of cleanup work could help to control costs.
Has EPA lowered its contract management costs through its recent
use of the U. S. Army Corps of Engineers to manage a portion of its
cleanup work? Because the Corps specializes in and conducts a
significant amount of construction contracting for the federal
government, it may be better equipped than EPA to manage Superfund
construction contracts. If using the Corps has been cost efficient for
EPA, should it give the Corps additional cleanup work to manage?
Our reviews over the years have consistently shown that without the
sustained attention of high-level management, EPA has not always
succeeded in implementing and sustaining contracting reforms. Because
of this history, we were concerned when the agency could not provide
documentation describing the (1) overall plan that the Contracts 2000
team would use for determining what options it would recommend that the
agency adopt to improve Superfund contracting practices and (2) the
time frames for implementing these improvements. As a result, we do not
know whether EPA will move quickly enough to put improvements in place
before it decides whether to exercise the option to review its
Superfund contracts for another 5 years.
while shifting funds could accelerate corrective action cleanups, the
impact on superfund is uncertain
Our work has demonstrated that limited resources have delayed the
progress of cleanups under the Corrective Action program; therefore,
moving more funds into the program from the Superfund program could
help accelerate RCRA cleanups. While we are uncertain how such a shift
would affect the Superfund program, EPA may have the flexibility to
minimize the impact of a reduction in funds on Superfund cleanups.
Lack of Resources Hampers EPA's Ability to Perform Corrective Action
Cleanups
In 1997, we assessed the status of EPA's RCRA Corrective Action
program. This program was designed for currently operating facilities
that must clean up contamination at their sites, whereas the Superfund
program was intended to address contamination at abandoned sites. At
the time of our review, we found that only about 8 percent of the
approximately 3,700 nonfederal facilities nationwide that treat, store,
or dispose of hazardous waste--including only about 5 percent of the
approximately 1,300 facilities EPA considers to pose the highest
risks--had completed cleanup actions under the Corrective Action
program, according to EPA's data. About 56 percent of the remaining
facilities--including about 35 percent of those posing the highest
risks--had yet to begin the formal cleanup process. While some
facilities had undertaken cleanup actions outside the program, the
extent of such actions is unknown because the actions are not reflected
in EPA's program data.
Contributing to this slow rate of progress was that, without a
business incentive, companies were reluctant to initiate cleanups until
EPA, or a state implementing the program for EPA, directed them to do
so. According to several cleanup managers we spoke with, companies will
generally ensure that the contamination at their facilities does not
pose an immediate danger to public health or the environment, whether
or not EPA or a state has directed the facility to enter the Corrective
Action program. However, the companies in our survey appeared to
undertake more comprehensive cleanup actions only when they had an
economic incentive to do so because the corrective action process can
be costly and time-consuming. According to one cleanup manager at a
large corporation, the company may not be anxious to pursue a cleanup
if the contamination is not posing an immediate threat, the facility is
not losing revenue, or the company is not incurring a financial
liability by delaying the cleanup.
Although EPA is aware that cleanups are progressing slowly, we
found that the agency could not direct more facilities to begin
cleanups because it lacked the necessary resources. In fiscal year
1997, EPA expected to direct cleanups at less than 2 percent (46) of
the 1,886 facilities--427 of which were high priorities--that had not
yet begun cleanup. For example, program managers in one region
projected that they would have enough resources that fiscal year to
direct companies to begin cleanups at only 4 of their 69 high-priority
facilities awaiting cleanup. Likewise, another region had 82 high-
priority facilities that were eligible for and awaiting corrective
action but expected to be able to enforce such action at only three of
the facilities during that fiscal year because of resource constraints.
Furthermore, several of EPA's program managers in headquarters and the
two regions noted that they may never have the resources to get to the
1,459 lower-priority facilities that were in EPA's corrective action
workload at that time. According to EPA Corrective Action program
managers, the program's budget did not increase for fiscal years 1998
or 1999. Therefore, the problems we identified in our earlier review
remain.
Effect of Moving Funds Out of the Superfund Program Is Difficult to
Predict
EPA officials have stated that the agency has serious concerns
about transferring funds out of the Superfund program and is evaluating
the effect of such a transfer on the agency's Superfund cleanup goals.
As we stated in our report on Superfund program management issues, in
fiscal year 1998, EPA had 50 sites that were ready to start
constructing the cleanup method but funded 38 of them, at a cost of
$200 million, or about 13 percent, of its $1.5 billion overall
Superfund budget.\5\ Given that EPA did not provide funds for all 50
sites, additional cuts to the program's budget could reduce the number
of future construction activities the agency could fund.
---------------------------------------------------------------------------
\5\ In addition to these new construction projects, EPA continued
to fund ongoing longer-term construction projects and shorter-term
cleanup actions at numerous sites.
---------------------------------------------------------------------------
However, EPA has some flexibility to determine the amount of funds
it plans to spend on its various Superfund program activities. Our
ongoing work reviewing EPA's total Superfund expenditures demonstrated
that for fiscal years 1996 through 1998, EPA spent about 60 percent of
its Superfund budget on its own site-specific and contractors' cleanup
costs and 40 percent on non-site-specific costs, including its own
program management and administrative activities.
Furthermore, we found that over these same 3 years, the amount of
funds going to contractors for cleanup work and to other site-specific
work was declining. Given that the Superfund program is now almost 20
years old and most sites are in construction and moving toward
completion, we would expect to see more spending for cleanups and less
for administrative costs. Such a shift in spending would be consistent
with changes in the types of work needed and with efficiencies gained
through experience. Since such a shift has not yet occurred, EPA may
have opportunities to achieve more administrative efficiencies, which
it can use instead of cuts in actual cleanup work to offset a reduction
in funding for the Superfund program.
Senator Bond. Thank you, Madam Administrator. I will ask
that we set the timer at 5 minutes to try and get as many
rounds in as possible. I had asked Senator Burns if he would
not mind voting early and coming back to----
Senator Burns. And often?
Senator Bond. Yes, two or three times--and will take the
gavel when I leave.
Senator Burns. Mr. Chairman, might I suggest something
here. We have got a little time set aside, floor time to sort
of describe and set the stage of where we think agriculture is
today, on the floor under the leadership of Senator Coverdell.
If you want to go vote, then I will chair, and then when you
come back, I will just go over there and vote and stay there.
Senator Bond. All right. Senator Craig, can you----
Senator Burns. George Frampton has already had a heart
attack.
Senator Bond. Senator Craig, can you come back?
Senator Craig. I will try to come back.
Senator Bond. Can you vote early and come back? The vote
starts at 10:30.
Senator Craig. I have some questions for Carol Browner.
Senator Bond. Let me move on and get started.
Senator Mikulski. Mr. Chairman, just one note of order.
When we vote, I will not be coming back because I am going to a
hearing on refugees and the emergency supplemental for Kosovo.
I thank the Administrator and I will submit my questions for
the record.
gap analysis of water quality needs
Senator Bond. All right. Madam Administrator, EPA's 1996
Clean Water Act Needs Survey identified about $140 billion in
waste water infrastructure financing needs. We understand EPA
has been updating these estimates in what is being called a GAP
analysis. What is your revised estimate?
Ms. Browner. We will have to submit that for the record. We
are concluding that analysis. As you know, Mr. Chairman, in
accordance with the desires of both Congress and the States we
complete Clean Water and Drinking Water Needs Surveys in
alternate years.
Senator Bond. I understand from the various sources like
the AMSA and others that it is estimated at about $200 billion.
Ms. Browner. Our analysis is not done yet and we will
submit it when it is done.
Senator Bond. We have it. It says--from AMSA--it says that
it is--it has been increased to $200 billion and that does not
even include waste water treatment replacement costs.
Ms. Browner. Mr. Chairman, I am more than happy to provide
it to you. It is not done. We do this by soliciting information
from the States. I do not doubt that you are right that the
needs continue and that they are significant. We will get it to
you the minute we have it done. But we went through a very
rigorous program with the States to determine how we would
actually do this. And I think it would be inappropriate for me
to speak outside of that process.
Senator Bond. Well, we were looking at the public meeting
material handed out. I assume this was preliminary information?
Ms. Browner. That is correct.
Senator Bond. On Thursday, March 18?
Ms. Browner. That would be correct.
Senator Bond. It shows SSO adds--it brings it up to almost
$200 billion and that there are replacement needs as well.
Ms. Browner. We do not dispute that there are replacement
needs.
Senator Bond. Apparently the SSOs were not included--they
were included at $10 billion the first time around and that is
an underestimate. Okay. In view of the significant increased
cost, and we think from the preliminary analysis, it would be
at least 43 percent, I want to point out that this chart shows
the request from OMB, from the President to the EPA. It started
out for clean water, $1.6 billion in 1996; $1.35 in 1997;
$1.075 in 1998, the same in 1999. This year, $800 million.
It is dropping off the chart. We believe that the needs are
at least $200 billion plus any addition for replacement, which
is also an SRF-eligible number. And given the magnitude of
these numbers--and we understand that there are other dollars
that go into cleaning up our waste water--why has the
presidential recommendation been slashed in half since 1996,
when cleaning up the waste water is the one way we can assure
that our children and families who go to lakes and beaches and
rivers and streams on summer vacation aren't subject to the
dangers of water pollution?
Ms. Browner. Mr. Chairman, the President made a commitment
to provide to the States a fund that would revolve annually at
$2 billion by the year 2005. Because of our work with you, and
because of funding levels and a variety of other reasons, the
fund will revolve at the promised $2 billion, which goes beyond
what the Clean Water Act authorizes in the year 2002.
Mr. Chairman, we do not dispute that water pollution
continues to be a significant environmental challenge. But when
you look at the nature of water pollution across this country,
as you yourself know, polluted runoff is as much a problem in
many communities as is waste water. What we would suggest to
Congress is now is the time for all of us to come together and
to rewrite and strengthen the Clean Water Act so we can meet
all of the pollution challenges that we face, and to not simply
continue to focus on one segment of the problem.
This is a large problem. We agree with you about that. But
when you go out there and you talk to the States and you talk
to people who deal with water pollution beyond waste water,
they are looking at a significant problem. They are looking for
support and we would encourage the Congress to work with us.
nonpoint source pollution
Senator Bond. Madam Administrator, we have done things on
the nonpoint source pollution. We have a number of initiatives
going. There are many things that need to be done there. But
there is much more than a $200 billion need. The amount that
the President has proposed for revolving funds for the States
is, I believe, totally inadequate.
We cannot, no matter what other problems there are, we
cannot underfund something that is as important as this. I
cannot understand the budget prioritization process when we
have such a clear need to address dealing with waste water and
the budget is cut. We cannot be setting up new initiatives.
Let me turn now to Senator Mikulski for her questions.
Senator Mikulski. Mr. Chairman, in light of the vote and
also----
Senator Bond. The good news or bad news, depending on which
side you sit on, is that the vote on Kosovo doesn't occur until
11:40. So we will not be interrupted by votes.
Senator Mikulski. Senator Byrd, in light--may I just
proceed? Otherwise I am happy to defer to you, sir.
Senator Byrd. Proceed.
waste water: y2k readiness
Senator Mikulski. Just following up on the waste water
issue, Madam Administrator. And I had hoped before your tenure
was over that we could call you Madam Secretary, but I
understand there were other politics involved. In the Y2K
readiness report prepared by Senators Bennett and Dodd and also
a GAO survey, there were flashing yellow lights about the Y2K
readiness of drinking water plants.
And I will get to my question. As you know, water plants
are often automated control systems and, therefore, they are
automated and in the event of a Y2K glitch, the failure to have
water could have widespread community and public health, et
cetera effects. According to GAO, only Colorado and Minnesota
have taken actions to assess the readiness of their plants.
Twenty-eight States including Maryland and Virginia are
beginning to notify--now this is May.
Could you tell us, number one, your assessment of where we
are with Y2K readiness in terms of the availability of water
and, number two, what is EPA's role and what action it has
taken on this?
Ms. Browner. Yes. As I said earlier, EPA, in terms of the
systems we managed, have now gotten a clean bill of health.
Congressman Horn has given us an ``A.'' Since we have completed
the work for our Y2K compliance issues, we are now working with
both the States and local governments. And many of these
drinking water utilities are privately owned. We are reaching
out to States and local governments in terms of the readiness
survey and in terms of what actions will need to be taken. It
is a mammoth undertaking. We believe, based on what the States
have shared with us and the trade associations, that the States
are going to be able to address the drinking water systems
problems.
Senator Mikulski. Are you coordinating this for the nation?
Who is coordinating the readiness of these water plants?
Ms. Browner. We have worked through the White House office
on Y2K compliance. We, in fact, brought this to their
attention. We have been conducting outreach meetings with the
various stakeholders. The preliminary indications from a survey
of 4,000 public water systems, which service about 80 percent
of the population, is that 86 percent of these systems that
serve 100,000 or more people expect to be Y2K-compliant.
Senator Mikulski. Madam Secretary, I want to move on--
excuse me, Madam Administrator. In your work with the White
House, I think you really need to press them to focus on this
issue. We had a briefing from the White House on what they were
doing. And it was so general in so many ways. The meeting was
helpful, but they really need to feel an urgency on this
because we are so used to having good water when we want it
that we are complacent.
Ms. Browner. We'll provide for the record the various
studies that have been done and the analysis we have done if
that would be helpful.
Senator Mikulski. I think that would.
[The information follows:]
Readiness of Drinking Water Plants for Y2K
The Agency agrees that the Y2K readiness of drinking water and
wastewater utilities is of vital national significance. EPA's Office of
Water has been actively leading the outreach efforts to this sector,
with substantial assistance and participation by the drinking water and
wastewater related trade and professional associations, both national
and local/regional chapters. OW and the EPA regional offices have held
numerous meetings with trade associations, other stakeholders and state
agencies. We have disseminated information through our web sites,
developed written materials, and participated in trade conferences and
other forums. We have also highlighted this issue through site visits
by the EPA Assistant Administrator for Water; these visits were
publicized in major drinking water and wastewater trade association
journals in a joint effort to raise the level of awareness of this
problem. We have worked to have Y2K addressed in drinking water and
wastewater operator training sessions in most states.
A recent GAO report indicated that few states have assessed the Y2K
readiness of their drinking water and wastewater utilities and that
many have not been actively reaching out to inform and work with them.
During and since the time of the GAO survey, EPA's regional offices
have been working directly with their states and have indicated that
state activity has increased on this issue since GAO collected their
data.
Many states have sent Y2K information to their drinking water and
wastewater utilities; held Y2K seminars, conferences and workshops;
published articles; and provided Y2K training to drinking water and
wastewater operators. An increasing number of states are conducting Y2K
readiness surveys and are incorporating Y2K into site visits. Some
states have been very proactive, providing information and assistance,
while others have interpreted their regulatory roles and authority as
applying only to enforcement activity if a utility should violate its
wastewater permit or be out of compliance with drinking water
regulations.
The surveys completed last year of wastewater utilities (conducted
by the American Metropolitan Sewerage Association) and drinking water
utilities (conducted by the American Water Works Association, the
Association of Metropolitan Water Agencies and the National Association
of Water Companies) indicated that most of the larger systems were
taking steps to address the issue and were likely to be prepared. The
surveys provided by the associations are attached.
These associations have committed to conducting follow-up surveys
with results available by early July. In addition, EPA's Office of
Water has agreed to work with the National Rural Water Association
(NRWA) to design a survey that NRWA will conduct of the small to medium
drinking water and wastewater systems nationwide. These systems were
largely unrepresented in the earlier surveys. John Koskinen, Chair of
the President's Council on Year 2000 Conversion, requested that the
survey results be available by early July to provide a more complete
picture of the readiness status of the nations' drinking water and
wastewater sector.
EPA continues to work with states, associations and other
stakeholders to encourage readiness activities, testing, contingency
planning and communication to the public on the Y2K readiness of
drinking water and wastewater utilities.
community public water systems year 2000 preparedness survey summary
Introduction
In July and August 1998, the American Water Works Association
(AWWA), the Association of Metropolitan Water Agencies (AMWA), and the
National Association of Water Companies (NAWC) conducted a joint survey
of their member public water utilities to determine the Year 2000
preparedness of community public water systems to address potential
computer problems caused by the change of date at the beginning of the
year 2000.
The public water utility membership of AWWA, AMWA and NAWC consists
of approximately 4,000 public water systems serving approximately
eighty percent of the American public. The remainder of the Nation's
55,000 community public water systems which are not members of AWWA,
AMWA or NAWC are primarily small rural public water systems which are
members of the National Rural Water Association (NRWA) or not members
of any of the four major public water system associations.
The 55,000 community public water systems serve a total population
of 249 million people. However, the 3,687 community public water
systems serving a population of 10,000 or more serve a total of 204
million people. Nearly all of these 3,687 community public water
systems are members of AWWA, AMWA, or NAWC. The remaining community
public water systems serve a total population of 45 million people. The
remainder of the United States population obtain their drinking water
from private wells.
Approximately 725 public water systems have responded to the
survey. The responding public water systems range in size from small
systems serving less than 10,000 people to systems serving more than a
million. While the number of respondents is a comparatively small
sample of the total population of community public water systems, the
preliminary data can be used to provide an indication and understanding
of the state of preparedness of the Nation's community public water
systems. However, it is also important to note that the state of
preparedness of non-responding utilities is not known. This could
introduce a bias into the results of a large number of non-responding
utilities are also unprepared. These caveats should be kept in mind
when evaluating the data of the survey to date.
Tentative Indications
Although a statistically valid projection may not be made from the
survey data, the data provide the following tentative indications
concerning the state or Year 2000 preparedness of the Nation's
community public water systems.
Approximately 75 percent of the American people are served by large
community public water systems serving a population over 100,000
people. Based on the survey, community public water systems serving
populations of 1,000,000 or more can be expected to have little or
minimal internal problems caused by the change of date at the beginning
of the year 2000. There are 30 community public water systems which
serve a population of more than 1,000,000. 89 percent of the community
public water systems serving a population of 100,000-1,000,000 expect
to have Year 2000 compliance work done in time. These statistics seem
to indicate that the overwhelming majority of the American people will
not have their drinking water supply disrupted or made unsafe by
internal Year 2000 computer problems of a community public water
system.
However, a smaller percentage of community public water systems (26
percent), including very large systems, appear to have fully assessed
the Year 2000 compliance status of service providers and vendors which
could affect public water system operations or expect to have completed
an external Year 2000 problem assessment before the Year 2000. This
raises the possibility that some community public water systems could
be affected by power outages, communications failures including data
transmission, or a shortage of water treatment chemicals if their
external service providers and vendors have Year 2000 problems.
The survey responses concerning contingency plans may cause some
confusion. Most public water systems have contingency plans for natural
disasters, etc., to operate and provide safe drinking water. This would
include using manual operations instead of computer operations and, in
a worst case scenario, issuing a ``boil water' notice. It would seem
that existing public water system contingency plans could be used or
adapted for a system failure caused by a Year 2000 problem. It may be
that public water systems that indicated that they have not completed
contingency plans (83 percent) intend to modify their existing
contingency plans to specifically mention the Year 2000 problem and
have not completed the update. However, regardless, the majority of the
public water systems indicated that they expect to have Year 2000
readiness work done in time.
As one would expect, the survey data indicates that the cost of
Year 2000 compliance increases with system size. No estimated total
national projection of cost of Year 2000 compliance can be determined
from the survey data at this time until a more refined cost analysis is
done in conjunction with the total number of public water systems in
each size category.
data summary
Formal Plan for Year 2000 Problem
61 percent of the utilities had formal plans for addressing the
Year 2000 problem; 36 percent did not have a formal plan; 3 percent did
not respond to this question.
52 percent of the systems serving less than 10,000 persons had
formal plans; 68 percent of systems serving 10,001-100,000 had formal
plans; 89 percent of systems serving 100,001-1,000,000 had formal
plans; 100 percent of systems serving over 1,000,000 had formal plans.
Completed Internal Utility-Wide Year 2000 Problem Assessment
51 percent of the utilities have completed an internal utility-wide
Year 2000 problem assessment; 42 percent have not completed a utility-
wide Year 2000 problem assessment; 7 percent did not respond to this
question.
44 percent of utilities serving less than 10,000 persons have
completed a utility-wide Year 2000 problem assessment; 57 percent of
systems serving 10,001-100,000 have completed a utility-wide Year 2000
problem assessment; 63 percent of systems serving 100,001-1,000,000
have completed a utility-wide Year 2000 problem assessment; 100 percent
of systems serving over 1,000,000 have completed a utility-wide Year
2000 problem assessment.
Expect Internal Year 2000 Work to be Completed in Time
81 percent of the utilities expect to complete internal Year 2000
work in time; 13 percent did not expect to complete internal Year 2000
work in time; 6 percent did not respond to this question.
76 percent of the utilities serving less than 10,000 persons expect
to have internal Year 2000 work to be completed in time; 87 percent of
the utilities serving 10,001-100,000 expect to have internal Year 2000
work to be completed in time; 89 percent of the utilities serving
100,001-100,000,000 expect to have internal Year 2000 work to be
completed in time; 100 percent of the utilities serving over
100,000,000 expect to have internal Year 2000 work to be completed in
time.
Completed External Year 2000 Problem Assessment
26 percent of the utilities have completed an external Year 2000
problem assessment; 69 percent have not completed an external Year 2000
problem assessment; 5 percent did not respond to this question.
22 percent of utilities serving less than 10,000 persons have
completed an external 2000 problem assessment; 31 percent of systems
serving 10,001-100,000 have completed an external Year 2000 problem
assessment; 35 percent of systems serving 100,001-1,000,000 have
completed an external Year 2000 problem assessment; 30 percent of
systems serving over 1,000,000 have completed an external Year 2000
problem assessment.
Expect External Year 2000 Work to be Completed in Time
65 percent of the utilities expect to complete external Year 2000
work in time; 29 percent did not expect to complete external Year 2000
work in time; 6 percent did not respond to this question.
62 percent of the utilities serving less than 10,000 persons expect
to have external Year 2000 work to be completed in time; 67 percent of
the utilities serving 10,001-100,000 expect to have external Year 2000
work to be completed in time; 67 percent of the utilities serving
100,001-1,000,000 expect to have external Year 2000 work to be
completed in time; 90 percent of the utilities serving over 100,000,000
expect to have external Year 2000 work to be completed in time.
Completed Contingency Plans for Unforseen Internal Problems
23 percent of the utilities have completed contingency plans for
unforseen internal problems; 72 percent of the utilities have not
completed contingency plans for unforseen internal problems; 5 percent
did not respond to this question.
20 percent of the utilities serving less than 10,000 persons have
completed contingency plans for unforseen internal problems; 25 percent
of the utilities serving 10,001-100,000 have completed contingency
plans for unforseen internal problems; 23 percent of the utilities
serving 100,001-1,000,000 have completed contingency plans for
unforseen internal problems; 30 percent of the utilities serving over
1,000,000 have completed contingency plans for unforseen internal
problems.
Completed Contingency plans for Unforseen External Problems
12 percent of the utilities have completed contingency plans for
unforseen external problems; 83 percent of the utilities have not
completed contingency plans for unforseen external problems; 5 percent
did not respond to this question.
13 percent of the utilities serving less than 10,000 persons have
completed contingency plans for unforseen external problems; 10 percent
of the utilities serving 10,001-100,000 have completed contingency
plans for unforseen external problems; 15 percent of the utilities
serving 100,001-1,000,000 have completed contingency plans for
unforseen external problems: 30 percent of the utilities serving over
1,000,000 have completed contingency plans for unforseen external
problems.
Cost of Year 2000 compliance
39 percent of the utilities expect to spend less than $10,000 to
become Year 2000 compliant; 26 percent of the utilities expect to spend
$10,000-$50,000 to become Year 2000 compliant; 8 percent of the
utilities expect to spend $50,000-$100,000 to become Year 2000
compliant; 10 percent of the utilities expect to spend $100,000-
$1,000,000 to become Year 2000 compliant; 4 percent of the utilities
expect to spend over $1,000,000 to become Year 2000 compliant.
As would be expected, the smaller community public water systems
expect to spend less and the larger systems expect to spend more on
Year 2000 compliance. The survey data range from 56 percent of systems
serving less than 10,000 people expecting to spend less than $10,000 on
Y2k compliance to 60 percent of systems serving more than 1,000,000
people expecting to spend more than $1,000,000 on Year 2000 compliance.
amsa year 2000 survey analysis
AMSA Year 2000 Survey--Background
The Association of Metropolitan Sewerage Agencies (AMSA) is a
dynamic coalition of over 200 of the nation's publicly-owned wastewater
treatment agencies. AMSA members collectively serve the majority of the
sewered population in the United States, and treat and reclaim more
than 18 billion gallons of wastewater each day. Over the past 28 years,
AMSA has maintained a close working relationship with both Congress and
the U.S. Environmental Protection Agency in the development of
environmental legislation and policymaking.
Locally, AMSA member agencies play a major role in their
communities, often spearheading watershed management efforts, promoting
industrial/household pollution prevention and water conservation, and
developing urban stormwater management programs. AMSA members are true
environmental practitioners who work daily towards ensuring the safety
and quality of our nation's water supply.
AMSA conducted a survey of its members to assess whether wastewater
agencies have evaluated the Year 2000 (Y2K) problem, the estimated
costs to remedy the problem, the status of implementing solutions, the
impacts of potential system failures, and whether plans are in place
should systems fail. Seventy-six of AMSA's 206 agencies responded to
the June 10, 1998 survey, and forty-three responded to the October 2,
1998 followup survey.
Computer Use and Level of Automation
Computers, microchips, electronic data logging/analysis, and remote
monitoring/control systems are widely used and are critical components
in the overall functions of the Nation's public wastewater treatment
agencies. These systems contribute to varying levels of automation in
the industry. While many of the functions within wastewater agencies
can be automated or computerized, such as administrative functions
(i.e., billing, payroll, finances, etc.), process control operations,
or laboratory functions, all these functions can be performed manually,
and a significant portion of the industry is not fully automated.
Respondents to AMSA's recent survey indicated an average level of
automation of 54 percent. For example, some agencies use automated
billing systems, while treatment plants may operate manually. Other
agencies have fully automated administrative operations, process
operations, and industrial compliance programs, but may not have
automated data processing in their laboratory.
The survey examines the level of implementation of Supervisory
Control and Data Acquisition (SCADA) systems within the AMSA
membership. SCADA systems can allow operators to remotely collect
operational data, and control operations of pump stations or treatment
plant processes from a single location. Among the survey respondents,
88 percent currently implement some form of SCADA system currently, and
nearly 100 percent of respondents indicated future plans to use SCADA
systems. It should be noted that although a wastewater treatment agency
may use SCADA in some of its processes, this does not necessarily mean
that the entire treatment process is automated. For instance, a SCADA
system may be used to monitor and collect data from remote pumping
stations, however, the SCADA may not monitor treatment plant processes.
Nearly 100 percent of the agencies responding to the recent AMSA
survey indicated that computers were used in process control,
laboratory, industrial compliance, billing systems, and for other
administrative purposes, such as finances, inventory, and maintenance
management. A complete listing of responses on the use of computers/
microchips in agency functions includes:
Administrative.--billing, accounts payable, payroll, human
resources, purchasing, telephone systems, assessments, procurement,
contract management, capital investment programs, general ledger,
office automation, pensions
Maintenance.--system and plant maintenance management, inventory
Operations.--process control, embedded programmable logic controls,
SCADA, electronic pressure recorders, generators, collection system
monitoring, flow monitoring, mobile equipment, meter reading and
routing
Laboratory.--laboratory analysis, calibration, reporting
Industrial Waste.--permitting, industrial compliance
determinations, sampling
Engineering.--project tracking, geographic information systems,
computer-aided drafting (CAD)
Reporting.--NPDES reporting and monitoring
Other.--interactive voice response, internet, energy management,
telephones, security, radio, elevators, fire alarms.
Assessment and Action
A vast majority of AMSA survey respondents (90 percent) have
developed a plan to assess and address the Year 2000 problem. Many of
these assessments are very formal processes which are either initiated
under a comprehensive local government assessment or as part of the
agency's overall planning processes (it should be noted that 50 percent
of the AMSA membership are agencies which operate under the
jurisdiction of a local city or county government, while another 50
percent of AMSA members operate as regional districts). A little more
than half of the agencies are addressing (or intending to address) the
problem in-house, while the remainder are using consultants or a
combination of in-house staff and consultants.
Costs
The costs to address the Year 2000 problem vary widely for survey
respondents. Forty-five percent of the wastewater agencies which
reported estimated costs indicated that the cost to address the Y2K
problem was relatively minimal, ranging from 0 to $100,000, while
fifteen percent reported estimated costs in excess of $1,000,000, with
the two highest reported values being $15,000,000. Most of the agencies
reporting expenditures in excess of $1,000,000 were relatively large
systems, however 17 percent of these were agencies serving populations
less than 250,000. In general, most agencies reported total estimated
costs to fix the Y2K problem between 0 to 2 percent of annual operation
costs. Four agencies reported estimated costs to fix the Y2K problem
over 10 percent of annual operation costs. The average annual budget
for an agency serving one million people is approximately $125,000,000.
Progress in Implementing Solutions
Implementation of solutions to the Y2K problem varies widely,
though most all responding agencies have made some progress.
Approximately 95 percent have begun to implement solutions to the Y2K
problem, while 26 percent are complete or nearly complete. To address
the Y2K problem, many agencies are systematically checking and
upgrading systems which are not Y2K compliant. Figure 1 illustrates a
timeline of responding AMSA POTW Y2K efforts. As illustrated in the
graph, a majority of the agencies, will have completed the awareness,
inventory, and assessment phases of Y2K conversion by January 1, 1999.
Responding agencies are poised to focus Y2K efforts on repair, testing,
contingency planning, and implementation in 1999 and nearly all have
plans to be implementing Y2K ready systems by January 1, 2000.
[GRAPHIC] [TIFF OMITTED] T05AP29.002
Figure 2, which illustrates the current status of responding
agencies in accordance with six defined phases of Y2K remediation, also
highlights that Y2K repair, testing, contingency planning, and
implementation in will be a major focus of for wastewater agencies in
1999.
[GRAPHIC] [TIFF OMITTED] T05AP29.003
Figure 3 illustrates the status of assessment/correction of Y2K
problems associated with embedded microchips. Embedded microchips
present a special challenge to the Y2K issue as they are pervasive in a
range of systems and equipment including: meter readers, programmable
logic controllers, security systems, elevators, alarms, etc. Responding
agencies are both testing these systems and receiving assurances from
vendors that these systems are Y2K compliant. As the graph illustrates,
a majority of the responding agencies are still in the assessment phase
for each system type, while many are complete with embedded chip
assessments, and are currently implementing remediation efforts,
especially for mission critical systems such as plant process and
remote process operations.
[GRAPHIC] [TIFF OMITTED] T05AP29.004
Impacts of Year 2000 Failure
Though most agencies believe they will be Y2K compliant in 1999,
AMSA's survey requested that agencies project the resulting impact,
should a Y2K failure occur in any critical systems. A breakdown by
agency function follows:
Administration.--Computers are used throughout the administrative
functions of a wastewater treatment agency. Billing, payroll, human
resources, and many other functions depend on accurate computerized
record-keeping and reporting. Potential failures in billing systems are
the most troublesome to agencies responding to the survey. Should
systems fail in the event of a Year 2000 problem, nearly all agencies
indicated that delays in billing would result in serious cash flow
interruptions. These interruptions in cash flow are unlikely to
directly affect operations, as many agencies have cash reserves on
hand, or may be able to negotiate with vendors to extend bill due
dates, however, such a failure is likely to have major impact on the
administrative functions of the agency. Some agencies reported that
they have backup contingencies should there be a failure in automated
billing.
Process Control.--All responding agencies with automated process
controls have the ability to switch to manual operations almost
immediately or within hours in the event of a Year 2000 failure.
Approximately 15 percent agencies reported potential treatment plant
problems and possible compliance issues as a result of switching to
manual mode. Potential additional costs would be incurred with the
addition of staff or the payment of overtime.
One of the biggest concerns in this situation is that collection
system and plant operational data would not be immediately accessible
for the operators, and whether this would lead to sewage backups,
overflows, or compliance problems. However, most agencies reported that
switching to manual mode would pose none or very minor problems as many
automated operations run in parallel with ``manual'' instrumentation
and control. For instance, a wastewater treatment plant may use
programmable logic controllers (PLCs) within its treatment operations
to control valves or pump operations based on flow or pressure
readings. In normal operations, the data from these controllers would
be relayed to an operator's computer control screen, and the PLCs would
automatically activate valves or pumps accordingly. Should one or more
PLCs malfunction, an operator would no longer receive data via the
computer control screen and would have to ``manually'' read a flow
meters or pressure gauges. The operator also could not rely on the PLCs
to automatically activate appropriate valves or pumps, thus would also
have to ``manually'' adjust these controls.
One potential catastrophic failure issue which was noted and which
is beyond the control of the wastewater agency is the occurrence of a
major regional electrical power failure. There are a wide-range of
capabilities in terms of operating treatment plants in the absence of a
electrical power.
During a recent meeting, with the electric power industry trade
groups, power industry officials indicated the a ``cautious optimism''
regarding their industry's ability to meet the Y2K challenge by January
1, 2000. The groups referenced a recently released report titled,
``Preparing the Electric Power Systems of North America for Transition
to the Year 2000--A Status Report and Work Plan'' which was submitted
to the Department of Energy on September 17, 1998 (available at
http:www.nerc.com). In summing up the report, officials indicated that
any power outages that occur due to Y2K issues are likely to be
localized and short-term (i.e. hours or days), and that the chance of a
widespread power grid failure is basically zero. Localized and short-
term power outages will not produce widespread treatment plant
disruption as most facilities have the dual power feeds from differing
electrical sub-stations as backup, and/or have reserve capacity within
the treatment and collection system to store flows until power is
restored.
In the extreme case of a regional, long-term electrical power
failure, thirty-seven percent of the responding agencies indicated that
all treatment plants under their control could operate indefinitely
throughout the power outage. Most of these facilities would use diesel,
methane, or natural gas powered generators, though fuel availability
would clearly be an issue. Some plants could operate generators with
methane produced from on-site solids digestion processes. Another
twenty-eight percent of the agencies indicated that their plants could
operate at partial capacity, or that some, but not all of the plants
under their control could operate fully. Remote pumping stations may
also be affected by a regional, long-term power failure. While,
seventy-percent of responding agencies would be able to operate their
remote pumping stations in the case of a long-term electrical power
failure using diesel generators, other agencies would have to rely on
mobile generators, or in-line and off-line storage capacity to contain
any flows that could not be pumped to the treatment plant.
Laboratory.--Should laboratory systems fail, the issue would be
whether agency laboratories could adequately and accurately analyze
sample results, and report compliance problems adequately to regulatory
and public health agencies. Some agencies can operate in manual mode,
while others indicated that out-sourcing of lab functions could be
implemented.
Industrial Compliance Programs.--Should industrial compliance
systems fail, the wastewater treatment agency would not be able to
adequately monitor industrial customer compliance, which could result
in undetected high strength discharges leading to treatment plant
upsets, delays in issuing permits, and noncompliance with federal
regulatory pretreatment requirements.
Plan of Action
Nearly 55 percent of the agencies have completed or begun work on a
contingency plan should all or a portion of their computer systems fail
as a result of the Year 2000. As noted in Figure 1, all respondents
plan to address the issue of contingency plans by January 1, 2000.
Contingency plans will discuss issues concerning: (1) how manual
operation should be initiated in the case of system failures; (2)
chemical and fuel supply needs; (3) coordination with other local
entities; (4) manpower needs, and; (5) correction of system failures.
Conclusion
Based on the results of the AMSA survey and follow up discussions
with wastewater treatment agency staff, it can be concluded that the
large segment of wastewater industry represented by AMSA's membership
will respond effectively to the challenges presented by the Year 2000
problem. However, a significant portion of work will need to be
completed prior to January 1, 2000. Remediation, testing,
implementation, and contingency planning should be high priorities in
1999.
While treatment plants have become more and more automated over the
past ten years, many treatment plants still operate fully manually, and
even automated plants can be reverted back to manual mode in a matter
of a few minutes or hours depending upon the complexity of the system
and manpower availability. Some problems are bound to occur, and may
involve either or both internal system problems or external factors
that are beyond the control of a public wastewater treatment agency,
however, careful program management and proper contingency planning
should minimize the impacts of these problems on public health and the
environment.
AMSA Year 2000 Survey--Addendum
CHEMICAL SUPPLY: 85 percent of responding agencies do not
anticipate chemical supply problems associated with Y2K. Some agencies
indicate that adequate supply is on-hand (e.g., 3 months) should there
be a short-term disruption in the chemical supply/delivery chain.
COMMUNICATIONS: 98 percent of responding agencies indicate that
pump stations will be able to operate in the event of a
telecommunications failure.
MANPOWER: 35 percent of responding agencies indicate additional
manpower needs and/or shortages should Y2K problems require manual
operations.
potential impact of embedded chip failures
Communication--Minor
Building Grounds--Minor
Instruments--Moderate
Treatment Plant Processes--Moderate to Major
Remote Process Operations--Moderate
food safety: pesticide risks
Senator Mikulski. Let me go to another issue and this also
goes to children and public health. I note from a Washington
Post article that seven groups have quit your food panel and
they criticized EPA for being soft on pesticide risks. I found
the article disturbing, Madam Administrator, and I would like
to give you the opportunity to share with us where we are on
food safety, the whole issue around pesticides because
pesticides have a direct impact in nonpoint runoff in our water
supply. I was troubled. Could I now hear your response to this
and how are you dealing with the pesticides problem? And do you
have the resources to do it?
Ms. Browner. Yes, we do. As I think you are well aware,
Senator Mikulski, Congress passed a new modern food safety law
working closely in a bipartisan manner with the administration
2 years ago. That law for the first time ever requires us to
take a set of actions that we are in the process of taking. In
an effort to make sure that we have addressed both the health
concerns and the needs of farmers, we did establish an advisory
committee. We are extremely disappointed that the
environmentalists, as this committee was concluding its work,
decided that they would rather simply pull out and make these
kind of attacks.
We will comply with the law. We will meet the deadlines but
we are going to do it in a way that is responsive to the needs
of all, and that requires a thoughtful and an inclusive process
and we are on track. The first deadlines come up in August. We
are on track to make those deadlines. We tried to encourage the
environmentalists to stay at the table so that they could be a
part of the final round of process decisions we will make. They
thought it was better to issue a press release and walk away.
It is a disappointment to us and we will continue to work----
Senator Mikulski. I note my time is up. I just want to
conclude by just saying that they pulled out because they
accused EPA of endless dithering. Now I am also from the school
of thought of sound science. We have encountered many issues on
premature science, and that has resulted in very prickly
debates on air quality and so on. So I think there is a
difference between dithering and pursuing a solid course of
action using the best science and the best minds available in
the scientific community to advise us before we go off. I am
looking for a balance here, a streamlined process based on
sound science, and I think you would have bipartisan support.
Senator Craig. Would the Senator yield?
Senator Mikulski. Yes. My time is up.
Senator Bond. I would say, let me agree with my ranking
member, sound science should be driving this. I am deeply
disappointed by the efforts which indicate that we are going to
have more hysterical anti-science attacks. We banned alar based
on hysteria, not on sound science. We bankrupted apple growers,
raised the cost of apples and contributed to more health
problems by raising the cost of apples than we benefited by
banning alar.
You had a--I defer to the Senator from Idaho, Senator
Craig.
Senator Craig. Very briefly. The Senator from Maryland is
absolutely right. And I must say on behalf of EPA, and I do not
oftentimes find areas to praise them in----
Senator Bond. That is why I deferred to you briefly,
Senator Craig. I thought this would be a good opportunity.
[Laughter.]
Senator Mikulski. This is great.
Senator Craig. They were approaching it cautiously and
responsibly and they were listening to Agriculture and
Agriculture was really trying to find the right answers in
working with them in demonstrating how all of this works and
does not work. And EPA was listening. And I am disappointed
that other stakeholders in this would walk out hoping they can
gain ground politically by lawsuits and by press releases. It
does not work that way. We will ultimately have a nonproductive
agriculture and, as the Chairman said, one that does not
produce our food quality in the way we would like it. So on
this one, EPA gets some kudos. Stay the course.
Ms. Browner. Thank you.
Senator Bond. Thank you, Senator. Right now I turn to
Senator Byrd.
transportation partners program
Senator Byrd. Mr. Chairman, as I indicated earlier, I am
interested in knowing more about the Transportation Partners
program. Can anyone, Mrs. Browner, tell us specifically how
this funding is being spent?
Ms. Browner. The Transportation Partners is an effort to
work on a voluntary basis with local, State, public, and
private organizations to look at what is right for those
communities at their behest in terms of reducing vehicle miles
traveled. This is not about highway construction. It is not
about telling people how they should live their lives. There
are a number of communities and businesses, for example, some
of the business partners include Wal-Mart, Kaiser Permanente,
and Bank of America who on behalf of their employees, want to
look at alternative modes of transportation which work for the
business, the employees and ultimately may work to benefit air
quality in the communities.
It is not a required program. It is a voluntary
partnership. I think we have over 300 partners now, project
partners across the country.
Senator Byrd. My question was can anyone tell us
specifically how this funding is being spent?
Ms. Browner. It is spent through grants. We are more than
happy to give you a detailed explanation of each of the grant
awards if that would be helpful. There are nine projects and I
can give you some examples. But if you would like each one of
them, we would be happy to provide that. Would you like some of
the examples?
Senator Byrd. I would suggest you have all of those put in
the record and then I will select a few, perhaps, that I may
wish to visit with you further on.
Ms. Browner. Okay.
[The information follows:]
Transportation Partners Grants
Association for Commuter Transportation.--No Transportation
Partners funds.
Bicycle Federation of America.--No Transportation Partners funds.
Business for Social Responsibility Education Fund (BSR).--
Transportation Partners is providing support to BSR to work with at
least ten member companies to implement commuter and fleet
transportation efficiency measures and to measure the greenhouse gas
emissions reductions that results.
Center for Clean Air Policy (CCAP).--Fosters dialogue amongst
governmental and private policy makers to help promote innovative,
market-based policy approaches to develop effective transportation and
environmental policies. Transportation Partners supports CCAP's ongoing
dialogue to develop more effective strategies to increase ridership for
metropolitan transit systems.
International Council for Local Environmental Initiatives
(ICLEI).--By supporting ICLEI's Cities for Climate Protection U.S.
Sustainable Transportation Program, Transportation Partners is
facilitating an expansion of ICLEI's network of local governments and
their private sector allies working on strategies to reduce vehicle
miles traveled. ICLEI is focusing most heavily on public-private
partnerships through EPA's Climate Wise Program corporate partners to
reduce commuter travel through incentives such as parking cash out and
to improve fleet efficiency. ICLEI is also developing a menu of options
for local governments to reduce their transportation emissions, and
quantifying the greenhouse gas emissions reductions resulting from its
work.
Environmental Defense Fund (EDF).--Transportation Partners is
funding EDF to support education and technical assistance for
innovative regional transportation policy alternatives. The analysis
and technical assistance provided by EDF to Metropolitan Planning
Organizations, State Departments of Transportation, local governments
and community groups improves the awareness of policy approaches that
can both ease traffic congestion and reduce emissions through demand
management and more efficient use of existing transportation systems.
Such policies include: commuter choice for employee transportation
benefits (aka parking cash-out), time-of-day pricing of roads and
parking, and single occupant car buy-in options to more effectively use
high-occupancy vehicle lanes.
Local Government Commission (LGC).--EPA is supporting LGC's efforts
to provide tools and information to local governments to enhance
community livability and reduce vehicle miles traveled. LGC focuses on
providing assistance with public participation, administering community
image surveys, and developing and distributing an array of technical
resources to local governments to encourage transit-oriented and infill
development and livable downtowns. LGC assembles teams for on-site
visits. LGC is measuring the greenhouse gas emissions reductions
attributable to its work.
Renew America.--Transportation Partners is supporting Renew America
in its mission to identify, recognize, and promote environmental
success stories within the U.S. By co-sponsoring Renew America's Way to
Go transportation and the environment awards, EPA is demonstrating that
success in reducing vehicle miles traveled is achievable. This program
disseminates information about award winners, helps pair winners with
others interested in implementing similar programs, and works with the
media to ensure appropriate public attention to exemplary
transportation efficiency achievements.
Surface Transportation Policy Project (STPP).--STPP promotes
transportation policy and investments that help conserve energy,
protect environmental quality,strengthen the economy, promote social
equity, and make communities more livable. Transportation Partners
provides funds to STPP to: support community involvement in the
transportation planning process; assist with the planning of the
national Railvolution conference; maintain its TransAct web site;
provide outreach to automobile insurance companies to encourage them to
price insurance by the mile; and, to document the greenhouse gas
reductions of its work with Transportation Partners.
Railvolution.--EPA is supporting this quintessential national
conference on enhancing community livability and reduced vehicle miles
traveled through the provision of transportation alternatives and
supportive community designs. Approximately 1,000 public and private
sector leaders throughout the nation are anticipated to gather in
Dallas in September 1999 for this important conference.
Senator Byrd. So what are you saying to me when I say can
anyone tell us specifically how this funding is being spent?
Ms. Browner. Yes.
Senator Byrd. You are saying the answer is yes?
Ms. Browner. Absolutely. As I said, I can provide examples
today and we can provide the rest. One, for example, is in
Howard County, Maryland, that I would be happy to talk about.
Senator Byrd. I would be happy to talk about some that may
be in West Virginia.
Ms. Browner. Okay.
Senator Byrd. I understand that to become a partner a group
must make an application to the agency. What kind of scrutiny
does the EPA undertake to select its so-called partners?
Ms. Browner. You are correct. They do make an application
for a grant award. They come through the traditional grant
application process and they are required to comply with all
the grant application processes.
transportation partners: grant awards
Senator Byrd. But the question is what kind of scrutiny
does the EPA undertake to select its so-called partners?
Ms. Browner. They have to have an organization that is
capable of doing the work that they are suggesting or are
asking to do. They must have the ability to manage the
resources that would be provided to them.
If you are concerned that some organization made an
application and perhaps was not as forthcoming in terms of
their qualifications or their financial management, we would
appreciate having that brought to our attention immediately. We
will fully investigate the matter. The organizations are
required to meet certain requirements.
Senator Byrd. Does anyone at the agency conduct any reviews
of these groups?
Ms. Browner. Yes. The grant officers are required to
ascertain whether or not the groups are capable of the work
that they are committing to do.
Senator Byrd. Can the EPA provide this subcommittee with
information as to how many of the partners are involved in
litigation against highway construction?
Ms. Browner. Yes. In fact, we have just recently provided
to another committee information on all grant recipients and
their litigation records against the agency. I believe that
probably the group you are interested in would be a part of
that submission. So we would be happy to provide it. We have
provided it to the EPW Committee.
Senator Byrd. Mr. Chairman, I would like to ask that the
EPA provide this Committee with information of how many of the
partners are involved in litigation against highway
construction and what that litigation is about. What the cases
are, by number. What the status is of the litigation.
Senator Bond. That will be a request of the committee and
it will be made available to all members of the committee.
Ms. Browner. We should be able to make that available this
week. We have also provided it to the EPW.
Senator Byrd, if I might, I think we may be familiar with--
someone here may be familiar with the particular organization
you may be concerned with in West Virginia. Just so we give you
all of the information, the litigation may be against other
Federal agencies that you are concerned about, or against
perhaps State agencies. So we will do our best to also
determine that. That is not what we were asked to do in the
other committee. That may be what you are interested in, in
part.
[The information follows:]
Grant Recipients and Their Litigation Records Against the Agency
Attached are the two charts concerning litigation by EPA grant
recipients that EPA submitted to the Senate Environment and Public
Works Committee.
Non-Governmental Individuals and Organizations That Received EPA Grants
From January 1, 1989-March 31, 1999 and also Sued EPA During That Period
[Lawsuit information]
ALABAMA RIVERS ALLIANCE, INC.: Date lawsuit was filed
No. 97-2518 (N.D. Ala.)................................... 09/22/97
No. 97-0714 (N.D. Ala.) (lead plaintiff is Mudd).......... 03/21/97
ALASKA CENTER FOR THE ENVIRONMENT:
No. 96-245 (D. Alaska).................................... 07/18/96
No. 95-35109 and 95-35065 (W.D. Wash.).................... 04/24/90
No. 96-1762 (W.D. Wash.) (lead plaintiff is Alaska Clean
Water Alliance)......................................... 11/08/96
No. 95-1153 and 95-107 (D. Alaska) (lead plaintiff is
Alyeska Seafood, Inc.).................................. 03/21/95
No. 97-60042 (5th Cir.) (lead petitioner is Texas Mid-
Continent Oil & Gas).................................... 01/22/97
ALASKA CLEAN WATER ALLIANCE:
No. 96-1762 (W.D. Wash.).................................. 11/08/96
No. 97-60042 (5th Cir.) (lead petitioner is Texas Mid-
Continent Oil & Gas).................................... 01/22/97
AMERICAN FOREST AND PAPER ASSOCIATION, INC.:
No. 97-1448 (D.C. Cir.)................................... 07/22/97
No. 97-1210 (D.C. Cir.)................................... 03/31/97
No. 97-1209 (D.C. Cir.)................................... 03/31/97
No. 97-1208 (D.C. Cir.)................................... 03/31/97
No. 97-1206 (D.C. Cir.)................................... 03/30/97
No. 96-60874 (5th Cir.)................................... 12/21/96
No. 97-9506 (10th Cir.)................................... 03/03/97
No. 97-1212 (D.C. Cir.)................................... 03/31/97
No. 97-1211 (D.C. Cir.)................................... 03/31/97
No. 98-1427 (D.C. Cir.)................................... 09/16/98
No. 99-1053 (D.C. Cir.)................................... 02/16/99
No. 98-1543 (D.C. Cir.)................................... 11/16/98
No. 96-5324 and 93-0694 (D.D.C.).......................... 04/05/93
No. 95-1360 (D.C. Cir.)................................... 07/19/95
No. 93-1347 (D.C. Cir.)................................... 05/24/93
No. 94-1395 (D.C. Cir.)................................... 05/16/94
No.95-1007 (D.D.C.)....................................... 05/26/95
No. 95-70025 (9th Cir.)................................... 01/06/95
No. 95-70027 (9th Cir.)................................... 01/06/95
No. 98-1203 and 98-1196 (D.C. Cir.) (lead petitioner is
National Association of Manufacturers).................. 04/10/98
No. 97-1130 (D.C. Cir.) (lead petitioner is American
Automobile Manufacturers)............................... 03/13/97
AMERICAN LITTORAL SOCIETY:
No. 98-979 (E.D. Va.) (lead plaintiff is American Canoe
Association, Inc.)...................................... 07/09/98
No. 96-489 (E.D. Pa.)..................................... 01/24/96
No. 96-339 (D.N.J.)....................................... 01/24/96
No. 96-5920 (E.D. Pa.).................................... 08/28/96
No. 96-330 (D. Del.)...................................... 06/19/96
No. 98-927 (D. Md.)(lead plaintiff is Sierra Club)........ 04/01/98
No. 97-3838 (D. Md.) (lead plaintiff is Sierra Club)...... 11/13/97
No. 96-5772 and 96-5105 (D.N.J.) (lead plaintiff is Clean
Ocean Action)........................................... 06/01/93
No. 96-591 (D. Del.)...................................... 08/28/96
AMERICAN LUNG ASSOCIATION:
No. 93-1305 (D.C. Cir.) (national association)............ 05/10/93
No. 94-1284 (D.C. Cir.) (national association)............ 04/01/94
No. 94-2166 (4th Cir.) (national association)............. 09/12/94
No. 92-6060 and 91-4144 (E.D.N.Y.) (national association
and American Lung Associations of Nassau, Suffolk,
Queens, and Brook-
lyn).................................................... 10/21/91
No. 92-5316 (E.D.N.Y.) (national association)............. 11/12/92
No. 93-643 (D. Ariz.) (national association and American
Lung Association of Arizona)............................ 10/13/93
No. 94-2140 (D.D.C.) (national association)............... 10/05/94
No. 96-1251 (D.C. Cir.) (national association)............ 07/19/96
No. 96-1388 (D.D.C.) (American Lung Association of
Northern Virginia)...................................... 06/18/96
No. 96-1856 (D. Ariz.) (American Lung Association of
Arizona)................................................ 08/13/96
No. 95-4000 (6th Cir.) (lead plaintiff is Citizens for a
Better Environment) (American Lung Association of
Michigan)............................................... 09/18/95
AMERICAN PUBLIC POWER ASSOCIATION:
No. 97-1513 (D.C. Cir.)................................... 08/15/97
No. 97-1564 (D.C. Cir.)................................... 09/15/97
No. 97-1562 (D.C. Cir.)................................... 09/15/97
No. 98-1394 (D.C. Cir.) (lead petitioner is Edison
Electric Insti-
tute)................................................... 08/21/98
No. 97-1125 (D.C. Cir.) (lead petitioner is Appalachian
Power
Co.).................................................... 03/17/97
AMERICAN RIVERS, INC.:
No. 97-70365 (9th Cir.)................................... 04/04/97
No. 94-70613 (9th Cir.)................................... 09/28/94
No. 96-3208 (E.D. La.) (lead plaintiff is Mississippi
River Basin Alliance)................................... 10/02/96
AMERICAN WATER WORKS ASSOCIATION:
No. 96-1208 (D.C. Cir.)................................... 06/21/96
No. 89-1489 (D.C. Cir.)................................... 08/10/89
No. 91-1149 (D.C. Cir.)................................... 03/28/91
No. 97-2 111 (D.D.C.) (lead plaintiff is Association of
Metropolitan Sewage Authorities)..................................
ANACOSTIA WATERSHED SOCIETY: No. 98-758 (D.D.C.) (lead
plaintiff is Kingman Park Civic Association).............. 03/25/98
ARIZONA TOXICS INFORMATION: No. 99-389 (D.D.C.) (lead
plaintiff is Greenpeace International).................... 02/18/99
ATLANTIC STATES LEGAL FOUNDATION:
No. 95-1788 (N.D.N.Y.).................................... 12/15/95
No. 97-378 and 95-9525 (lOth Cir.) (lead plaintiff is
Maier).................................................. 06/02/95
BABCOCK & WILCOX: No. 90-1509 (DC Cir.)....................... 10/29/90
CITIZENS FOR A BETTER ENVIRONMENT:
No. 95 4000 (6th Cir.).................................... 09/18/95
No. 91-15108 (N. D. Cal.)................................. 04/17/90
No. 91-70056 (9th Cir.)................................... 01/25/91
No. 90-15455 and 89-2044 (N. D Cal.)...................... 06/12/89
CITIZENS FOR A HEALTHY BAY: No. C99-0375Z (W.D. Wash.)........ 03/17/99
CLEAN OCEAN ACTION:
No. 96-5772 (3rd Cir.) and 96-5105 (D.N.J.)............... 06/01/93
No. 94-5490 (3rd Cir.) and 94-2614 (D.N.J.)............... 06/01/94
COLORADO ENVIRONMENTAL ACTION: No. 97-1841 (D. Colo.)......... 08/14/97
CONCERNED CITIZENS OF AGRICULTURE STREET: No. 98-124 (E.D.
La.)...................................................... 01/15/98
CONSERVATION LAW FOUNDATION:
No. 91-1269 and 89-2325 (D. Mass.)........................ 10/17/89
No. 95-1047 and 95-1020 (D. N.H.)......................... 03/26/92
No. 92-1335 (1st Cir ).................................... 03/26/92
No. 94-1062 (D.C. Cir.)................................... 01/28/94
No. 94-1692 (D.C. Cir.)................................... 10/31/94
No. 91-12222 (D. Mass).................................... 08/21/91
No. 92-278 and 92-156 (D. N.H.)........................... 03/26/92
COOK INLET KEEPER: No. 97-60042 (5th Cir.) (lead petitioner is
Texas Mid-Continent Oil & Gas)............................ 01/22/97
DELAWARE VALLEY CITIZENS COUNCIL FOR CLEAN AIR:
No. 95-3318 (3rd Cir.).................................... 06/30/95
No. 95-3363 (3rd Cir.).................................... 06/30/95
No. 95 3494 (3rd Cir.).................................... 09/14/95
No. 96-3086 (3rd Cir.).................................... 02/09/96
No. 95-1241 (D.C. Cir.)................................... 05/01/95
No. 97-3428 (3rd Cir.).................................... 08/11/97
No. 96-1316 (D.C. Cir.)................................... 09/06/96
No. 95-3318 (D. D.C.)..................................... 06/18/96
No. 94-3180 (M.D. Pa.).................................... 04/19/94
No. 96-3086 and 95-2533 (E.D. Pa.)........................ 05/01/95
No. 90-1309 and 89-2592 (E.D. Pa.)........................ 04/17/89
No. 94-1692 (D.C. Cir.) (lead petitioner is Conservation
Law Foundation)......................................... 10/31/94
EARTH ISLAND INSTITUTE: No. 96-1457 (D.C. Cir.)............... 12/02/96
EDISON ELECTRIC INSTITUTE:
1No. 95-1378 (D.C. Cir.).................................. 07/26/95
No. 96-1062 (D.C. Cir.)................................... 02/20/96
No. 95-1393 (D.C. Cir.)................................... 08/04/95
No. 8-1394 (D.C. Cir.).................................... 08/21/98
No. 94-2346 (D.D.C.) ..................................... 10/28/94
No. 91-1586 (D.C. Cir.)................................... 11/27/91
No. 92-1638 (D.C. Cir.)................................... 12/09/92
No. 93-1474 (D.C. Cir.)................................... 07/27/93
No. 95-1144 (D.C. Cir.)................................... 03/06/95
No. 97-1125 (D.C. Cir.) (lead petitioner is Appalachian
Power Company).......................................... 03/17/97
No. 91-2435 (D.D.C.) (lead plaintiff is Gearhart)......... 09/26/91
ENVIRONMENTAL DEFENSE FUND:
No. 92-2520 and 3-91-00058 (E.D. Va.)..................... 01/29/91
(E.D. Va.) \1\............................................ 10/09/90
No. 93-91-00165 (E.D. Va.)................................ 03/29/91
No. 93-0532 (D.D.C.)...................................... 03/15/93
No. 95-15574 (N.D. Cal.).................................. 04/30/92
No. 90-1074 (D.C. Cir.)................................... 02/13/90
No. 92-1082 ( Cir.) \2\................................... 02/24/92
No. 93-1203 (D.C. Cir.)................................... 03/12/93
No. 94-1044 (D.C. Cir.)................................... 01/21/94
No. 89-0598 (D.D.C.)...................................... 03/08/89
No. 91-0429 (D.D.C.)...................................... 02/26/91
No. 90-1387 (D.C. Cir.)................................... 07/25/90
No. 91-1296 (D.C. Cir.)................................... 06/24/91
No. 97-1562 and 97-467-5 (E.D.N.C.)....................... 07/22/91
No. 98-1363 (D.C. Cir.)................................... 02/12/99
No. 99-1048 (D.C. Cir.)................................... 02/12/99
No. 93-1316 (D.C. Cir.)................................... 05/14/93
No. 93-1830 and 93-1789 (D.C. Cir.) (lead petitioner is
American Road & Transportation Builders Association).... 11/17/93
FRIENDS OF THE EARTH:
No. 92-1761 (W.D. Wash.).................................. 11/16/92
No. 91-3013 and 91-1109 (4th Cir.)........................ 01/18/91
No. 94-1079 (D.C. Cir.) (lead petitioner is Natural
Resources Defense Council).............................. 02/08/94
No. 98-758 (D.D.C.) (lead plaintiff is Kingman Park Civic
Association)............................................ 03/25/98
No. 97-1518 (D.D.C.) (lead plaintiff is Friends of Mount
Aventine)............................................... 07/02/97
GENERAL ELECTRIC COMPANY:
No. 95-2818 (7th Cir.).................................... 08/02/95
No. 97-1695 \3\........................................... 11/04/97
No. 97-2738 (7th Cir.).................................... 07/11/97
No. 98-60642 (D.C. Cir.).................................. 10/21/98
No. 93-1251 (D.C. Cir.)................................... 04/01/93
No. 95-1165 (D.C. Cir.)................................... 03/16/95
No. 90-1297 (D.C. Cir.)................................... 06/06/90
No. 94-0457 (D.D.C.)...................................... 03/08/94
No. 93-1272 (D.C. Cir.)................................... 04/16/93
No. 93-1807 (D.C. Cir.)................................... 11/30/93
No. 94-1274 (D.C. Cir.)................................... 03/29/94
No. (D.C. cir.) \4\....................................... 05/16/94
No. 91-1645 (D.C. Cir.)................................... 12/24/91
No. 94-1163 (1st Cir.).................................... 02/25/94
GEORGIA ENVIRONMENTAL ORGANIZATION: No. 97-8680 and 96-9327
(N.D. Ga.) (lead plaintiff is Sierra Club)................ 09/22/94
HEAL THE BAY: No. 98-4825 (N.D. Cal.)......................... 12/17/98
HORSEHEAD RESOURCE DEVELOPMENT CO.:
No. 96-3475 and 95-1785 (W.D. Pa.)........................ 11/01/95
No. 95-1286 (D.C. Cir.)................................... 06/01/95
No. 90-1413 (D.C. Cir.)................................... 08/06/90
No. 94-1764 (D.C. Cir.)................................... 12/16/94
No. 94-1709 (D.C. Cir.)................................... 11/21/94
No. 91-1221 (D.C. Cir.)................................... 05/14/91
No. 98-1397 (D.C. Cir.) (lead petitioner is Zinc
Corporation of America)................................. 08/24/98
No. 91-1538 (D.C. Cir.) (lead petitioner is Steel
Manufacturers Association).............................. 11/12/91
IDAHO CONSERVATION LEAGUE:
No. 97-35336 and 96-807 (W.D. Wash.)...................... 05/24/96
No. 96-829 (W.D. Wash.) (lead plaintiff is Idaho Sporting
Con-
gress).................................................. 05/29/96
LAND AND WATER FUND OF THE ROCKIES: No. 97-35336 and 96-807
(W.D.Wash.) (lead plaintiff is Idaho Conservation League). 05/24/96
MAINE ORGANIC FARMERS & GARDENERS: No. 99-389 (D.D.C.) (lead
plaintiff is Greenpeace International).................... 02/18/99
MOTHERS AND OTHERS FOR A LIVABLE PLANET: No. 99-389 (D.D.C.)
(lead plaintiff is Greenpeace International).............. 02/18/99
NATIONAL ASSOCIATION OF HOMEBUILDERS:
No. 97-1588 (D.C. Cir.)................................... 09/16/97
No. 4-99-11 (E.D. Va.).................................... 01/27/99
NATIONAL WILDLIFE FEDERATION:
No. 4-95-131 (W.D. Mich.)................................. 07/19/95
No. 95-1811 (D.D.C.)...................................... 09/21/95
No. 95-1363 (D.C. Cir.)................................... 07/19/95
No. 97-1504 (D.D.C.)...................................... 07/01/97
No. 93-0331 (D.D.C.)...................................... 02/17/93
No. (S.D. Fla.) \5\....................................... 01/14/91
No. (S.D. Tex.) \6\....................................... 05/09/91
No. 94-3309 (6th Cir.).................................... 03/24/94
No. 96-3208 (E.D. La.) (lead plaintiff is Mississippi
River Basin Alliance)................................... 10/02/96
No. 96-1680 (D.D.C.) (lead plaintiff is Sierra Club)...... 07/18/96
No. 97-60042 (5th Cir.) (lead petitioner is --Texas Mid-
Continent Oil & Gas).................................... 01/22/97
NATURAL HERITAGE INSTITUTE: No. 97-3997 (N.D. Cal.) (lead
plaintiff is Defend the Bay, Inc.)........................ 07/19/96
NATURAL RESOURCES DEFENSE COUNCIL:
No. (D.D.C.) \7\.......................................... 11/26/90
No. 92-2520 and 3-91-00058 (E.D. Va.)..................... 01/29/91
No. 91-5235 (D.N.J.)...................................... 11/25/91
No. 92-122 (N.D. Okla.)................................... 02/10/92
No. 94-8424 (S.D.N.Y.).................................... 11/18/94
No. 95-634 (D.D.C.)....................................... 04/03/95
No. 89-2980 (D.D.C.)...................................... 10/30/89
No. 90-70671 (9th Cir.)................................... 12/10/90
No. 91-70200 (9th Cir.)................................... 03/27/91
No. 91-1343 (D.C. Cir.)................................... 07/22/91
No. 92-70020 (9th Cir.)................................... 01/03/92
No. (9th Cir.) \8\........................................ 01/08/92
No. 92-70543 (9th Cir.)................................... 07/29/92
No. 92-3756 (3rd Cir.).................................... 12/31/92
No. 93-3293 and 93-3066 (3rd Cir.)........................ 02/11/93
No. 93-70313 (9th Cir.)................................... 03/23/93
No. 93-3131 (3rd Cir.).................................... 03/25/93
No. 93-3130 (3rd Cir.).................................... 03/25/93
No. 92-1534 (E.D. Va.).................................... 01/24/92
No. 92-1494(E.D.N.Y.)..................................... 03/30/92
No. 92-2225 (D.D.C.)...................................... 10/01/92
No. 90-1068 (D.C. Cir.)................................... 02/13/90
No. 90-3439 and 90-2447 (3rd Cir.)........................ 07/17/90
No. 90-1464 (D.C. Cir.)................................... 09/24/90
No. 91-1170 (D.C. Cir.)................................... 04/10/91
No. 91-1294 (D.C. Cir.)................................... 06/21/91
No. 92-1137 (D.C. Cir.)................................... 04/02/92
No. 92-1197 (D.C. Cir.)................................... 05/04/92
No. 92-1353 (D.C. Cir.)................................... 08/11/92
No. 92-1415 (D.C. Cir.)................................... 09/14/92
No. 92-1409 (D.C. Cir.)................................... 09/11/92
No. 92-1535 (D.C. Cir.)................................... 10/09/92
No. 92-1596 (D.C. Cir.)................................... 11/16/92
No. 92-1630 (D.C. Cir.)................................... 12/04/92
No. 93-1204 (D.C. Cir.)................................... 03/12/93
No. (D.C. Cir.) \9\....................................... 03/12/93
No. 94-1079 (D.C. Cir.)................................... 02/08/94
No. 94-1398 (D.C. Cir.)................................... 05/18/94
No. 94-1647 (D.C. Cir.)................................... 09/27/94
No. 92-2093 (E.D.N.Y.).................................... 05/29/92
No. 92-2196 (D.D.C.)...................................... 09/25/92
No. 93-1946 (D.D.C.)...................................... 09/21/93
No. 90-0694 (D.D.C.)...................................... 03/26/90
No. (D.D.C.) \10\......................................... 03/14/91
No. 91-1105 (D.D.C.)...................................... 05/15/91
No. 90-1245 (D.C. Cir.)................................... 05/10/90
No. 90-1322 (D.C. Cir.)................................... 06/27/90
No. 90-1497 (D.C. Cir.)................................... 10/19/90
No. 92-1005 (D.C. Cir.)................................... 01/06/92
No. 92-1371 (D.C. Cir.)................................... 08/18/92
No. 92-1639 (D.C. Cir).................................... 12/09/92
No. 98-1431 (D.C. Cir.)................................... 09/16/98
No. 98-1363 (D.C. Cir.) (lead petitioner is Environmental
Defense Fund)........................................... 06/05/98
No. 97-1686 (D.C. Cir.) (lead petitioner is Sierra Club).. 07/15/97
No. 96-1316 (D.C. Cir.) (lead petitioner is Delaware
Valley Citizens Council)................................ 09/06/96
No. 98-1379 (D.C. Cir.)................................... 06/08/92
No. 92-2369 (D.N.J.)...................................... 06/08/92
No. 97-60042 (5th Cir.) (lead petitioner is Texas Mid-
Continent Oil & Gas).................................... 01/22/97
NEW YORK CITY ENVIRONMENTAL JUSTICE ALLIANCE: No. 98-4404
(S.D.N.Y.) (lead plaintiff is South Bronx Coalition for
Clean Air, Inc.).......................................... 07/20/98
NORTH CAROLINA COASTAL FEDERATION: No. 97-1562 and 97-467-5
(E.D.N.C.) (lead plaintiff is Environmental Defense Fund). 07/22/91
NORTHWEST COALITION FOR ALTERNATIVES:
No. 90-70262 (9th Cir.)................................... 06/05/90
No. 91-70426 (9th Cir.)................................... 07/12/91
No. 97-1135 (W.D. Wash.) (lead plaintiff is Pineros y
Campesinos Unidos del Nordeste)......................... 07/10/97
OKLAHOMA WILDLIFE FEDERATION:
No. 99-0020 (N.D. Okla.).................................. 01/07/99
No. 98-145 (N.D. Okla.)................................... 02/23/98
No. 97-1090 (N.D. Okla.) (lead plaintiff is Hayes)........ 12/11/97
PEOPLE FOR PUGET SOUND:
No. 93-70301 (9th Cir.)................................... 03/19/93
No. C99-0375Z (W.D. Wash.) (lead plaintiff is Citizens for
a Healthy Bay).......................................... 03/17/99
SANTA NIONICA BAYKEEPER: No. 98-4825 (N.D. Cal.) (lead
plaintiff is Heal the Bay)................................ 12/17/98
SCENIC HUDSON: No. 94-4105 and 93-4011 (2d Cir.).............. 01/29/93
SERVICE EMPLOYEES INTERNATIONAL UNION:
No. 89-0851 (D.D.C.)...................................... 03/31/89
No. 89-1228 (D.C. Cir.)................................... 04/03/89
SIERRA CLUB:
No. 98-1195 (W.D. Mo.) (lead plaintiff is American Canoe
Association, Inc.)...................................... 11/12/98
No. 96-5920 (E.D. Pa.) (lead plaintiff is American
Littoral Soci-
ety).................................................... 08/28/96
No. 96-330 (D. Del.) (lead plaintiff is American Littoral
Society)................................................ 06/19/96
No. 97-1562 and 91-467-5 (E.D.N.C.) (lead plaintiff is
Environmental Defense Fund)............................. 07/22/91
No. 96-245 (D. Alaska) (lead plaintiff is Alaska Center
for the Environment).................................... 07/18/96
No. 99-30 (N.D. Iowa)..................................... 02/25/99
No. 99-114 (E.D. Ark.).................................... 02/18/99
No. 96-527 (E.D. La.)..................................... 02/12/96
No. 98-927 (D. Md.)....................................... 04/01/98
No. 97-3838 (D. Md.)...................................... 11/13/97
No. 97-3683 (N.D. Ga.).................................... 12/11/97
No. 98-71120 and 98-60804 (9th Cir.)...................... 09/24/98
No. 99-60015 (5th Cir.)................................... 02/08/99
No. 96-70223 (9th Cir.)................................... 03/27/96
No. 98-1270 (D.C. Cir.)................................... 06/09/98
No. 95-9541 (10th Cir.)................................... 09/15/95
No. 96-1007 (D.C. Cir.)................................... 01/12/96
No. 95-1562 (D.C. Cir.)................................... 11/03/95
No. 97-1686 (D.C. Cir.)................................... 07/15/97
No. 97-2119 (4th Cir.).................................... 08/22/97
No. 98-1610 (D.D.C.)...................................... 06/24/98
No. 98-2733 (D.D.C.)...................................... 11/12/98
No. 95-1747 (D.D.C.)...................................... 09/13/95
No. 96-672 (S.D. Ala.).................................... 07/16/96
No. 99-388 (D.D.C.)....................................... 02/18/99
No. 96-436 (D.D.C.)....................................... 03/07/96
No. 96-1680 (D.D.C.)...................................... 07/18/96
No. 97-675 (D.D.C.)....................................... 04/04/97
No. 96-2431 (D. Md.) (lead plaintiff is Audubon Naturalist
Society)................................................ 10/31/95
No. 95-24901 (D. Kan.) (lead plaintiff is Kansas Natural
Resources Council)...................................... 10/31/95
No. 98-1379 (D.C. Cir.) (lead plaintiff is Natural
Resources Defense Council).............................. 08/18/98
No. 98-1431 (D.C. Cir.) (lead petitioner is Natural
Resources Defense Council).............................. 09/16/98
No. 97-3004 (D.D.C.)...................................... 12/16/97
No. 97-3888 (N.D. Cal.)................................... 10/23/97
No. 98-5366 and 97-1984 (D.D.C.).......................... 08/29/97
No. 98-1564 (D.C. Cir).................................... 11/30/98
No. (N.D. Ga.) \11\....................................... 04/24/91
No. 4-92-970 (D. Minn.)................................... 10/07/92
No. 90-1674 (D. Ariz.).................................... 10/29/90
No. 97-8680 (N.D. Ga.).................................... 09/22/94
No. 93-2644 (D.D.C.)...................................... 12/30/93
No. 1:94-CV-2501 (N.D. Ga.)............................... 09/22/94
No. 89-2064 (N.D. Cal.)................................... 06/13/89
No. 89-3408 (D.D.C.)...................................... 12/20/89
No. 91-10898 (D. Mass.)................................... 03/25/91
No. 92-1749 (D.D.C.)...................................... 07/27/92
No. 93-5245 and 93-0124 (D.D.C.).......................... 01/19/93
No. 92-2282 (1st Cir.).................................... 11/05/92
No. 93-0125 (D.D.C.)...................................... 01/19/93
No. 93-0284 (E.D.N. Y )................................... 01/21/93
No. 93-0197 (D.D.C.)...................................... 02/01/93
No. 93-0564 (D.D.C.)...................................... 03/19/93
No. 94-0553 (D.D.C.)...................................... 03/17/94
No. 94-0954 (D.D.C.)...................................... 04/29/94
No. 95-0627 (D.D.C.)...................................... 03/21/95
No. 93-2167 (D.D.C.)...................................... 10/21/93
No. 92-1003 (D.C. Cir.)................................... 01/06/92
No. 94-1692 (D.C. Cir.) (lead petitioner is Conservation
Law Foundation)......................................... 10/31/94
No. 96-1316 (D.C. Cir.) (lead petitioner is Delaware
Valley Citizens Council)................................ 09/06/96
No. 95-15574 and 92-1636 (N.D. Cal.) (lead plaintiff is
Environmental Defense Fund)............................. 04/30/92
No. 92-2227 and 91-10898 (D. Mass.)....................... 03/25/91
No. 98-927 (D. Md.)....................................... 04/01/91
No. 94-920 (S.D. Cal.) (San Diego chapter)................ 06/09/94
SOUTHERN ENVIRONMENTAL LAW CENTERS: No. 97-1562 and 91-467-5
(E.D.N.C.) (lead plaintiff is Environmental Defense Fund). 07/22/91
SOUTHWEST RESEARCH AND INFORMATION CENTER \12\:
No. 98-1323 (D.C. Cir.)................................... 06/17/98
No. 96-1109 and 96-1108 (D.C. Cir.) (lead plaintiff is
State of New Mexico).................................... 04/08/96
SUSTAINABLE COTTON PROJECT: No.99-389 (D.D.C.) (lead plaintiff
is Greenpeace International).............................. 02/18/99
TEXACO INC.:
No.98-1428(D.C. Cir.)..................................... 09/16/98
No.94-1143(D.C. Cir.)..................................... 02/25/94
No.94-1686(D.C. Cir.)..................................... 10/25/94
No.92-9569 (10th Cir.) (Texaco Exploration & Production,
Inc.)................................................... 11/23/92
No.90-1321 (D.C. Cir.) (Texaco Refining).................. 06/27/90
TIDES CENTER: No.97-1342 (D.C. Cir.).......................... 04/30/97
TIDES FOUNDATION: No.94-2663 (D.D.C.)......................... 12/12/94
WASHINGTON ENVIRONMENTAL COUNCIL: No.C99-0375Z (W.D. Wash.)
(lead plaintiff is Citizens for a Healthy Bay)............ 03/17/99
WASHINGTON PARK LEAD COMMITTEE: No.2-98-421 (E.D. Va.)........ 04/17/98
WASHINGTON TOXICS COALITION:
No.98-1564 (D.C. Cir.) (lead petitioner is Sierra Club)... 11/30/98
No.C99-0375Z (W.D. Wash.) (lead plaintiff is Citizens for
a Healthy Bay).......................................... 03/17/99
WYOMING OUTDOOR COUNCIL: No 97-140 and 96-2831 (D. Colo.)..... 12/09/96
\1\ Case number not readily available.
\2\ Case number not readily available.
\3\ Court not readily available.
\4\ Case number not readily available.
\5\ Case number not readily available.
\6\ Case number not readily available.
\7\ Case number not readily available.
\8\ Case number not readily available.
\9\ Case number not readily available.
\10\ Case number not readily available.
\11\ Case number not readily available.
\12\ We are uncertain whether Southern Environmental Law Center is the
same entity as grantee Southern Environmental. In the interest of
inclusiveness, however, we have included Southern Environmental Law
Center on this list.
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EPA has entered into cooperative agreements with groups that have
expertise in various aspects of the transportation and environmental
issues. In some cases, groups which have received Federal funds are
also engaged in litigation with the Federal government. EPA has strict
guidelines that prevent groups from using EPA funds to pay for these
legal actions. Every EPA grant agreement is conditioned on compliance
with OMB Circulars that prohibit the use of grant funds for suits
against the Government. Specifically, they prohibit ``costs of legal,
accounting, and consultant services, and related costs, incurred in
connection with * * * the prosecution of claims or appeals against the
Federal Government'' (OMB Circular No. A-122, Attachment B, Section
10.g, which applies to nonprofit organizations; same provision in
Circular No. A-21, Section J.11.g, which applies to educational
institutions) and ``legal expenses for prosecution of claims against
the Federal Government'' (Circular No. A-87, Attachment B, Section
14.b, which applies to State, local, and tribal governments). In
addition, EPA's appropriation acts provide that grant funds may not be
used to pay the expenses of, or otherwise compensate, non-Federal
parties intervening in regulatory or adjudicatory proceedings.
EPA's Transportation Partners (TP) Program is a voluntary program
that promotes and supports innovative, local, voluntary efforts to
reduce vehicle miles traveled (VMT). The TP program is comprised of a
team of national, non- governmental organizations, called Principal
Partners, that receive EPA funding to foster innovative transportation
solutions nationwide. Transportation Partners has funded nine Principal
Partners organizations since 1995.
Funds received by the Principal Partners are used to assist over
350 Project Partners, which include State and local government
officials, businesses, communities, and organizations that are engaged
in VMT reduction strategies. Project Partners receive no funds from
EPA's Transportation Partners Program, nor do they receive any funds or
technical assistance from the Principle Partners for litigation.
We are aware of one lawsuit brought by a Principle Partner that is
related to highway projects:
Environmental Defense Fund, Inc. v. Environmental Protection
Agency, 167 F.3d 641 (D.C. Cir. 1999). This case does not involve a
challenge to a particular highway project but to EPA's national
conformity rules under the Clean Air Act. (These rules implement the
Act's prohibition on metropolitan transportation projects unless they
are part of a regional transportation plan that conforms to applicable
state air quality standards.) EDF brought the suit to require states to
conduct a more extensive and timely analysis of a plan's conformity
with air quality standards than was required by EPA's rules. In a
decision issued on March 2, 1999, the court held that various parts of
EPA's conformity regulations were inconsistent with requirements of the
Act.
We are also aware of three lawsuits that appear to have been
brought by Project Partners \1\ and that are related to highway
projects:
---------------------------------------------------------------------------
\1\ Conservation Law Foundation of Rhode Island is a Project
Partner. We do not know, however, whether this is the chapter of
Conservation Law Foundation that instituted this lawsuit.
---------------------------------------------------------------------------
Corridor H Alternatives, Inc. v. Slater, 982 F.Supp. 24 (D.D.C.),
aff'd in part and rev'd in part, 166 F.3d 368 (D.C. Cir. 1999). This is
a case alleging that the U.S. Department of Transportation (DOT)
violated the Department of Transportation Act, DOT's regulations, and
the National Environmental Policy Act in approving the Corridor H
highway project. In an opinion issued on February 9, 999, the D.C.
Circuit halted further construction of Corridor H pending DOT's
evaluation of historic sites along the corridor.
Georgians for Transportation Alternatives and Sierra Club v.
Shakelford, No. 99-CV-0160. This is a case against DOT (not EPA)
relating to numerous grand fathered projects in Atlanta. The case is
pending.
Conservation Law Foundation v. Federal Highway Administration, 827
F.Supp. 871 (D. R.I.), aff'd 24 F.3d 1465 (1st Cir. 1994). This is a
suit against DOT (not EPA) to stop the Jamestown Connector highway
project. The district court denied the plaintiffs' motion for a
preliminary injunction against the project; this decision was upheld on
appeal.
We are also aware that the Sierra Club and the Conservation Law
Foundation have filed three lawsuits related to highway construction in
Massachusetts, Connecticut, and Missouri. Although these groups'
national offices are not Principle or Project Partners, a number of
their local chapters are Project Partners. However, in the states
affected by the three lawsuits we are aware of, the local chapters of
Sierra Club or the Conservation Law Foundation are not Project
Partners. In addition, two of these cases were filed in the early
1990's, long before EPA started its Transportation Partners program.
Lawsuits concerning highway construction are generally brought
against the U.S. Department of Transportation (DOT) and/or State or
local agencies, not EPA. Because EPA is not a party, we generally do
not know about the cases unless they involve the interpretation of
EPA's statutes or regulations, and the Department of Justice asks us to
review the Government's brief. The Department of Justice or DOT would
likely have more complete information than EPA on these lawsuits.
Senator Byrd. Let me state again, Mr. Chairman, what I
stated earlier out of order. The EPA program known as
Transportation Partners has recently come to my attention
through some published reports that make some rather
disconcerting charges. Primary among those charges are that
this program is the source of funding for some purely anti-road
initiatives.
I can certainly see the merit in a program that helps local
communities to develop voluntary strategies for transportation-
related emissions reduction and that assist them in developing
transportation alternatives that reduce traffic volume and
congestion. It seems to me that if EPA is actually helping to
underwrite activities designed to block construction of
authorized and desired safe and more modern highways, a
critical name is being built and I would like to know if EPA is
doing that. I have no doubt that the public would be dismayed
to hear it if, in fact--these are the only reports that I have
had--one Federal agency was spending millions of taxpayer
dollars to build modern infrastructure and another agency was
spending additional taxpayer money to help prevent such
construction.
The logical result of this kind of mess is that the
taxpayers end up paying several times over, including footing
the bill to fight court battles to defend the projects and
covering the costs of inflation resulting from lengthy
construction delays. The only beneficiaries from this kind of
scheme, it would seem, are the lawyers. This scenario simply
defies fiscal logic.
I am not saying that these reports are true but that is
what we need to find out. And I thank the Chairman and I thank
you the Administrator.
Ms. Browner. Mr. Chairman, may I just respond very quickly.
Senator Bond. Please.
Ms. Browner. Senator Byrd, I am also familiar with a
report. The one I am familiar with was the Washington Times
that raised this question. When it was brought to my attention,
I did ask the people in the Agency questions about it. I do not
know if that is the report that you saw.
What I do want this committee to know is that there are
Federal rules prohibiting grant moneys from being used in
litigation, and we abide by all of those rules. We are sued by
everybody from environmental groups to Fortune 500 companies.
The Home Builders sue us and they receive grants from us. If
any of these organizations were to use their grant monies to
litigate against us, that would be inappropriate and we would
take action and we do monitor for that.
I appreciate the fact that there have been these news
reports. It does raise questions and we are more than happy to
answer them.
Senator Byrd. Mr. Chairman, I thank the Administrator for
making that statement.
Senator Bond. That was the question I was going to ask.
Madam Administrator, I would only note that money is fungible.
That is one of the problems we will get into when I come back
to ask questions.
We will ask you about the EPA Region 1 Regional
Administrator's statement about the agency's, ``unwavering
commitment to use the full force of environmental law to oppose
or seek modification of those transportation projects which by
their very nature contribute to sprawl.'' We will give you an
opportunity to respond to that.
Ms. Browner. I did not make the statement. I want to be
very clear.
Senator Bond. That is the administrator in Region 1. He got
our attention.
Senator Burns.
nonpoint source pollution
Senator Burns. Do you know what we are supposed to be
doing? Senator Byrd, you raise a very interesting point and I
am very interested in what the Administrator said. We could
expand this way beyond the Transportation Partnership because
we have been trying to deal with this situation in other areas.
Ms. Browner, thank you for coming this morning. And I
wanted to talk to you a little bit about what we find ourselves
in, as far as an issue that you brought up yourself this
morning and that is nonpoint source pollution in the clean
water and what we feel is sort of--we are worried about
livestock operations.
Let me preface this by saying, clean water is not a luxury.
It is essential. We not only think--I know we think principally
here in this 17 square miles of logic-free environment that it
is for people alone. It is not. It is essential for any kind of
production of livestock. I would say that we probably take as
much pains and procedures to make sure that we have clean
water. So that becomes very important to us.
As you know we, in this country, especially in the
agriculture production, there is no commodity making any money
now, not one commodity being produced on the farm is making any
money. The oil patch is dead; timber, precious metals. The
spread between the raw product and the end product is greater
now than it has ever been. And yet we proceed under a trade act
that opens our markets to those commodities that are not
produced under the same rules and regulations that we find
ourselves trying to operate under. We cannot compete. We have
eaten our seed corn. We are now into the equity of--losing
equity very, very quickly.
It is not that we do not want to comply. But we cannot
comply. The money is not there. We cannot redo a feeding
operation. We just do not have the money. In fact, we are
closing them up, in my country anyway. And it is market
conditions.
It is hard to talk to my constituents when you have about
250 loads of live cattle a day coming from Canada. Whenever we
look at the profitability of banks, improved grocery stores
that pack every single item of the food chain, their
profitability has improved. Yet we see hardly any increase in
food prices, but a drastic decrease in farm funds. It is not
the fact that we do not want to cooperate in giving out the
money.
I would ask that in your thinking, whenever we start going
out and trying to enforce some of these situations that we
have, that you take into consideration the situation that we
find ourselves in.
Where in the world did I put my questions? I had a whole
bunch. That will teach him to give me the gavel. We will have
to just adjourn and go home.
You might want to respond to that statement.
Ms. Browner. I recognize and the administration certainly
recognizes the plight of the farmer in the country today. I
know you have worked closely with my colleague Dan Glickman and
others to provide very, very much needed support. One
suggestion I would make to you----
Senator Burns. Ms. Browner, that does not do us a damn bit
of good.
Ms. Browner. I think the problem is quite large.
Senator Burns. It is market. Ain't nothing wrong on the
farm except the product. What they do down there, they might as
well go out and go to the golf course with the rest of them.
And I am serious about that. I am dead serious. I do not know
how we confront that. But go ahead. I'm sorry. I get very
emotional about this because they are my people.
Ms. Browner. I would not want to suggest that this is the
answer. However, I think there may be some opportunity in
addressing the environmental concerns of farmers through the
funding flexibility that we are asking Congress to provide each
State. The flexibility would allow the States to set aside 20
percent of the money for direct grants to communities and
combine that with some of the other resources you have been
willing to provide.
I do not want to suggest this solves the problem but for a
State like Montana, for example polluted runoff, I think that
some of the flexibilities and the funding flexibilities we are
asking you to provide could be helpful.
budget priorities for fiscal year 2000
Senator Burns. We want to work with you and we want to take
this thing head on if we possibly can. Keeping in mind that the
funds that an individual has are very much limited right now.
And it is not that they do not want to. And it is not that they
have not done a pretty good job up to this point. Now there are
changing conditions out there that would sort of hold some of
this up, but nonetheless we know that it is just not there.
Give me some kind of an idea, like, you had a $383 million
reduction for the existing programs in the 2000 budget. If you
wanted to come before this committee, what are your primary
priorities? What do you see where you will be placing your
emphasis in this budget as we move forward into next year?
Ms. Browner. Twofold. One is strengthening the protections
we provide the American people, air, water----
Senator Burns. I know. In those areas.
Ms. Browner. For example, within the clean water efforts,
fully funding the Clean Water Action Plan, $651 million. Within
drinking water, fully funding the request. And I would like to
note that there was a statement made earlier that we had cut
our drinking water request. We have not. We did not carry
forward a congressional earmark. In fact, we have increased
funding for that program, not a large amount. But there is no
cut to that program.
So within our air pollution efforts, to continue the
partnership with the states in terms of the funding we provide
to them and the technology.
The second large area of focus will be to give both States
and local communities greater abilities to access resources for
those things they want to do. For example, the Clean Air
Partnership Fund, the President's Better America Bonds Program,
really provide tools and resources for those communities who
want to take a certain approach to addressing environmental
issues. No one is required to participate.
The third area, as important as the others, is ensuring
that we have the kind of science, the kind of data analysis,
data management that are important to providing both the
American people with information but also to the decisions that
we, the states and industry, all make in terms of continuing
our efforts to reduce pollution challenges.
food quality and safety
Senator Burns. You are moving into an area of regulating
health care. You are moving into an area where I do not think
you are needed, most of it in food quality and safety. I think
the USDA has done a pretty good job up to this point.
Ms. Browner. USDA has never regulated pesticides. We have
done that for 28 years.
Senator Burns. I know. Now, when we had a meeting, I met
with members of Parliament in Canada just this last week in
Great Falls. As you know, we have got to standardize one way or
the other our regulatory regime between Canada and the United
States because Canada continues to have, it seems like, access
to pesticides and herbicides and fungicides that we do not down
here in the production of some of our crops. Have you had made
any efforts to work with Canada to harmonize those standards?
Ms. Browner. Yes. In fact, we have a significant effort
underway with Canada to look at environmental standards
broadly. I meet with the Environment Minister, Christine
Stewart, regularly and talk to her even more frequently.
Canada, as you well know, their government is set up completely
differently. Their Federal level has much less authority in
terms of setting environmental standards than the individual
provinces. Simple difference in terms of how their government
is structured, has proven to be one of the challenges and one
of the many challenges we face.
Yes. We recognize this issue and we are, in fact, working
with Canada on these issues.
Senator Burns. In other words, the rules and regulations we
have to operate under down here. Yet we allow imports to come
in and compete with us. They operate under a different
rulebook.
Ms. Browner. I know you know this. But a food product
cannot enter the United States that does not meet our pesticide
tolerance requirements. It cannot be in exceedance. If it is a
banned pesticide, for example, it cannot be used. The FDA is
responsible for the border inspections to ensure compliance.
In terms of technical issues like the residual limits and
data review, we do have differences that we are working on.
Senator Burns. Are you ready over there, Senator?
Senator Harkin. I am just getting my instructions.
Senator Burns. I have got a couple of local issues that we
can talk about in my office or your office.
Ms. Browner. I will come and see you.
regional haze
Senator Burns. I feel like this is a place--I am concerned
a little bit about regional haze. As you know, the commission
was established and then what they recommended, that was made
up of governors, with the Grand Canyon. And it seems as though
after all was said and done nothing was--the recommendations of
those people--of that study, not very many of those
recommendations were put in place.
I continue to have those kind of concerns, concerns about
we have no control on Federal lands as far as our air quality
is concerned. I will talk to Mr. Frampton about that in a
little bit in those areas. But a couple of areas that I think--
this is more of a local thing with Montana.
Ms. Browner. We have worked very, very closely with WGA,
and with Governor Leavitt who is their representative, on the
regional haze rule. We did make changes in accordance with
their recommendations and I think WGA issued a public statement
of support for the final program which was announced last week.
Senator Burns. On what they had recommended.
Ms. Browner. No. For the final program which we announced
last week on Thursday, Earth Day. WGA is supporting that
program and the Western Governors are supporting it. We would
be happy to show you the changes we made. We have a very, very
intense effort with them.
[The information follows:]
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Senator Burns. I better head over there and vote. The
Honorable Senator from Iowa.
Senator Harkin. I thank the Chairman.
Senator Burns. You are going to be all by yourself.
Senator Harkin. That is dangerous.
Senator Burns. It certainly is.
Senator Harkin. We can pass all kinds of things.
Senator Burns. I wanted to adjourn.
Senator Harkin. I want to vote.
Senator Burns. If you can get a quorum.
afo's
Senator Harkin. Thank you very much. I will just go ahead.
Madam Secretary, I appreciate you being here. I have just two
or three things I want to cover: Animal waste, radon and EPP,
which is a shorthand for environmentally preferable products.
The administration's national strategy for animal feeding
operations announced by EPA and USDA in March calls for upwards
of 20,000 livestock operations to be permitted under the Clean
Water Act. I have legislation pending myself calling for
tighter environmental standards for large animal feeding
operations. I, again, compliment and congratulate you for
working with Secretary Glickman on this issue and joining
forces together.
What I am concerned about is the fact that many States lack
the personnel to make the regular inspections of these large
animal feeding operations that would be required for meaningful
environmental oversight under the Clean Water Act. Is EPA going
to make additional funding available to the States? What do we
need in order to get the personnel that we need for the
inspections?
Ms. Browner. The national strategy for animal feeding
operations EPA-USDA announcement--essentially requires States
to demonstrate that they can run the program within their
State. We provide money to the States and, in fact, this budget
request continues a $20 million increase in section 106 grants
for the States. States can make a decision to use some of these
funds for this program.
Many of the States have told us that they think they are
going to be able to address it through prioritization within
their existing resources. One of EPA's roles is to make sure
that the States are able to carry through on the commitments
that they are making. If a State were to fail, then we can
backstop the State. For example, we could help them with the
permitting aspects.
It is a relatively new program and a large undertaking. I
think we have managed to provide this national backstop, so you
do not have all of these differences that were unfolding among
States. The second phase will be working with the States to
ensure full implementation.
environmental preferable products
Senator Harkin. I may have a follow-up question on that.
But let me get to the other two things I wanted to cover.
My main concern on that is the personnel required. I am
really concerned about how much personnel. If you need
additional personnel, what kind of funding is it going to take
and what do we need to do up here on the appropriations side?
How much more money do we need for those personnel?
The second thing I wanted to cover is what I call the
environmental preferable products, EPP. These are consumer and
industrial products made from agriculturally based substances
such as soy, corn oil, ag waste, wheat straw, things like that.
If we do that, that is sort of taking care of the environment
in the beginning rather than in the end. For example, the
Federal Government can usually avoid having to pay a high
disposal cost and can easily beat environmental compliance
rules. For example, rather than buying standard industrial
lubricants or solvents, Federal agencies can buy bio-based
equivalents made from soy oil. They meet the same performance
standards. They are less toxic and you do not have the disposal
problem.
In fact, the Government can help by identifying
environmentally preferable products in establishing common
standards. I have a couple of things here, like, the Department
of Interior, I guess, is testing starch-based plates and bowls
and utensils to replace polystyrene in cafeterias throughout--I
guess they are going to do it throughout the Park Service and
things like that.
Ms. Browner. This starch-based product is also used in
shipping peanuts.
Senator Harkin. Exactly. That kind of stuff. The same
thing. The Postal Service is testing building materials made
from straw. Anyway, there is an executive order. President
Clinton issued an executive order to do this, 13101, providing
that Federal agencies should find ways of using more
environmentally preferable products. And, I guess, EPA ought to
be in the lead in this.
My question is what is the EPA doing in moving forward
toward increasing the Government's purchase of bio-based EPPs
as required by the Executive Order, number one. Number two,
what are the barriers you see in implementing this Executive
Order, not just for you but for the rest of the Government?
This committee--and the Chairman did this last year--added
a million dollars in the budget this year. And how are those
funds being used?
Ms. Browner. The Environmentally Preferable Purchasing
[EPP] program has been in existence for several years. The bio-
based products are a new focus of this program. EPA, on behalf
of the entire Federal Government, reviews products either
through our own volition or products brought to us by
manufacturers to ascertain whether or not they are
environmentally preferable.
We do that in accordance with a set of protocols. Once we
make that decision, the rest of the Government is informed and
there is a list of products that have been certified with EPP
status. One of EPP's challenges is the reviewing of the
products. There can be a lot of controversy in weighing. For
instance, how much energy went into making two otherwise
seemingly comparable bars of soap, rather than just looking at
the environmental ``friendliness'' of the final product.
Once we actually make the EPP these determinations, the
next step is to get the other Federal agencies and departments
to use the products. The example you give of the Department of
Interior [DOI] is encouraging. It shows that this is not simply
EPA producing a list and then begging people to review and make
use of the list. Other agencies are formulating these ideas on
their own. We can work with DOI to see whether or not the
starch-based plate, bowls and utensils can be certified.
Senator Harkin. My time is up. If you cannot tell me now,
maybe you can just supply to me, Ms. Browner, what the million
dollars you put--what you have used that million dollars for.
[The information follows:]
Environmentally Preferable Products: $1 Million Congressional Add
The fiscal year 1999 $1 million Congressional Add-On for
Environmentally Preferable Products is being used primarily to build
infrastructure for green procurement. Approximately 75 percent of these
funds will go toward engaging voluntary standard setting organizations
to develop environmental standards and tools to train and provide
environmental information to federal procurement officials.
specific resource breakout
Pilots--$405K
--pilots with third party, standards organizations
--other pilots
Tools--$310K
--training and information tools for federal purchasers
--life cycle based decision support tool (NIST software tool)
--measurement
Outreach--$235K
--case studies, EPP updates, outreach to federal agencies, website
Coordination--$50K
--funds for Office of Federal Environmental Executive--support for
``summit'' of state/local/federal green purchasing programs
Total: $1.0 million
Senator Bond. Thank you very much, Senator Harkin. Thank
you for keeping the hearing going and now we turn back to
Senator Craig.
regional haze: western governors conference
Senator Craig. Mr. Chairman, thank you very much. Director
Browner, thank you for being with us today.
My colleague from Montana broached a couple of questions
with you as it related to regional haze which remains of great
concern to our Governors in the West. And I know that you had
mentioned to him that one of the Governors thought that the way
this was developing under your agency might be okay. Let me
read a quote from an April 6 letter you got from the chairman
of the Western Governors Conference in which--it does not sound
like things are okay.
I will ultimately ask you why you did not follow the
congressional intent last year that we established in the
budget process recommending that you go back and deal with this
issue.
I quote from Governor Geringer of Wyoming:
Given the rapidity with which the air frequently moves
through Wyoming, we are acutely aware that air does not respect
political boundaries. We believe that the regional haze and
visibility can only be addressed through a cooperative and a
collaborative process involving a number of States. We are
committed to a regional process. Through the regional haze
rules we are about to embark on a process that may drastically
affect the way we do business. It is imperative that when we
take the bold steps required in addressing visibility we do it
with the best set of rules possible. I must, therefore, once
again urge you--
I cannot read the print here. It is a fax letter--
to repropose the rules to allow a full public process to
resolve the concerns and the confusion in the currently
circulated rules.
That is the chairman of the Western Governors Conference. I
think that is respectful also of my Governor's concerns that we
are out there dealing with something that we have not dealt
with in an up-front manner. You talk about developing a
cooperative relationship with States and local entities.
Approximately 15 Governors from throughout the country have
requested that EPA now repropose the rules. What are you doing?
Ms. Browner. We have finalized the rule on Thursday.
Senator Craig. In other words, you are not going to do it?
Ms. Browner. I can explain why. We worked very closely with
all of the Governors who expressed interest in this. We had
numerous meetings, telephone calls with Governors. We made
changes in the original proposal. This effort of protecting air
quality in our natural parks and wilderness areas has been
underway for almost 20 years.
Senator Craig. I know it well. I have been with it longer
than you, Carol. So what happened to last year's appropriation
conference report where we encouraged EPA to repropose the
regional haze rules?
Ms. Browner. We have worked closely with all of the
interested parties to see if we could resolve differences. We
believe that we have struck the appropriate balance----
Senator Craig. Well, I am still waiting for the call
because I helped put that language in. I am one of those
interested parties. I am not at all happy. We are going to come
at you aggressively on this. Fifteen Governors have a right to
be heard and we do not believe----
Ms. Browner. They were heard.
Senator Craig. No. They do not think so.
Ms. Browner. With all due respect, we have spoken to
Governors. Bob Perciasepe has been on the phone with Governors
including Governor Geringer and I am sure he would be happy to
explain the nature of those calls in the last several weeks.
Senator Craig. I visited with the Governors, too. I am sure
there are always two sides to a story. I am one that will
accept that reality. But what I hear from the Governors is that
it puts them, they find, in a very difficult situation and they
do not believe that the effort was as full as you suggest it
is.
Ms. Browner. We did repropose the western portion of the
rule so that we could engage in further dialogue. I am not
suggesting that every single Governor was made absolutely
happy.
Senator Craig. And I do not believe you could probably do
that.
Ms. Browner. It was my understanding that Governor Leavitt
who was one of the leading governors----
Senator Craig. I am aware of the Governor's position and I
visited with him on it.
Ms. Browner. Per our conversation with Governor Leavitt, we
were under the impression that the Governor believes we were
responsive to his concerns in the final rule.
regional haze: statutory authority
Senator Craig. What is the statutory authority for a
regional BART in view of the specific resource requirements?
How can you do that best available retrofit technology in light
of what we are trying to do here?
Ms. Browner. The Clean Air Act provided for the best
available retrofit technology. We have added to that
opportunity, embodied in the Clean Air Act, a trading program,
so that we could further assist the utilities and the other 26
industrial sources who will be required to retrofit, the
commonly referred to grandfather sources and do it in the most
cost-effective manner.
So we did go beyond simply stating the technology and
looked to some of the kind of market mechanisms that we have
used in other sections of the Clean Air Act.
Senator Craig. Carol, I think you know why I asked the
question. Because when we talk about regional problems and air
moving within a region, BART statutes require a specific
attribution of haze to a specific source and knowledge of
environmental benefits anticipated from BART controls. That is
how Congress intended it, and yet you appear to be kind of
spreading a broad net not specific to the intent of the law or
the regulations.
Ms. Browner. The States have to do an inventory and they
will, in accordance with the law, look at the 26 categories and
make determinations in terms of sources. But rather than simply
stopping there and stating what the reductions are going to be,
we added to that, per a lot of input from Governors and others,
a trading mechanism so that as you look across the problem you
can find the most cost-effective and the cheapest reductions,
rather than simply stating every single facility that shows up
in the survey has to do this.
We worked very hard to strike that balance between the
issues for the national parks and the wilderness areas, the
economics of these older or these grandfathered facilities, and
the regional component of this problem. I think this is why
many of the Governors feel like we spoke to their issues.
regional haze: selective burning
Senator Craig. In this instance, let me ask you, do the
right hand and the left hand communicate? The right hand being
EPA and these regional haze rules and Interior. Now Interior
doesn't have anything to do with the Forest Service. But, as we
know, Bruce Babbitt has been out recently talking about
selective burns in a rather sizable manner. He was recently
flying over the mountains of Idaho saying we are going to burn
several hundred thousand acres here this year. Simple logic,
because I was born and raised in the West, the West gets kind
of hazy in the fall with burning and, that is, now the right
hand and the left hand are trying to do this. So we're going to
compensate on one hand by squeezing the private sector and the
public sector is going to do selective burning.
Are you communicating and is there a plan where that begins
to fit together?
Ms. Browner. Yes. Whether it be a regional haze or any of
the other air pollution programs of this administration, we
have continued to support selective burning.
Senator Craig. You should.
Ms. Browner. We think it provides important fire
protections for the communities and for wildlife habitat. We
have been very, very clear that when States look at their
pollution data, the burn days, when you can monitor for the
effect, are taken out of the database. We do not want people
going through the expense of reducing air pollution that is
attributable to burns. In no way is that what this is about. We
have worked hard.
Many of the States have come to us. We have pulled data for
them to segregate out those days where either there was a
forest fire happening or a prescribed burn happening. We are
not hearing from States complaining that this is not the case
in the air quality database. If your State thinks there is
something in the air quality database that was attributable to
a burn, we are happy to work with them.
Senator Bond. Madam Administrator, we appreciate that
particularly, since I burned my native warm season grasses this
weekend and only burned one section of the fence. [Laughter.]
Senator Craig. You were a contributor to a regional haze
and I will bet you were not in their database.
Ms. Browner. We are taking it out today.
Senator Craig. Thank you, Mr. Chairman, I will come back
with another----
Senator Bond. We do have lots of questions.
Senator Craig. Let me conclude that your rhetoric is fine.
I will tell you that not all is well with 15 Governors in the
West. Thank you.
clean water: unmet capital needs
Senator Bond. The Association of Metropolitan Sewerage
Agencies has told us that the capital needs for waste water
treatment are $10 billion per year and replacement needs are
$6.2 billion per year and the annual, local and Federal
expenditures are $10.5 billion a year. That means there is a
difference of $5.7 billion, almost $6 billion in annual unmet
needs for capital in clean water. I would ask that as you
develop your information that you are going to submit us on the
unmet capital needs that you comment on that.
Let me turn back to the questions that my colleague from
West Virginia was asking. You have stated that Federal funds
cannot be used for litigation against the Federal Government;
is that correct?
Ms. Browner. Yes.
grant audits
Senator Bond. Okay. How many financial audits of grantees
does EPA conduct each----
Ms. Browner. Through the IG's office?
Senator Bond. Through the grants office.
Ms. Browner. All grants are subject to audit review.
Senator Bond. How many audits did EPA do of grantees last
year?
Ms. Browner. Of the grantees or of the grants?
Senator Bond. Of the grants. You do audits of the grants.
Where the money went. Do you audit where the money goes?
Ms. Browner. Yes.
Senator Bond. And how it is used?
Ms. Browner. Yes. We have what are referred to as post-
award management reviews, 333 last year.
Senator Bond. Out of how many? What is the universe? How
many are out there, roughly?
Ms. Browner. The problem with this is it is apples and
oranges. In terms of the number of grant awards that we made
last year, we have----
Senator Bond. You can submit that for the record.
Ms. Browner. We will submit that.
[The information follows:]
Completing Financial Audits
Financial audits of grantees are audits performed by either the
Inspector General (IG) or by CPA firms under the auspices of OMB
Circular A-133 or the Single Audit Act.\1\ Grant Offices are not
permitted to perform ``financial audits.''
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\1\ The Single Audit Act and A-133 are intended to cover the
financial audits of State and local governments and institutions of
higher education and nonprofit organizations expending $300,000 or more
in grants or cost reimbursable contracts per year; that is, requires
grantees to obtain audits in accordance with these requirements to
determine the effectiveness of its financial management systems and
internal control procedures (neither the IG or the Federal Agencies are
allowed to duplicate what was done under the Single Audit Act). The
Office of the Inspector General, receives notification of the all
single audits with findings impacting EPA.
---------------------------------------------------------------------------
As applied in EPA, in addition to the audits performed under the
Single Audit Act requirements, financial audits include the IG's
financial statement audits of the State Revolving Funds Trust Funds and
financial management audits performed of grantees (examples of
financial management audits include audits of accounting systems,
procurement systems, internal controls, cash management procedures or
expenditures under a given grant or grants). During fiscal year 1998,
the IG or its representative, performed six financial audits of EPA
grantees. Additionally, there were 91 single audits with findings
impacting EPA. During fiscal year 1999, the IG has performed four
financial audits and three audits of the SRF Trust Fund. Additionally,
there have been 76 single audits issued with findings impacting EPA.
ensuring grant programmatic and administrative requirements are met
The Agency is responsible for monitoring and overseeing grantees.
EPA officials must perform the following certifications and steps
before the grant can be formally accepted and closed out:
Role of the Program Office.--The program office's responsibilities
are to certify that the deliverables of the grant have been received
and are acceptable and that the grantee has met all the programmatic
terms and conditions of the grant.
Role of the Grants Management Office.--The grants management
office`s responsibilities are to certify that the grantee has met all
administrative requirements of the grant; reconcile grantee payments to
EPA financial management system records to grantee's financial status
report and; deobligate any unliquidated obligations.
Role of the Finance Office.--The finance office is responsible for
deobligating funds and setting up and collecting any accounts
receivable, if necessary.
During fiscal year 1998, EPA formally closed out over 9,000
nonconstruction grants and over 4,000 grants through April 30 for
fiscal year 1999.
outreach and review of grantees
The eleven Grants Management Offices in EPA perform outreach to and
review of grantees through several mechanisms such as workshops and
training, technical assistance visits, evaluative onsite reviews (e.g.
evaluating grantee financial management system and cost sharing
documentation and validating data on financial reports) and desk
reviews.
During fiscal year 1998, the Grants Management Offices performed
about 468 such outreach and reviews of grantees. The number to date for
fiscal year 1999 is about 480.
EPA has developed websites on the Internet, including a tutorial,
providing many basic types of information for the public, including
step-by-step instructions for preparing a grant application.
Senator Bond. Were these financial audits to see how the
money was used or did somebody just go out and look at the----
Ms. Browner. No. They have to spend the money in accordance
with the grant award.
Senator Bond. You did make the determination they spent the
money and complied, so you could give an opinion that those
were done adequately?
Ms. Browner. The grants that we review, the 333, are
subject to the full review that every Federal agency engages in
terms of grant awards.
Senator Byrd. Mr. Chairman, would you allow for a question
without it being taking out of your time?
Madam Administrator, can you trace this money from the
source of the grant to the expenditure of it?
Ms. Browner. Yes. They are required to provide us with that
information. And if someone were to fail to provide us with
that information, then they can be required to return the
funds.
grant money used for litigation
Senator Byrd. Supposed they used some other money to carry
out what they purportedly are to do, that used this money which
is fungible. How do you know if this money is actually being
spent in accordance with your regulations and the laws?
Ms. Browner. We review and audit the grants to ensure that
it is occurring.
I think the issue perhaps--if I might, just so we can all
make sure we're understanding each other.
Senator Byrd. I do not mean to take Mr. Chairman's time.
Senator Bond. I am going to reclaim it. Don't worry about
that. If you give a brief answer on that, then I have a
hypothetical and maybe it will help get to the question that
Senator Byrd and I want to address.
Ms. Browner. As a hypothetical, we'll just say it is a
million-dollar organization that does any number of things.
They make an application to EPA to do a specific project. When
we grant that award, we make that grant, they are required to
do the work under that project. They are not allowed to use
grant funds to lobby. And we have withdrawn funds for that
reason. They are not allowed to use it in litigation.
I think the question we are all struggling with here is
because of that grant award, do they now have resources in that
million dollars that they used to do something else? I think
that is the question that is before us.
I think a more specific question that is before us is, do
organizations get grants from EPA and then turn around, using
other moneys, and sue EPA? And the answer to that is yes,
everybody from the National Home Builders Association to
environmental organizations. However, they cannot use those
grant funds to sue us, and we have rules in place. If you are
under the impression that someone has done that, we will take
immediate action.
Senator Bond. Let me pose to you a hypothetical. An
organization that has an annual operating budget of three
quarters of a million dollars and they do lots of good things.
They educate school children and they have offices. They get a
grant from EPA to educate school children. The grant is
$500,000. They have the existing three quarters of a million
dollars. They then spend a half million dollars on legal fees
to sue EPA or the Department of Transportation or the State and
the city combined and use the Federal grant money plus $250,000
left over to run their educational programs. Is this
acceptable?
Ms. Browner. If they make an application to do specific
public education and they are awarded a grant per that
application, that is all they can spend that money on. They
cannot----
Senator Bond. And it is not--you think it is not EPA's
concern that they used--that the $500,000 freed up enables them
to sue EPA or Department of Transportation?
Ms. Browner. Rest assured. We do not like being sued. I do
not like being the named respondent in these lawsuits. What the
law allows us to do is to make a solicitation for grants and to
review them. They are earmarks. There are grants that function
as earmarks that go to organizations that turn around and sue
us.
If I might give you a statistic that I think might bring
this into focus. I think it is something that deserves
attention. We were asked to look at this by another committee.
We were actually asked in that committee to look at it over a
10-year period. Over a 10-year period there were over 6,000
grant recipients who got EPA grants, 6,200. During this same
period of time there were approximately 2,000 lawsuits filed
against EPA representing something on the order of 4,000
parties, 2,000 actual lawsuits. We can give you the case
numbers and everything. Of that, in this 10-year review, 250 of
the litigants in those lawsuits, their organizations had also
received grants. This is over 10 years, a universe of 6,200
grants, 2,000 lawsuits of which 250 received grant funds.
They include people like General Electric, the Home
Builders Association, and the Environmental Defense Fund. One
of the largest recipients of grant money from EPA and one of
the litigants, and one of the organizations who love to take us
to court, is the American Lung Association. In community after
community your local American Lung chapters are receiving funds
to work with schools on asthma, and on radon. So, yes, as grant
recipients, their organizations have sued us. There are rules
against using our money to sue us.
grant audits: ig's report
Senator Bond. Madam Administrator, we have the Inspector
General's report. This one was 1998. He said that EPA did not
fulfill its obligations to adequately monitor assistance
agreement activities. The staff did not always negotiate work
plans with well-defined commitments, adequately document costs.
In prior audits, they said material weaknesses: Failed to
review grant applications, perform site visits, provide
complete certifications. And we continue to get assurances that
EPA will correct the problems. We do not see an item in the
budget request that EPA is developing a policy addressing post-
award management of grants, even though it has been committed
to issue this policy since 1997.
I might just ask a quick question. I believe the Inspector
General Ms. Tinsley is here. On the basis of your work, can you
tell us whether EPA has an understanding and a knowledge of
whether any of their grant money is used for--has been used
either directly or indirectly for litigation against the
Government? Is EPA able to ascertain that based on your work?
Ms. Tinsley. Our work has not shown that to date. We are
developing a much broader strategy to look at how the EPA
distributes funds.
Senator Bond. You continue to believe this is a material
weakness?
Ms. Browner. I want to be clear----
Senator Bond. Let Ms. Tinsley finish. Is there anything
else you want to add on that?
Ms. Tinsley. I can add that the agency is aware that there
are problems. They have recently issued a policy to do this
grant oversight and to do reviews as grants are delivered to
make sure that the grants identify what the grantee is going to
do specifically. It is a major part of EPA's budget. It's a
difficult problem. There are a lot of grantees.
Senator Bond. If you have further comments on the policy or
the status of the program, we would invite you to submit it to
the committee because I am getting a sense that we may not have
gone far enough in ensuring that we are not using taxpayer
dollars indirectly to finance lawsuits which challenge pilot
policies and programs established by the Congress.
Now, Madam Administrator, you wish to comment.
Ms. Browner. The Inspector General I know will correct me
if I am wrong, but I do not believe that the Inspector General
who also looks at grant awards and does tell us when they find
problems on specific grants has ever come to us and said one of
your grants was used to sue you. I do not believe they have
ever found one and I think she is indicating no.
Senator Bond. I think our question is, it is not whether
the money is used directly. It is the fact that funds are
fungible and that it is a potential to displace and utilize
those resources, freeing up other funds for litigation.
Ms. Browner. Mr. Chairman, as I said, I don't like being
sued any more than any one else likes being sued. I believe
this is an issue Government-wide and I believe there are
obviously constitutional issues. Organizations, simply because
they receive a grant to do specific work, do not give up their
right to publicly disagree with us and drag us into court.
Senator Bond. Exactly. But we, as taxpayers, do not have
any obligation to keep funding. Let me turn to Senator Byrd----
consent decrees
Senator Craig. Mr. Chairman, could I ask that the director
submit us a list that goes directly to this and that, could we
find out from you, since 1993, which organizations have brought
suits against EPA that have resulted in, very important here,
consent decrees which led to new requirements on the agency or
the public at large?
Ms. Browner. That is a different question than the one we
have----
Senator Craig. Not really.
Ms. Browner. I am happy to answer it. We have provided this
before. I think we provided it, if not to this committee last
year, a different committee. We will be happy to provide it
again.
[The information follows:]
Organizations That Have Brought Lawsuits Against EPA That Have Resulted
in Consent Orders That Led to New Requirements
Attached is a chart listing all of EPA's consent orders in
defensive judicial litigation since 1989. For each consent order, the
chart provides the case caption, a list of the parties to the lawsuit,
the allegations in the complaint (including, for lawsuits alleging that
EPA failed to carry out a non-discretionary duty by a statutory
deadline, the statutory deadline), a brief description of the order,
and a list of the parties that were involved in negotiation of the
order.
Because some of the EPA attorneys who worked on older consent
orders are no longer employed by the Agency and because some of our
older litigation files contain limited information, we had some
difficulty assembling this chart for some cases. However, we believe
that the attached chart is reasonably accurate and complete.
Please note that virtually all the consent orders in the chart
merely establish court deadlines for EPA actions that are required by
statute and do not dictate the content of those actions. Where they
involve a commitment to undertake rulemaking, EPA's actions would be
subject to the notice-and-comment provisions of the Administrative
Procedure Act. Like all consent orders, each of these orders was
reviewed at a high level within the Department of Justice and by a
court to ensure that it was fair, reasonable, and in the public
interest. In addition, it is the policy of the Department of Justice
that the United States not consent to court orders which contain
provisions for injunctive relief which could not be ordered by a court
unilaterally. Finally, you should be aware that Section 113(g) of the
Clean Air Act requires EPA to provide notice of and opportunity to
comment on defensive consent orders under the Clean Air Act before they
are final or filed with a court, a practice to which EPA carefully
adheres.
CONSENT ORDERS RESOLVING DEFENSIVE JUDICIAL LITIGATION BETWEEN EPA AND OTHER PARTIES
[January 1, 1989-March 31, 1999 \1\]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Parties to consent order (other than Allegations in complaint against EPA,
Case EPA) including original statutory deadline Description of consent order Parties present in negotiations
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Alabama Rivers Alliance v. Alabama Rivers Association, Edward Mudd Failure to establish total maximum EPA agreed to establish TMDLs for all Parties to the consent order.
Hankinson, No. CV-97-S-2518-M II, Ouida Fritschi, and the Homewood daily loads (TMDLs) by statutory WQLs on Alabama's 1996 CWA Sec.
(N.D.Ala.) and Edward Mudd, II v. Citizens Association. deadline (30 days from alleged 303(d) list by 2005 if Alabama does
Hankinson, No. CV-97-S-0714-M constructive submission of no TMDLs) not do so. EPA will also develop a
(N.D.Ala.). and failure to undertake monitoring report evaluating and making
necessary to identify all water recommendations regarding Alabama's
quality limited segments (WQLs) in water quality monitoring and
Alabama. CWA Sec. 303(d). assessment program and CWA Sec.
303(d) listing process.
American Littoral Society v. EPA, American Littoral Society and Public Failure to establish total maximum EPA agreed, among other things, to Parties to the consent order and
No. 96-489 (E.D.Pa.). Interest Research Group of daily loads (TMDLs) and lists of establish TMDLs for Pennsylvania State of Pennsylvania (non-
Pennsylvania. impaired waters by statutory deadline waters not meeting water quality party).
(30 days from alleged constructive standards by 2009 if Pennsylvania does
submission of no TMDLs or lists--7/79, not do so, take final action regarding
as alleged by plaintiffs). CWA Sec. Pennsylvania's CWA Sec. 303(d) list,
303(d). Failure to approve develop report on Pennsylvania's
Pennsylvania's continuing planning monitoring and listing program, review
process by statutory deadline (30 days Pennsylvania's continuing planning
from submission) and review it from process, and request comment on TMDLs
time to time thereafter. CWA Sec. and lists from Fish & Wildlife Service
303(e). Failure to consult under ESA and National Marine Fisheries Service.
on list and TMDL approvals.
American Littoral Society v. EPA, American Littoral Society and Sierra Failure to comply with mandatory EPA agreed, among other things, to Parties to the consent order and
No. 96-591 (SLR) (D.Del.). Club. duties, including establishment of establish TMDLs for Delaware waters State of Delaware (non-party).
total maximum daily loads (TMDLs) by not meeting water quality standards by
statutory deadline (30 days from 2006 if Delaware does not do so,
alleged constructive submission of no consider basis for Delaware's 1998
TMDLs or lists--7/79, as alleged by listing decision and take appropriate
plaintiffs). CWA Sec. 303(d). Failure action, develop report on Delaware's
to approve Delaware's continuing monitoring and listing program, review
planning process by statutory deadline Delaware's continuing planning
(30 days from submission) and review process, and request comment on TMDLs
it from time to time thereafter. CWA and lists from Fish & Wildlife Service
Sec. 303(e). Failure to consult under and National Marine Fisheries Service.
ESA on list and TMDL approvals.
American Lung Association of American Lung Association of Arizona, Failure to promulgate Federal EPA agreed to a schedule for issuance Parties to the consent order.
Arizona v. Browner, No. Civ. 96- Carolyn Aspegren, and William Grimm. implementation plan (FIP) for non- of a FIP for Phoenix, Arizona ozone
1856 PHX ROS (D. Ariz.). attainment area by statutory deadline nonattainment area for reductions of
(2 years after finding of failure of volatile organic compounds (VOCs)
State implementation plan (SIP)). CAA under CAA Sec. 182(b)(1).
Sec. 110(c).
American Lung Association of American Lung Association, Urban Failure to promulgate Federal EPA agreed to a schedule regarding Parties to the consent order.
Northern Virginia v. Browner, Civ. Protectors, Sierra Club, Friends of implementation plan (FIP) for non- issuance of a FIP for ozone
No. 1:96 CVO 1388 (and the Earth, Delaware Valley Citizens attainment area by statutory deadline nonattainment areas in Washington,
consolidated cases Civ. No. 1:96 Council for Clean Air, Chester (2 years after finding of failure of D.C., Baltimore, MD, and Philadelphia,
CVO 1392 and Civ. No. 1:96 CVO Residents Concerned for Quality State implementation plan (SIP)). CAA PA for reductions of volatile organic
1393) (D.D.C.). Living, Communities Organized to Sec. 110(c). compounds (VOCs) under CAA Sec.
Improve Life, Odette McDonald, and 182(b)(1).
Katherine Nueslein.
American Lung Association v. American Lung Association (ALA); ALA of Failure to review criteria under CAA EPA agreed to a schedule for review of Parties to the consent order.
Browner, No. 92-5316 (E.D.N.Y.). Nassau (NY), Queens (NY), and Brooklyn Sec. 108 and national ambient air NAAQS for sulfur oxides.
(NY); States of Maine and New Jersey; quality standard (NAAQS) for sulfur
Paul Henry, Noberto Cabballery, oxides by statutory deadline (5 years
Alexandra Cabballery, and Howard Hills. after completion of previous NAAQS
review for sulfur oxides). CAA Sec.
109(d).
Atlantic States Legal Foundation v. Atlantic States Legal Foundation....... Failure to promulgate regulations EPA agreed to schedule for promulgating Parties to the consent order.
EPA, No. 95-CV-1788 (N.D.N.Y.). identifying dangerous levels of lead regulations identifying dangerous
in paint, dust and soil by statutory levels of lead.
deadline of 4/28/94. TSCA Sec. 403.
Brewster v. Reilly, No. 90-6367-HO William L. Brewster.................... Failure to promulgate drinking water EPA agreed to schedules for issuing Parties to the consent order.
(D.Or.). regulations by statutory deadline of 6/ drinking water regulations.
89. SDWA Sec. 1412(b).
Bull Run Coalition v. EPA, No. 88- Bull Run Coalition, Citizens Interested Failure to promulgate drinking water EPA agreed to schedules for issuing Bull Run Coalition.
6097 (D.Or.). in Bull Run, Inc., Frank Gearhart, regulations by statutory deadline of drinking water regulations.
Joseph L. Miller, Kathy Williams, 12/87. SDWA Sec. 1412(b).
Lucia N. Skov, Vera Defoe, Mark Wigg,
Samuel E. Sargent, Frances Price Cook,
and William L. Brewster.
Bull Run Coalition v. EPA, No. 88- Bull Run Coalition, Citizens Interested Failure to promulgate drinking water EPA agreed to schedules for issuing Bull Run Coalition.
6444 (D.Or.). in Bull Run, Inc., Frank Gearhart, regulations by statutory deadline of 6/ drinking water regulations.
Joseph L. Miller, Kathy Williams, 88. SDWA Sec. 1412(b).
Lucia N. Skov, Mark Wigg, Samuel E.
Sargent, Frances Price Cook, William
L. Brewster, Cherie Holenstein, Ralph
Frohwerk, Georgia Frohwerk, and
Margaret H. Thomas.
Citizens for Balanced Citizens for Balanced Transportation, Failure to promulgate federal EPA agreed to a schedule regarding Parties to consent order and
Transportation v. EPA, No. 96-W- Bob Yuhnke, and Earth Law. implementation plan (FIP) for carbon action on SIP measures for carbon Colorado Air Quality Control
645 (D. Colo.). monoxide and particulate matter (PM- monoxide (CO) and particulate matter Commission (non-party).
10) for Denver within 2 years of EPA (PM-10) for Denver.
finding of SIP failure. CAA Sec.
110(k).
Citizens Interested in Bull Run, Citizens Interested in Bull Run, Inc... Failure to promulgate drinking water EPA agreed to schedules for issuing Parties to consent order.
Inc. v. EPA, No. CIV 92-1587 regulations by statutory deadline of 6/ drinking water regulations.
(D.Or.). 91. SDWA Sec. 1412(b).
Citizens Interested in Bull Run, Citizens Interested in Bull Run, Inc... Failure to promulgate regulations EPA agreed to a schedule for issuing Parties to the consent order.
Inc. v. Reilly, No 92-6258 (D.Or.). requiring federal agencies to conform regulations requiring federal agencies
their procurement regulations with to conform their procurement
title VI of the CAA by statutory regulations with Title VI of the CAA.
deadline of 5/15/92. CAA Sec. 613.
Citizens to Preserve the Ojai v. Citizens to Preserve the Ojai.......... Failure to promulgate Federal EPA agreed to schedules regarding Parties to the consent order.
EPA, No. CV 88-0982 HLH (C.D.Cal.). implementation plan (FIP) for non- issuance of a FIP for ozone for the
attainment area by statutory deadline Ventura Air Quality Management
(4-10 months from SIP disapproval). District.
CAA Sec. 110(c).
Clinton County Commissioners v. Clinton County Commissioners and Arrest Response action at Drake Chemical EPA agreed to discontinue soil Parties to the consent order.
EPA, No. 4:CV-96-00181 (M.D.Pa.). the Incinerator Remediation, Inc. Superfund Site violated CERCLA and excavation and incinerator test
RCRA and threatened human health and operations at Drake Chemical Superfund
the environment. Site until further risk analysis was
completed by EPA and the court issued
a ruling with respect to plaintiffs' 2/
96 motion for a preliminary injunction.
Clinton County Commissioners v. Clinton County Commissioners and Arrest Response action at Drake Chemical Upon plaintiffs' motion for injunctive Parties to the consent order.
EPA, No. 4:CV-96-00181 (M.D.Pa.). the Incinerator Remediation, Inc. Superfund Site violated CERCLA and relief pending appeal, EPA agreed not
RCRA and threatened human health and to commence full-scale operation of
the environment. the incinerator before 5/15/97 or
before Court of Appeals for the Third
Circuit issued decision (in exchange
for plaintiffs' agreement that EPA
could proceed with test operations).
Coalition for Clean Air, Inc. v. Coalition for Clean Air, Inc., and Failure to promulgate Federal EPA agreed to schedules regarding Parties to the consent order.
EPA, No. CV 88-4414 HLH (C.D. Sierra Club. implementation plan (FIP) for non- issuance of FIPs for carbon monoxide
Cal.). attainment area by statutory deadline (CO) and ozone for the South Coast Air
(4-10 months from SIP disapproval). Quality Management District.
CAA Sec. 110(c).
Coalition for Clean Air, Inc. v. Coalition for Clean Air, Inc., Natural Failure to fulfill commitment in EPA agreed to a schedule to conclude Parties to the consent order.
EPA, No. 97-6916 (C.D.Cal.). Resources Defense Council, Inc., and approved California ozone State the public consultative process on the
Communities for a Better Environment. implementation plan (SIP) approval to California ozone SIP.
make certain determinations by 12/31/
97 as part of a public consultative
process on Federal and State measures.
Complaint was amended in 1998 to
include this claim.
Cook v. Reilly, No. 89-6307E Frances P. Cook and Citizens Interested Failure to issue standards of EPA agreed to a schedule for regulation Parties to the consent order.
(D.Or.). in Bull Run, Inc. performance for stationary source by of emissions of volatile organic
statutory deadline (4 years after the compounds (VOCs) from dry cleaners
category is listed under CAA Sec. under CAA Sec. 111.
111(b)). CAA Sec. 111.
Cronin v. Browner, No. 93-0314 John J. Cronin, the Hudson Riverkeeper, Failure to promulgate regulations for EPA agreed to propose regulations for Parties to the consent order.
(AGS) (S.D. N.Y.). Cynthia E. Poten, the Delaware cooling water intake structures by cooling water intake structures by 7/2/
Riverkeeper, The Hudson Riverkeeper statutory deadline of 2/15/74 for new 99 and take final action by 8/13/01.
Fund, Inc., The New York Coastal sources and 7/1/77 for existing
Fishermen's Association, Inc., The sources. CWA Sec. Sec. 301(b), 306,
American Littoral Society, Inc., and 316(b).
Michael Lozeau, the San Francisco
BayKeeper, BJ Cummings, the Puget
Soundkeeper, Terrance E. Backer, the
Soundkeeper, The Long Island
Soundkeeper Fund, Inc., Andrew
Willner, the Baykeeper for the New
York and New Jersey Harbor Estuary,
Joseph E. Payne, the Casco BayKeeper,
Terrance Tamminen, the Santa Monica
BayKeeper, John Torgan, the
Narragansett BayKeeper, Save the Bay,
Inc.
Defend the Bay, Inc. v. Marcus, No. Defend the Bay, Inc.................... Failure to establish total maximum EPA agreed to establish TMDLs for Parties to the consent order.
97-3997 MMC (N.D.Cal.). daily loads (TMDLs) for Newport Bay by Newport Bay by 2001 if California does
statutory deadline (30 days from not do so.
alleged constructive submission of no
TMDLs--6/79, as alleged by
plaintiffs). CWA Sec. 303(d). Failure
to disapprove California's 1994 CWA
Sec. 303(d) list for impaired waters
despite omission of Newport Bay.
Defenders of Wildlife v. Browner, Defenders of Wildlife, George Marsik, Failure to act on Arizona's submission EPA agreed to take final action on Parties to the consent order.
No. CIV 93-234 TUC ACM (D.Ariz.). Jerry Van Gasse, and James Slingluff. of water quality standards by water quality standards submitted by
statutory deadline of 5/92; failure to Arizona under CWA Sec. 303(c) by 4/30/
propose federal water quality 94; EPA agreed to establish TMDLs for
standards by statutory deadlines of 12/ mercury in certain waters in Arizona
9/93 and 7/29/94; failure to establish by 2001 if Arizona does not do so.
total maximum daily loads (TMDLs) by
statutory deadline (30 days from
alleged constructive submission of no
TMDLs). CWA Sec. 303 (c) and (d).
DiSimone v. Browner, No. 97-1987 Barry DiSimone and Donald Steuter Failure to implement Federal EPA agreed to a schedule for rulemaking Parties to the consent order.
(D.Ariz.). (represented by Arizona Center for Law implementation plan (FIP) commitments to implement the FIP for carbon
in the Public Interest). that came due at various times in mid- monoxide in Phoenix, Arizona.
1990's. CAA Sec. 110(c).
Donison v. Browner, No. CIV 92-6280- Clare Donison, Ralph Frowerk, Frank Failure to promulgate drinking water EPA agreed to schedules for issuing Parties to the consent order.
HO (D.Or.). Gearhart, Kathy Williams, and Citizens regulations by statutory deadline of 6/ drinking water regulations under SDWA.
Interested in Bull Run, Inc. 89. SDWA Sec. 1412(b).
Environmental Technology Council v. Environmental Technology Council and Failure to revise regulations governing EPA agreed to a rulemaking schedule Parties to the consent order;
Browner, Nos. 94-2119 and 94-2346 Edison Electric Institute. mixtures and treatment residues of regarding revisions to a specific Chemical Manufacturers
(D.D.C.). hazardous waste by statutory deadline section of the regulatory definition Association (intervenor), the
of 10/1/94. Pub. L. No. 102-389 (1992). of hazardous waste, including possible American Forest and Paper
exemptions from hazardous waste Association (intervenor), the
regulation. Chamber of Commerce of the
United States (intervenor), the
American Iron and Steel
Institute (intervenor), the
American Petroleum Institute
(intervenor), and The
Fertilizer Institute
(intervenor).
Environmental Defense Fund v. Environmental Defense Fund............. Failure to determine whether certain Required EPA to complete several RCRA Parties to the consent order.
Browner, No. 89-0598 (D.D.C.). hazardous wastes should be listed as rulemakings required by statute by
hazardous wastes by statutory deadline various dates, including determining
of 2/8/86 (RCRA Sec. 3001(e)); whether certain solid wastes should be
failure to promulgate toxicity listed as hazardous wastes and
characteristic by statutory deadline 3/ producing studies of certain wastes.
8/87 (Sec. 3001(g)).
Environmental Defense Fund v. EPA, Environmental Defense Fund............. Failure to determine whether mining Required EPA to issue regulatory Parties to the consent order.
No. 91-0429 (D.D.C.). wastes should be regulated under RCRA determination under RCRA Sec. 3001(b)
Subtitle C by statutory deadline of 1/ regarding status of mineral processing
31/91 (RCRA Sec. 3001(b)). wastes under Subtitle C of RCRA by 5/
20/91.
Environmental Defense Fund v. EPA, Environmental Defense Fund, Sierra Failure to promulgate conformity rule EPA agreed to a schedule for issuance Parties to the consent order.
No. 92-1636 (N.D.Cal.). Club, and Carla Baird. by statutory deadline of 11/15/91. CAA of conformity rules under CAA Sec.
Sec. 176(c)(4)(A). 176(c)(4).
Environmental Defense Fund v. Environmental Defense Fund, Natural Failure to review criteria under CAA EPA agreed to a schedule to review the Parties to the consent order.
Reilly, No. 85-9507 (S.D.N.Y.). Resources Defense Council, Inc., Sec. 108 and secondary national secondary NAAQS for sulfur oxides
National Parks and Conservation ambient air quality standard (NAAQS) under CAA Sec. 109(d).
Association, and States of New York, for sulfur oxides by statutory
Connecticut, Massachusetts, New deadline (5 years after completion of
Hampshire, Minnesota, and Rhode Island. previous secondary sulfur oxides NAAQS
review). CAA Sec. 109(d).
Forest Guardians v. EPA, Civ. No. Forest Guardians and Southwest Failure to establish total maximum EPA agreed to establish TMDLs for all Parties to the consent order.
96-0826 LH (D.N.M.). Environmental Center. daily loads (TMDLs) by statutory water quality limited segments on New
deadline (30 days from alleged Mexico's 1998 CWA Sec. 303(d) list by
constructive submission of no TMDLs--7/ 2006 if New Mexico does not do so.
79, as alleged by plaintiffs). CWA
Sec. 303(d).
Frohwerk v. Reilly, No. CIV 91-6549- Ralph Frowerk, Citizens Interested in Failure to promulgate drinking water EPA agreed to schedules for issuing Parties to the consent order.
TC (D.Or.). Bull Run, Inc., Frank Gearhart, Joseph regulations by statutory deadline of 6/ drinking water regulations.
Miller and Kathy Williams. 89. SDWA Sec. 1412(b)..
Frohwerk v. Reilly, No. CIV 90-6363- Ralph Frowerk, Frank Gearhart, Kathy Failure to promulgate drinking water EPA agreed to schedules for issuing Parties to the consent order.
JO (D.Or.). Williams, William L. Brewster and regulations by statutory deadline of 6/ drinking water regulations.
Citizens Interested in Bull Run, Inc. 90. SDWA Sec. 1412(b).
Gearhart v. Browner, Civil No. 89- Frank Gearhart, Citizens Interested in Failure to propose and promulgate EPA agreed to issue sewage sludge Natural Resources Defense
6266-HO (D.Or.). Bull Run, Inc., Kathy Williams, regulations for sewage sludge by regulations under CWA Sec. 405 as Council, Inc. and all
Frances Price Cook, Natural Resources statutory deadlines (propose round follows : promulgate round one--11/25/ plaintiffs.
Defense Council, Inc. (intervenor), one--11/30/86; promulgate round one--8/ 92; notice of round two pollutants--5/
and Association of Municipal Sewage 31/87; propose round two--7/31/87; 24/93; propose round two--12/15/99;
Authorities (AMSA) (intervenor). promulgate round two--6/15/88). CWA promulgate round two--12/15/01.
Sec. 405(d).
Gearhart v. Reilly, No. 91-2435 Bull Run Coalition, Frank Gearhart, and Failure to submit a report to Congress Required EPA to submit report to Parties to the consent order.
(D.D.C.). Edison Electric Institute. on fossil fuel combustion wastes by congress and to issue regulatory
statutory deadline of 10/21/82; determinations under RCRA Sec.
failure to determine whether to 3001(b) regarding the status under of
regulate these wastes under RCRA fossil fuel combustion wastes under
Subtitle C by statutory deadline (6 Subtitle C of RCRA by various dates.
months after submission of report to
Congress). RCRA Sec. 3001(b).
Golden Gate Audubon Society v. Golden Gate Audubon Society, Marin Failure to promptly propose water EPA agreed to propose and promulgate Sierra Club Legal Defense Fund
Browner, No. CIV-5-93 646 LKK PAN Audubon Society, Santa Clara Audubon quality standards; failure to water quality standards for the San represented plaintiffs.
(E.D.Cal.). Society, Ohlone Audubon Society, Mount promulgate standards by statutory Francisco Bay Delta by 12/93, and 12/
Diablo Audubon Society, Sequoia deadline (90 days after proposal). CWA 94, respectively.
Audubon Society, Madrone Audubon Sec. 303(c).
Society, Point Reyes Bird Observatory,
Environmental Defense Fund, Natural
Resources Defense Council, Inc., The
Bay Institute, Save San Francisco Bay
Association, Pacific Coast Fisheries
Associations, California Native Plant
Society, Citizens for a Better
Environment, United Anglers of
California, Sierra Club, and
Streaminders Chapter of the Izaak
Walton League.
Heal the Bay, Inc., v. Carol Heal the Bay, Inc., Santa Monica Failure to establish total maximum EPA agreed to backstop development of Natural Resources Defense
Browner, No. C98-4825 (SBA) BayKeeper, Inc., and Terry Tamminen. daily loads (TMDLs) by statutory TMDLs for the Los Angeles region of Council, Inc., Heal the Bay,
(N.D.Cal.). deadline (30 days after alleged California by 2012. EPA also agreed to Inc., and Santa Monica
constructive submission of no TMDLs); review the State's continuing planning BayKeeper, Inc.
failure to review State continuing process and to develop a report
planning process from time to time; evaluating the State's monitoring
failure to monitor as necessary to program.
identify all water quality limited
segments. CWA Sec. 303(d).
Institute for Energy and Not known. In process of obtaining Failure to act on petition to add EPA agreed to a schedule to take action Parties to the consent order.
Environmental Research v. EPA, No. consent decree from DOJ archives. substance to list of class I on a petition to list certain
93-2266 (D.D.C.). substances by statutory deadline (1 hydrochlorofluorcarbons (HCFCs) as
year after receipt of petition). CAA class I ozone depleting substances
Sec. 602(c)(3). under CAA Sec. 602(c).
Kansas Natural Resource Council, Kansas Natural Resource Council, Inc., Failure to establish total maximum EPA agreed, among other things, to Parties to the consent order.
Inc. v. Browner, No. 95-2490-JWL Sierra Club, and State of Kansas daily loads (TMDLs) and lists of establish TMDLs for Kansas waters not
(D.Kan.). (intervenor/defendant). impaired waters by statutory deadline meeting water quality standards by
(30 days after constructive submission 2006 if Kansas does not do so, and to
of no TMDLs or lists--7/79, as alleged review Kansas' continuing planning
by plaintiffs). CWA Sec. 303(d). process.
Failure to approve Kansas' continuing
planning process by statutory deadline
(30 days after submission--3/73, as
alleged by plaintiffs); failure to
review continuing planning process
from time to time. CWA Sec. 303(e).
Legal Environmental Assistance Legal Environmental Assistance Failure to promptly propose federal EPA agreed to either propose water Parties to the consent order.
Foundation v. Browner, No. CV-96- Foundation. water quality standards. CWA Sec. quality standards for Alabama or
ETC-2454-S (N.D.Ala.). 303(c). withdraw outstanding disapprovals of
Alabama water quality standards by 2/
98.
Legal Environmental Assistance Legal Environmental Assistance Failure to promptly propose water EPA agreed to promulgate revised water Parties to the consent order.
Foundation, v. Browner, Civ. No. Foundation. quality standards; failure to quality standards for Florida within
92-40252-WS (N.D.Fla.). promulgate standards by statutory 22 months unless Florida adopts
deadline (90 days after proposal). CWA revised standards addressing EPA's
Sec. 303(c). previous disapproval.
Maryland Environmental Interest Maryland Environmental Interest Group, Failure to promulgate regulations EPA agreed to a schedule for issuing Parties to the consent order.
Group v. Reilly, No. 92-1225 Lisa Satterfield, and Sierra Club. regarding the use and disposal of final rule on use and disposal of
(D.D.C.). certain class I substances during the Class I substances during servicing of
servicing of refrigeration systems by refrigeration systems under CAA Sec.
statutory deadline of 1/1/92. CAA Sec. 608(a)(1).
608(a)(1).
Miller v. EPA, No. 89-6328 (and Joseph L. Miller, Ralph Frohwerk, Failure to promulgate drinking water EPA agreed to schedules for issuing Parties to consent order.
consolidated cases Frohwerk v. Citizens Interested in Bull Run, Inc., regulations by statutory deadline of 6/ drinking water regulations.
EPA, No. 90-6363, Citizens Kathy Williams, and Clare Donison. 87 (Miller). SDWA Sec. 1412(b).
Interested in Bull Run, No. 92-
1587, Frohwerk v. EPA, No. 91-
6549, and Donison v. EPA, No. 92-
6280) (D.Or.).
National Wildlife Federation v. National Wildlife Federation, Great Failure to promulgate by statutory EPA agreed to promulgate by 2/27/98 Parties to the consent order.
Browner, No. 97-1504-HHK (D.D.C.). Lakes Water Quality Coalition, and deadline of 3/23/97 federal water federal water quality standards for
State of New York (defendant). quality standards for Great Lakes Great Lakes States that did not make
States that failed to make timely timely submissions of State programs
submissions of state water quality under CWA Sec. 118.
programs. CWA Sec. 118(c)(3).
National Wildlife Federation v. National Wildlife Federation........... Failure to issue water quality guidance EPA agreed to promulgate Great Lakes Parties to the consent order.
Browner, No. 92-2338-CCR (D.D.C.). for the Great Lakes System by Water Quality Initiative Guidance
statutory deadline of 6/20/92. CWA under CWA Sec. 118 by 3/13/95.
Sec. 118(c)(2).
Natural Resources Defense Council, Natural Resources Defense Council, Inc Failure to promulgate regulations for EPA agreed to propose (by 12/97) and Parties to the consent order.
Inc. v. Browner, No. 95-634 (PLF) storm water discharges by statutory take final action (by 10/99) on
(D.D.C.). deadline of 10/1/93. CWA Sec. rulemaking for regulation of storm
402(p)(6). water discharges under CWA Sec.
402(p)(6) (``Phase 2'').
Natural Resources Defense Council, Natural Resources Defense Council, Inc. Failure to promulgate new source EPA agreed to a schedule regarding Parties to the consent order.
Inc. v. EPA, No. 92-2093 and Sierra Club. performance standards for solid waste issuance of standards of performance
(E.D.N.Y.) and Sierra Club v. EPA, incinerators by statutory deadline (11/ for municipal solid waste and medical
No. 93-0284 (E.D.N.Y.). 15/91 for municipal waste combusters waste incinerators under CAA Sec. 129.
and 11/15/92 for medical waste
incinerators). CAA Sec. 129(a)(1)(A).
Natural Resources Defense Council, Natural Resources Defense Council, Failure to determine whether used oil EPA agreed to determine whether non- Parties to the consent order.
Inc. v. EPA, No. 90-0694 (D.D.C.). Inc., Hazardous Waste Treatment should be listed as a hazardous waste recycled used oil should be listed as
Council, and Association of Petroleum by statutory deadline (proposal--11/8/ a hazardous waste by 5/1/92.
Re-refiners. 85; final rule--11/8/86). RCRA Sec.
3014(b).
Natural Resources Defense Council, Natural Resources Defense Council, Inc. Failure to issue national toxics water Agreement on attorneys fees and Parties to the consent order.
Inc. v. EPA, No. 92-2369 (D.N.J.). and New Jersey Public Interest quality standards rule by statutory dismissal of underlying action
Research Group. deadline of 2/92. CWA Sec. 303(c). challenging national toxics water
quality standards rule.
Natural Resources Defense Council, Natural Resources Defense Council, Inc Failure to act on petition to add EPA agreed to a schedule to take action Parties to the consent order.
Inc. v. EPA, No. 93-1946 (D.D.C.). substance to list of Class I on a petition to add methyl bromide to
substances by statutory deadline (1 list of Class I substances, and
year after receipt of petition). CAA accelerate phase out of certain
Sec. 602(c)(3). Failure to promulgate chlorofluorocarbons (CFCs) under CAA
regulations to phase out production of Sec. Sec. 601 and 604.
Class I substances by statutory
deadline of 9/15/91. CAA Sec. 604(c).
Natural Resources Defense Council, Natural Resources Defense Council, Inc Failure to promulgate revisions to EPA agreed to promulgate revisions to Parties to the consent order.
Inc. v. Reilly, No. 88-3199 CERCLA National Contingency Plan (NCP) the CERCLA NCP Plan by 2/5/90.
(D.D.C.). by statutory deadline of 4/17/88.
CERCLA Sec. 105(b).
Natural Resources Defense Council, Natural Resources Defense Council, Inc Petitioner sought review of EPA EPA agreed to a schedule after remand Parties to the consent order.
Inc. v. Reilly, No. 92-1137 decision not to require on-board vapor in NRDC v. Reilly, 983 F.2d 259 (D.C.
(consolidated with Nos. 92-1142, recovery for autos under CAA Sec. Cir. 1993), concerning onboard vapor
92-1157, 92-1222, 92-1260, and 92- 202(a)(6) (which established statutory recovery for cars under CAA Sec.
1243) (D.C. Cir.). deadline of 11/15/91 for promulgation 202(a)(6).
of on-board standards). On remand to
EPA, petitioners sought a schedule for
Agency action consistent with D.C.
Circuit's opinion.
Natural Resources Defense Council, Natural Resources Defense Council, Failure to promulgate by statutory EPA agreed to propose and take final Parties to the consent order.
Inc. v. Browner, No. 89-2980 Inc., Public Citizen, Inc., American deadline of 2/4/91 effluent guidelines action with respect to effluent
(D.D.C.). Forest & Paper Association in accordance with required plan; guidelines for 12 point source
(intervenor), and Chemical failure to issue required plan by categories, ending in 2003; EPA agreed
Manufacturers Association (intervenor). statutory deadline of 2/4/88. CWA Sec. to conduct studies for 11 point source
Sec. 301(b), 304(m), 306(b) and categories; EPA agreed to provide
307(b). plaintiffs with a semi-annual status
report. Consent order entered in 1992,
amended in 1997 and thereafter.
Nelson v. Reilly, No. 92-6260 Nelson, Gearhart, Kelly, and Citizens Failure to revise certification test EPA agreed to a schedule regarding Parties to the consent order.
(D.Or.). for Bull Run, Inc. procedures for light-duty trucks and issuance of certification test
vehicles by statutory deadline of 11/ procedures under CAA Sec.
15/91. CAA Sec. 206(a)(4)(A). 206(a)(4)(A).
Northwest Environmental Advocates Northwest Environmental Advocates and Failure to approve or disapprove EPA agreed to establish 38 TMDLs in 5 Parties to the consent order and
v. EPA, No. C91-427 (W.D.Wash.). Northwest Environmental Defense Center. Washington `s CWA Sec. 303(d) list years if Washington does not do so. State of Washington (non-
and total maximum daily loads (TMDLs) party).
by statutory deadline (30 days after
State's submission); failure to
establish reasonable schedule for TMDL
development; failure to disapprove
Washington's continuing planning
process and NPDES permit program as of
7/27/79. CWA Sec. 303(d).
Northwest Environmental Advocates Northwest Environmental Advocates and Failure to approve or disapprove EPA agreed to exercise all reasonable Parties to the consent order.
v. EPA, No. C94-1666R (W.D.Wash.). Northwest Environmental Defense Center. Oregon's list of water quality limited diligence to see that Oregon's 1994
waters by statutory deadline (30 days CWA Sec. 303(d) list was submitted
after State's submission). CWA Sec. before 9/30/95 and approved no later
303(d). than 11/30/95.
Ober v. Browner, No. CIV 94-1318 Edward Ober and Robin Silver Failure to promulgate Federal EPA agreed to a schedule regarding Parties to the consent order.
PHX PGR (D.Ariz.). (represented by Arizona Center for Law implementation plan (FIP) for non- issuance of a FIP for particulate
in the Public Interest). attainment area by statutory deadline matter (PM-10), for the Phoenix,
of 3/4/94. CAA Sec. 110(c). Arizona area.
Ohio Valley Environmental Ohio Valley Environmental Coalition, Failure to establish total maximum EPA agreed, among other things, to Parties to the consent order;
Coalition, Inc. v. Browner, Nos. Inc., West Virginia Highlands daily loads (TMDLs) and lists of establish TMDLs for West Virginia West Virginia Chamber of
2:95-0529, 2:96-0091 (S.D.W.Va.). Conservancy, Inc., Rogenia Fout, impaired waters by statutory deadline waters not meeting water quality Commerce, West Virginia Coal
Thomas E. Keating, and Bill Ragette. (30 days after alleged constructive standards by 2006 if West Virginia Association, West Virginia Farm
submission of no TMDLs or lists--7/79, does not do so, and consider certain Bureau, West Virginia Forestry
as alleged by plaintiffs). CWA Sec. factors in reviewing West Virginia's Association, West Virginia
303(d). lists of impaired waters. Mining and Reclamation
Association (intervenors).
Oregon Natural Resources Council, Oregon Natural Resources Council....... Failure to promulgate rule establishing EPA agreed to a schedule for issuing Parties to the consent order.
Inc. v. Browner, No. 93-79 (D.Or.). specifications for detergent additives rules on detergent additives for
for gasoline by statutory deadline of gasoline under CAA Sec. 211(l).
11/15/92. CAA Sec. 211(l).
Oregon Natural Resources Council, Oregon Natural Resources Council and Failure to review criteria under CAA EPA agreed to a schedule for review of Parties to the consent order.
Inc. v. Reilly, No. 91-6529 individual citizen plaintiffs. Sec. 108 and national ambient air NAAQS for NO2 under CAA Sec. 109(d).
(D.Or.). quality standard (NAAQS) for nitrogen
dioxide (NO2) by statutory deadline (5
years after completion of previous NO2
NAAQS review). CAA Sec. 109(d).
Pacific Coast Federation of Pacific Coast Federation of Fishermen's Failure to establish total maximum EPA agreed to establish TMDLs for the Parties to the consent order.
Fishermen's Associations v. Association, Golden Gate Fishermen's daily loads (TMDLs) for 17 North Coast 17 North Coast rivers by 2008 if
Marcus, No. 95-4474 MHP (N.D.Cal.). Association, Sierra Club, rivers that California included in its California does not do so.
Environmental Protection Information 1994 CWA Sec. 303(d) list of impaired
Center, Coast Action Group, Friends of waters by statutory deadline (30 days
the Garcia California Trout, Klamath after alleged constructive submission
Forest Alliance, Mendocino in 12/94 of no TMDLS for those listed
Environmental Center, Willits rivers). CWA Sec. 303(d).
Environmental Center, California
Wilderness Coalition, Friends of the
Navarro, South Fork Mountain Defense
Committee, Northcoast Environmental
Center.
Sierra Club v. Browner, No. 96-1747 Sierra Club............................ Failure to take various actions EPA agreed to a schedule to take Parties to the consent order;
(consolidated with No. 95-463) concerning air toxics by statutory various actions regarding air toxins American Petroleum Institute,
(D.D.C.). deadlines in CAA Sec. 112; failure to under CAA Sec. Sec. 112 (c)(3), American Automobile
promulgate emissions standards for (c)(6), and (k)(3), and 202(l)(2). EPA Manufacturers Association, and
locomotives by statutory deadline of agreed to a schedule for issuing rules International Automobile
11/15/92. CAA Sec. 213(a)(5). on locomotives under CAA Sec. Manufacturers (intervenors).
213(a)(5).
Sierra Club v. Browner, No. 93-0124 Sierra Club and Natural Resources Failure to take actions by statutory EPA agreed to a schedule for Parties to the consent order.
(consolidated with Nos. 93-0125, Defense Council, Inc. deadlines under a variety of different miscellaneous CAA actions.
93-0197, and 93-0564) (D.D.C.). CAA provisions, including Sec. Sec.
112(d) (11/15/92), 111 (11/15/92),
112(e) (11/15/92), 612 (11/15/92),
407(c) (proposal--1/1/93; final--1/1/
94), 112(n)(5) (11/15/92) and 112(s)
(1/15/93).
Sierra Club v. Browner, No. 93-2644 Sierra Club............................ Failure to promulgate regulations for EPA agreed to schedules for issuing Parties to the consent order
(NHJ) (D.D.C.). Class V underground injection wells by study and proposed and final (represented by Earth Justice).
statutory deadline of 12/75. SDWA Sec. rulemaking determinations for Class V
1421(a). underground injection wells.
Sierra Club v. Browner, No. 95-627 Sierra Club............................ Failure to promulgate regulations EPA agreed to a schedule to issue Parties to the consent order.
(D.D.C.). regarding the use and disposal of regulations pertaining to halons and
certain class I and class II methyl bromide under CAA Sec.
substances by statutory deadline of 11/ 608(a)(2).
15/94. CAA Sec. 608(a)(2).
Sierra Club v. Browner, No. 95-627 Sierra Club............................ Failure to issue guidance concerning EPA agreed to a schedule to issue Parties to the consent order.
(D.D.C.). physical and operational changes at guidance concerning construction of
major sources of hazardous air major sources of HAPs under CAA Sec.
pollutants (HAPs) by statutory 112(g).
deadline of 5/15/92. CAA Sec.
122(g)(1)(B).
Sierra Club v. Browner, No. 95-627 Sierra Club............................ Failure to submit study on mercury EPA agreed to a schedule for study on Parties to the consent order.
(D.D.C.). emissions to Congress by statutory mercury under CAA Sec. 112(n)(1)(B),
deadline of 11/15/94. CAA Sec. and to promulgate standards for
112(n)(1)(B). Failure to promulgate certain categories of sources under
emission standards for hazardous air CAA Sec. 112(d).
pollutants for source category by
statutory deadline of 11/15/94. CAA
Sec. 112(e).
Sierra Club v. Browner, No. 96-1680 Sierra Club, National Wildlife Failure to submit report to Congress EPA agreed to a schedule for actions Parties to the consent order.
(D.C. Cir.). Federation, and Chesapeake Bay concerning atmospheric deposition to concerning atmospheric deposition to
Foundation. the Great Waters by statutory deadline the Great Waters under CAA Sec. Sec.
of 11/15/93. CAA Sec. 112(m)(5). 112(m)(5) and 112(m)(6).
Failure to promulgate regulations to
prevent harmful atmospheric deposition
to the Great Waters by statutory
deadline of 11/15/95. CAA Sec.
112(m)(6).
Sierra Club v. Browner, No. 97-0675 Sierra Club............................ Failure to submit report to Congress on EPA agreed to a schedule for report to Parties to the consent order.
(D.D.C.). residual risk by statutory deadline of Congress on residual risk under CAA
11/15/96. CAA Sec. 112(f)(1). Failure Sec. 112(f)(1), and promulgation of
to promulgate regulations for solid regulations for solid waste
waste incinerators by statutory incinerators under CAA Sec.
deadline of 11/15/94. CAA Sec. 129(a)(1)(D).
129(a)(1)(D).
Sierra Club v. Browner, No. 97-1984 Sierra Club............................ Failure to promulgate best available EPA agreed to a schedule for issuing Parties to the consent order
PLF (D.D.C.). control regulations for emissions of rules on consumer/commercial products (represented by Earth Justice).
volatile organic compounds (VOCs) from under CAA Sec. 183(e).
consumer and commercial products by
statutory deadline of 3/15/97. CAA
Sec. 183(e)(3).
Sierra Club v. Browner, No. 97-3004 Sierra Club............................ Failure to submit report to Congress EPA agreed to a schedule for Tier 2 Parties to the consent order and
(D.D.C.). concerning the results of Phase II study concerning light-duty vehicles American Automobile
study of certain light-duty vehicles and trucks under CAA Sec. 202(I). Manufacturers Association.
and trucks by statutory deadline of 6/
1/97. CAA Sec. 202(I)(2)(B).
Sierra Club v. EPA, No. 94-0553; Sierra Club............................ Failure to take actions by statutory EPA agreed to a schedule for Parties to the consent order.
Sierra Club v. EPA, No. 94-0954 deadlines under a variety of different miscellaneous CAA actions.
(D.D.C.).. CAA provisions, including Sec. Sec.
112(k)(2) (11/15/93), 603(d)(1) (11/15/
93), 404 (11/15/93), 112(n)(1) (11/15/
93), and 129(a) (11/15/93).
Sierra Club v. EPA, No. 97-3888 Sierra Club............................ Failure to act on submission of state EPA agreed to a schedule for action on Parties to the consent order.
(N.D.Cal.). implementation plan (SIP) by statutory SIP in San Francisco Bay Area under
deadline (12 months from complete SIP CAA Sec. 110.
submission). CAA Sec. 110(k).
Sierra Club v. Hankinson, No. 1:94- Sierra Club, Georgia Environmental Failure to establish total maximum EPA agreed to a schedule for (1) the Parties to the consent order.
CV-2501-MHS (N.D.Ga.). Organization, Inc., Coosa River Basin daily loads (TMDLs) by statutory establishment of TMDLs for Georgia
Initiative, Inc., Trout Unlimited, and deadline (30 days after constructive waters not meeting water quality
Ogeechee River Valley Association, Inc. submission of no TMDLs--7/79, as standards by 2005 if Georgia does not
alleged by plaintiffs); failure to do so.; (2) the evaluation of certain
disapprove State's list of impaired information relating to Georgia's CWA
waters; failure to establish a Sec. 303(d) lists; and (3) making
schedule for the submission of all certain decisions regarding the
TMDLs in Georgia. CWA Sec. 303(d). content of Georgia's CWA Sec. 303(d)
lists.
Sierra Club v. Hankinson, No. 97-CV- Sierra Club............................ Failure to establish total maximum EPA agreed to establish TMDLs for all Parties to the consent order.
3683 (N.D.Ga.). daily loads (TMDLs) by statutory water quality limited segments on
deadline (30 days after alleged Mississippi's 1996 CWA Sec. 303(d)
constructive submission of no TMDLs). list by 2009 if Mississippi does not
CWA Sec. 303(d).. do so.
State of Connecticut v. Browner, States of Connecticut, Massachusetts, Failure to act on petitions to make EPA agreed to a schedule to act on Parties to the consent order.
No. 98-1376 (S.D.N.Y.). Maine, Pennsylvania, New Hampshire, finding that major sources emit or petitions submitted under CAA Sec.
New York, Rhode Island, and Vermont. would emit prohibited pollutants by 126.
statutory deadline (60 days plus time
provided by CAA Sec. 307(d)(10)
extensions, approximately 12/98). CAA
Sec. 126.
Tides Foundation v. EPA, No. 94- Tides Foundation....................... Failure to propose and promulgate by Required EPA to promulgate regulations Parties to the consent order
2663 (D.D.C.). statutory deadlines (proposal--4/6/92; under RCRA Sec. 3004(y) by February (represented by the Military
final--10/6/94) regulations governing 1997 identifying when military Toxics Project).
military munitions which are hazardous munitions are hazardous wastes and
wastes. RCRA Sec. 3004(y). establishing standards for their
transportation and storage.
Ward v. Browner, No. Civ. 97-1418 LaVonda Ward and Carolyn Aspegren...... Failure to promulgate determination of EPA agreed to a schedule regarding Parties to the consent order.
PHX ROS (D.Ariz.). attainment or non-attainment areas by determination of attainment for ozone
statutory deadline of 6 months after for the Phoenix, Arizona area.
11/15/96 attainment date (i.e., 5/15/
97). CAA Sec. 107(d)).
Washingto n Legal Foundation v. Washington Legal Foundation; Senators Failure to submit reports to Congress EPA agreed to a schedule to provide Parties to the consent order.
EPA, No. 95-2396 (D.D.C.). Craig and Nickles; Representatives on costs and benefits of CAA reports to Congress on costs and
Boehner, Barton, Livingston, Barr, compliance by statutory deadlines (pre- benefits under CAA Sec. 312.
Chenoweth, Klug, and Norwood. 1990 requirements--11/15/91; 1990
requirements--11/15/92). CAA Sec.
312(d) and (e).
Waxman v. Reilly, No. 92-1320 Representative Waxman, Public Citizen, Failure to take actions by statutory EPA agreed to a schedule for Parties to the consent order.
(D.D.C.), Sierra Club v. Reilly, and Sierra Club. deadlines under a variety of different miscellaneous actions under CAA Titles
No. 92-1749 (D.D.C.). CAA provisions, including Sec. Sec. I, II, IV and VI.
407(d) (5/15/92), 610(a) (11/15/91),
611(a) (5/15/92), 602(e) (11/15/91),
112(j) (5/15/92), 112(l)(2) (11/15/
91), 129(a) (5/15/92), and 407(b)(1)
(5/15/92).
Williams v. Reilly, No. 89-6265-E Kathy Williams, Citizens Interested In Failure to promulgate regulations EPA agreed to issue final NPDES storm Parties to the consent order.
(D.Or.). Bull Run, Inc., Frank Gearhart, Samuel establishing permit application water (Phase I) application
E. Sargent, and Frances Price Cook. requirements for storm water regulations by March, 1990 (later
discharges by statutory deadline of 2/ amended to October 31, 1990).
4/89. CWA Sec. 402(p)(4).
Williams v. Reilly, No. 90-6255-JO Kathy Williams, William Brewster, Ralph Failure to promulgate emission EPA agreed to a schedule to issue Parties to the consent order.
(D.Or.). Frohwerk, and Georgia Bunn. standards for hazardous air pollutants regulations controlling air emissions
for source category by statutory from organic solvent cleaners under
deadline (4 years after the category CAA Sec. 112.
is listed under CAA Sec. 111(b)). CAA
Sec. 111.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Abbreviations: CAA--Clean Air Act; CWA--Clean Water Act; CERCLA--Comprehensive Environmental Response, Compensation and Liability Act (``Superfund''); TSCA--Toxic Substances Control Act;
ESA--Endangered Species Act. Case numbers indicate the year in which the case was filed (e.g., a case with the number 92-1234 would have been filed in 1992).
Senator Craig. Would you give us an update on it?
Ms. Browner. On our consent decrees. Yes. Certainly.
Mr. Chairman, the vast majority of the consent decrees that
we have entered into are the result of the fact that over the
years EPA has missed congressionally mandated deadlines.
Congress has said set a standard by X date. We miss it. We are
then sued for missing it and we enter into a schedule for
compliance.
I think what would be most helpful on these consent
decrees, on the ones that we refer to as deadlines suits, we
will also provide for you what the congressionally mandated
deadline was and you will see how far off we are.
Senator Craig. We want a complete picture.
Senator Bond. Thank you, Madam Administrator. Senator Byrd.
nitrogen oxide: state implementation plans
Senator Byrd. Mr. Chairman, I have to leave shortly. Let me
ask briefly a question or two with regard to the nitrogen oxide
state implementation plans for 22 States in the eastern United
States. Several States including West Virginia requested a 7-
months stay in the deadline for the submission of state
implementation plans under the NOX SIP Call Rule to
give them sufficient time to complete their regulatory
processes for approval of the plans.
Since the Clean Air Act clearly contemplated the States
receiving 18 months to develop and submit SIPS, why is the
agency in such a hurry for the States to complete and file
those SIPS?
Ms. Browner. There are a number of reasons. I am sure you
are aware we are in litigation. The court has not yet set a
briefing schedule but there has been a lawsuit filed. One of
the issues that we are dealing with, just by way of example, is
the fact that the Northeast states have asserted their rights
under the Clean Air Act, section 126 petitions, which calls for
specific reductions from specific facilities, and that is
moving forward on a time frame laid out in the Act.
While we recognize their right to do that, we believe that
the best way to address the ozone transport issue will not be
ultimately through these petitions but rather through the SIP
calls, that States will get a much better opportunity to make
their own decisions in the SIP planning process than if we are
forced into a situation of having to move forward with the
States' petition.
Senator Byrd. Madam Administrator, I do not want to appear
to be discourteous but I do have to leave. My question is not
really being answered. Since the appeal of the NOX
SIP Call will likely be decided by early 2000, why not grant
the States the stay in the deadline for SIP submission until
after the court has acted?
Ms. Browner. There are a number of reasons. I tried to give
you one reason, which is we have these other petitions pending
that we think would limit your State's options and
opportunities to make their own decisions.
We, also, have a group of States that have filed a lawsuit
against us to move forward. We have existing court deadlines.
When we look across all of the issues and the legal
requirements and judicial requirements, we believe that a delay
in the State Implementation Planning process is not beneficial
and is not warranted.
Senator Byrd. Does it not make sense, though, Madam
Administrator, to wait until the court has acted?
Ms. Browner. There are a lot of different court actions
that are going to take place around this.
Senator Byrd. I did not say which court action I'm talking
about----
Ms. Browner. But there are others, quite frankly, Senator,
that I think your State would probably feel could ultimately
tie their hands in making a set of State-specific decisions. We
are trying to weed through this across all of the litigation
and across all of the Clean Air requirements. It is not easy.
These are difficult decisions.
There are tensions here, as you are well aware, between
some of the other States and some of the Northeast states and
some of the rights that can arise.
Senator Byrd. The electric utility industry in several
States have raised concerns about the ability to comply with
the very stringent NOX reduction requirements in a
very short time frame without threatening the reliability of
the electrical supply in the affected and neighboring states.
The North American Electric Reliability Council is preparing a
comprehensive report to assess this issue. If it should
determine that the compliance deadline imposes a certain threat
to the reliability of electricity, will the EPA be willing to
extend the compliance deadline to alleviate this problem?
Ms. Browner. We spent a great deal of time discussing with
trade associations in various States this issue prior to----
Senator Byrd. Is the answer not yes or no to my question?
Ms. Browner. We did it in the SIP call. That is the answer.
Senator Byrd. Then the answer is yes?
Ms. Browner. Yes. We have done it in the SIP Call. We gave
the state the right to move deadlines for individual facilities
if they felt there would be an interruption in electrical
service. Your State got that in the SIP call. In fact, your
State was very vocal in arguing for that. We provided
reliability and flexibility, what they wanted, 200,000 tons
extra to the States for precisely this reason. It is in the SIP
Call now.
Senator Byrd. Would you examine the cumulative effect of
your regulations instead of looking at the EPA regulations on a
case-by-case basis? States like West Virginia are suffering
death by a thousand cuts instead of a single blow. Could you do
that?
Ms. Browner. Yes. We are certainly willing to work with
West Virginia to do that.
Senator Byrd. What did you say?
Ms. Browner. I said we would be more than happy to work
with West Virginia to do that. Yes.
Senator Byrd. Mr. Chairman, I have some other questions.
But, I take it, you will not be in session this afternoon.
Senator Bond. We hope to finish this up in time for lunch.
I have a number of questions on the NOX and SIP Call
myself. There will be significant questions submitted for the
record.
Senator Byrd. Very well. I'll submit mine for the record.
Thank you, Madam Administrator.
Ms. Browner. Thank you.
Senator Bond. Thank you very much, Senator Byrd, for your
participation, and my staff and I will look forward to working
with your staff on a number of these issues you have raised.
Turning back to Senator Craig for questions.
SF: coeur d'alene
Senator Craig. Thank you very much, Mr. Chairman.
Director Browner, another set of questions on a different
issue, and some of them you may not be able to respond to now
and we will submit them so that we can get a complete set of
answers for the record.
As you know, in the north end of my State I have one of the
largest Superfund sites geographically in the country, a 21-
mile square Superfund site in the greater Coeur d'Alene Basin
and it is what is known as the Silver Valley, an old lead and
zinc and silver mining region of our State that has been gone
now for well over a century.
We are extremely frustrated in the region by an inability
to shape and to bring to some definitive conclusion where we
go. As you know, some years ago a natural resource damages suit
was filed by the Justice Department on behalf of Interior and
Native Americans as it relates to the region and that has, of
course, complicated the process. But I think the thing that
frustrates all of us most is a concern that outside the 21-mile
zone, we have seen EPA's presence in an ever-increasing way, as
their scientists comb the region to try to find impacts outside
the Superfund site.
In fact, there is great concern there that EPA might
propose an expanded Superfund site that would be almost
unbelievable regionally. Now in latter days there has been a
backing away from that and I am very pleased about that. But
what concerns me most is when we did deal with the remediation
and investigation feasibility studies, we have seen lots of
money spent and no gold nuggets found. Kootenai City, Idaho
attracts worldwide recreation. EPA is out on the beaches and
testing the water and implying, at least in the short term,
that this may not be a safe area to be in, even though the
beaches were found safe. Kids swim in the water. Fish
promulgate in the water and Mother Nature is doing a reasonably
good job of cleaning it up. I guess my question to you is how
much money has been spent on RFI studies outside the existing
Superfund sites? Do you have that figure?
Ms. Browner. There has not been a Superfund designation at
this time. We are working, in fact, I had a meeting with your
Governor just last week. Our regional administrator met with
the Governor and we are fully committed to finding consensus on
how to deal with any listings. But there is----
Senator Craig. That was not my question. My question was
could you to date or could you provide to me the amount of
money EPA has spent in these remedial investigation feasibility
studies outside the site?
Ms. Browner. There is no site.
Senator Craig. No. EPA is all over the Coeur d'Alene area
and the Spokane area.
Ms. Browner. Maybe we can provide the information for the
entire State.
Senator Craig. No. I want it to be provided for the Coeur
d'Alene Basin region. That spills across State boundaries into
the Spokane valley. That would be extremely helpful. Do you
know how much more is anticipated in relation to the scientific
efforts going on and what that would be?
Ms. Browner. We will provide that for you. I do know that
on April 22 there were two separate meetings held to discuss
results of the ecological sampling. There are more meetings
planned and we have indicated that we will adjust the time
frames to incorporate the public participation.
[The information follows:]
Coeur D'Alene Basin
EPA estimates that as of May 2, 1999, approximately $10,200,000 in
cost associated with work in the Basin, including the RI/FS and the
costs associated with litigation. In addition, EPA has incurred
$750,000 conducting residential and school soil removals outside of the
existing 21 square mile Superfund site.
These costs are estimates and have not been reconciled by EPA
finance personnel. All site costs are reconciled as part of the cost
recovery process which occurs when the sites reach completion.
EPA estimates spending an additional $6.1 million in fiscal year
1999 and approximately $8.8 million in fiscal year 2000 to complete the
RI/FS for the Basin. These costs are estimates; actual cost will be
dependent upon factors that are unknown at this time, such as the
nature and extent of contamination found, the need for treatability
studies, and input from a large number of stakeholders involved in the
Basin.
Senator Craig. In those time frames, how long do you think
it will take EPA to finalize this? And it now looks like 2001
may be the case, with cost upwards to $17 million. Do we know
that to be the case?
Ms. Browner. I do not know that to be the case. What I
would like to do, if this would be helpful to you, is ask Chuck
Clark who met with your Governor to actually call you and
discuss the outcome of that meeting and the specific
commitments in terms of how we will proceed.
Senator Craig. Carol, that region is very intent on getting
cleaned up and getting this passed them. They have been intent
on that for a decade. And I must say you have not been at the
helm for EPA a decade but EPA has not been acting in a
contributing manner toward timeliness. I would say in all
credibility it has been getting better and we are going to put
enough heat on you that it gets a lot better a lot quicker.
Ms. Browner. I think the intention on this side is to make
sure that those areas that may need cleanup remediation, that
we manage it in such a way that other areas are not affected. I
think that has proven to be more difficult than anyone thought.
The easy way to proceed and perhaps the way the Agency
proceeded historically was to draw a big line around everything
as opposed to just taking the isolated areas. I know that is
what we all want.
Senator Craig. The U.S. Geological Survey has been there
and we can tell you where the hot spots are. There have been
major effort on the part of the States and the interested
parties and they have probably done more for cleanup--Mother
Nature is doing a pretty good job in cooperation with these hot
spot cleanups and all that kind of thing. I think that is our
frustration.
As you know, when EPA casts its net, it also creates a
cloud and that cloud can impact economic activity and it can
also impact the future opportunities in a region that is
extremely beautiful. And if anyone drives there, they think it
has got to be one of the beauty spots of the Western world. We
say EPA is scouring on the beach to see if there is a problem
and that is an impact that is very negative. That is why
timeliness is important here.
Ms. Browner. Okay.
Senator Craig. I am pleased with your sensitivity to it. It
is something that deserves to be dealt with in a timely
fashion. I have a number of other questions and I will submit
those for the record.
information management office
Senator Bond. Thank you very much for your questions and
thank you for your participation on this subcommittee.
We have many, many very important areas and we are very
grateful when the subcommittee members will take part and help
us in pursuing the knowledge and the information that we need
to craft a bill.
Let me turn now to a very exciting topic, one that always
captures headlines. It is information management. And if
everybody will bear with us. This is important.
The committee expressed last year the need for an office of
information management. As you and I discussed yesterday, I
would like to note for the record, when will this office be
fully operational? When will we have someone in charge? Will
this individual be fully accountable for the quality and
integrity of all EPA data that is released?
Ms. Browner. By the end of summer it will be operational.
And, yes, that person will be fully accountable. Per our
discussion in your office earlier this week, we have provided
an organizational chart.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T05AP29.001
Ms. Browner. I think what you will see that we are taking
the issues of both collection, management, quality assurance
and dissemination very, very seriously.
You see there is a quality board and quality staff that
answer directly to----
Senator Bond. I guess, the question is you've got this
person in the middle of it there.
Ms. Browner. On top.
Senator Bond. How is this person going to exercise the
discipline over all of the different lines of authority within
EPA?
Ms. Browner. Since the actual programs that collect the
data are getting moved into this office, for example, a program
that traditionally sat in the Office of Toxic Release Inventory
is getting moved into this office and they will answer to this
person.
Senator Bond. And you pointed out the move would not
initially include all of them. But the most important ones that
have multiprogram application would be moved in.
Ms. Browner. Correct.
Senator Bond. So they would actually be reporting to this
national program manager, not the old division or department
directly?
Ms. Browner. Correct.
Senator Bond. By the end of September this will be in
operation. Have you developed the plan for how this office will
operate, the goals and other objectives, the management
priorities and what resources are needed? Do you have that
information available?
Ms. Browner. Yes. We can provide that for the record. What
we are doing is a broad outreach to parties who will make use
of this office, to parties who will be responsible for
providing information to this office in terms of how to go into
all of the details of creating this office.
We do have a general mission statement and a basic design
premise that we have developed. We have been working to refine
it with parties both inside the agency and outside the Agency
such as industries, the states, and the public.
There is, for example, the data quality----
[The information follows:]
EPA's New Information Office
the need for change
External Drivers
--Rapid Technology Development
--Greater Demand for Environmental Information
--Concerns about Data Quality and Security
--Concerns about Reporting Burden
--GPRA
Internal Responses
--REI Action Plan
--Data Quality Action Plan
--Center for Environmental Information and Statistics Strategies
--Goal 7 of EPA's Strategic Plan
developments to date
Comprehensive Information Management Force.--recommends
organization to oversee information management and policy (Aug-Sept
1998)
Information Working Group.--recommended a structural framework for
the new Information Office (Oct-Dec 1998)
Information Transition and Organizational Planning.--established
framework and early action projects, will launch new office this summer
(Jan-Aug 1999)
who's involved
Leadership Team
--David Gardiner
--Margaret Schneider
--Al Pesachowitz
ITOP
--Kathy Petruccelli, Director
--Temporary team of about 25 staff
Active Inreach and Outreach
--EPA programs and regions
--State partners
--Other external groups
our aspirations
Vision.--a center of excellence that advances use of integrated
multi-media information:
--as a strategic resource for decisionmakers, and
--to satisfy the publics right-to-know
Mission.--provide leadership in creating information policies and
mechanisms that enable:
--efficiency,
--effectiveness,
--quality, and
--usability of information throughout EPA
our key goals
Provide:
--Information Integration
--Information Quality
--Burden Reduction
--Right-to-know
Through:
--A strong Leadership and Policy Framework
--Enhanced State Partnership
--Sound Information Infrastructure
For information-based decisionmaking by all.
programs coming into the new office
OIRM
TRI
CEIS
EMPACT
EMMC
ECOS/EPA Envir. Info. Mgmt WG
One Stop Program
EPA QA Program
Regulatory Info. Div.
Surf Your Watershed
National Computer Center
LAN/e-mail
IRM ESC
Centralized Dockets
Spatial Data/MultiResolution Land Characterization
early action projects
New Projects
--Information Plan
--Public Access Policies
--Open Data Access
Important Work Underway
--REI
--Data Quality Action Plan
--Burden Reduction
--Enhanced Public Access
--Streamlining TRI Data Collection and Release
--Systems Modernization
key issues
Cross-Agency Support
Collaborative Partnerships with States
``Respectful Use'' of Information
Information Security
Balancing Burden Reduction and Data Gaps
Data Quality
budget status
Currently defining a process to identify functions and resources
moving to the new Office while simultaneously defining roles,
responsibilities and needs.
--Fiscal year 1999: Approximately 350-400 FTE; Approximately $45-55M
extramural
--Fiscal year 2000: Internal adjustments via Operating Plan
--Fiscal year 2001: Develop needs through Goal 7 and 10 process
timeline
April
--Resolve ``gray areas'' for inclusion in new Office
--Define new Office functions
May
--Design new Office substructure
--Develop process for selecting managers and staff
June
--Select managers
--Develop fiscal year 2001 budget
July
--Select staff
August
--Resolve all administrative, organizational, and logistical details
--Complete internal review of full reorganization proposal
--Complete Union review of reorganization
--Complete reorganization by Labor Day
missouri lawsuits
Senator Bond. Because it is important, we want to make sure
that you focus on that.
There are many other questions that we will be submitting
for the record. But let me ask, the authority to file lawsuits
is provided in many of our environmental statutes, especially
clean air. Can you give me any reason that I can share with my
Missouri constituents why Missouri has become such a particular
focus for some of these lawsuits? What is it in Missouri that
attracts lawsuits? There are some areas that attract tornadoes.
What is about Missouri that attracts lawsuits?
Ms. Browner. The good news is we are all on the same side.
Senator Bond. Do you know what it is?
Ms. Browner. We will look at that. You do have one that has
attracted a lot of attention. But there, I think, you and the
Agency and the State are all of common mind. We think we did
something very reasonable in terms of providing the State some
relief that they sought and not affecting the public's air
quality.
Unfortunately, there was an organization out there who did
not agree with us. We are in lockstep with the State in
defending against the lawsuit.
[The information follows:]
Air Quality Lawsuits: Missouri
Missouri has been the subject of Clean Air Act litigation for a few
reasons. First, EPA did not meet the statute's requirements for the
Agency to determine whether the St. Louis moderate ozone nonattainment
area had attained the 1-hour ozone standard by the area's attainment
date and, if the area had not, to reclassify it from moderate status to
a serious or higher classification under the Act's provisions for
implementing the 1-hour standard. In addition, the plaintiffs allege
that EPA has failed to meet a duty to promulgate federal implementation
plans for the St. Louis area due to the lack of approved state
implementation plan provisions satisfying various Clean Air Act
requirements. It should be noted that this litigation also affects
Illinois since the St. Louis ozone nonattainment area includes a
portion of Illinois, as well as Missouri. Moreover, other states have
been the subject of similar litigation (e.g., Phoenix, Arizona was the
subject of litigation concerning EPA's failure to determine whether it
had attained the 1-hour ozone standard and various cities in the east
such as Baltimore, Philadelphia and New York have been the subject of
litigation concerning EPA's alleged failure to promulgate federal
implementation plans).
Other citizen suits have been brought against EPA which affect
Missouri's environmental programs. For example, there are two pending
lawsuits in which the plaintiffs are seeking a court order to require
EPA to develop total maximum daily loads (TMDLs) for waters in
Missouri. American Canoe Association v. EPA, No. 98-1195 (W.D. Mo.) and
Missouri Soybean Association v. EPA, No. 98-4282 CV-C-5 (W.D. Mo.).
However, lawsuits of this nature are not unusual. For example, citizens
groups have filed TMDL lawsuits similar to the one in Missouri in 28
states.
Senator Bond. Madam Administrator, we are going to move on.
Let me close. This is going to be Senator Craig's--he said he
needed an opportunity to ask a question. I would say, just to
follow up on that, Missouri is not in compliance yet. Is that
one of the reasons there is a lawsuit? Are we on the way? Is
this a problem?
Ms. Browner. We have enjoyed a very good relationship with
your Governor and others in your State in addressing difficult
air pollution challenges. We appreciate their creativity and
willingness to work with us. You have a plan and are moving
forward. We will go and look at how many lawsuits have been
filed around Missouri. There are probably many more in my home
state of Florida.
compliance assistance activities
Senator Bond. I would note that EPA is only requesting $19
million for compliance assistance activities, a reduction. But
in your budget you state that you think the States will assume
the majority of the work.
I question whether it would be wasteful for 50 States to
develop compliance tools, and EPA has indicated how successful
those programs are, and we would like to have for the record
your assessment of the effectiveness of these programs.
Ms. Browner. Within compliance, there are a number of
different programs. The nine compliance centers we think, have
been hugely successful. We are not cutting those. There are
some non-agency training programs that we have not sought
funding for.
Senator Bond. We were just looking at the compliance
assistance and grants line. My staff will get back to you on
that.
[The information follows:]
Compliance Assistance: Effectiveness of Programs
EPA's role has been and continues to be to develop and distribute
compliance assistance information and tools for business and industry.
As the primary providers of direct assistance to the regulated
community, states and localities and other compliance assistance
providers use or adapt EPA compliance assistance materials to reflect
specific state or local requirements. We believe this relationship has
been very successful in improving the regulated community's awareness
and understanding of its environmental obligations. We intend to expand
these outreach efforts by working more closely with compliance
assistance providers, especially with state and local governments.
Participants at our recent conferences on EPA's compliance programs
confirmed the value of EPA's compliance assistance tools and materials
and urged us to continue developing general compliance assistance tools
that are widely applicable and that are made widely available through
the Internet, toll-free hot lines and other appropriate channels. We
also heard strong support for the view that states are the first-line,
on-site purveyors of compliance assistance. EPA continues to work with
the states and other assistance providers to develop a strong network
to exchange information and tools and minimize duplicate services.
We believe that our compliance assistance tools have increased the
regulated community's understanding of environmental requirements. For
example, working with industry associations and other organizations, we
have set up nine Compliance Assistance Centers through Internet web
sites, toll-free telephone lines, and fax mail, each directed toward a
specific industry or government sector. During 1998, the five existing
Compliance Assistance Centers logged over 190,000 user sessions and
responded to over 3,600 toll free phone calls and questions via e-mail.
In addition to the Centers usage, EPA Regional offices in fiscal year
1998 collectively reached almost 250,000 regulated entities through
compliance assistance outreach mechanisms including telephone hotlines,
workshops and training sessions, on-site visits and compliance
assistance tools. Notable examples of these tools include the 28 sector
notebooks, which are industry sector profiles containing information on
the overall compliance history, applicable federal requirements,
industrial processes, pollutants generated, pollution prevention
approaches, and cooperative programs designed to improve the
environmental performance of the industry. Since 1995, over 300,000
copies have been distributed in printed and electronic form. Moreover,
eighteen plain language guides and several compliance checklists have
been prepared for selected sectors, including the food processors,
paints and coatings, and automotive sectors.
In addition to the development of compliance assistance materials,
EPA regions and states have undertaken sector-based compliance
assistance projects in partnership with industry. For example, EPA,
Virginia, Maryland, the District of Columbia, and the Korean Dry
Cleaners Association of Greater Washington developed a mentoring
program where experienced dry cleaners trained by EPA and the states
helped less-sophisticated dry cleaners understand and comply with
environmental requirements. The compliance rate of participants was
estimated to be 20 percent higher than other area dry cleaners. EPA
will continue these types of partnerships to increase environmental
compliance.
Additional committee questions
Senator Bond. Thank you very much, Madam Administrator.
[The following questions were not asked at the hearing, but
were submitted to the Agency for response subsequent to the
hearing:]
Questions Submitted by Senator Bond
grants oversight of assistance agreement: post award management
Question. How would these reviews enable EP grants management staff
to ensure individual grant recipients did not charge the Federal
government unallowable costs such as litigation expenses?
Answer. The main purpose of post-award management review is to
provide a general overall evaluation and discussion of the recipient's
financial, procurement, property management, and general and
administrative systems. To ensure the grantees system are working, we
do some transactional testing on a select sample basis, looking for
unallowable costs such as litigation and other expenses.
However, these are not audits, because only the Office of the
Inspector General (OIG or IG) or Certified Public Accountant (CPA) can
perform audits. Post Award Management reviews are limited in scope and
range from 1.5 to three days on-site.
Question. Do the monitoring strategies required under the Tier I
Baseline Monitoring component of the Policy enable EPA grants
management staff to ensure individual grant recipients did not charge
the Federal government unallowable costs such as litigation expenses?
Answer. Tier I monitoring is geared toward proactive and preventive
monitoring, such as continual contact and communication with the
project officers and recipients to ensure the grants are progressing
satisfactorily and to respond to any problems or concerns. If the
recipient or project officer has a concern or question about
allowability of any activity or purchase under the grant, the Grants
Management staff will address those questions in accordance with the
grant agreement and administrative rules and regulations, or as
necessary, obtain or provide the appropriate guidance or direction.
Question. How many financial audits did grants management staff
perform on non-construction grants to non-profits (grants) in fiscal
year 1999 to enure individual grant recipients did not charge the
Federal government unallowable cost such as litigation expenses? What
percentage does this represent of the fiscal year 1999 total number of
grants?
Answer. Financial audits are audits performed by staff in the OIG
or by CPA firms under either the Single Audit Act or the IG Act. Grant
staff are not permitted to perform financial audits. However, we do
perform post-award management review monitoring and other grantee
outreach activities as noted in response # 1.
During fiscal year 1999, grants management staff performed 638
outreach activities to recipient type organizations through training
and outreach, technical assistance onsite reviews, evaluative on-site
reviews (e.g. general evaluation of grantee financial management
systems, cost sharing, source documentation, subawards, property
management, travel, payroll, and cost allocability and allowability),
etc. This represents approximately 16 percent of the fiscal year 1999
total number of active awards. However, with emphasis on Post Award,
the percentage is 6.2 percent of total active awards.
Moreover, to date in fiscal year 1999, we have performed Post Award
Outreach (including Evaluative and Technical Assistance on-site visits,
desk reviews, and management assistance forums) at approximately 16.5
percent of our ``recipient organizations''. This percentage does not
include Pre-award workshops, training, and outreach.
Question. Did any of these financial audits obtain general ledger--
summary of transactions, transaction details, originating documents or
other materials to ensure individual grant recipients did not charge
the Federal government unallowable costs such as litigation expense?
Answer. Again, we do not perform financial audits. However, our
post award management reviews frequently involve a review of the
general and or subsidiary ledgers from which to judgementally select
samples for transaction testing purposes. Within the tests of
transactions we obtained supporting details through supporting
documentation, discussions, and observations. We also, performed traces
to originating documents looking at original authorizing signatures,
approval dates, and need for the transaction. During each visit the
four major areas (i.e., financial, procurement, property management,
and general and administrative) are addressed, however, the detailed
focus of our review may vary to some degree based upon identified
problem areas.
Question. As of April 29, 1999, how many of EPA's Grants Management
Offices (GMOs) have fully implemented the policy and which GMOs have
not, if any?
Answer. As of April 29, 1999, all Grants Management Offices (GMOs)
have begun to implement the Post Award policy. With the exception of
one GMO, these offices are complete or nearly complete in their
implementation of the policy. The GMO in Region X will benefit from a
national conference this month when officials and representatives from
each GMO will discuss the policy's implementation in each of their
regions and Headquarters. While we are happy to report that most of our
offices are at or near full implementation, the facet of `full
implementation' extends out to December, 1999 in accordance with the
Post Award policy.
Question. How many GMOs have developed a Monitoring Plan to monitor
their post-award management activities and which GMOs have not, if any?
Answer. All but two GMOs have developed a Post Award Monitoring
Plan. The GMO in Region VII is well underway in implementing the Post
Award Monitoring policy but is in the midst of completing its
Monitoring Plan. Region X will develop a plan in June, 1999.
grants: oversight of assistance agreement--material weaknesses
correction
Question. When the Administrator first declared oversight of
assistance agreements a Material Weakness in 1996 under the Federal
Managers' Financial Integrity Act, the Agency targeted 1998 as the
target correction date for this Weakness. The Agency has pushed back on
the correction date by an additional year in each successive Integrity
Act Report and the correction date is now 2000. What is the reason for
these multiple extensions of the correction deadline?
Answer. The Agency did consider moving up this target date since
the closeout of non construction grants was progressing satisfactorily.
However, Agency decision makers wanted to ensure that all programs and
Regions had developed post award plans prior to eliminating this as a
material weakness. Post Award Plans are being developed and
implemented, and the Agency has closed out 95 percent of its original
non construction grant backlog.
Question. A major corrective action milestone to address EPA's
grants management material weakness calls for the issuance of a policy
on Project Officer roles with emphasis on post award administration.
The original target date for completion of this milestone was December
1997, the current target date is December 1998 and yet the fiscal year
1998 Integrity Act Report states the Agency has not completed this
milestone. What is the reason for delay in completing this milestone
and when will the Agency achieve this milestone?
Answer. The Grants Office has worked closely with the program
offices and regions to develop the policy for post award management by
Headquarters and Regional Offices; the policy was signed on April 5,
1999. The final policy is a companion to the Grant Management Officer's
post award policy. It requires each headquarters and regional office to
develop and implement a post award plan. It will ensure management
accountability and allows offices to tailor their post award efforts to
their particular grant programs and grantees. The Plans will be
reviewed by the Office of Grants and Debarment and will ensure
coordination between grants specialists and project officers. The final
policy is broader than originally envisioned and will support better
grants management in the Agency.
Question. The Agency, as part of its strategy to address its
material weakness in grants management, conducted a study to realign
the Grants Operations Branch to allow more time for post award
administration. The Agency set December 1998 as the target date to
implement the recommendations from the realignment study and yet the
Agency states in the fiscal year 1998 Integrity Act Report that EPA has
not accomplished this milestone. What are the recommendations and what
progress has EPA made in implementing these recommendations?
Answer. The Grants Operations Branch realignment study resulted in
various recommendations to allow more time for post-award
administration. These recommendations addressed issues such as
automation improvement, workload distribution, and staff training. Each
of the recommendations under this study have been considered and were
implemented, as feasible. The remaining recommendations are automation-
related. The automation-related recommendations have been incorporated
into the development of the Integrated Grants Management System (IGMS)
which will eventually automate the programmatic and administrative
grant process from guidance development, application, negotiations,
award to closeout.
The implementation of these recommendations has allowed the
headquarters staff more time for conducting post-award administration
activities such as baseline monitoring activities, site visits, and
other outreach activities.
Question. The Agency has requested each Region and program office
conduct Management Effectiveness Reviews (MERs) concerning oversight of
assistance agreements. What will these reviews enable the Agency to
determine and will they enable EPA grants officers to ensure individual
grant recipients are not charging the Federal government unallowable
costs such as litigation expenses? If so, how many MERs did the Agency
conduct in fiscal year 1999 and how many does EPA expect to conduct in
fiscal year 2000?
Answer. The Office of Grants and Debarment (OGD) is the national
program manager for grants management in the Agency. Management
Effectiveness Reviews (MER) are self-assessments by each Agency office
and Region on how they manage their grant programs. OGD develops
protocols, provides guidance, ensures the MERs are completed and
corrective actions are conducted by program and regional offices. In
addition, OGD consolidates the results of the MERs and works with all
of the regions and program offices to identify needed training,
policies, etc. These results are considered and incorporated in the
final assurance letter to Congress.
MERs are conducted every two years by the offices. OGD works with
the program and regional offices on a regular basis to ensure progress
is being made on corrective actions identified during the MER.. Since
these reviews focus on internal systems, the review of unallowable
costs by a particular grantee would not be part of the MER process. As
part of the fiscal year 1999 MER, program and regional offices are
being asked to evaluate the effectiveness of their post award
management plans and implementation.
During fiscal year 1999, the Agency will complete 22 MERs. The MERs
are conducted every two years. OGD ensures program and regional offices
address corrective actions. The next round will occur in fiscal year
2001.
The Agency will use the Management Oversight Reviews (MORs) to
measure the results of its progress to eliminate the grants management
material weakness. What will these reviews enable the Agency to
determine and will they enable EPA grants officers to ensure individual
grant recipients are not charging the Federal government unallowable
costs such as litigation expenses? If so, how? How many MORs did the
Agency conduct in fiscal year 1999 and how many does EPA expect to
conduct in fiscal year 2000?
OGD is the national program manager for grants management. In
assuring the quality of these operations nationwide, OGD conducts
oversight reviews (MOR) of its GMOs regularly. The MORs are part of the
Office's quality assurance function and include a rigorous review of
how the grants office operate. The MOR protocols review compliance with
EPA statutes, grant regulations and policies. A select number of grant
files are reviewed to ensure quality in the GMO's review and award of
grants. Categories of cost are identified during the pre-award phase as
part of the applicant's budget. The review team searches these
documents and ensures GMO staff are performing satisfactory reviews of
the applicants' budgets. (Expenditure reports from the recipient to EPA
such as financial status reports merely identify aggregated
expenditures in accordance with Federal regulations.) Specific concerns
unique to the particular GMO are addressed during the MOR.
Each MOR Team is comprised of four individuals including
Headquarters Policy staff as the lead and grant specialists from
Headquarters and other regional GMO staff. The MOR team also interviews
regional program office staff about grants management in the region.
We performed three MORs during fiscal year 1999, and we anticipate
performing three in fiscal year 2000. We plan to perform three each
year so each GMO is reviewed every three to four years.
Question. A 1995 Inspector General audit examining recurring
problems in EPA grants management found EPA project officers and grant
specialists did not review Financial Status Reports (FSR) and many
grant files did not contain FSRs. Do FSRs enable EPA grants officers to
ensure individual grant recipients are not charging the Federal
government unallowable costs such as litigation expenses? If so, how?
For what percentage of grants in fiscal year 1999 did EPA project
officers and grants specialist review FSRs and how does EPA know and
measure this fact?
Answer. Financial Status Reports (FSR), standardized government-
wide forms, identify expenditures in aggregated amounts. There is no
break-out of costs or expenditures by category type, nor is there a
break down by product, item, or service purchased. Therefore, EPA staff
cannot use FSRs to identify unallowable costs. Government-wide
regulations prohibit requesting detailed financial information beyond
what is authorized in OMB circulars.
Through May 1999, EPA has reviewed and approved a minimum of 3,400
final Financial Status Reports. The approval of these reports was
necessary to the closeout of these grants. These reviews are documented
in the Agency's grant closeout process and reported in the Grants
Information Control System.
Government-wide OMB circulars provide the option of utilizing
`Reports of Federal Cash Transactions' or `Requests for Advance or
Reimbursement' if it is determined this information provides more
timely financial information than an interim FSR. EPA requires these
reports on a quarterly basis for all grantees who receive electronic
payments (approximately 85 percent of all non construction grantees).
Other mechanisms are available to monitor the financial status of a
grant project. Project officers and grant specialists can monitor the
amount drawn down under the grant from the Agency's financial system.
Monitoring drawdowns from the financial management system during the
life of the grants ensures more timely stewardship of federal funds.
Question. The same IG audit found EPA was not obtaining single
audit reports from grant recipients. What information does the single
audit reports provide EPA project officers and grant specialists? Does
the financial statement audit enable EPA grants officers to ensure
individual grant recipients are not charging the Federal government
unallowable costs such as litigation expenses? If so, how? For what
percentage of grants in fiscal year 1999 did EPA project officers and
grants specialists obtain and review FSRs and how does EPA know and
measure this fact?
Answer. Under single audit there is a concept of major and non-
major programs. For a major program, the auditor provides an opinion on
compliance with Federal laws, regulations and provisions of contracts
or grant agreements that may have a direct and material effect on each
major program.
The single audit provides no specific audit coverage of non-major
programs. Major programs are selected at each individual grantee using
a risk-based approach. Using the risk-based approach, an auditor looks
at not only the dollar value of a program, but also the risk that a
grantee has not complied with program requirements, based on current
and prior audit experience, the extent of federal agency and pass-
through entity oversight, and any inherent risk of non-compliance in a
federal program.
Question. For what percentage of grants do EPA project officers and
grants specialists review FSRs and how does EPA know and measure this
fact?
Answer. EPA staff review FSRs as they are received. This fact is
monitored in EPA's Grants Information and Control System (GICS). The
date of final FSR receipt is recorded in GICS. The final FSR is one of
several items required to close out a grant. The GICS will be updated
to reflect the date the grant is actually closed. While this
measurement is combined with other actions required for grant closeout,
EPA knows from this data that the FSRs are being reviewed and approved.
EPA has closed out 95 percent of its awards.
grants: oversight of assistance agreements--post award management
Question. EPA's fiscal year 2000 Annual Performance Plan includes a
single performance goal for Grants Management. The two parts of that
goal consist of eliminating the closeout backlog for non-construction
grants and increasing the number of Grants Management Offices awarding
grants through the Integrated Grants Management System.
How does eliminating the closeout backlog for non-construction
grants address the oversight concerns of thoroughly reviewing grant
applications, performing site visits, reviewing project status reports,
obtaining single audit reports, providing final project certifications,
or enabling EPA grants officers to ensure individual recipients are not
charging the Federal government unallowable costs such as litigation
expenses?
How will ``utilizing electronic commerce to fully automate the
assistance process from cradle to grave,'' as hoped for in the fiscal
year 2000 Annual Performance Plan, address the oversight concerns of
thoroughly reviewing grant applications, performing site visits,
reviewing project status reports, obtaining single audit reports,
providing final project certifications or enabling EPA grants officers
to ensure individual grant recipients are not charging the Federal
government unallowable costs such as litigation expenses?
Answer. Several years ago, the Agency began efforts on a major
reinvention effort--the Integrated Grants Management System. This is
programmatic and administrative electronic grant system. We are
currently piloting the initial stages of the system with five pilot
regions and states. This system will give the Agency the framework to
track and document all of our work in the areas of pre-application,
award, post award and closeout. The system will ensure greater
consistency and standardization nationwide and will enhance
communication with grantees and across EPA. The system will have links
to other intergovernmental systems such as the Single Audit
Clearinghouse. In addition, project officers and grant specialists will
be able to monitor requirements of the grant, receive copies of reports
from the grantee and document site visits.
The Agency has made significant progress in addressing their non
construction grant closeout backlog. Closeout policies have been
reviewed and updated; all grants management offices have developed
strategies to identify barriers to closeout and how they are addressing
those barriers. As a result, as of the end of May, the Agency had
closed 95 percent of its original closeout backlog. In addition, the
Agency is piloting automation tools so that project officers and grant
specialists can speed up closeout of grants. To closeout a grant, the
Agency must review and approve the final Financial Status Report, all
dollars on the grant are either deobligated or expended by the grantee,
and all deliverables are certified complete by the project officer.
EPA also continues to participate with other federal agencies on US
E grants and Federal Commons. The Agency believes that all of these
systems will help us to save time on processing so that we can focus
our efforts on the monitoring of grants and grantees.
The Agency has taken numerous actions which addresses the oversight
and monitoring concerns related to grants management. The Agency has
strengthened the training provided to program office staff, placing
greater emphasis on post award management, and has implemented a
refresher course which addresses new grants management issues. EPA also
provides information on its website and automating tools which enhances
post award monitoring. The website also provides information on Grants
policies and procedures. The Agency has also increased the training
provided to our Grants Specialist. Examples of the type of training
received by the Agency's Grants Specialist includes: post award
monitoring activities, fraud awareness, OMB Cost Principles, cost
analysis, and Appropriation Law training.
In addition to training, the Agency is conducting various post
award monitoring activities of grant recipients which include on-site
evaluative visits, on-site technical assistance, technical assistance
conferences and workshops, and desk reviews. On a biennial basis, all
regional and headquarters program offices conduct a management
effectiveness review of their assistance activities to identify
potential vulnerabilities and areas for improvements.
Question. The fiscal year 2000 Annual Performance Plan states the
Agency included $8,568,800 for the Grants Management Key Program in its
fiscal year 1999 Enacted Operating Plan and $9,679,900 in the fiscal
year 1999 President's Budget request. What level of resources did the
Agency devote to this Key Program or equivalent set of activities in
its fiscal year 1998 Enacted Operating Plan?
Answer. The total dollars for the Office of Grants and Debarment in
fiscal year 1998 was $7.5 million.
Question. How many financial auditors were employed by EPA grants
organizations (excluding the IG) in fiscal year 1999?
Answer. Financial auditors (GS-511) within EPA are employed
primarily by EPA's Office of the Inspector General.
Question. How must a non-profit group document its non-profit
status before obtaining a grant from EPA?
Answer. A non-profit group documents its non-profit status by
indicating its status in block #7 of its signed application form (SF-
424). The grants management staff also checks the Cumulative List of
Organizations (described in Section 170(c) of the Internal Revenue
Code) known as ``the Blue Book'' and Supplement. If the applicant
organization is listed in these documents, EPA may award the
organization a grant. If the applicant organization is not listed in
the Blue Book, the Grant Specialist will contact the recipient for
further information and necessary documentation. If it is determined
the organization is a non-profit organized under 401(c)(4), the Agency
will not make the award. The Grants Specialist also checks the
application for the organization's Anti-Lobbying certifications which
will also indicate the organization's status. The Lobbying
Certifications will indicate whether the organization lobbies, and if
so, certify that lobbying is not paid for with Federal funds.
epa review of transportation projects
Question. In a speech delivered in February to a group of
developers in Boston, Region I Regional Administrator John DeVillars
noted the Agency's `unwavering commitment to use the full force of
environmental law to oppose or seek modification of those projects
which--by their very nature--contribute to sprawl.' Was DeVillars
speaking for the Agency when he described this `unwavering commitment'?
Answer. Mr. DeVillars' comments reflect the Agency's commitment to
address one of the most serious environmental issues this country is
facing: the deterioration of air and water quality caused by traffic
growth and nonpoint source pollution. Using the authorities and funding
that Congress has provided to EPA and the states, we have made
significant improvements in air and water quality that are attributable
to controls on point sources of pollution; however, total increases in
vehicle miles traveled and nonpoint source water pollution are
threatening to undermine this progress. For example, we are driving our
cars almost 60 percent more than in 1980 and although car emissions
have gotten cleaner, EPA estimates that the pollutants emitted by this
increase in driving will, in 10 to 12 years, reduce the gains we have
made in recent years in reducing air pollution, unless technology keeps
pace. EPA does not have--nor ever will--the authority to control the
number of vehicle miles traveled in this country. But EPA is committed
to working in partnership with the Department of Transportation and
others to offer people transportation choices that are less polluting,
in order to meet our Congressional mandates to protect the quality of
our air and water. Similarly, over half of our water pollution
nationwide is now due to nonpoint sources, such as runoff from roadways
and parking lots. As Mr. DeVillars stated, EPA will use existing
regulatory authorities in the Clean Air Act, Clean Water Act, and
National Environmental Policy Act to carry out our statutory
obligations to ensure that projects are designed in such a way as to
minimize adverse environmental effects of sprawling patterns of
development. Finally, EPA also will work to ensure that none of our
programs or policies are inadvertently encouraging sprawl or the decay
of our urban centers.
Question. Which transportation projects has EPA opposed in the last
five years?
Answer. One of the authorities that EPA uses to review
transportation projects is Section 309 of the Clean Air Act. Under this
section, EPA has the responsibility to comment on the potential impacts
of federal actions to public health or welfare, or environmental
quality. One of the significant ways in which EPA carries out that
responsibility is to review and comment on Environmental Impact
Statements (EIS) published by the other federal agencies in accordance
with the National Environmental Policy Act (NEPA). In order to carry
out EPA's responsibility in a consistent manner, EPA developed and uses
a rating system to rate draft and draft supplemental EIS. This system
rates a document both on its potential impacts as well as the adequacy
of the documentation itself. The adequacy of the document is reviewed
to see if the agency disclosed all significant potential environmental
impacts to the public and the decision-maker well enough to make an
informed decision. With the exception of extraordinary circumstances,
EPA limits its ability to refer proposed actions to the Council on
Environmental Quality (CEQ), the agency which oversees implementation
of the NEPA, to EISs which have received the most stringent EPA ratings
of either environmentally unsatisfactory or inadequate information or
both.
For illustrative purposes, EPA examined its tracking data for the
previous 5 calendar years (1994 through 1998) for Federal Highway
Administration draft and supplemental draft EISs. The FHWA EISs
represent the majority of all transportation projects reviewed by the
EPA. During the years 1994-1998, EPA staff reviewed a total of 252
draft or supplemental draft environmental impact statements for
proposed highway projects. Of those 252, EPA rated 2 as environmentally
unsatisfactory because the Agency believed the environmental impacts
were of sufficient magnitude that the project should not proceed as
proposed and 4 as inadequate for not presenting enough information so
the reviewer could assess the significance of the potential
environmental impacts of the proposed action or EPA had identified
reasonably available alternatives not discussed in the document. All 6
await final FHWA determination. EPA has not referred any FHWA project
to the CEQ during this time period. Below is a list of the 6 projects
mentioned above:
--Southeastern Expressway Improvements, Chesapeake and Virginia
Beach, VA
--CA-125 South Route Location, San Diego County, CA
--Inter-County Connector Improvement, Montgomery and Prince Georges
Counties, MD
--I-880/CA-92 Interchange Reconstruction, Alameda County, CA
--Cross-Base Highway Project, Pierce County, Washington
--San Francisco-Oakland Bay Bridge, San Francisco and Alameda
Counties, CA
Question. Which transportation projects have EPA grants recipients
opposed in the last five years?
Answer. The Agency does not have a data base which contains
information on the positions taken by EPA grantees on transportation
projects. The Agency does not administer a grant program designed to
oppose transportation projects, nor does it award grants for costs
incurred for lobbying and filing claims against the U.S. Government.
These costs are unallowable under OMB Circulars relating to grants.
Additionally, Section 409 of EPA's fiscal year 1999 Appropriation Act
provides that grant funds may not be used to pay the expenses of, or
otherwise compensate, non-federal parties to intervene in Federal
regulatory or adjudicatory proceedings. EPA monitors the activities of
grantees to fulfill the Agency's fiduciary responsibility to ensure
that the funds it grants to recipients are used for the purposes
outlined in the grant award. However, EPA does not keep track of
activities grantees carry out with their own funds.
Question. DeVillars credited EPA for stopping construction of the
Nashua Circumferential Highway in New Hampshire.
Answer. The Nashua Circumferential Highway was a proposed 12-mile-
long expressway around the City of Nashua, New Hampshire. Because of
the proposed highway's significant adverse impacts to exceptionally
valuable wetlands, wildlife habitat, and water quality, EPA exercised
its authority under the Clean Water Act to prevent construction of the
southern segment of the project, and advocated a so-called partial
build solution entailing construction of up to 7.5 miles of the
northern portion of the road. The partial-build option will achieve 85
percent of the transportation benefits of the full-build, at less than
half the environmental cost and at half the capital cost. EPA's action
was supported by the City of Nashua and the three other affected towns,
and the Governor. The New Hampshire Department of Transportation is
currently developing plans to proceed with the partial-build highway.
Question. Is it policy of EPA to stop transportation projects? What
tools does EPA use to stop transportation projects?
Answer. It is not the policy of EPA to stop transportation
projects. We do, however, use our statutory authority to ensure that
projects are designed and built in a manner that minimizes adverse
impacts to the environment.
npdes permitting program funding
Question. As of March 1998, EPA had not re-issued 38 percent of
permits for major facilities and 76 percent of permits for minor
facilities. This led to the Administrator declaring NPDES permit
backlogs as a new Material Weakness under FMFIA. Why does the fiscal
year 2000 Annual Performance Plan include only a 1.5 percent increase
for the NPDES Permitting activity in the Regions? Are these resources
sufficient to address this problem? The Agency received a 2.6 percent
increase from Congress for its Environmental Programs and Management
(EPM) operating budget in fiscal year 1999 and yet EPA cut the
Headquarters NPDES Permitting activity over 24 percent from fiscal year
1998 to fiscal year 1999 enacted levels. Why did the Agency, knowing in
the Spring of 1998 that NPDES permitting backlogs were a candidate for
material weakness, make this cut?
Answer. EPA increased the Regional NPDES budget by 23 percent and
the Headquarters NPDES budget by 45 percent in the fiscal year 2000
President's Budget. A portion of this increase allows for a multi-
pronged approach to eliminating backlog in delegated and non-delegated
States, including (1) direct permit issuance assistance to several
Regions and States; (2) broader use of tools developed in some Regions
and States such as general permits, electronic permit programs, and
streamlined procedures to expedite issuance; and (3) the development of
strategies in partnership with States for eliminating backlog while
maintaining high permit quality. As we implement these initiatives, we
hope to better assess the sufficiency of available resources to
eliminate the backlog. EPA does not currently have a complete picture
of the resource needs at the State level, but will develop a better
understanding through an ongoing resource gap analysis (to be completed
Fall 1999) and by partnering with high backlog States to develop
specific State strategies for eliminating backlog. In terms of fiscal
year 1999, while the Headquarters permitting activity was reduced from
fiscal year 1998 Enacted levels, total NPDES permitting resources
(including Regional resources where the bulk of the permitting effort
is located) rose over 20 percent from fiscal year 1998 Enacted levels.
It should be noted that the headquarters cut was consistent with the
overall extramural reduction taken across the water program as a result
of the EPM general reduction.
Question. The backlog in EPA issued Major NPDES permits has tripled
over the last 10 years and the NPDES permit universe will expand in the
storm water and concentrated animal feeding operation areas. The fiscal
year 1998 Integrity Act Report stated that without timely permit re-
issuance, necessary improvements in water quality will not occur. How
does the timely re-issuance of NPDES permits improve water quality.
Answer. NPDES permits establish specific, enforceable pollutant
discharge targets that must be achieved by the permittee to ensure that
water quality is protected and that technology goals are achieved. If
the permit is current and properly drafted, it should reflect all
current and applicable water quality and technology goals. If the
permittee complies with all of its permit conditions, the environment
should be protected.
If, however, the current permit-holder has submitted a timely and
complete permit application for renewal of its permit, and the
permitting authority fails to issue a new permit prior to the
expiration date, the expired permit will generally be administratively
continued, allowing the conditions and requirements to remain in effect
until the new permit is issued. Federal regulations permit
administrative continuances under these circumstances for federally-
issued permits, as do most states. States and EPA remain able to take
enforcement actions against violations of these ``administratively
continued'' permits. In many cases, EPA or the state would reissue the
same permit levels, in which case, the backlog of these permits poses
no threat to the environment. In other cases, a new or revised effluent
guideline, water quality standard or TMDL would cause the permitting
agency to revise the permit levels. In these cases, the
``administratively continued'' permits are less protective of the
environment.
safety of food funding
Question. The fiscal year 2000 Annual Performance Plan includes a
substantial funding increase to meet the Agency Objective of Reducing
Use on Food of Pesticides Not Meeting (Food Safety) Standards. The
reason this large increase is needed in part, however, is because EPA
cut this program itself in the fiscal year 1999 Enacted Operating Plan.
Why, when Congress gave EPA a 2.6 percent increase from fiscal year
1998 to fiscal year 1999 enacted levels for Environmental Programs and
Management, did the Agency cut efforts to reduce use on food of
pesticides not meeting standards by over 16 percent from fiscal year
1998 to fiscal year 1999?
Answer. While the Agency did receive a small increase in the
Environmental Program Management (EPM) appropriation, this increase was
offset by the combined effect of Cost Of Living Adjustments (COLAs) for
staff, increases in rent and other infrastructure costs, and by
congressional set-asides. These factors contributed to reductions in
numerous Agency programs, including several priority areas such as the
Agency Objective of Reducing Use on Food of Pesticides Not Meeting
(Food Safety) Standards.
Question. In general, are the health risks to adults and children
from current pesticides which need to be reregistered to meet new
statutory food safety standards relatively greater than the risks posed
by new pesticides?
Answer. Many older chemicals have risk profiles that are not of
concern, however, a significant number of major chemicals that have not
yet been completely reviewed through reregistration or tolerance
reassessment have risk characteristics of concern to the Agency. For
example, over 5000 of the 9728 food tolerances that need to be
reassessed under FQPA are in ``Group 1'', meaning that they appear to
pose the greatest risk to public health. These may include the
organophosphates, carbamates, organochlorines and pesticides considered
probable or possible human carcinogens.
Question. How did EPA's 20 percent cut from fiscal year 1998 to
fiscal year 1999 enacted levels for the Reregistration Eligibility
Decisions activity, which contributes to the Agency Objective of
Reducing Use on Food of Pesticides Not Meeting (Food Safety) Standards,
affect the Agency's ability to make those decision and improve the
safety of food produced and consumed by Americans?
Answer. The Agency continues to hold the safety of our food supply
as one of its highest priorities. Those activities which most directly
affect our food safety, such as tolerance reassessments and
registration of reduced risk pesticides were protected from budget
reductions to the extent possible. We are continuing to place greater
emphasis on reregistration of chemicals which have food uses, in
particular to those which affect children's foods. The reductions to
the Reregistration program in both Reregistration Eligibility Decisions
(REDs) and Special Review will affect REDs production in both this year
and 2000, and will affect both food and non-food use. However the
extent of the delay in these reregistrations has not yet been fully
evaluated. Our efforts to make decisions on those chemicals which are
of highest concern, such as the organophosphates, carbamates and
carcinogens remain a priority. The Agency continues to work with the
registrants and other stakeholders in order to maximize our resources
and minimize the impact of these reductions.
Question. How did EPA's 40 percent cut from fiscal year 1998 to
fiscal year 1999 enacted levels for the Special Review activity, which
contributes to the Agency Objective of Reducing Use on Food of
Pesticides Not Meeting (Food Safety) Standards, affect the Agency's
ability to perform those reviews and improve the safety of food
produced and consumed by Americans?
Answer. See above.
agency performance measures
Question. The Agency's only performance measures towards GPRA
implementation in the fiscal year 2000 Annual Performance Plan concern
completing the measures in a timely manner. Why does the Agency not
include any qualitative GPRA performance measures or goals such as
increasing the number of outcome based goals or measures?
Answer. The Agency is committed to improving its performance
measures and developing outcome measures and goals where appropriate
and when data are available. In other words, we are pursuing practical
improvements in the manner of expressing and measuring performance
goals, but not in a single-minded manner. Your suggestions that EPA
could measure its progress in GPRA implementation via the number of
outcome-based performance goals is an intriguing idea. However, such a
measure, by itself, would mask several considerations. Among these
would be the ability to measure prospective outcomes, which varies
among our environmental programs. Also, each of the Agency's programs
needs a complementary set of both output and outcome measures and goals
to effectively manage and assess how individual program activities
contribute to achieving the Agency's long-term strategic commitments.
The optimal set of performance measures and goals, therefore, will be
different for each program.
Question. The General Accounting Office estimates that outcome
performance measures make up only 15 percent of the performance
measures in the fiscal year 2000 Annual Performance Plan and
Congressional Justification. Does EPA believe the current number of
outcome measures versus the number of output measures is adequate to
measure the Agency's impact on the environment?
Answer. EPA's intended long-term positive impacts on the
environment are expressed in the EPA Strategic Plan's environmental
goals (Goals 1-6) and general objectives under those goals. The
majority of these general objectives articulate the Agency's intent to
achieve specific environmental outcomes. The Agency is committed to be
able to measure progress towards achieving these objectives by the
target year for each strategic objective (e.g., 2005). In the Agency's
Annual Performance Plan, EPA provides annual performance goals and
measures for activities the Agency plans to conduct over the year that
are necessary for achieving the longer-term strategic environmental
outcome objectives. Where needed, the Agency intends to develop the
necessary data, analytical methods, indicators and measures to be able
to assess progress in achieving these longer-term strategic
environmental outcome objectives. Outcome-oriented annual performance
measures and goals will be incorporated into future Annual Performance
Plans as necessary data and analytical methods become available, and
the Agency expects the percentage of outcome-based performance goals to
increase.
Question. How does the Agency believe its actions impact the
environment and human health positively if the Agency is unable to
measure change in behavior in the regulated community or the
environment which result from EPA activities?
Answer. Both of the measures you cite are certainly important ways
to gauge the value of environmental programs, but clearly there are
other kinds of information necessary to grasp the positive impacts of
EPA's actions. For example, every significant regulatory action entails
exhaustive consideration and analysis of risk, economic, and societal
impacts. We acknowledge, however, that better measures of societal
behavior and environmental trends would certainly help us assess the
Agency's priorities and performance. This in fact is EPA's whole
purpose in creating its integrated planning, budgeting and
accountability framework. Thus, as we have indicated above, we are
seeking steady improvement in measuring such outcomes, and using these
measures in performance plans.
Question. What resources in dollars and FTE does the Agency
currently devote towards developing performance measures? What level of
resources are required to develop additional outcome performance
measures?
Answer. EPA's accounting system does not specifically track dollars
and FTE devoted to developing performance measures. In general,
however, each of EPA's programs identifies the specific data and
methods required for effective results-based management at all
organizational levels, thereby incorporating associated resource
requirements into routine program and project planning. In addition,
the Center for Environmental Information and Statistics, as part of the
Agency's new Information Office, is in the process of assessing the
Agency's long-term strategic information needs.
Question. What steps is EPA taking to increase the ratio of outcome
measures versus output measures?
Answer. As stated above, the Agency expresses its intended long-
term strategic environmental outcomes in EPA's Strategic Plan's general
objectives. Specific outcome-oriented annual performance goals and
measures that evaluate the Agency's progress in achieving these
environmental outcome objectives will be incorporated into the Agency's
Annual Performance Plans as data and assessment methods become
available.
enforcement performance goals and measures
Question. Thirteen of fifteen performance measures in the
Enforcement and Compliance Assurance program's objective to Reduce
Noncompliance measure outputs such as inspections, investigations and
reports generated. Is changing the behavior of the regulated community
or impacting the environment positively a goal of the Enforcement
program and if so why does the program not measure more of its
performance toward these type of goals?
Answer. Changing the behavior of the regulated community and
impacting the environment positively are the results which EPA's
enforcement and compliance assurance program strive to achieve and
measure. Under the objective about reducing noncompliance, there are
actually five outcome measures which pertain to environmental impact
and changing the behavior of the regulated community. They are: percent
of enforcement actions which require pollutant reductions; estimated
pounds of pollutants reduced; rates of noncompliance for selected
environmental problems (which measures compliance behavior of certain
regulated populations); percentage of significant violators with
recurring significant violations within 2 years (which measures
recidivism behavior of the most serious violators); and average time
for significant violators to return to compliance (which also measures
behavior of the most serious violators). All five of these outcomes
measure environmental impact or behavior change which is due, at least
in part, to the actions of EPA or state enforcement efforts. In
addition, we are working to develop other measures of environmental
impact and behavior change for this objective. These additional
measures are: percent of enforcement actions which lead to changes in
use or handling of pollutants by facilities; and percentage of
enforcement cases which lead to improvement in environmental management
practices and information at facilities.
Question. All of the performance measures regarding Compliance
Monitoring Activities are measures of Agency outputs such as
investigations or inspections. Does the Enforcement program not expect
these activities will produce a change in behavior by the regulated
community or improve the environment? If the Agency believes these
activities will change behavior or improve the environment, how is the
Agency measuring this improvement?
Answer. EPA believes that compliance monitoring activities such as
inspections and investigations contribute to behavior change and
environmental improvement. EPA's inspection presence contributes to
improved rates of compliance and individual inspections result in
changes and improvements at specific facilities. To measure these
facility-specific changes, EPA's Region II office is conducting a pilot
project to document results (e.g., changes in environmental management
practices) achieved through individual objectives. The pilot project
will be completed by December 1999, the results of the pilot will be
reviewed, and a decision will be made about whether to implement the
pilot for the entire national program.
Question. The performance measure for the Compliance Incentive
activity, which encourages entities to conduct audits and disclose and
correct violations, contains only an output measure tracking the number
of facilities participating in the program. Does the Agency not believe
this policy produces environmental benefits? If the Agency does believe
these policies are improving the environment, how is the program
measuring this performance?
Answer. The performance measure for compliance incentive activity--
i.e., the number of facilities that self-disclosed potential
violations--focuses on an outcome that actually results from a change
in behavior by a regulated facility. Facilities and companies come
forward voluntarily to use the audit and self-disclosure policy
developed and offered by EPA. In addition, we are beginning to measure
the same kinds of environmental and behavioral change outcomes for
audit policy settlements that we are currently measuring for completed
enforcement actions.
Question. While the Enforcement and Compliance Assurance program
included a performance measure tracking the increase in Small Business
Compliance Assistance Center (Center) usage in fiscal year 1999, there
is no similar measure in fiscal year 2000. Is increasing Center usage
no longer a goal of the program?
Answer. The fiscal year 1999 performance measure regarding
increased usage was designed to capture increased activity from the
expansion of Compliance Assistance Centers, of which 5 were added in
fiscal year 1999. There are no new Centers planned for fiscal year
2000. The fiscal year 2000 Plan, for Goal 9, Objective 2, includes a
measure of ``Number of facilities reached through targeted compliance
assistance'' which would include facilities receiving compliance
through the centers or any other program initiative.
Question. The fiscal year 2000 Annual Plan and Congressional
Justification no longer contains performance measures of Federal
Actions under the National Environmental Policy Act. Is this a function
no longer engaged in measurable performance?
Answer. The fiscal year 2000 Annual Plan contains a performance
plan measure for NEPA implementation under Goal 9, Objective 2, Sub-
Objective 3. The measure reads ``325 major proposed Federal actions,
i.e., Draft Environmental Impact Statements (DEIS) to be filed''
Question. Why are the performance measures under development in the
National Performance Measures Strategy (Strategy) and scheduled to
become operational in fiscal year 1999 or at the beginning of fiscal
year 2000 not in the Agency's fiscal year 2000 Annual Plan?
Answer. All of the measures scheduled to become operational in
fiscal year 1999 or fiscal year 2000 under the National Performance
Measures Strategy are incorporated into the fiscal year 2000 Annual
Plan. In the Annual Plan, measures being developed under the Strategy
are sometimes stated more specifically and in terms of a target. For
example, Set 2 of the Strategy is described as ``Environmental and
human health improvements from EPA enforcement actions.'' In the Annual
Plan, we have used two measures from Set 2--percent of enforcement
actions that require pollutant reductions, and pounds of pollutants
reduced--and set targets for each.
Question. Will the Strategy implement Phase II performance measures
of statistically valid compliance rates and environmental and human
health improvements by the beginning of fiscal year 2000?
Answer. EPA is currently working with a statistical consultant on a
methodology for developing statistically valid rates of compliance. At
the beginning of fiscal year 2000, EPA regional offices will be asked
to conduct inspections based on a random and representative sample of
facilities in selected regulated populations. These random inspections,
combined with inspections based on other targeting criteria, will be
used to generate statistically valid compliance rates. The rates will
be based on all inspection activity conducted through the end of fiscal
year 2000.
Question. One EPA official has suggested that the amount of money
spent in ``supplemental environmental projects'' (SEPS) as part of
settlements is a good measure of the Enforcement and Compliance
Assurance Program's impact. In fiscal year 1998, EPA enforcement action
resulted in $90 million worth of SEPs. Is $90 million in SEPs a good
return on the $321 million spent under Goal 9 in fiscal year 1998?
Answer. Money spent in ``supplemental environmental projects'' is
one of several measures of the environmental impact that EPA
enforcement actions can achieve. Setting a specific amount of SEP
dollars as a goal or target to achieve would be an inappropriate
performance measure, since SEP amounts are a by-product of specific
cases targeted through criteria involving noncompliance patterns and/or
environmental risk. In addition, comparing the SEP dollars generated to
the total amount spent under all of Goal 9 is inappropriate since only
a portion of the resources under Goal 9 are dedicated to enforcement
cases.
compliance assistance
Question. Steven Herman, Assistant Administrator for Enforcement
and Compliance Assurance, stated at a January 1999 conference that
``EPA is a law enforcement Agency.'' Is it the position of EPA that EPA
is a law enforcement Agency?
Answer. Protecting the public and the environment from risks
imposed by violations of environmental laws and regulations is, and
always has been, basic to EPA's mission. Formal law enforcement is one
important component of EPA's responsibilities and will continue to be a
central and indispensable element of our efforts to ensure compliance.
EPA's strong and aggressive enforcement program has been the
centerpiece of efforts to ensure compliance and has achieved
significant improvements in human health and the environment.
Question. If ``EPA is a law enforcement Agency,'' is the Agency
still committed to non-law enforcement tools such as Compliance
Assistance which would bring about compliance? Does reducing the
Compliance Assistance program stem from the belief that ``EPA is a law
enforcement Agency'' and thus should not been engaged in Compliance
Assistance programs?
Answer. EPA is not reducing its compliance assistance program. The
Agency is actually increasing funding to several important compliance
assistance activities, such as to the compliance assistance centers and
for tools development.
EPA is committed to using the full set of available tools--
including compliance assistance--in the pursuit of compliance
assurance. Although formal law enforcement is the cornerstone of our
efforts, the continuation of serious environmental problems and changes
in the scope and types of activities and entities that are regulated
requires EPA to use a range of approaches to motivating environmental
law compliance. Formal civil and criminal enforcement are supported by
effective compliance assistance and compliance incentive programs. In
fact, it is the very success of its formal enforcement program that has
allowed EPA to develop these complementary programs over the last
several years.
Proceeding from the 1994 reorganization of enforcement and
compliance operations, EPA has built a very robust compliance
assistance program. The Agency has developed and implemented a new set
of policies and tools to further improve environmental compliance. EPA
provides information on federal rules and regulations through the nine
compliance assistance centers which we are committed to sustaining in
the future. The Agency has also developed 27 sector notebooks, 18 plain
language guides, and self-auditing checklists and protocols. EPA has
been and will continue to work cooperatively and productively with
those in the regulated community who want to do the right thing but may
need some assistance to get there.
EPA's 2000 budget request does not reflect a shift in compliance
assistance resources to enforcement activities. Through a recent study
of Regional enforcement and compliance work, we learned that our
previous methodology identified more workyears providing compliance
assistance than were actually doing this type of work. EPA's fiscal
year 2000 budget displays how regional resources have actually been
applied.
Question. The fiscal year 2000 Annual Performance Plan states the
Agency plans to reduce the compliance assistance program with the
expectation that the states will assume the majority of this work in
fiscal year 2000. The Agency has cited the inability of the states to
perform fully their environmental duties as the rationale for a wide
range of positions including the need to maintain a Federal enforcement
and compliance assurance presence. Why is the Agency attempting to
devolve the Compliance Assistance Program to the states if it does not
trust the states are capable of maintaining the full range of
environmental programs?
Answer. As with many of our other environmental protection
responsibilities, EPA relies on a strong and effective state-EPA
partnership to provide effective compliance assistance to the regulated
community. EPA's role has been and continues to be to develop and
distribute compliance assistance information and tools for business and
industry. As the primary providers of direct assistance to the
regulated community, states and localities and other compliance
assistance providers use or adapt EPA compliance assistance materials
to reflect specific state or local requirements. We believe this
relationship has been very successful in improving the regulated
community's awareness and understanding of its environmental
obligations.
This belief was supported by participants from a wide range of
public and private sector organization who attended recent conferences
on EPA's compliance programs. These participants confirmed the value of
EPA's compliance assistance tools and materials and urged us to
continue developing general compliance assistance tools that are widely
applicable and that are made widely available through the Internet,
toll-free hot lines and other appropriate channels. We also heard
strong support for the view that states are the first-line, on-site
purveyors of compliance assistance. EPA is continuing to work with the
states and other assistance providers to develop a strong network that
exchanges information and tools and minimizes duplicate services.
Question. The 2000 Annual Performance Plan states an analysis of
Regional resource information indicated many of the compliance
assistance resources are actually conducting inspections and pursuing
cases since the Office of Enforcement and Compliance Assurance (OECA)
reorganization. How much of these resources were shifted to enforcement
duties over the years after the reorganization?
Answer. OECA recently conducted a study of the compliance
assistance and enforcement work being done in the Regions during the
1998 and planned for 1999. Results from the study prompted us to
revisit the methodology previously used to estimate regional resources
dedicated to compliance assistance activities. We found that the
previous methodology identified more workyears providing compliance
assistance than were actually doing this type of work. In order to be
consistent with the Government Performance and Results Act framework of
aligning resources with intended use, our fiscal year 2000 budget
request reflects how our regional resources have actually been utilized
between compliance assistance and enforcement (rather than a shift from
compliance assistance to enforcement.)
Question. What compliance assistance guidance and tools development
would the Agency not perform if it made its proposed cuts in this area
under the fiscal year 2000 Annual Performance Plan?
Answer. EPA will focus its efforts on developing widely applicable
compliance assistance information and tools related to national program
concerns. We would look to the states and other public and private
compliance assistance providers to develop and disseminate compliance
assistance tools that address a situation specific to a geographic area
or localized industry. Further, we would devote a greater portion of
our staff resources to in-house compliance tool development from
contract management responsibilities.
Question. What compliance assistance would the Agency not provide
Federal Facilities if EPA made the proposed cuts under the fiscal year
2000 Annual Performance Plan?
Answer. EPA will continue to provide compliance assistance to
Federal facilities through its new on-line compliance assistance center
and through the development of guides, manuals and other compliance
assistance tools. On-site assistance activities conducted by the
Regions, including environmental management reviews and pollution
prevention opportunity assessments, would be reduced. Conferences,
workshops and training for Federal facilities also are likely to be
impacted, although this may be somewhat offset by regional staff using
in-house resources in lieu of contract support efforts.
Question. An Agency Task Force on Innovative Approaches to
Environmental Protection recommended EPA adopt a holistic Agency-wide
strategy for compliance assistance that encompasses the full range of
the regulatory program, from rulemaking through compliance and
enforcement. The program of general compliance assistance would enable
EPA to develop a compliance assistance approach that included a
compliance guide and a self-audit checklist for each new major
regulation, develop a set of delivery options for each tool and
evaluate the effectiveness of each tool.
How much would it cost per year to develop compliance assistance
tools as part of the rulemaking package for every major new regulation?
How much would it cost per year to deliver compliance assistance
tools to the regulated community and to organizations likely to have
contact with the regulated community as part of the rulemaking for
every major regulation?
How much would it cost per year to: (1) begin wider dissemination
of compliance assistance and pollution prevention information and tools
to State, local, tribal and private compliance assistance providers;
(2) develop a clearinghouse of compliance assistance materials and
tools; (3) begin developing a national network of federally-funded
business and environmental assistance programs by convening a national
meeting in 1999 to identify general principles for collaboration; and
(4)convene a national Compliance Assistance Forum to share information
with participants on recently-developed compliance assistance
materials, get stakeholder input in setting priorities for development
of compliance assistance materials, and facilitate exchange of tools.
Answer. To date, the report drafted by the Agency Task Force on
Innovative Approaches to Environmental Protection has not received
final approval from Administrator Browner and is still being revised.
Also, we intend to get the input of other public and private compliance
assistance providers in setting priorities for development of
compliance assistance materials. Therefore, it would be premature to
offer estimates of the resources required to implement this report
since its final content is unknown.
small business compliance assistance centers
Question. How many and which of the Small Business Compliance
Assistance Centers (Centers) have submitted multi-year operating plans
to the Agency? What is the total cost of all the Centers in fiscal year
2000 as submitted by the Centers to EPA in their multi-year operating
plans? What is the total EPA funding requested in fiscal year 2000 by
the Centers in their multi-year operating plan?
Answer. In 1998, the Center Grantees were asked to develop five-
year operating plans in order to initiate discussions on long-term
planning. The five-year operating plans developed by the grantees
describe the overall plans for the individual Centers, outline the
Center goals, and present strategic plans over the five-year period.
All nine Centers are addressed in the operating plans. Through this
planning exercise, the grantees identified their options, needs, and
desires to maintain and enhance their Centers. Projected funding
requests for fiscal year 1998 through fiscal year 2002 were identified
in the plans, but there was never a commitment made that the requested
funds would be available or received. That was understood during the
development of the operating plans. Instead, the five-year operating
plans are a planning tool which project an fiscal year 2000 total
operating cost of approximately $2,960,000 for the nine Centers, which
assumes contributions from EPA, in-kind contributions from the
Grantees, and revenue-generating proposals as well. Of this amount,
approximately $1,596,000 was specifically requested in EPA to fund the
Centers in fiscal year 2000.
Question. What level of funding does EPA include in its fiscal year
2000 President's Budget Request for Center Operating costs? What levels
of funding has EPA verbally indicated at the staff level it will
provide each of the Centers in fiscal year 2000?
Answer. The President's fiscal year 2000 Budget includes a request
of $1,500,000 to fund EPA's portion of Center operating costs in fiscal
year 2000. EPA staff have not verbally provided the Center grantees
with an indication of the amount of funding that EPA will provide to
each Center in fiscal year 2000.
Question. What indications has EPA received from the Centers as to
whether they will be able to meet their goals of self-sufficiency in
fiscal year 2000 and beyond? Does EPA believe the Centers will meet
their non-EPA contributions towards self-sufficiency in fiscal year
2000 and beyond?
Answer. EPA does not believe the Centers will achieve self-
sufficiency in fiscal year 2000, and has serious doubts as to whether
the Centers can achieve self-sufficiency beyond fiscal year 2000. The
Centers are exploring various mechanisms to generate funds to support
Center operations. For example, various Centers have attempted to
generate funds through a Web site registration fee, seeking industry
contributions, and selling advertising space and compliance assistance
tools. To date, such activities have generated minimal revenue compared
to what is needed to maintain the Centers. In addition, it has been
argued that activities which require payment conflict with the Centers'
mission to provide readily available compliance assistance information
to small businesses.
Question. Will EPA allow Centers to close if the Centers are unable
to meet their self funding goals and EPA funding is insufficient to
meet Center operating costs? Will EPA allow Centers to become inactive
or otherwise unable to provide updated information to compliance
assistance clients?
Answer. In the fiscal year 2000 EPA President's budget, the
viability and maintenance of the nine Centers is assured. Although we
cannot be certain of out-year budgets at this time, we view the Centers
as a priority. To best meet the needs of the customers of the nine
Centers, it is critical that EPA be provided flexibility with regard to
the funding allocations for each individual Center. The Agency takes
into account a variety of factors, such as national program priorities,
available funding, client needs, costs of different Center services,
changes in sector requirements on an annual basis, and Web site usage
trends to appropriately allocate annual funds to each of the nine
Centers.
Question. How many visitors did the Centers have to their websites
in fiscal year 1999? How many ``hits'' are the Centers' websites
currently receiving per month?
Answer. The Centers have experienced over 150,000 user sessions in
the first six months of fiscal year 1999. Since January 1999, the
Centers have experienced an average of 405,000 ``hits'' per month. We
believe that the number of user sessions, the number of visits to the a
site (not the number of pages visited or hit), is the most accurate
figure to use to gauge Centers' usage.
Question. How many frequent Centers website visitors are taking
some positive action in their facilities concerning environmental
compliance? What percentage of total frequent website visitors does
this represent?
Answer. In fiscal year 1998, on-line surveys were posted on five
Centers for two months to assess use rates and user satisfaction of the
Centers. Of the center users, 905 responded to the surveys
(representing a 6-15 percent survey response rate.) Eighty-five percent
of the users who completed the surveys (surveyed users) stated that
they visit the centers at least monthly, and nearly one third of the
surveyed users stated that they visit the centers weekly. Survey
respondents also identified behavioral changes that resulted from their
use of the Centers. Of the 214 survey responses addressing behavioral
change, 81 percent stated that they took an action as a result of using
the Centers. For example, Center users contacted a vendor, requested
technical assistance, contacted a regulatory agency, changed a process,
obtained a permit, or changed waste handling practices.
Question. It is estimated that because of their small size, EPA and
state regulators are unable to and thus will not visit or inspect more
than 200,000 of the 500,000 auto service and repair establishments.
Likewise, EPA and/or state regulators will not visit between 90 and 95
percent of printers because they are small quantity generators and
regulators are appropriately targeting larger facilities. Does EPA have
any statistics on the number or percent of facilities in the other
sectors covered by Centers which EPA will not reach because of their
size or other factors?
Answer. The Agency targets industry sectors (sectors) for
inspections based upon the sector's compliance history and impact on
the environment, such as pollutant releases and risk. In addition,
facilities may be inspected based on tips and complaints from the
public; the length of time since last inspected; demographic
considerations; new regulatory requirements which impact the facility;
facility classification or size; and other considerations. The Agency's
fiscal year 2000/2001 OECA Memorandum of Agreement Guidance identifies
the following national EPA priorities for fiscal year 2000/2001 based
on the factors listed above: (1) Clean Water Act--wet weather; (2) Safe
Drinking Water Act--microbial rules; (3) Clean Air Act--New Source
Review/Prevention of Significant Deterioration; (4) Clean Air Act--air
toxics; (5) Resource Conversation and Recover Act--permit evaders; (6)
petroleum refinery sector; and (7) metal services (electroplating and
coating) sector.
In general, the Agency tends to target larger facilities for
inspections, while small businesses tend to be targeted for compliance
assistance activities unless they are the subject of a citizen
complaint or place the community at risk due to their practices. The
establishment of the nine Centers has enabled the Agency to reach a far
greater number of small businesses than could be accomplished through
EPA site-visit activities. This was one of the reasons for establishing
the Centers. But for the printed wiring board manufacturing sector, the
sectors covered by the Centers are comprised of numerous facilities,
many of which are small businesses. As with the auto service and repair
and printing sectors, limited resources do not allow EPA and state
regulators to annually visit or inspect a majority of the facilities
within these sectors. For example, EPA estimates that (1) 50 to 60
percent of the transportation sector covered by the Transportation
Environmental Resource Center are not inspected annually; and (2) 70
percent and 50 percent of the chemical preparation and industrial
organic chemical manufacturers respectively are not inspected annually.
State activities are generally not reported to EPA on a sector basis.
agency audit policy: self disclosure of potential violations
Question. What percentage of disclosures under the Audit Policy
disclosed paperwork or record keeping violations versus disclosures of
environmental violations as measured by recent study of the audit
policy?
Answer. Eighty-four percent of the disclosures evaluated involved
violations of reporting, record-keeping, or labeling requirements. I
should note that many violations of emission or discharge standards are
required to be identified by prescribed monitoring (e.g., through stack
testing or daily sampling). Because such violations are identified and
reported through required monitoring rather than through voluntary
audits, they are not eligible for relief under either EPA's policy or
state audit laws.
Question. If a goal of the Enforcement and Compliance program is to
have 75 percent of concluded enforcement actions require environmental
or human health improvements, why does the current Audit Policy
emphasize paperwork or record keeping violations?
Answer. While EPA is committed to obtaining human health or
environmental improvements from concluded enforcement actions, this
term encompasses those cases that EPA initiates after independently
identifying a violation. We have generally not considered violations
that are voluntarily disclosed and corrected under our audit policy to
be ``enforcement actions'' in the traditional sense. For example, these
disclosures are separately tracked in our docket, and many cases can be
resolved by issuing a letter indicating that noncompliance has been
corrected. As noted above, many violations of discharge and emission
requirements are required to be monitored and reported, and are
therefore not eligible for relief under either EPA policy or state law.
Many so-called ``paperwork requirements are mandated by laws
established by Congress, and operate to prevent spills, serious
accidents or other mishaps. The audit policy has proved to be an
efficient means to obtain voluntary compliance with such requirements.
Question. Would changes in the type of penalties reduced by the
Audit Policy produce more disclosures and thus prompt correction of
environmental violations as opposed to violations of paperwork or
record keeping requirements?
Answer. EPA is considering non-penalty-related changes to the Audit
Policy that we hope will encourage additional disclosures. Our recent
proposal in the Federal Register suggests that disclosure time from
point of discovery be extended from 10 to 21 days, and that a multi-
facility corporation not necessarily be disqualified from the policy
for disclosures made at a facility even where an investigation has
occurred at another of its facilities. EPA is also encouraged by the
results of targeted outreach and views it as a mechanism for
encouraging disclosure of more substantive violations. It is our
experience that the greatest gains under the Audit Policy are made when
EPA reaches out to a specific industry sector, in some cases
identifying recently-enacted regulations or those that may be prone to
noncompliance within that sector, and invites the sector to audit and
disclose. For example, EPA's outreach effort with the
telecommunications industry resulted in violation disclosures and
corrections at over 700 facilities.
It is unclear, however, that changes to the Audit Policy will
necessarily affect the volume of disclosures made by regulated
entities. The recent National Conference of State Legislatures study
found no statistically significant difference in auditing rates based
on whether the state in which the facility operates has an
environmental audit law, audit policy, or no law or policy. It follows
that changes to an existing policy may have a similarly insignificant
effect.
Question. What percentage of disclosures made under the Audit
Policy have been made under Federal programs which are not delegated to
the states?
Answer. Ninety-two percent of the disclosures made to EPA involve
programs for which EPA has lead responsibility. In general, we would
expect most disclosure to be made directly to the state agencies that
are authorized to administer federal programs, and have taken steps to
avoid inconsistency and confusion, and thereby encourage disclosures at
the state level. EPA has worked closely with states such as Texas,
Ohio, Michigan, South Dakota, and Minnesota to assure that state audit
immunity laws provide incentives to disclose while meeting minimum
requirements necessary for authorized federal programs. Other states,
such as California, Florida and Pennsylvania, have worked with EPA to
develop appropriate policies to encourage self-disclosure and
correction.
Question. What is the average number of pages of information EPA
has obtained from entities disclosing violations under the audit policy
to prove the audit was conducted properly and that the violation was
properly repaired?
Answer. Although EPA does not keep data on the length of disclosure
documents, typically entities disclose in several pages of text, which
often includes an elective analysis of how the disclosure meets the
conditions of the Audit Policy. EPA encourages disclosures to use a
checklist, available on OECA's website, to assist in providing relevant
information. EPA frequently receives phone calls from prospective
disclosures requesting a chart or format for their disclosure.
Question. The Spring Audit Policy Update states that approximately
470 entities at more than 1,800 facilities disclosed violations under
the Audit Policy. What percentage of the total number of entities or
facilities committing violations in the same period do these numbers
represent?
Answer. EPA does not have access to records that would indicate the
total number of violations that have occurred at all facilities over
the past three years. Clearly, the audit policy disclosures are a small
fraction of that total. As stated above, many violations are required
to be monitored under specific requirements of regulations or permits
and are not discovered through voluntary audits. These include, for
example, violations of discharge limits at major facilities permitted
under the Clean Water Act.
Question. Why have less than one-third of disclosures made under
the Audit Policy resulted in settlements?
Answer. EPA has granted penalty relief for approximately half of
the facilities covered by disclosures. The difference between the
number of facilities disclosed and the number of facilities provided
settlement may fall into one of several situations: (1) the disclosure
has not yet been resolved through settlement; (2) the disclosure did
not meet the conditions of the Audit Policy; (3) upon further analysis,
EPA determined that a violation did not occur; or (4) the entity
disclosed to EPA the identity of several facilities at the onset of a
corporate-wide audit believing that the audit would reveal violations
at all facilities, and upon conducting the audit discovered violations
at some but not all of the facilities. EPA is taking steps to best
manage the facilities in the first category. For example, EPA is making
use of self-certification and unilateral letters of determination for
certain types of cases, such as those involving fewer violations. EPA
encourages the use of disclosure checklists by the disclosures so that
the disclosure includes all of the information needed for EPA to
determine policy applicability and resolve cases in a timely fashion.
In addition, EPA now has a national audit policy coordinator to field
questions from Regional offices and the regulated community, and is
adapting its data systems to better track pertinent case information,
both of which are changes that we expect will expedite processing in
many cases.
Question. Does the Agency believe the amount of environmental
improvement which could be obtained through the elimination of all
penalties outweigh the value of those penalties currently collected by
the Agency under the current Audit Policy? How does the Agency measure
this belief?
Answer. The Audit Policy strikes a critical balance in EPA's
enforcement program by rewarding parties who voluntarily and timely
disclose and correct violations, while ensuring that no regulated
entities gain an unfair business advantage by avoiding compliance with
legal requirements. EPA believes that elimination of all penalties in
Audit Policy cases would likely result in decreased environmental
improvement by disrupting the balance that the Audit Policy strikes.
Elimination of all penalties would provide a disincentive for entities
to be proactive in environmental compliance and would provide financial
incentives for those entities less diligent in environmental
compliance.
enforcement accomplishments
Question. Why did civil enforcement activity in the areas of
administrative penalty order settlements, administrative non-penalty
orders--cases concluded, EPA civil referrals to Department of Justice
(DOJ) and civil judicial settlements all decrease from fiscal year 1997
to fiscal year 1998?
Answer. The Environmental Protection Agency's enforcement program
experienced a slight decrease in traditional enforcement outputs
between the 1997 and 1998 fiscal years, as measured by civil judicial
referrals and settlements, and civil penalties collected. Inspections
and administrative orders actually increased somewhat over that period.
Overall, we do not believe that the small decrease in civil
judicial activity between fiscal year 1997 and 1998 is particularly
significant. To some extent, it reflects the cyclical nature of the
case development process. For example, several large settlements
totaling nearly $100 million in penalties were not entered until just
after the 1998 fiscal year ended, and so were not reflected in last
year's accounting.
We believe that an increased emphasis on cases that offer the
greatest environmental benefit could have some impact on the total
number of referrals, as such actions are more complex and require more
resources. The value of injunctive relief rose from $1.89 billion to
$1.98 billion between 1997 and 1998, reflecting a trend toward
development of more significant cases. Our settlement with
manufacturers of heavy duty diesel engines will reduce emissions of
nitrogen oxides by 1.3 million tons, or 6 percent of the total national
inventory of NOX pollutants. We have attached a summary of
the environmental results obtained through enforcement actions, which
reflect our commitment to making progress in reducing actual pollutant
loadings.
Question. Why did major criminal enforcement outputs such as
referrals, sentences and fines decrease from fiscal year 1997 to fiscal
year 1998?
Answer. The outputs for EPA's criminal enforcement efforts
fluctuate somewhat from year to year based on the type and mix of cases
being prosecuted by the Department of Justice (DOJ). Generally there
has been a consistent trend in the growth of all outputs.
A number of the criminal enforcement outputs increased slightly
from fiscal year 1997 to fiscal year 1998, while others decreased. The
number of defendants indicted during this period rose 8.7 percent from
232 individual and 90 corporate defendants in fiscal year 1997 to 257
individual and 93 corporate defendants in fiscal year 1998.
Additionally, the number of criminal cases initiated in fiscal year
1998 rose by 15.4 percent from 551 in fiscal year 1997 to 636 in fiscal
year 1998.
Two of the outputs referred to in the question are not under the
direct control of EPA's criminal program. The Federal Judiciary
determines what the individual sentences are to be and the amount of
the fine in accordance with the Federal Sentencing Guidelines. The
total amount of jail time defendants were sentenced to serve decreased
11.7 percent from 195.8 years in fiscal year 1997 to 172.9 years in
fiscal year 1998. Fines decreased from $169.3 million to $92.8 million.
This is due primarily to the fact that the fiscal year 1997 total
includes one fine for $75 million from a particularly egregious case
where a barge carrying fuel oil sank off Puerto Rico fouling the
beaches at the height of the tourist season.
The number of criminal cases referred to DOJ decreased in fiscal
year 1998 by 4.3 percent from 278 in fiscal year 1997 to 266 in fiscal
year 1998. This decrease is attributable to a shift in emphasis to more
complex, resource intensive investigations that require multiple agent
involvement. As we continue to train more state and local environmental
enforcement personnel, the EPA criminal program is concentrating on
more complex inter-regional investigations. As a result there is an
increase in the quality of cases and a decrease in the quantity of
cases. State and local criminal investigators are handling the more
routine and localized violations. The Criminal Investigation Division's
Special Agents have been directed to place their emphasis on cases that
involve both significant environmental harm and culpable conduct. Our
expectation is that this level of referrals to DOJ will remain fairly
constant into the future.
Question. Is the Agency emphasizing more difficult, complex, multi-
state actions which produce fewer outputs such as cases concluded or
penalties achieved? Do these complex and multi-state actions produce
greater environmental improvements than casework which might produce
higher output totals?
Answer. Traditionally, EPA has enforced the environmental laws by
bringing actions against individual facilities for violations of a
single statute. Over the past few years, the Agency has broadened its
enforcement efforts to address non-compliance by single companies at
their facilities in more than one state, under one or more of the
environmental laws. Although these complex actions may produce fewer
discrete cases, the environmental benefits and resource efficiencies
gained greatly outweigh the results which could have been obtained by
pursuing violations at each of these facilities individually. The total
penalties achieved are appropriate to resolution of the violations
alleged; however, the scale of these actions provide enhanced
opportunities for agreements by companies to perform supplemental
environmental projects, which tend to mitigate the final penalty number
reported.
In addition to increasing the environmental benefits gained, it
should be noted that these multi-state cases also exemplify the
uniquely effective role of federal enforcement. Single states do not
have the resources or legal ability to address nationwide environmental
violations in a systematic and coordinated way, or to fashion the
national, comprehensive settlements now being achieved by the Agency.
An example of the benefits attained through a multi-state approach,
even for violations of just one statute, is the 1996 settlement with
the Georgia Pacific Corporation for alleged failure to comply with the
Clean Air Act regulations at 26 of the corporation's engineered wood
products facilities. The company had ignored its legal responsibility
to obtain permits and to report air emissions accurately, causing
annual excess emissions of more than 5,000 tons of volatile organic
compounds (``VOCs,'' the precursors to smog and ozone) into the
environment. As a result of EPA's national enforcement action, Georgia
Pacific paid $6 million in penalties, applied for the appropriate state
air permits at 19 facilities, and installed state-of-the-art pollution
control equipment--designed to reduce VOC emissions by about 90 percent
--at 11 of the 26 facilities, mostly located in the Southeast. An
additional total of $5.25 million was committed for supplemental
environmental projects, including funding critical research on air
pollution in the Southern Appalachians. Finally, the company agreed to
perform comprehensive clean air audits at all 26 of its wood products
facilities nationwide and monitor compliance limits on a daily basis.
EPA has also obtained substantial benefits from complex, multimedia
enforcement actions to address violations of two or more environmental
statutes.
On April 15, 1999, EPA filed in federal court the second, final
phase of a national agreement with ASARCO, Inc., a national mining and
smelting company. The first phase of this agreement was completed in
January 1998. The entire settlement represents the first time that the
federal government has entered into a consolidated agreement that
resolves violations of different environmental statutes at more than
one of a company's facilities. Texas and Arizona were co-plaintiffs in
this agreement.
This comprehensive approach to resolution of ASARCO's environmental
liabilities protects public health and the environment by reducing the
release of certain heavy metals, such as arsenic, mercury and lead,
which can be toxic to both humans and wildlife. For example, the
company has agreed to clean up the environmental impacts at its Montana
operation that resulted from 100 years of smelting activities and to
operate a subsidiary in Texas as a permitted, lawful recycling facility
for metal plating and finishing wastes, one of only three in the
nation. It also builds environmental safeguards for the future: A major
and unique commitment by ASARCO in this historic agreement is the
establishment of a five-year environmental management and compliance
auditing program involving 6,000 employees at its 32 operating
facilities nationwide.
Only a complex, consolidated approach to resolution of a company's
environmental liabilities will create sufficient opportunity to obtain
corporate-wide improvements and nation-wide environmental protections.
NESS also allows the Agency to use its limited enforcement resources
more efficiently in a manner that complements, but does not duplicate,
the enforcement agendas of state governments. For example, instead of
numerous government agencies each taking separate actions under one
environmental law against individual facilities of a national
corporation, only a single action is initiated. The program reduces
costs, improves performance, and provides the opportunity for
partnering between state and federal government and industry.
Another example is EPA's October 1, 1998, consent decree with
Ashland, Inc. which resolves multimedia violations found at Ashland's
three petroleum refineries, located in Kentucky, Minnesota, and Ohio.
EPA alleged that Ashland had violated the CAA, CWA, RCRA, EPCRA, and
TSCA. In addition to penalties Ashland will pay $14.9 million to
perform supplemental environmental projects (``SEPs''). One SEP is an
innovative project that will restore 274 acres of rare prairie grass
ecosystem in Minnesota and donate the land to the State; this tract is
the largest unprotected native prairie in the Twin Cities area.
The corrective actions Ashland is undertaking includes improvements
to the wastewater drainage system at its Ohio facility to prevent the
release of volatile organic pollutants into the atmosphere, upgrades to
the wastewater treatment system at the Kentucky plant to reduce the
release of harmful chemicals into the Big Sandy River, and the
installation of a series of wells to prevent the release of petroleum
contaminants into the Mississippi River in Minnesota. Ashland is also
required to reduce particulate releases and improve the recovery of
sulphur dioxide at the Ohio refinery. Sulfur dioxide is an air
pollutant that can affect human health, especially that of asthmatics,
harm vegetation and aquatic life by acidifying lakes and streams. The
company will also undertake air monitoring and analysis in the Tri-
State area of Kentucky, Ohio, and West Virginia.
Question. In fiscal year 1998, EPA enforcement actions required
chemical or pollutant reductions or eliminations in almost a third of
all cases. This is well below the fiscal year 2000 performance goal of
75 percent of enforcement actions requiring environmental or human
health improvements. How does the Agency intend to pursue more cases
which require environmental improvements and less cases which do not
produce improvements but may concern paperwork or record keeping
requirements?
Answer. EPA is working hard to improve its selection of enforcement
priorities and its specific targeting efforts to focus on those
violations that present the greatest threats to human health and the
environment. Our priorities for fiscal year 2000 and 2001, for example,
which were developed in consultation with EPA program offices as well
as states, focus on reducing nitrogen oxides and other criteria air
pollutants from unpermitted operations, toxic air emissions, the
illegal and unsafe handling of hazardous waste, and ``wet weather''
flows of raw sewage and other contaminants from sewer collection
systems. These priorities will lead to actions that result in
significant environmental improvements; as noted above, our settlement
with manufacturers of heavy duty diesel engines will reduce illegal
nitrogen oxide emissions by 1.3 million tons.
In the meantime, EPA must still take actions that serve to identify
and avoid environmental or human health risks before they become much
worse. For example, risk notification requirements under various
environmental laws serve to warn emergency personnel of the presence of
toxic materials at particular sites, and the absence of this
information has resulted in injury or death to firefighting personnel.
EPA is exploring how best to measure the value of actions that prevent
accidents or other serious risks, as opposed to responding to events
after pollution has already been released or residents near a facility
have been forced to evacuate their homes. The Agency has been
particularly successful in working with the regulated community to
encourage voluntary disclosure and correction of violations in return
for eliminating or greatly reducing penalties. For example, since
January 1998, we have concluded settlements with 11 telecommunications
companies, under the Audit Policy, that have led to correction of
Emergency Planning and Community Right-to-Know Act (EPCRA) and/or Clean
Water Act (CWA) Spill Prevention Control and Countermeasure (SPCC)
Violations at more than 700 facilities.
reinventing environmental information
Question. Provide the status as of Q2/fiscal year 1999 of each REI
milestone for implementation of data standards and electronic reporting
into the national systems including an identification of any milestones
which the Agency has missed or expects to miss as of the Q2/fiscal year
1999 and any actions, strategies or efforts to achieve missed
milestones or avert missing of milestones the Agency expects to miss.
Answer. Although some interim milestones have been revised as the
work dictates, the data standards development program is on schedule to
be completed by February 2001. Based upon our current work, we are
hopeful that we may in fact beat this date by some months.
Implementation of data standards and electronic reporting in EPA
information systems is on schedule to meet the REI Action Plan date of
Quarter 2, fiscal year 2003.
------------------------------------------------------------------------
Status
------------------------------------------------------------------------
Status of Data Standards:
Date Standard................. Final
Industrial Classification..... Final
Facility Identification....... Interim
Latitude/Longitude............ Interim
Chemical Identification....... Interim
Biological Identification..... Interim
Electronic Reporting Standards Draft standards for all systems
(scheduled 12/31/99)
------------------------------------------------------------------------
Question. Describe by Goal, Objective, Sub-Objective, Key Program,
Office, and Activity, the level of resources including dollars and FTE
assigned or loaned to REI efforts in fiscal year 1998, proposed in the
fiscal year 1999 President's Budget, included in the fiscal year 1999
Operating Plan, spent in fiscal year 1999 to date, and proposed in the
fiscal year 2000 President's Budget.
Answer. See the attached table.
[GRAPHIC] [TIFF OMITTED] T05AP29.025
Question. Identify and describe the GPRA or Agency performance
measures in fiscal year 1999 and fiscal year 2000 which incorporate REI
commitments.
Answer. There are two Agency performance measures in fiscal year
1999 and fiscal year 2000 which incorporate REI commitments: the One
Stop Program and Facility ID.
------------------------------------------------------------------------
Fiscal year 1999 Fiscal year 2000
Measure commitment commitment
------------------------------------------------------------------------
One Stop Program............ By 1999, the Agency By 2000, the Agency
will streamline and will streamline and
improve the improve the
information information
reporting process reporting process
between state between state
partners and EPA by partners and EPA by
increasing the increasing the
number of number of
participants in the participants in the
One Stop program to One Stop program
29 states. from 29 to 38
states.
Facility ID................. By 1999, establish a By 2000, increase
National Facility Facility ID file
ID file with accuracy by
accurate establishing a
information for National Facility
30,000 facilities ID file with
that report to the accurate
TRI. information for
100,000 facilities.
------------------------------------------------------------------------
small business regulatory enforcement fairness act (sbrefa)
Question. With the ongoing dismantling of the Office of Policy and
the potential for that office to lose its Presidential appointee, what
plans does EPA have for the group which conducts Agency SBREFA
activities including the panel process? Will EPA ensure that this
activity is afforded the resources and attention necessary to
successfully perform its function?
Answer. To date, no final decision concerning the Office of Policy
has been made. EPA is proud of its record of outreach to small entities
subject to environmental regulation. Along with SBA and OMB, the Agency
has completed 15 Small Business Advocacy Review Panels, and the Agency
has been fairly recognized for the energy and care we have devoted to
our responsibilities under SBREFA. Because not only the public
interest, but also the specific work of the Agency, benefits
conspicuously by the inclusion of small entities in our policy
decisions, we are strongly committed to maintaining the set of
services. EPA will continue to devote the attention and resources
appropriate to an excellent job of including small entities in the
regulatory decisions that affect them.
project xl
Question. As of April 30, 1999, how many Final Project Agreements
(FPA) has EPA implemented?
Answer. As of April 30, 1999, EPA had 11 FPAs in implementation and
12 proposals in the final stages of development (when the details of
FPAs are hammered out). The Agency and its state partners are also in
the process of reviewing and giving serious consideration to 18
additional proposals. In addition, we are working with potential
project sponsors on developing written proposals for another 19
promising project suggestions and are holding initial discussions with
sponsors on 20 more ideas.
Question. As of April 30, 1999, what is the total amount of dollars
spent by EPA on contracts to solicit, find, encourage or obtain Project
XL participants?
Answer. At the end of 1997, EPA took stock and found that most XL
project proposals had been submitted to the Agency by companies. In
order to identify a wider variety of XL project sponsors and ideas,
particularly in areas where the Agency wanted to see innovative
thinking occur (such as environmental technology, source reduction, and
product life cycle), EPA issued two Requests for Proposals, one in
Headquarters and one in Region I in Boston. The objective was to select
three or four outside organizations which could work effectively as co-
sponsors, coordinators, or facilitators and help create the wider
variety of projects EPA was seeking. In Headquarters, we selected 3
organizations to help us achieve that objective: (1) the Denver
Research Group in collaboration with the National Conference of Black
Mayors, which proposed to develop an Environmental Management System
for businesses in the Greater St. Louis Metropolitan region; (2) ML
Strategies, working with the Santa Fe Council on Environmental
Excellence, which proposed to bring ideas developed by a consortium of
New England universities to fruition, involving improved ways to manage
wastes from thousands of small research laboratories; and (3) the
Minnesota Center for Environmental Advocacy, an environmental group,
which proposed to work with the Mayo Clinic to reduce the hospital's
toxic waste, especially mercury and dioxin. Region I selected The
Conservation Law Foundation that proposed to identify and develop
especially community-sponsored XL projects. The total amount spent on
these four small purchase orders by April 30, 1999, was $195,050.
The effort was successful in that the small contracts have
resulted, so far, in one Final Project Agreement to be signed in June,
several promising projects still under development, and one project
that had been facilitated by the XL program, but did not need to be
implemented under XL to be completed.
EPA's regional office in Texas spent approximately another $7,000
for contractor assistance in planning and facilitating the XL program
share of a marketing workshop covering all of Region 6's reinvention
programs. This effort resulted in one project currently being developed
into a proposal. The combined efforts of the Office of Reinvention and
the two regions to use contractor support to develop proposals amounts
to $202,050.
The Office of Reinvention in Headquarters spent an additional
$55,000 for contractor support over the past two years to assist it
with general XL marketing activities, such as writing and designing a
marketing brochure, developing a database of potential project sponsors
to be contacted, organizing a meeting with consulting firms that might
be interested in Project XL, writing fact sheets, and assisting with
large mailings.
In summary, the total amount of dollars spent by EPA on contracts
by April 30, 1999, to solicit, find, encourage or obtain Project XL
participants was $257,050.
Question. Of the FPAs EPA is currently implementing, how many
originated through assistance from a contractor?
Answer. All of EPA's XL projects in implementation originated
before EPA started to use contractor support for developing proposals.
However, EPA is expecting to sign a Final Project Agreement in June for
the New England Labs project that was developed through one of our
small purchase order contracts, and several more are in the pipeline.
npdes backlog
Question. EPA has declared the backlog in the National Pollutant
Discharge Elimination System (NPDES) program a material weakness. In
Region 10, for example, there were 1,000 NPDES permit applications
waiting to be processed of which 70 percent were over 4 years old. Why
do we have this backlog?
Answer. EPA estimates that approximately 28 percent of major NPDES
permits and between 28 and 47 percent of minor NPDES permits are
currently expired. Of these, approximately 3.7 percent of majors, and
between 16 and 34 percent of minors, have been expired for more than 5
years. As noted, EPA Region 10 has a higher than average backlog rate;
approximately 60 percent of majors, and 72 percent of minors.
A number of reasons have been identified for the existence and
persistence of permit backlog. Among them are the: expanding universe
of facilities requiring NPDES permit coverage, e.g., the addition of
Concentrated Animal Feeding Operations (CAFOs) and Storm Water to the
NPDES program; the increasing complexity of the NPDES permitting
program due to State adoption of numeric water quality standards, Total
Maximum Daily Load (TMDL) requirements, and more complex industrial
operations; increasing involvement (e.g., hearings, challenges,
appeals) of outside parties in permit development and issuance slowing
the overall process; and high staff turnover and training limitations
at the State and Regional level. EPA is currently investigating the
degree to which the above-cited reasons are impacting the program at
various levels by examining permitting efficiencies and resource needs
and gaps. Targeted efforts are also underway in several Regions and
States to clean up incorrect permit expiration data, and to accelerate
issuance of NPDES permits.
Question. What is the potential impact to the environment of not
eliminating the backlog?
Answer. Environmental impacts occur when unacceptable levels of
pollutants are discharged from an industrial or municipal facility.
Such discharges may occur whether or not an NPDES permit has been
issued, or whether the permit is current or expired (backlogged). The
importance of the permit, however, is that it establishes the specific,
enforceable pollutant discharge targets that must be achieved by the
permittee to ensure that water quality is protected and that technology
goals are achieved. If the permit is current and properly drafted, it
should reflect all current and applicable water quality and technology
goals. If the permittee complies with all of its permit conditions, the
environment should be protected.
If the current permit-holder has submitted a timely and complete
permit application for renewal of its permit, and the permitting
authority fails to issue a new permit prior to the expiration date, the
expired permit will generally be ``administratively continued'',
allowing the conditions and requirements to remain in effect until the
new permit is issued. States and EPA remain able to take enforcement
actions against violations of these ``administratively continued''
permits. In many cases, EPA or the state would reissue the same permit
levels, in which case, the backlog of these permits poses no threat to
the environment. In other cases, a new or revised effluent guideline,
water quality standard or TMDL would cause the permitting Agency to
revise the permit levels. In these cases, the ``administratively
continued'' permits are less protective of the environment.
Question. Will the budget request allow EPA to eliminate the
backlog? How much money would be required to eliminate the permit
backlog in non-delegated States and in delegated States?
Answer. Our budget request allows for a multi-pronged approach to
eliminating backlog in delegated and non-delegated States, including
direct permit issuance assistance to several Regions and States;
broader use of tools developed in some Regions and States such as
general permits, electronic ``permit wizard'' programs, and streamlined
procedures to expedite issuance; and the development of strategies in
partnership with States for eliminating backlog while maintaining high
permit quality. As we implement these initiatives, we hope to
significantly reduce the backlog and better assess better the
sufficiency of available resources to eliminate the backlog. EPA does
not currently have a complete picture of the resource needs at the
State level, but will develop a better understanding through an ongoing
resource gap analysis (to be completed Fall 1999) and by partnering
with high backlog States to develop specific State strategies for
eliminating backlog.
Question. In the STAG account, the request included $115.6 million
for State water quality management grants (CWA section 106) and $19
million for water quality cooperative agreements (CWA section
104(b)(3), the same levels provided in the fiscal year 1999
appropriation. States use these grants to support a variety of CWA
implementation activities, including permitting, standard setting,
monitoring, and enforcement. How will EPA work with States to ensure
that NPDES-delegated States use these resources to address their permit
backlogs? How will EPA determine if States are devoting sufficient
resources to this problem?
Answer. EPA will be developing backlog reduction strategies in
partnership with the States that will address State-specific needs,
examine and pilot new approaches, examine inefficiencies in the
existing process, and set fixed targets and goals for permit issuance
while maintaining high permit quality. Working through the giant
negotiation process, the Agency will work to ensure that the States are
developing a level of resources commensurate with their strategies and
program targets and goals.
Question. If permit backlogs are such a chronic problem, what new
approaches is EPA looking at, such as the self-certification program
the State of Massachusetts has piloted called Environmental Results
Program?
Answer. EPA realizes that the ever-expanding scope and complexity
of the NPDES program has led to systemic resource shortfalls and
backlogs in many States. Solutions may require bold experimentation and
the widespread adoption, in certain cases, of new programs that have
been successful in some States. EPA is examining a suite of
innovations, including the increased use of electronic ``permit
wizard'' programs, technical exchanges and fora between permit writers
in various States, and the piloting of programs such as New York
State's Environmental Benefits Permit Strategy (EBPS), which provides
greater efficiency by separating and prioritizing administrative and
technical permit issuance tasks.
Question. How will the new NPDES permit requirements for animal
feeding operations impact the backlog?
Answer. Over the past 25 years, the focus of the NPDES permit
program has been the control of industrial and municipal point sources
of pollution. To date, efforts have been directed mostly toward the
more traditional point sources with discrete discharge outfalls.
Sources such as concentrated animal feeding operations are not new to
the NPDES program, but are point sources that have been within the
scope of the NPDES program for many years. As the more traditional
point sources have implemented appropriate controls, sources such as
CAFOs have become sources from which controls would yield the greatest
environmental benefit. As EPA and States identify and address these
types of sources, the universe of facilities required to be covered
under an NPDES permit will continue to expand. It is likely, however,
that permitting authorities will choose to permit most concentrated
animal feeding operations under general NPDES permits. Since general
permits allow the coverage of large numbers of facilities under a
single permit, the increase in administrative burden to the overall
permit program will be lessened.
Question. Please provide a breakout of the budget request for NPDES
permitting for new permits versus updating existing permits.
Answer. EPA estimates that approximately 1,300 existing major
permits and 12,500 existing minor permits expire in an average calendar
year. While no precise estimates on new individual permits are
available, the Agency believes that these numbers are small (perhaps 20
majors, and 500 minors) relative to existing permits. The NPDES budget
request is intended to address all aspects of permitting, including new
permits and re-issuance of expired permits. The budget request also
supports Agency efforts to more accurately characterize the NPDES
universe and to identify issues affecting the permit backlog. This
includes providing assistance and guidance to States and Regions for
management of Compliance data and develop backlog reduction strategies.
cwap: added funds
Question. With respect to the Clean Water Action Plan, what
assurances does EPA have that the added funds the agency is spending in
the first year of the program are having their intended effect? What
assurances can the agency provide that the public will get a good
return on that investment and on the additional CWAP funds being sought
for fiscal year 2000?
Answer. The fiscal year 1999 funds added for CWAP were primarily
for grants to states under Section 319 of the Clean Water Act ($95
million incremental funds)--plus $20 million for section 106 state
program management grants. The section 319 funds are being awarded on
schedule, i.e., during the spring of 1999, for work that will take
place later in 1999 and into 2000. Although the funds are just being
awarded, we already have some assurances that the funds will be
targeted at the highest priority needs. In making the incremental funds
available to states, the CWAP envisioned targeting those funds to
watersheds which the states and tribes identify as priorities for
restoration, based on Unified Watershed Assessments (UWA's), which were
to be prepared by the states and tribes. All of the states and many
tribes now have completed their UWA's.
Likewise we have asked the states to upgrade their section 319
programs as a pre-requisite to receiving incremental funds in the
future. We are already seeing many states and tribes upgrading their
Section 319 programs to incorporate nine key elements which were
identified in national guidance, which was developed in cooperation
with the Association of State and Interstate Water Pollution Control
Agencies (ASIWPCA). This upgrading of states' non-point source programs
provides further assurance that CWAP funding is having and will
continue to have the intended effect. Moreover, as we review states'
non-point source program workplans, as well as project-specific and
place-specific proposals for spending the incremental Section 319
funds, we see these plans and projects clearly indicating that the
funds will be used for the CWAP's intended purposes, i.e., for
development and implementation of watershed restoration action
strategies--with the inclusion of multiple agencies and other
stakeholders in both the planning and implementation phases.
EPA and other federal agencies have been working with tribal,
state, and local partners to implement the more than 100 key actions in
the CWAP. The first anniversary report highlights the progress made
toward implementation of the Action Plan and outlines the agenda for
future years. Accomplishments in the first year include the development
of a national animal feeding operations strategy, development of a
multi-year strategy for the development and implementation of nutrient
criteria for specific waterbodies across the country, installation of
EPA's Beach Watch Website that provides the first national listing of
beach water quality monitoring information, and development of
watershed priorities through Unified Watershed Assessments. In 2000 and
future years, federal agencies will continue to monitor progress toward
key actions and the four major objectives of the CWAP--improve
information and citizens' right-to-know, address polluted runoff,
enhance natural resources stewardship, and protect public health. The
Agencies will also be developing comprehensive performance measures to
measure the net results of CWAP in future years, taking into account
the fact that it usually takes a few years to implement improvements
and to see the water quality benefits of those improvements.
tmdl program: internal cost assessments
Question. EPA has reportedly done some internal cost assessments of
anticipated revisions to the TMDL program. What are the Agency's
current cost estimates, in terms of impacts on states and the EPA? How
will the cost of the TMDL program affect implementation of other core
water quality activities? What state and EPA activities are being
delayed or deferred as a result of current emphasis on TMDLs?
Answer. The Administration is still developing proposed revisions
to the regulations governing the TMDL program required by Section
303(d) of the Clean Water Act. Part of this process involves estimating
additional costs of complying with any revisions. A final determination
on State costs has not been made.
The regulatory proposals are based on the consensus recommendations
of a Federal Advisory Committee for TMDLs. Four State Environmental
Department Secretaries or Deputy Secretaries were members of this
Committee and signed the final report presented to the Administrator in
July 1998. We expect to propose changes to the TMDL program in late
summer 1999; we expect final regulations sometime next year.
EPA anticipates that the implementation of the current TMDL program
can be borne by States and EPA with the support of the President's
Budget proposal for fiscal year 2000, without either delaying or
deferring other ongoing core water quality activities. The
implementation of any final revised TMDL regulations will occur in
later fiscal years. Working with the States, EPA has undertaken a water
quality gap analysis project to examine the future funding that States
need to effectively manage their water quality programs and will use
that analysis to inform future budget requests.
tmdl: sound science
Question. Stakeholders agree that sound scientific judgments are
and will continue to be required for developing and implementing TMDLs.
This includes scientific judgments as to the levels of pollutants that
are safe for aquatic life in a waterway and calculation of the quantity
of pollutants discharged that will not impair a waterway and how load
limitations are allocated among sources. Yet many are concerned that
needed technical and scientific information is inadequate. What
resources is EPA devoting to assist states in this regard?
Answer. Resources supplementing State TMDL efforts are found in
state water pollution control grants under Clean Water Act Sec. 106, in
Sec. 319 state nonpoint source grants, and in EPA's operating
resources. Section 106 grants, for which the Agency has requested
$115.5 million in 2000, support a wide range of water pollution control
activities including permitting, water quality planning and standard
setting, assessment and monitoring, and TMDL development and
implementation. While EPA does not generally request (nor allocate to
states, Tribes or interstate agencies) specific resource levels for the
various eligible activities within the Sec. 106 budget, EPA's 1998
request did include an increase to support TMDL activities. We continue
to emphasize the importance of establishing and maintaining adequate
TMDL programs from within available Sec. 106 resources. Beginning in
1999, states are permitted to use up to 20 percent of their Sec. 319
allocation to upgrade and refine their nonpoint source programs and
assessments. A prominent example of potentially eligible Sec. 319
activities is the development of TMDLs to help implement Watershed
Restoration Action Strategies developed by states for high-priority
watersheds. Aside from this direct state grant funding, EPA also
requests resources to be used by EPA in direct and indirect support of
states' TMDL efforts. At approximately $15 million in the 2000 request,
these resources support technical assistance on specific TMDLs,
training of state personnel, development of national guidance and
policy, and backstopping state efforts as necessary to meet TMDL
development deadlines.
Question. How will EPA ensure the scientific soundness of TMDLs?
Answer. EPA is devoting a significant portion of its ecological
research program to better understanding the levels of pollutants that
are safe for aquatic life in a waterway, quantifying pollutant
discharges from non-point and atmospheric sources, developing
mathematical models that accurately calculate safe pollutant loads from
point, non-point, groundwater, and atmospheric sources of pollution,
identifying effective means for restoring aquatic ecosystems to sound
health, and monitoring actual progress toward that goal. Specific
examples include the development of biocriteria (indicators for
determining the health of aquatic ecosystems based on the species
present in the water body), landscape ecology (using satellite imagery
to assess the impact on land use and land cover on non-point source
pollutants to surface waters), the Environmental Monitoring and
Assessment Program (EMAP)which is developing monitoring methods in
Eastern U.S. coastal waters and inland waters in the Western U.S., as
well as the Coastal Monitoring program, which has the potential for
providing baseline information for TMDL's in estuaries. In addition,
the Multimedia Integrated Modeling System (MIMS) will be a next-
generation modeling system that will link air, water, groundwater, and
biological models in highly realistic configurations.
More specifically, ORD is conducting near-term research on
improving the scientific basis for setting TMDLs for sediment,
nutrients, pathogenic organisms, and temperature. The results of this
work will be incorporated into a nationally-applicable advanced
problem-solving software framework that will permit easier use by the
states, including automated links to land use, meteorological and
aquatic organism effects data bases. This work is being conducted
primarily in the Savannah River. Our scientists are also working
directly with program offices to demonstrate cross-media TMDLs for
mercury in Florida and Wisconsin. The completion of these regional
demonstration models are anticipated within the next two years and the
results will provide important feedback on our ability to apply these
techniques nationwide.
Finally, EPA's Science to Achieve Results (STAR) program is
supporting TMDL development through it's Water and Watersheds
partnership with NSF and USDA by soliciting research that will improve
our understanding of watershed processes relevant to TMDLs and of
analytical methods for determining how changes in the management of
upland and riparian areas affect the quality of water bodies,
especially with respect to mercury pollution, a widespread and growing
pollution problem in more than half of the states.
EPA insures the quality of all of it's scientific research through
a rigorous process of peer review, both prior to initiating research
efforts and of all research products. The STAR grants program relies on
its competitive grants process to identify the very best researchers
and research ideas.
state grants: fiscal year 1999 funding increase
Question. EPA officials have said that the fiscal year 1999 funding
increases for state grants (especially $95 million additional for
section 319 nonpoint pollution management grants) will be directed to
projects in priority watersheds, as identified by states in watershed
assessment reports prepared in 1998. However, because the time frame
for preparing those assessments was very short from June to October 1,
1998), there is some question about their quality and thoroughness.
What procedures will EPA use to oversee distribution of grant funds to
priority watersheds to ensure that funds are targeted to those with
highest need of restoration.
Answer. On December 4, 1998, EPA issued guidance on ``Funding the
Development and Implementation of Watershed Restoration Action
Strategies under Section 319 of the Clean Water Act.'' The primary
purpose of this guidance is to clarify the requirement for application
of incremental funds to priority watersheds (i.e., those for which
watershed restoration action strategies are to be developed). The
guidance calls for a clear indication in each Section 319 workplan of
``which grant activities will be implemented using the base funds and
which projects will be supported by the incremental funds.'' Likewise,
the guidance requires that ``subsequent reports (e.g., grantee
performance reports or annual nonpoint source progress reports under
Section 319(h)(11) should similarly clearly distinguish these
activities.''
We are also using the Section 319 Grants Tracking System (GRTS),
where states input detailed information about Section 319 grants, to
include information specific to projects supported by the incremental
funds. We are confident that the combination of extensive guidance,
specific tracking, and continuing adherence by states to standard grant
monitoring and reporting requirements will ensure the proper
application of the incremental funds.
children's health
Question. EPA is planning to fund eight research centers that will
help communities to reduce threats to environmental health. Other than
research, exactly what kinds of activities are being funded in the
communities by these centers?
Answer. EPA, NIEHS and CDC are supporting eight Centers for
Children's Environmental Health and Disease Prevention Research, each
of which will conduct multi-disciplinary basic and applied research in
combination with community based prevention research projects designed
to provide critical knowledge that will eventually help to decrease the
prevalence, morbidity, and mortality of environmentally-related
childhood diseases. All of the funded center projects are research
activities. Five of the centers will research asthma; three will
research health effects associated with pesticide exposure. A
requirement for research funding for the centers is that each center
support one project that develops, implements, and evaluates a
community based intervention/prevention program. Community based
prevention research studies are being designed with active community
involvement and are primarily intended to develop and test the
effectiveness and feasibility of various intervention strategies in
reducing exposures to environmental contaminants that contribute to
childhood illnesses. In fiscal year 2000, EPA will support an
additional research center, which will research developmental
disorders.
The overall theme and nature of the community based prevention
research activities for each of the eight established Centers are as
follows:
ASTHMA CENTERS:
University of Iowa School of Medicine.--Theme: The Etiology and
Pathogenesis of Airway Disease in Children from Rural Communities.
Prevention Research Component (Rural Iowa communities): Multi-component
Intervention Study of Asthma in Children from Rural Communities. The
goal of this study is to develop, implement, and test a multi-component
model for the prevention of asthma among rural children.
University of Southern California.--Theme: Respiratory Disease and
Prevention. Prevention Research Component (Los Angeles): Asthma In
Children: A Community-based Intervention Project will determine whether
a comprehensive health education program using IPM techniques for
cockroach control will result in reduction of dust mites or cockroaches
in children's homes and clinical improvements in asthma.
Johns Hopkins University.--Theme: Asthmatic Child in the Urban
Environment. Prevention Research Component (Baltimore, MD): Randomized,
Controlled Trial of Home Exposure Control in Asthma will test the
effectiveness of intervention methods to reduce hazardous exposures and
their adverse health effects.
University of Michigan School of Public Health.--Theme:
Environmental influences on asthma in children. Prevention Research
Component (Detroit, MI): aim is to test methodologies that reduce
exposure of children to environmental contaminants in their homes and
neighborhoods that trigger asthma, thereby improving asthma related
health status and reducing asthma-related medical care utilization.
Columbia School of Public Health.--Theme: Comprehensive community
based assessment and reduction of environmental risks to infants and
children. Prevention Research Component (South Bronx): Community-based
intervention project will test: effectiveness of community education in
raising awareness of environmental health risks and changing behaviors;
effectiveness of maternal education in reducing exposure to secondhand
smoke; effectiveness of household allergen reduction; and antioxidant
dietary supplementation to reduce asthma-related biomarkers.
PESTICIDE CENTERS:
University of California at Berkeley.--Theme: Exposures and Health
of Farm Worker Children in California. Prevention Research Component
(Salinas Valley, Monterey County, CA): Initiate and evaluate the impact
of a ``Healthy Home'' intervention on the reduction of pesticide
exposure to children.
Mount Sinai Medical Center.--Theme: Environmental Toxicants and
Neuro-developmental Impairment in Inner City Children. Prevention
Research Component (East Harlem): The goal of the prevention research
component--Growing Up Healthy in Harlem--is to test methodologies that
reduce exposures of inner-city children and their families to
pesticides in city housing through the technique of Integrated Pest
Management (IPM) and reduce exposure to PBS through dietary
modification.
University of Washington School of Public Health and Community
Medicine.--Theme: Understanding the biochemical, molecular, and
exposure mechanisms that define children's susceptibility to pesticides
and the implications for assessing pesticide risks to normal
development and learning. Prevention Research Component (Yakima Valley,
WA): Reducing Take-home Pesticide Exposures in Children of Farm Workers
Question. What statutory authority has EPA identified for this
overall [children's health] initiative? What authority do you cite for
the activities related to the control of asthma?
Answer. EPA's Office of Children's Health Protection was
established in 1997 in response to Executive Order 13045, which
mandates that Executive Branch departments and agencies make children's
environmental health and safety a priority. The role of the office is
to promote and coordinate a variety of cross-media activities related
to children's environmental health that are carried out by numerous EPA
offices implementing many environmental statutes, which are identified
below. Through the office, the Agency also has ongoing efforts to
coordinate children's environmental health and safety activities with
other Federal departments and agencies. Specific activities may be
authorized by one or more of these statutes. The primary authorities
for asthma related activities are specifically identified.
--Radon Gas & Indoor Air Quality Research Act (asthma)
--Clean Air Act, Section 103 (asthma)
--Toxic Substances Control Act, Section 10 (asthma)
--Federal Insecticide, Fungicide, and Rodenticide Act, Sec. 20
(asthma)
--Clean Water Act, Section 104
--Food Quality Protection Act
--Solid Waste Disposal Act, Section 8001
--Safe Drinking Water Act, Section 1442
--Pollution Prevention Act
--National Environmental Education Act
Question. Although there is some evidence that asthmatic symptoms
are aggravated by air pollution, is there any scientific evidence that
air pollutants, either criteria pollutants or hazardous air pollutants
cause asthma?
Answer. While exposure to outdoor air pollutants is not currently
thought to be a cause of asthma, evidence indicates that exposure to
air pollution is associated with exacerbation of asthma-related
symptoms. For example, increases in ambient ozone concentrations have
been associated with increases in hospital admissions for respiratory
causes for individuals with asthma, worsening of symptoms, decrements
in lung function, increase in lung inflammation, and increased
medication use (EPA-452/R-96-007, June 1996). Epidemiological research
has associated increased incidence of adult-onset asthma for those
individuals who have had childhood asthma, living in communities with
higher long-term ambient ozone concentrations. (McConnell et al., 1999)
Community epidemiology studies have also indicated that ambient
particulate matter levels can be associated with altered lung function
and increased respiratory symptoms in asthmatic patients, as well as
increases in hospital admissions for asthma. (Thurston et al., 1997;
Schwartz et al., 1994) Evidence for decreased lung function has also
been found in chamber studies of mild asthmatics with exposures to
environmental tobacco smoke. In addition, exposures to particulate
matter or ozone have been shown to have a ``priming'' effect for
responsiveness to allergens, with the pollutant exposure leading to
heightened responses to allergens among allergic asthmatics (Koenig, et
al., 1988; Kreit, et al., 1989).
House dust mites, cockroaches, mold and animal dander have been
identified as the principal indoor allergens that trigger asthma
symptoms. Reducing exposure to these allergens has been shown not only
to reduce asthma symptoms and the need for medication, but also to
improve lung function. Environmental tobacco smoke (also called
secondhand smoke) is an important irritant that can trigger an asthma
episode and possibly potentiate the effects of allergens.
Question. Does EPA plan to develop or distribute already developed
educational material on asthma before NAS completes its study of the
relationship between various environmental pollutants and asthma?
Answer. An asthma attack is one of several health endpoints that
have been associated over the past several years with indoor air
contaminants, including secondhand smoke and allergens such as dust
mites, cockroach allergen, animal (i.e., pet) dander, and mold. There
is consensus within the scientific community that reducing exposure to
secondhand smoke and allergens should reduce the frequency and severity
of respiratory illnesses in children, including but not limited to
asthma. The National Asthma Education and Prevention Program (NAEPP)
Expert Panel 2 Report (NIH Publication No. 97-4051, July 1997)
specifically recommends avoidance of secondhand smoke and other
allergens. Information developed by EPA and many other sources to help
people make informed, voluntary decisions to reduce their children's
(and their own) exposure to these and other contaminants is widely
available and being widely disseminated through many different
channels, including government, non-profit and industry networks.
The report is a follow-on study to a 1993 Institute of Medicine of
the National Academy of Sciences (IOM/NAS) report on Indoor Allergens
that helped to focus attention on the links between the growing problem
of asthma and indoor air pollution. The study now being conducted by
the NAS addresses only indoor pollutants rather than all environmental
contaminants, and is scheduled to be completed in the Fall of 1999.
The NAS report is expected to help to consolidate an extensive body
of already published scientific literature into a concise summary of
what is, and is not, currently known about the role that indoor
pollutants play in the induction and exacerbation of asthma. The report
will include less studied contaminants such as pesticides, particles,
nitrous oxides and other chemicals and irritants. While the report is
expected to help further refine existing guidance and information on
effective prevention strategies and identify critical information gaps,
there currently exists a consensus among the scientific community that
disseminating exposure reduction information will help protect children
as well as adults from indoor contaminants.
clean air partnership fund: grants to cities
Question. EPA is requesting $200 million for a new Clean Air
Partnership Fund for grants to cities, states and tribes together with
the private sector to demonstrate ways to reduce air pollution. How did
EPA establish $200 million as the amount requested for the fund?
Answer. EPA is requesting $200 million in fiscal year 2000 for the
Clean Air Partnership Fund based on years of discussions with potential
grants recipients concerning the air quality improvement challenges
they face. The $200 million request will provide a significant new
source of support for innovative, integrated air quality improvement
demonstrations that currently are not being implemented.
office of information management
Question. EPA has decided to create an office of information
management, which is to be operational by the end of summer. Will this
office have the authority including purse-string controls to compel
other EPA offices to follow through on the policies and procedures it
sets forth on disseminating EPA data? How will EPA overcome potential
resistance to centralized policies, after 30 years of free reign for
the individual program offices of data systems?
Answer. In October 1998, The Administrator made the decision to
create a new information office as the result of recommendations made
by an Agency-wide task force of senior managers representing both
national programs and Regions. In making this decision, she accepted
the position of the task force that the Agency and its stakeholders
would benefit from more centralized responsibility for its information
policy and activities. This broad internal consensus has enabled the
Agency to move quickly to create a new organization that pulls the
information life cycle into one place with a customer focus. It will
provide a single, coherent, and coordinated strategy for information
collection, management, use, and dissemination. It will have authority
to review major investments in data collection and information
technology and to develop and implement policy on key information
issues such as data dissemination.
To better assure commitment to, understanding of, and compliance
with the Agency-wide information policies that the Office will develop,
the Deputy Administrator has been meeting regularly with Agency senior
managers to develop a means by which the National Program Manager for
information can meet directly with the senior leadership of the Agency
on a continuing basis. This mechanism, while still being refined, will
create a council of Assistant and Regional Administrator level leaders,
staffed by the new information office, that will provide a forum to
discuss and resolve information policy issues, develop effective
strategies for policy implementation, and review progress in key areas.
office of information management: implementation plan
Question. EPA has not yet developed an information plan to show how
the agency intends to achieve its visions and goals--even while the new
office is supposed to be in operation in a few months. EPA has
indicated it will have a plan at the end of September, after the office
is operational. Shouldn't you have this plan in place before setting up
the office? Will the plan lay out the EPA's information management
priorities, and the resources needed to accomplish them? Can you tell
us now what the priorities of the office will be?
Answer. The new information office will provide leadership to
develop an information plan (technically referred to as an information
architecture) for the information and information technology to support
EPA's mission. Developing this type of plan at an Agency-wide level is
a relatively new approach to information management across government
and is very complex, but the value is clear: this planning approach
provides a better mechanism to effectively and efficiently plan our
information and technology investments on a multi-year basis. We will
identify and coordinate information needs, with anticipated burden
reduction for existing requirements, coordinate technology investments,
and improve public access to and ability to use information from
multiple sources.
As a first step in this effort, EPA will develop a high-level plan
to define the information needed to support our public access mission.
We will build upon the current work in identifying emerging information
needs and opportunities for burden reduction to determine both priority
information needs for public information and critical data needs for
implementing EPA's programs. This approach will be coordinated with
improvements in the Agency Strategic Plan and work on core performance
measures under the National Environmental Performance Partnerships
program. EPA will combine the results with other architecture planning
processes across our other mission areas as the new organization builds
this capacity. We will then be in a position to identify high and low
priority needs, opportunities to increase effectiveness and lower
costs, make plans on a multi-year basis to acquire needed information
and technology, and phase out unneeded or outdated information and
technology.
Developing the Information Plan will involve many parts of the
Agency not just the new Information Office. We will also work closely
with our State partners and with all of our information customers to
ensure that the Information Plan is something the Agency can and will
use to improve our information practices to improve our service
internally and externally. While the Plan will not be completed before
the new Information Office is fully operational, its development will
be one of the highest priorities of the new office. The Agency does not
believe that the plan need be fully developed in order for the new
office to begin its critical work. Indeed, the ability of the Agency to
work through a single office to address all aspects of information
collection, management and dissemination will help us develop an
Information Plan that is of high quality and utility.
As we develop the Plan, we will be able to do an increasingly
better job of setting information priorities that reflect an Agency-
wide perspective, rather than a stovepipe, program-by-program
perspective. We will also be working to identify the resources needed
to accomplish those priorities.
In addition to developing an Information Plan, we have identified
several important top-level goals for the new Information Office. These
goals are:
Integrate information.--Increase the effectiveness of environmental
information by better integrating and coordinating the information
collected, its management, and its synthesis into products for
decision-makers and the public.
Strengthen information partnerships.--Increase the extent and
effectiveness of information partnerships, including leveraging
information technology investments, to meet the needs of our varied
information managers and customers. This starts with States and tribes,
and extends to other federal, local, international agencies, and
private organizations.
Enhance information quality.--Increase the value of environmental
information for all stakeholders by seeking customer feedback and
systematically improving its usability, clarity, accuracy and
reliability. This includes development of compatible data standards and
ensuring that quality is known and appropriate for intended uses.
Foster information-based decision-making.--Evaluate data and
communicate its utility to improve environmental decision-making.
Generate new trend and outcome information that promotes adaptive and
forward-looking environmental management by decision-makers at all
levels.
Reduce burden.--Increase the efficiency of information collection
by reducing unnecessary EPA, State, and stakeholder cost and burden of
collecting and using information
Strengthen EPA's information infrastructure.--Increase the
efficiency, effectiveness and coherence of the information
infrastructure. This involves strategic investment in technology,
increasing the reliability (Y2K) and integration of installed
technology, and enhancing information security.
Expand American's right to know about their environment.--Enable
easy access to a wealth of information about the state of their local
environment to expand citizen understanding and involvement and give
people tools to protect their families and their communities as they
see fit. Increased information transparency among scientists, public
health officials, businesses, citizens, and all levels of government
will foster greater knowledge about the environment and what can be
done to protect it.
office of information management: reporting burden reduction and rei
Question. Among the many issues this office will address is
reporting burden. Reducing the burden of reporting redundant or
unnecessary information is important not only to the regulated
community but also to regulators. What goals have been set for easing
the reporting burden, especially for small businesses?
Answer. EPA seeks reporting burden reductions from three categories
of respondents: (1) state partners reporting information to EPA, (2)
regulated entities who report information to the Agency and the states,
and (3) users of information provided by EPA. While efforts to reduce
reporting obligations continue at the program level, we hope to
identify larger burden reduction opportunities through implementation
of the REI data standards and electronic reporting.
In addition, EPA and the states intend to critically examine the
data needed for programmatic and public access purposes. EPA is
creating an automated capability to portray the full range of EPA
reporting requirements. With this, EPA, the states, and regulated
entities can get a better picture of reporting obligations, and can
look at this burden sector-by-sector to identify burden reduction
opportunities.
With respect to state reporting burden, EPA and its state partners
are creating a process to explore burden reduction ideas on a state-by-
state basis. We will make sure that reporting requirements yield high
quality, needed information at the lowest possible costs. All of these
efforts will pursue alternatives to current reporting approaches,
including whole facility reporting.
EPA has adopted the Paperwork Reduction Act goal of reducing
paperwork burden by five percent each year, although in recent years
reductions have been offset by increases due to implementation of the
Toxic Release Inventory, other right-to-know programs, and by new
statutory requirements. EPA does not have a separate burden reduction
goal for small business but does place a high priority on reducing or
minimizing burden on them. EPA has begun a dialogue with a group of
small business representatives to explore additional opportunities for
reducing reporting burden and to ensure that REI and other reporting
initiatives are well aligned with small business needs.
rei: data standards
Question. REI involves developing data standards, including a
uniform identifier for a regulated facility. EPA has been trying to
develop such a standard as far back as 1994. Why is it taking so long
to develop this fundamental element for achieving the plan's stated
data integration goal? What assurance can you give us that you will be
able to meet the September 1999 target set for completing this and all
other standards required by the plan?
Answer. The REI Facility Identification data standard was approved
as an interim data standard in February 1998. Since that time, EPA has
been working with states to refine the standard to ensure that it meets
all of EPA's stakeholders needs. The final standard is scheduled to be
issued by September 30, 1999. Business rules for implementing the
standard are being developed in conjunction with the states.
This is a difficult data standard because it represents a
fundamental change in the way EPA and the states conduct business. In
addition to a standard facility identification number, the standard
contains basic information about the facility such as name, address,
locational information, and industrial classification. These data
elements are defined, collected, and used differently by EPA programs
and by each state. Reaching agreement of standard definitions and
practices has required a long process of discussion and negotiation
that is nearing completion.
The REI program was designed to provide the resources and
management attention to standards development to ensure that they will
be completed. EPA expects to meet the three year REI milestone for
standards development and five year milestone for implementation in EPA
information systems. Although some interim milestones have slipped, the
entire data standards program is on track to complete development by
December 31, 1999, more than one year ahead of the schedule in the REI
Action Plan. Two of the six standards are already final and the other
four standards have been issued as interim.
data quality: error correction plan strategy
Question. A year ago EPA committed to putting together a strategy
to ensure data quality, including an error correction process which is
well-defined, efficiency (sic) and transparent. [Fred Hansen memo of
Apr. 29, 1998] This still has not been done. When will EPA have an
error correction plan in place, and will EPA discontinue the practice
of not checking the accuracy of data before putting it on the Internet?
Will EPA begin taking responsibility for the quality of the data it
puts out, rather than simply blaming the sources from which the data
came?
Answer. EPA's data quality strategy, which was developed in
response to Fred Hanson's memo of April 29, 1999, includes a framework
for an error correction process. On April 1, 1999, Peter Robertson,
acting Deputy Administrator, wrote a memo accepting the strategy and
restating the Agency's commitment to data quality. Responsibility for
leadership on data quality rests with the new information office. The
new information office, which is expected to be operational by
September, 1999, will contain a quality staff and a quality board that
will have overarching responsibilities for quality-related activities
across the Agency. Implementation of an error correction process is a
high priority for the new information office.
EPA does check the quality of data for which it has direct
responsibility before putting it on the Internet. For example, Toxic
Release Inventory (TRI) data, which is submitted directly to EPA by
facilities, is put through rigorous quality control before being
released to the public.
data quality: stakeholders involvement
Question. Will EPA begin involving stakeholders in discussions
about plans to put information out, particularly for purposes other
than that for which it was collected?
Answer. EPA is already involving stakeholders in plans to develop
new information. For example, EPA's Center for Environmental
Information and Statistics and the EMPACT program have routinely
consulted stakeholders about their information needs, access
preferences and feedback on proposed information products (e.g., EPA
web site, CEIS web site and EMPACT project reports and communications).
In addition, EPA has committed to an Early Action Project for the
new Information office which will address a number of issues relating
to the development of new data and information products for release to
the public.
The Agency will soon begin to engage states, tribes and
stakeholders on issues such as prior notification of new products,
processes for involving state partners and stakeholders in product
development, and provision of metadata and interpretive context.
data quality: states involvement
Question. Given that much of EPA's data comes from the states, what
specifically is being planned with the states to ensure that EPA's
information management and data quality plans are workable.
Answer. EPA is working with states through the Environmental
Commissioners of States (ECOS). EPA is a partner with states on the
ECOS Information Management Workgroup. The workgroup has developed a
vision and operating principles and has chartered several teams to
jointly deal with information management issues (e.g., facility
identification). EPA will continue to work through ECOS and other
mechanisms to ensure that information management and data quality plans
are workable.
data quality: fiscal year 2000 budget request
Question. Specific funding requests could not be identified in
EPA's budget for data quality and security concerns. How much of EPA's
fiscal year 2000 budget request specifically would go to ``data
quality'' and ``information systems security''? What specifically is
requested for fiscal year 2000 to address critical data gaps, and how
does this compare to fiscal year 1999? What role will the new office
play in identifying and prioritizing data
Answer. In fiscal year 1999 approximately $175 thousand was used to
address data gaps and in fiscal year 2000 approximately $250 thousand
will be needed to continue and build on the work relating to data gaps
in the new Information Collections Office. The fiscal year 2000 Office
of Information Resources Management security budget is $1,481 thousand.
The new Information Office will integrate various aspects of
information management, policy and technology at EPA. Although the
Agency's program offices will retain many of their information
responsibilities, the new office will lead the creation of a
coordinated and consistent policy and information framework. One area
in which this coordinated and consistent policy function will apply is
in the identification and prioritization of data gaps. A critical step
in addressing data gaps is the development of an information plan which
will serve as an architecture for the information and information
technology necessary to support EPA's mission. In part, the information
plan will determine both priority information needs for public
information and critical data needs for implementing EPA's programs
Working with the offices across the Agency, our state partners and all
of our information stakeholders, the new Information Office will have
the lead for developing the information plan. The information plan
effort will build upon current work in identifying emerging information
needs and opportunities for burden reduction.
data quality: computer security centralized validation process
Question. With respect to computer security concerns, when will EPA
establish a centralized validation process to ensure required aspects
of the information system security are properly planned for and
documented throughout the Agency, as recommended by the Inspector
General?
Answer. In response to the Inspector General's recommendation to
establish a centralized validation process, EPA agreed to require its
Primary Organization Heads (Assistant Administrators, Regional
Administrators, the Chief Financial Officer, the General Counsel, and
the Inspector General) to certify their security planning activities
annually to the Chief Information Officer. Primary Organization Heads
certify that workable information security plans have been implemented.
To make this decision, Primary Organization Heads rely on EPA's Senior
Information Resource Management Officials (SIRMOs) to first approve in
writing that each security plan adequately addresses the security
controls required for the protection of the general support system or
major application. Prior to approving security plans, SIRMOs are
responsible for ensuring that independent reviews are conducted for
each plan.
data quality: empact initiative funding
Question. EPA has requested funding under EMPACT for a ``state of
the art scientific information system'' that it identifies as currently
in development (p. VII-6). Please explain this initiative and the
specific funding request associated with it. Also, how much is being
spent in this and prior fiscal years on this effort? Will additional
funds be needed in the outyears?
Answer. While EMPACT and work to develop a state-of-the-art
scientific information system both are captured under the Agency's
Empowerment Goal, the information system is not a part of the EMPACT
program. The effort to develop a scientific information system resulted
from a 1997 Office of Research and Development (ORD) commitment to
improve the coordination of its science information management
activities. The ORD publication, ``Strategic Plan for ORD: Information
Management Component'', published in 1997, sketched out several
management options that could be employed to achieve ORD's information
management goals and objectives. Of these, ORD management selected the
development of a Science Information Management Coordination Board
(SIMCorB) as the preferred option. On the SIMCorB are representatives
from each of ORD's research laboratories and centers.
One of the first activities undertaken by SIMCorB was the
development of an implementation plan that would modify EPA's research
environment so that strategic information management (IM) goals would
be met. Project plans were developed in four areas, one of which was
development of a Science Information Management System (SIMS) to
support Agency science activities.
The Board evaluated existing IM activities and systems and
determined that an existing IM effort, the Environmental Information
Management System (EIMS) \1\, formed an appropriate foundation upon
which to build the SIMS.
---------------------------------------------------------------------------
\1\ EIMS stores and maintains descriptive information about
documents, datasets, databases, models, images, web pages and
multimedia products in a relational database. Descriptive information
stored within EIMS is consistent with the Federal Geographic Data
Committee (FGDC) metadata content standards for spatial data. EIMS is
scheduled to become a node of the National Spatial Data Infrastructure
(NSDI) during the summer of 1999.
---------------------------------------------------------------------------
In fiscal year 2000, EIMS will begin its modification to become
SIMS, with system augmentation continuing through 2003. Eventually,
SIMS will be the foundation of the research electronic
``collaboratory''. Through SIMS, individual investigators located
anywhere in the Agency's research laboratory system will be able to
participate in all the activities of the science project life cycle
(communication, planning, analysis, publication and archival) as if
they were collocated.
The following table reflects the four-year research and development
investment in this activity under the Agency's Empowerment Goal.
Figures represent estimates through the fiscal year 2000 President's
Budget Request. We expect to provide outyear support for system
augmentation under the base research program.
[Dollars in millions]
------------------------------------------------------------------------
Fiscal year
-----------------------------------
1997 1998 1999 2000
------------------------------------------------------------------------
EPA/ORD............................. $0.1 $0.4 $0.4 $0.4
------------------------------------------------------------------------
data quality: cerlcis
Question. Beginning in 1990, concerns have been raised by the I.G.
as to the quality of data contained in CERCLIS database. EPA staff
still must verify the accuracy of data used for the mandated Superfund
annual report because CERCLIS data still cannot be relied on. Why is it
taking EPA so long to correct this problem?
Answer. Earlier reviews by the OIG did indicate some data quality
issues with the CERCLIS database, but their recent work in this area
has documented considerable improvements. In 1990, the OIG issued an
audit report ``CERCLIS Reporting'' and a subsequent follow-up report in
March, 1992, ``Special Review on Follow-Up of CERCLIS Reporting and
Post-Implementation'', which included numerous recommendations to
improve the quality of data and reporting of information through the
CERCLIS database. Through 1993, EPA took corrective actions which
improved report program documentation, enhanced the CERCLIS report
library central coordination effort to more effectively monitor the
change control process, and established a third party testing team and
new testing procedures.
During the OIG's review last year of the fiscal year 1995-97
Superfund Annual Reports to Congress (SARC), the OIG implied that
numerous discussions between Headquarters and Regional staff were
needed to verify the accuracy of CERCLIS data. This statement was also
included in the OIG's January, 1998 response back to Dick Armey's
August, 1998 request of the OIG's Top Ten Concerns at EPA. However, the
OIG was not aware that the data used for the SARC originated from a
frozen database for the specific year being reported. Although the
SARC's are being issued late, the data sets included in the reports
were unchanged from the frozen database of the reported year. The OIG
subsequently understood this process, and issued their final report
without any criticism of the quality of CERCLIS data. On the contrary,
the OIG's final report praised EPA for having adequate controls over
data entry procedures into the CERCLIS database. The OIG also cited
their December, 1997 audit ``Superfund Construction Completion
Reporting'', in which they stated ``that the source documentation
supported 100 percent of the construction completion accomplishments,
one of the Agency's main indicators of site progress. The information
EPA reported was accurate, and Congress and the public can rely upon
the information.''
Question. What specifically is planned for fiscal year 2000?
Answer. We will continue our ongoing data quality efforts on
CERCLIS which consist of the following: supporting the designated data
sponsors through national work group meetings, participating in the
biweekly data quality conference calls, organizing national meetings
with the Information Management Coordinators where data quality issues
are identified and discussed, and enhancing the CERCLIS system with
features that support data integrity, i.e., Smart Screens which help
the user correctly identify the required data.
Question. When can the concerns the I.G. has identified be
resolved?
Answer. The OIG's concerns have been resolved based on the OIG's
final report which contained no criticism of the quality of CERCLIS
data but rather praised EPA for having adequate controls over data
entry procedures into the CERCLIS database. Through 1993, EPA took
corrective actions which improved report program documentation,
enhanced the CERCLIS report library central coordination effort to more
effectively monitor the change control process, and established a third
party testing team and new testing procedures.
data quality: rcris
Question. In 1993 the I.G. reported that EPA's RCRIS system did not
contain accurate and timely information. There continue to be problems,
6 years later, as outlined in 3 1999 OIG reports. Since RCRIS data
accuracy problems have been long recognized and RCRIS is an important
information system, what is EPA doing to finally improve RCRIS?
Answer. The Office of Solid Waste and Emergency Response (OSWER) is
committed to using RCRIS as the sole source of data to monitor progress
towards the GPRA goal of safe waste management for hazardous waste
facilities. Working with the EPA Regional offices, we have initiated a
series of efforts to improve both the data system and the data it
contains. Significant improvements have already been made, and more are
expected, in particular toward the end of 1999.
Our first step, starting in 1998, was to have a team work with
Regional contacts (the Regions in turn worked with the States) to
establish and verify a GPRA baseline ``universe'' of operating permit
and post-closure facilities in the RCRIS database. Our approach
involved revisions to the data system parameters followed by two rounds
of checking the data, and identifying and correcting discrepancies.
These efforts resulted in a significant improvement in the quality of
the RCRIS data showing what facilities are in the GPRA baseline
universe.
With the GPRA baseline defined, we are currently working with our
Regional contacts to further refine a method to use RCRIS to accurately
determine progress towards GPRA goals. Once these refinements are
incorporated into RCRIS, the Agency will clean up the unit-specific
data in RCRIS. Correcting the unit-specific data is a significant
undertaking which should result in a major improvement in overall data
quality.
RCRIS is also an accurate and up-to-date source of national
information on Corrective Action activities and results. Over the last
two years the accuracy of Corrective Action information has been
materially improved by focusing our maintenance efforts on a few key
areas and ensuring that implementers get feedback on the quality their
data.
Tim Fields, Acting Assistant Administrator for OSWER, recently
issued a memorandum to the Regional Administrators entitled ``Improving
the Accuracy of RCRA Corrective Action Program Data'' (2/11/99). This
major effort is largely completed and significant improvements in the
RCRIS data can be seen currently. Since a significant amount of the
RCRIS corrective action data is implemented by States, prior to issuing
the memorandum a meeting was held in cooperation with Association of
State and Territorial Solid Waste Management Officials (ASTSWMO) to
include all States with significant influences on national RCRIS data
quality and have them participate in the collective effort to improve
the quality of RCRIS data. Additionally, to focus and increase the
effectiveness of the RCRIS cleanup efforts the corrective action
program identified a limited number of key program activities
(Environmental Indicators and other key program milestones) that need
to be cleaned up and maintained through time.
Our Environmental Indicator (EI) codes (our sole measures for GPRA)
are relatively new and are constantly being used to illustrate the
progress in specific Regions and States. Over the last year graphical
charts which directly compare Regional and State EI results to their
neighbors have been made available to Regional and State regulators.
These graphs have significantly increased the recognition of the
importance of having accurate national data and have resulted in
significant improvement in, and increase of, RCRIS EI data. We are
planning increased public access and awareness of corrective action EI
progress through the use of Regional/State maps showing facility
locations that are linked to RCRIS records showing EI status. The
corrective action Program is using only national RCRIS data for annual
planning, and for giving credit for accomplishments. This approach
helps ensure the accuracy of the national RCRIS data.
In addition, modernization of current systems is underway to make
data more directly accessible to program personnel via the Internet.
Key management reports are already available to EPA and States now, and
additional features are in development with implementation to be
completed by May of 2000.
Finally, OSWER in conjunction with other EPA offices, is working
with States to assess future information needs through the Waste
Information Needs initiative (WIN). This is a multi-year process to
evaluate stakeholder requirements and ensure senior management
direction for future investment in new technology and prioritization
for data collection and quality.
The Office of Enforcement and Compliance Assurance (OECA) is
nearing completion of Quality Management Plans (QMPs) for the
compliance and enforcement data contained in RCRIS. The QMP will
consist of: Data Quality Objectives (DQOs), that identify the level of
quality needed to support OECA decisions; a Quality Assurance Project
Plan, which ensures that data meets the standards set by the DQOs;
Standard Operating Procedures for collection and quality assurance of
the data used to support OECA decisions; and a Baseline Data Audit, to
be used as a baseline from which we will measure progress toward
improved data quality.
OECA is proposing to embark on a multiyear modernization effort to
integrate core compliance and enforcement data from each media program,
into a single data system. This effort, which is contingent upon
receiving Agency funding, would ensure that hazardous waste compliance
and enforcement data is integrated with other media data on a common
platform with as much definitional standardization as is practicable.
data quality: state water quality assessment report
Question. Recently issued OIG reports and ongoing audits found that
state water quality assessment reports were not complete, accurate and
timely. The state reports are entered into EPA's STORET database, which
is the basis for the national report on water quality. What plans does
EPA have to work with the states to address these problems.
Answer. Many States enter into STORET the actual water quality data
they use in developing the assessments they provide in their State
305(b) reports. In developing the national report on water quality, we
analyze and summarize the State assessments provided in their 305(b)
reports rather than generate the national report from the STORET data
base.
EPA continues to work with the States on the quality and national
consistency of their 305(b) reports. For the first time, in 1998, all
50 States submitted 305(b) reports. Both EPA and the States recognize
the continuing need both to improve the quality of the assessments and
to increase the number of actual waterbodies monitored over time.
Working with the States, EPA issued new 305(b) guidance in 1997 that
should help improve both the State 305(b) reports and the national
summary report generated from the State reports. Improvements will
include more comprehensive coverage of waters and georeferencing of
305(b) information to identify and map specific waterbodies, including
whether they meet water quality standards, and to enable long-term
tracking of trends. As it usually takes at least one full reporting
cycle for the States to incorporate new guidance into their operations,
we hope to see improvements starting with the year 2000 State and
national summary 305(b) reports. EPA will continue to work with the
States on the implementation of this new guidance.
In the fiscal year 2000 President's Budget, EPA continues its $20
million investment in Section 106 Grants so that states and tribes have
more resources available for monitoring activities to reduce point and
nonpoint source pollution, including permit issuance for CAFOs and
assessment improvements.
data quality: grant management
Question. Numerous IG reports, Congressional hearings, and your own
annual certification to the President under the Federal Managers'
Financial Integrity Act have identified serious grants management
problems at EPA. While the agency plans next year to work on closing
out the backlog of thousands of inactive grants, EPA has yet to change
the way its grant officers do business. What steps are you taking to
change the way EPA personnel do business and prevent further
mismanagement of grants funds? What incentives do EPA staff have to
ensure that grant agreements are followed? Are additional incentives
needed, and is so, what form would they take?
Answer. The Agency has taken a number of significant actions to
ensure proper management of grants. The Agency has implemented a policy
which requires employees to be trained and certified before serving as
a Project Officer for an assistance agreement. The Agency has trained
over 4,000 employees over the past five years.
The Agency has strengthened the training provided to program office
staff; placing greater emphasis on post award management in the
Agency's Assistance Project Officer Training Course. In addition, EPA
has developed and is conducting a refresher course which addresses new
grants management issues and provides information on our website and
automation tools.
The Agency has developed several policies for grants management and
program office staff to strengthen grants management. For example, the
Agency issued a closeout policy to address non-construction grant
backlog and to eliminate future backlogs. This policy requires each
Grants Management Office to identify specific impediments to grant
closeout and develop an annual plan to address these barriers.
Also, the Agency has issued post award management policies for the
Grants Management Offices and headquarters and regional program offices
to clearly define performance expectations, accountability, and
guidelines for post award management. The policies also require the
development and implementation of post award management plans that
addresses the unique requirements of each organization.
Various post award monitoring activities of grant recipients
continue to be conducted. Monitoring activities include baseline
monitoring (day-to-day monitoring activities under all grants); on-site
evaluative visits (evaluation of specific grants and grantee financial,
procurement, systems); on-site technical assistance; technical
assistance conferences and workshops (Agency Outreach); and desk
reviews. Also, on a biennial basis the Agency conducts Management
Effectiveness Reviews (MERs). All regional and headquarters program
offices conducted a self-assessment review of their assistance
activities to identify potential vulnerabilities and areas for
improvement. The first MER occurred in 1997, and Offices and Regions
are now conducting their 1999 MERs.
The Agency continues to conduct management oversight reviews (MORs)
of the Grants Management Offices to assess how they are managing their
grant operations. As part of these reviews, the MOR review team will
conduct an assessment of post award management and closeout plans.
Information resources management and technology in the assistance
area have been increased. All assistance-related policies have been
placed on the Agency's Intranet. Grants management and program office
staff may monitor grant expenditures on their projects electronically.
The Agency may access the Single Audit Clearinghouse database at the
Department of Commerce Bureau of Census. This electronic capability
helps in the post award monitoring and management of grants.
The original closeout backlog of non-construction grants has been
reduced by 95 percent and EPA will eliminate the closeout backlog by
the Congressional deadline of July 2000.
Moreover, the Agency continues to work in partnership with the
Inspector General to identify specific grant or grant program areas for
audit where we have questions (e.g., grantee financial management
systems, practices, or performance).
Assistance agreements with our environmental partners are a
critical component of meeting the Agency's public health and
environmental goals and objectives. To demonstrate the importance of
ensuring that grants are managed and fulfill our environmental mission,
EPA has developed tools for both programs and staff. First, each
Program and Regional Office has been asked to develop and implement
post award management plans. These plans will be coordinated and
assessed by the national program manager for grants. All programs and
regions also conduct self assessments biannually to ensure that grants
are effectively managed in their organization. Second, the Agency is
working with staff (both program and grants) to ensure they have the
training and tools to perform their jobs. Employees must be trained and
certified before serving as project officers. In addition, EPA is
developing automation tools such as the Integrated Grants Management
System to reinvent and strengthen grants management. The Agency
believes that this approach (better trained staff, stronger grants
oversight, and automated systems) will advance the Agency's public
health and environmental mission.
Grants managers in the Agency will be working with the Office of
Reinvention to identify additional incentives and opportunities for
streamlining which will result in strengthened grants management.
grants management: post award management policy
Question. Each year EPA has reported in its Integrity Act report
that is has extended by another year the date it hopes to correct the
grants problems. And, the fiscal year 2000 Budget Request indicates EPA
has yet to develop a policy addressing post-award management of grants
even though the Agency committed to issuing this policy in 1997. What
hasn't this been a higher priority?
Answer. EPA has been working steadily over the last four years to
strengthen grants management and has made considerable progress. One of
the Agency's highest priority in addressing grants management issues
was to develop and implement a policy that required training. Over the
last five years, the Agency has trained over 4,000 project officers,
and we recently developed a refresher course which addresses new grants
management issues and provides information on websites and automation
tools.
The Agency has also developed new policies addressing closeouts and
post award management for both the grants and program offices. In
addition to developing new policies, the grants offices have initiated
various oversight and assistance reviews with grantees.
The Agency has made significant progress to eliminate the closeout
backlog of non-construction grants. Overall, the Agency has eliminated
approximately 95 percent of the original backlog of nearly 20,000 and
is committed to eliminating the non-construction grants closeout
backlog by July 2000 as announced by the Deputy Administrator at a July
1996 Congressional Hearing.
In addition to the focus on training, policies and procedures, and
closeouts, the Agency has made a commitment to streamline and reinvent
the grants process by developing and implementing a paperless,
programmatic and administrative system, which fully automates the
grants process. The Integrated Grants Management System will strengthen
our relationships with our environmental partners, enhance our post
award and closeout management, and improve the speed and user-
friendliness of the grant process.
grants management: statutory authority
Question. This past September, EPA's Inspector General found that
EPA lacked statutory authority for 44 percent of the grants the IG
reviewed. In one area, the IG found that EPA was awarding grants for
economic development studies, environmental justice and technical
assistance under a research provision of CERCLA. What is EPA doing to
correct this major deficiency?
Answer. In September 1998, the Office of Inspector General issued
audit report E3AMF8-11-0008-8100209 entitled Statutory Authority for
EPA Assistance Agreements. The OIG recommended that the Agency obtain
clarifying authority to fund assistance agreement activities questioned
in the audit. The Agency has received clarifying authority in the
fiscal year 1999 Appropriation for Federal Insecticide, Fungicide, and
Rodenticide Act (FIFRA) Section 23 which authorizes assistance to
States and Indian Tribes for cooperation, aid, and training. The Agency
has also requested clarification of FIFRA Section 20 (assistance for
research and monitoring activities) and the Toxic Substances Control
Act (TSCA) Section 10 (assistance for research, development,
collection, dissemination, and utilization of data) in the fiscal year
2000 President's request to Congress. The Agency is also requiring
documentation in the decision memorandum which explains how the
proposed workplan relates to the authorizing statute. The Agency has
completed action on the OIG recommendations and the audit has been
closed.
compliance assistance
Question. EPA is requesting only $19 million for compliance
assistance activities. This is a reduction of almost $5 million below
the current level. While EPA professes to believe these programs are
important--and despite that these programs have been very successful in
helping small businesses comply with complex environmental
regulations--they have been held at roughly $20 million for many years.
According to your budget (p. IX-30), compliance assistance is being cut
`` with the expectation that the states will assume a majority of this
work in 2000.'' Wouldn't it be wasteful for 50 states to develop
compliance tools for the same rules, and unrealistic to expect states
or private entities to develop these tools when EPA is the interpreter
of its own rules?
Recent documents EPA has put out suggest EPA believes these
programs are quite effective, and I understand EPA has taken some steps
to quantify the effectiveness of these programs. Is this true, do you
agree they are effective, and if so, why is EPA proposing to cut the
programs?
Answer. Rather than indicate a shift in program emphasis, the
apparent decrease in resources requested in the fiscal year 2000 budget
for compliance assistance reflects how our regional resources have
actually been used between compliance assistance and enforcement.
Results from a recent study of the compliance assistance and
enforcement work done in the Regions prompted OECA to revisit the
methodology used to estimate the regional resources dedicated to
compliance assistance activities. We learned that our previous
methodology identified more workyears providing compliance assistance
than were actually doing this type of work. We intend to continue what
we believe has been a strong and innovative compliance assistance
program.
EPA's role has been and continues to be to develop and distribute
compliance assistance information and tools for business and industry.
As the primary providers of direct assistance to the regulated
community, states and localities and other compliance assistance
providers use or adapt EPA compliance assistance materials to reflect
specific state or local requirements. We believe this relationship has
been very successful in improving the regulated community's awareness
and understanding of its environmental obligations. We intend to expand
these outreach efforts by working more closely with compliance
assistance providers, especially with state and local governments.
Participants at our recent conferences on EPA's compliance programs
confirmed the value of EPA's compliance assistance tools and materials
and urged us to continue developing general compliance assistance tools
that are widely applicable and that are made widely available through
the Internet, toll-free hot lines and other appropriate channels. We
also heard strong support for the view that states are the first-line,
on-site purveyors of compliance assistance. EPA is continuing to work
with the states and other assistance providers to develop a strong
network that exchanges information and tools and minimizes duplicate
services.
We believe that our compliance assistance tools have increased the
regulated community's understanding of environmental requirements. For
example, working with industry associations and other organizations, we
have set up nine Compliance Assistance Centers through Internet web
sites, toll-free telephone lines, and fax mail, each directed toward a
specific industry or government sector. During 1998, the five existing
Compliance Assistance Centers logged over 190,000 user sessions and
responded to over 3,600 toll free phone calls and questions via e-mail.
In addition to the Centers usage, EPA Regional offices in fiscal year
1998 collectively reached almost 250,000 regulated entities through
compliance assistance outreach mechanisms including telephone hotlines,
workshops and training sessions, on-site visits and compliance
assistance tools. Notable examples of these tools include the 28 sector
notebooks, which are industry sector profiles containing information on
the overall compliance history, applicable federal requirements,
industrial processes, pollutants generated, pollution prevention
approaches, and cooperative programs designed to improve the
environmental performance of the industry. Since 1995, over 300,000
copies have been distributed in printed and electronic form. Moreover,
eighteen plain language guides and several compliance checklists have
been prepared for selected sectors, including the food processors,
paints and coatings, and automotive sectors.
gao: superfund program
Question. Superfund/GAO has continued to list the Superfund program
as a high-risk program, subject to fraud, waste and abuse. GAO cites
concerns in the area of inadequate contractor oversight, overcapacity
of contractors, cost-recovery concerns, and other issues. What specific
actions is EPA taking to ensure that next year, Superfund is not on the
list of high-risk programs?
Answer. As indicated previously to GAO, the Superfund program
continues to maintain a high level of regional and headquarters
management attention and oversight over its contracts. Over the past
few years, EPA has strengthened management over its Superfund contracts
and has taken steps to assure that it has the appropriate contracting
capacity to meet present and future cleanup requirements. Some of the
specific steps we have taken include: (1) reduced the number of
contracts from forty-five Alternative Remedial Contracting Strategy
(ARCS) contracts to nineteen Response Action Contracts (RACs), (2)
reduced the base level of effort hours in several of the more recently
awarded RACs (e.g., in Regions 2, 3, 9 and 10), (3) reduced the number
of new RACs awards in Regions 4, 9 and 10 to one per region, instead of
two per region, and (4) transitioned work efficiently and expeditiously
from expiring ARCS contracts to new RACs. In addition, we are
monitoring national RACs capacity utilization on a continuing basis and
developing quarterly reports for senior management review. These
reports have shown an overall positive trend with more technical work
being ordered through RACs and program support cost percentages
decreasing. Finally, we are taking steps to assure that decisions to
exercise options to extend the periods of performance under RACs are
based on sound programmatic and business considerations and well
documented both in the regions and at headquarters.
In the cost recovery area, GAO has focused on indirect cost rates
and performance measures for the cost recovery program. GAO has
consistently noted that, because of the indirect rates that are being
used, EPA is unable to recover most of its indirect costs. GAO also
notes that EPA's existing cost recovery measures are inadequate, and
suggests the development of another measure.
In 1982, the Agency established a very conservative methodology for
charging indirect costs to sites for possible cost recovery, because
CERCLA statute was not explicit on recoverability of indirect costs and
EPA has had to rely on case law to clarify the statute.
EPA attempted to further clarify its authority and be more
aggressive in recovering indirect costs in a 1992 proposed rule. That
effort was withdrawn when the proposal drew significant opposition on
numerous issues including the proposed indirect rate methodology. At
the same time, Congressional committee members were also critical of
EPA for not using its enforcement discretion, such as providing orphan
share at sites with non-viable parties or parties with limited ability
to pay, to improve the fairness of the Superfund program.
EPA began a second rule making effort in 1995, just before becoming
aware of OMB's new government-wide cost accounting standards (July
1995). Because the OMB standards provided both methodology and
authority, EPA decided to revise the indirect rate methodology using
the new Federal cost accounting standards.
EPA has provided GAO with a draft of the revised methodology and is
awaiting GAO comments. The new methodology is also being reviewed by a
private accounting firm to ensure that it is consistent with the new
standards. The new methodology is expected to be operational in early
2000.
In response to prior GAO recommendations, in 1994 EPA established a
new performance measure requiring cost recovery Statue of Limitation
(SOL) cases to be addressed in a timely manner. To do this EPA
establishes site specific annual targets for all cases with total costs
greater than $200,000 and SOLs that will expire during the upcoming
fiscal year and beyond. Regions are not required to address all SOL
cases and are encouraged to bring additional cases each year
particularly where PRP financial viability may be changing or high
dollars are at stake. A majority of the cost recovery cases are removal
actions which are addressed within 3 years of removal completion. Cost
recovery for remedial actions is generally pursued after the remedy is
selected. If parties do not agree to conduct the response or pay past
costs, EPA generally brings a cost recovery case within 2-3 years of
the initiation of the remedial action.
EPA currently uses a variety of ``tools'' to manage the enforcement
program. EPA reduces the need for cost recovery by maximizing the
number of PRP conducted cleanups, the value of PRP cleanups since the
inception of the program is approximately $13.1 billion. The Agency has
been very successful at this, compelling PRPs to conduct more than 70
percent of new cleanup work at NPL sites. The overwhelming success rate
for cases that are brought indicates that cases are being filed in a
timely manner and that they are well documented.
Question. How high a priority is this for EPA?
Answer. OSWER declared the contract issue an Agency-wide weakness
in its fiscal year 1997 Annual Assurance Letter through the FIMFIA
process. The corrective actions and progress made to address these
issues are regularly monitored by OSWER's Assistant Administrator.
gao: contract capacity program support costs
Question. The General Accounting Office in its testimony today
states that the Environmental Protection Agency has too much contract
capacity and is spending too much in program support costs as a result.
The Environmental Protection Agency spends on average about 28 percent
of total costs, compared to the Environmental Protection Agency's
target of 11 percent. What are the Environmental Protection Agency's
plans to address this and make better use of Superfund resources?
Answer. The Office of Solid Waste and Emergency Response has taken
steps to assure that the Superfund program has the appropriate
contracting capacity to meet present and future cleanup requirements.
Specifically, we have (1) reduced the number of contracts from 45
alternative remedial contracting strategy contracts to 19 response
action contracts, (2) reduced the base level of effort hours in several
of the more recently awarded response action contracts in Regions 2, 3,
9, and 10, (3) reduced the number of new response action contracts
awards in Regions 4, 9 and 10 to one per region, instead of two per
region, and (4) transitioned work efficiently and expeditiously from
expiring alternative remedial contracting strategy contracts to new
response action contracts.
In addition, we are actively monitoring national response action
contracts' capacity utilization on a continuing basis and developing
quarterly reports for senior management review. We will issue a
national policy on response action contracts' options analysis in June
1999, which will outline guidelines in assessing the exercise of
response action contracts' options. These guidelines will assure that
Agency decisions to exercise options to extend response action
contracts are based on sound programmatic and business considerations,
and are well documented both in the regions and at headquarters.
As we previously indicated in our comments on the General
Accounting Office's draft report, we are concerned that the General
Accounting Office's findings on program support costs may be
overstated. The General Accounting Office's analysis included two newly
awarded contracts and three additional contracts that had been in place
for only a year or less. At the time of the General Accounting Office's
review in September 1998, the Agency did not have sufficient time to
assign substantial technical work to these contracts. Since that time,
our management reports have shown a positive trend, both in terms of
reductions to program support percentages and increased contract
capacity utilization for these contracts; this is also true for
response action contracts overall. In several cases, the regions have
used innovative methods, such as fix pricing their program support work
assignments, to lower their program support costs. We continue to
believe that as more technical work is ordered through response action
contracts, the program support percentages will decrease.
Question. The General Accounting Office says, Our reviews over the
years have consistently shown that without sustained high level
management attention, the Environmental Protection Agency has not
always succeeded in implementing and sustaining contract reforms. Will
the Environmental Protection Agency leadership make Superfund contract
improvements a top priority?
Answer. With much effort on the parts of both the program/regional
and contracting personnel, the Environmental Protection Agency
continues to make many positive steps to improve our contract
management. The Environmental Protection Agency senior leadership has
and continues to make Superfund contract improvements a top priority.
The Office of Solid Waste and Emergency Response had previously
developed a corrective action strategy and milestones relating to
independent Government cost estimates as part of the fiscal year 1998
Integrity Act process. We believe that completion of these milestones
will serve to improve the quality of independent Government cost
estimates.
The Agency's senior managers continue to focus attention on any
areas that represent potential vulnerabilities in contract management.
In order to ensure that the Agency relationship with its contractors
remains an appropriate one, the senior managers agreed that the
following steps will be taken during fiscal year 1999: (1) program/
regional offices would identify all contracts where the contractor is
working at a Government facility and evaluate whether this was
appropriate and necessary, and if not, relocate the place of
performance to an off-site location; program/regional offices would
determine, which, if any, of their contracts were most susceptible to
improper personal relationships, programs/regional offices would
perform management effectiveness reviews on those with the greatest
risks.
Additionally, the Office of Administration and Resources
Management/Office of Acquisition Management is also launching two new
initiatives to improve Superfund contracting. The first initiative will
require contracting officers to specify the Environmental Protection
Agency's requirements in more performance-focused terms rather than the
Environmental Protection Agency long practiced method of specifying the
professional and technical level of contractor personnel assumed to be
required to accomplish the contract mission. The second initiative will
prohibit the specification of program management costs as a separate
cost element, unless the contractor can demonstrate that this method of
charging is consistent with its normal accounting practice. The
Environmental Protection Agency hopes to build on these initiatives in
the future with additional initiatives.
Lastly, the Environmental Protection Agency has recently taken
steps to revitalize the Superfund Senior Regional Management and
Acquisition Council. The Superfund Senior Regional Management and
Acquisition Council is a bi-annual conference, co-chaired by the Office
of Solid Waste and Emergency Response and the Office of Administration
and Resources Management/Office of Acquisition Management to promote
quality in contracts management, share Regional successes, and new
ideas for managing Superfund contracts, and resolve cross-cutting
acquisition issues. Participants on the Superfund Regional Management
and Acquisition Council are generally one senior representative from
each of the Region's Waste Management Divisions, Environmental Services
Divisions and the Assistant Regional Administrator for Planning/Policy
and Management Offices. Headquarter offices that are represented
include the Office of Solid Waste and Emergency Response, the Office of
Administration and Resources Management, Office of Enforcement and
Compliance Assurance, and the Office of the Inspector General. The
Superfund Senior Regional Management and Acquisition Council provides
guidance and direction to those Superfund program managers implementing
recommended improvements in Superfund contracts planning procurement,
and management processes that promote consistent approaches to managing
high quality cleanup projects.
Question. How will the Environmental Protection Agency use the
Contracts 2000 initiative to address some of the recurring contract
management issues the General Accounting Office has identified and what
re the specific time frames for implementing improvements through
Contracts 2000?
Answer. The Environmental Protection Agency agrees that the
Contracts 2000 effort is a very important strategic initiative.
Contracts 2000 is a strategic planning effort to develop the structure
of the Superfund contracting program following the Long-term
Contracting Strategy. Phase I, the strategy, was completed with the
issuance of a decision memorandum signed by Tim Fields, Acting
Assistant Administrator, Office of Solid Waste and Emergency Response,
and Betty Bailey, Director, Office of Administration and Resources
Management/Office of Acquisition Management on February 5, 1998. We
will issue the Contracts 2000 Strategy Report in June 1999, which will
expand on the issues and decisions that support the strategy outlined
in the memorandum.
The implementation phase began in February 1998. The implementation
work group has been developing the implementation plans that each
region will submit for management approval. The workgroup has also
considered ongoing acquisition initiatives, such as performance based
contracting and multiple award contracting. Sub-work groups began
developing the statements of work for those classes of contracts
expiring by the end of fiscal year 2000.
We will issue the Contracts 2000 Implementation Framework in June
1999. The framework will include the roles and responsibilities for
reviewing and approving regional Contracts 2000 implementation plans,
and the components that need to be addressed by these plans, such as
implementation charts, acquisition strategies, and timetables.
Contracts Class Implementation charts, showing the number of contracts,
size, and type for each region, and the structure and management of the
contracts, will be published throughout the 1999 year as they are
approved by the Environmental Protection Agency management.
Question. Is the Environmental Protection Agency working to develop
new and more effective ways to build more competition into the
Environmental Protection Agency's contracting process? Please describe.
Answer. In some classes of Superfund contracts, the Contracts 2000
workgroup identified where and how the Environmental Protection Agency
can increase the industrial base through sector contracting. For
example, as part of the planning for the Superfund technical assessment
and response team contracts, the Environmental Protection Agency
regions have submitted initial plans for awarding more than one
contract per region. In almost every region, it is expected that one
solicitation will be a full and open competition and one or more will
be set-aside for small businesses or small disadvantaged businesses.
Additionally, under this class of contracts, the new requirements
for price evaluation adjustment for small disadvantaged business
concerns and the small disadvantaged business participation program
will apply in the full and open competitions. The Environmental
Protection Agency plans to include as part of the technical evaluation,
an evaluation of each potential offeror's commitment to the Agency's
goal for participation by small, HUBZone small, women-owned and small
disadvantaged businesses as team members and/or subcontractors, as well
as an offeror's participation in the Agency's Mentor-Protegee program
as a mentor firm. In accordance with the requirements of the Small
Business Contracting Program and the Agency's Office of Small and
Disadvantaged Business Utilization policies, the successful offerors,
if not small businesses, will be required to submit acceptable
subcontracting plans. Our administrative contracting officers will
monitor the contracts to ensure that the subcontracting plan is
enforced to provide participation by small, HUBZone small, women-owned
and small disadvantaged businesses to the maximum extent possible
consistent with efficient performance.
Question. Has the Environmental Protection Agency lowered its
contract management costs through its recent practice of using the Army
Corps of Engineers to manage about 40 percent of its cleanup work? Is
the Environmental Protection Agency giving consideration to using the
Corps additional workload to manage, in view of its expertise in this
area? If not, why not?
Answer. One of the major elements of the Contracts 2000 strategy is
the continued use of the U.S. Army Corps of Engineers to manage large,
complex remedial actions. Specific advantages we derive from the
relationship include an ability to leverage limited Environmental
Protection Agency technical resources, Corps' personnel add an
additional federal presence at our sites, and they can perform
inherently governmental construction/contract management functions. The
Environmental Protection Agency uses commercial contractors to perform
the remaining response activities as well as construction oversight and
remedial actions under $15,000,000.
gao: rcra corrective action program
Question. The Environment and Public Works Committee recommended
shifting $27 million from the Superfund program to the RCRA corrective
action program. Many sites under the RCRA corrective action program are
Superfund-caliber. What do you think about his recommendation?
Answer. We believe funding included in the President's year 2000
budget is adequate to keep the program on track to meet our 2005 GPRA
Environmental Indicator goals (By 2005, Human exposure will be
controlled at 95 percent of RCRA high priority contaminated hazardous
waste facilities, and releases to groundwater will be controlled at 70
percent of these facilities). However, the Agency is currently
conducting an internal mid-year review to determine accomplishments to
date. Part of that review will focus on whether accomplishments to date
and projected commitments will ensure that we achieve our 2005 targets.
This approach directly reflects the revision process outlined in GPRA
and OMB guidance and other materials. The Agency believes that
resources requested for EPA and State oversight in the fiscal year 2000
President's Budget are adequate to keep the program on track to meet
the fiscal year 2005 goals.
Question. Could we achieve more public health protections by
shifting these funds?
Answer. The Agency believes there are fundamental differences
between the RCRA Corrective Action and Superfund programs that do not
support resource comparisons. Unlike Superfund where roughly 25 percent
of cleanups are funded through the Trust Fund, RCRA cleanups are 100
percent owner/operator funded. EPA and State RCRA Program grant
resources fund oversight by EPA and State regulators but no actual
cleanup. In addition, while Superfund is primarily a Federal program
wherein EPA maintains overall responsibility for cleanups (even where
States manage cleanups under cooperative agreements with EPA), the RCRA
cleanup program is formally delegated to, and run by 33 of the States
in lieu of EPA.
Question. GAO's testimony states ``Given that the Superfund program
is now almost 20 years old and that most of the sites are in
construction and moving toward completion, we would expect to see a
trend where spending on cleanups is increasing and administrative costs
are decreasing due to the changing workload mix and program
efficiencies. Since this is not the case, EPA may have opportunities to
achieve more administrative efficiencies in the program and therefore
manage a reduction in its Superfund program through such efficiencies
rather than by reducing actual cleanup workload.'' Do you agree?
Answer. EPA has committed to the completion of 85 constructions per
year through fiscal year 2005. This commitment is based on maintaining
the current pace of work and current funding levels. If no new sites
are added to the National Priorities List (NPL), at the end of fiscal
year 2005, approximately 200 sites will await completion of
construction. Assuming the completion of 85 constructions beyond fiscal
year 2005, it will take an additional 2 to 3 years to complete
construction of sites currently listed on the NPL.
Based on a GAO survey, 1,789 sites in the Comprehensive
Environmental Response, Compensation, and Liability Information System
have been identified as potentially eligible for placement on the NPL.
EPA and State officials have identified at least 232 of those sites as
strong candidates for the NPL. Our current level of funding supports 30
to 40 listings a year. Based on an annual average of 26 additions to
the NPL over the past six years, it will require almost 9 years to list
all 232 sites. Completion of constructions will take considerably
longer.
government performance and results act
Question. GAO has determined that only about 40 of EPA's roughly
320 performance measures are true results-oriented measures. The rest
are traditional outputs, such as the number of permits issued or
reviews conducted, and in the area of right-to-know, the number of web
site hits. Why has EPA been slow to adopt results-oriented performance
measures that directly address environmental and public health
protections?
Answer. The Agency is committed to improving its performance
measures and developing outcome measures and goals where appropriate
and when data are available. However, development of results-based data
and methods requires close consultation and coordination with our
partners in the States and Tribes. In many cases, results-based
performance measures can only be developed after necessary analytical
methods and monitoring/data management systems have been developed and
implemented. In addition, there is often a significant lag time between
the collection, reporting, and analysis of environmental data. In
summary, we recognize that our current performance measures are largely
output-oriented; we are working to increase the number of outcome-
oriented measures.
Question. What specific efforts are planned to increase the number
of true performance measures, and how high a priority is this?
Answer. EPA is fully committed to the principles of results-based
management. Each EPA program is continuously evaluating the type and
quality of data and analysis needed to improve its effectiveness and
efficiency. Through the National Environmental Performance Partnership
System, together with the States and Tribes, the Agency is developing
better compliance tracking and program performance data, thereby
enhancing our ability to develop outcome measures. For example, the
Office of Research and Development, working together with EPA's
regional offices and our partners in the States, has begun an
initiative to provide ambient monitoring data for the entire U.S.
coastline. In addition, the Center for Environmental Information and
Statistics and the Agency's new Information Office are in the process
of assessing the Agency's long-term strategic information needs.
Question. To what extent is the lack of data the reason EPA has not
developed a large number of real performance measures?
Answer. Insufficient data is the most limiting factor. Results-
oriented performance measures typically require extensive monitoring
data for the results to be statistically valid. Some programs have such
data (e.g., for air quality) but most do not. These data-sets need to
be collected in a comprehensive manner, usually over some period of
years, to support reliable analyses of environmental conditions and
trends. In recent years, the Agency has invested in better systems for
collecting and analyzing environmental data, and more work is planned
to provide the data needed to assess performance as required by GPRA.
gao: reinvention
Question. Reinvention. GAO has cited EPA's so-called reinvention
efforts a major management challenge, yet many of these efforts are key
to implementation of innovative and more effective means of improving
the environment. Reinvention efforts in general are aimed at achieving
better environmental results through the use of innovative and flexible
approaches, which we all agree makes sense. GAO has listed a large
number of concerns, such as achieving ``buy in'' among the agency's
rank and file, achieving agreement among stakeholders, and an uneven
record in evaluating the success of initiatives. What is your response
to these concerns?
According to a recent ``Inside EPA'' article, an EPA-commissioned
study of the Common Sense Initiative has found that ``the CSI
principles have not yet reached into the heart of EPA's operations, and
there remain strong concerns among participants that the agency has
given up trying to drive a broader institutional embrace of reinvention
concepts. CSI has as yet made little progress in addressing broad
regulatory changes.'' Does EPA agree with the conclusions of your
contractor's review? What plans does EPA have to address these
concerns?
Please describe what new ``reinvention'' initiatives are underway,
such as the Sustainable Industry program, and the budget request
associated with these initiatives, and explain how these new
initiatives differ from and build on older initiatives such as CSI.
Have sufficient resources been requested to follow through on
initiatives which have already been started?
Answer. Several evaluations of the Common Sense Initiative (CSI)
were completed in its four-year history (1994-1998) and EPA has been
responsive to all of the findings and recommendations from these
reviews. In February 1997, an independent contractor issued its review
of CSI. Subsequently, in July 1997, the General Accounting Office (GAO)
released their evaluation of CSI. EPA actions as a result of these
evaluations included: better defining CSI's goals and expected results,
clarifying how the Council and Sector Subcommittees will accomplish
their work, and developing Council and Subcommittees result-oriented
performance measures. With the completion of the CSI experiment in
December 1998, a four-year evaluation of the initiative was
commissioned and results of that evaluation were announced in mid-April
1998. While we agree with some of the recent contractor's review, EPA
has not given up on the institutional embrace of sector concepts, nor
do we believe that CSI has resulted in little progress toward
addressing regulatory changes.
CSI's completion did not represent the conclusion of Agency
sponsored sector-based, multi stakeholder work, rather it represented
the transition to new actions for sector-based environmental solutions.
An Agency-wide Sector Action Plan has been prepared based on the CSI
experience. The Plan was approved by the CSI Council and EPA senior
management last Fall and is currently being implemented. The goal of
the Plan is to incorporate sector strategies into Agency core
functions, where appropriate, to solve environmental problems. Further,
the Plan will build EPA management capacity to conduct sector work and
involve external stakeholders to craft sector-based solutions. The
sector plan addresses many of the independent contractor's findings
about the Agency's long term commitment to implementation of CSI
activities.
Nearly 30 recommendations were generated through the CSI
experiment. Some are resulting in permanent regulatory changes, while
others are focused on implementing longer term, next generation
environmental policy tools such as voluntary, performance-based
regulatory systems. The combination of EPA efforts in responding to
these recommendations with the multifaceted approach in the Sector Plan
will result in a deeper acceptance of using the sector approach in
solving environmental problems.
The Sustainable Industry (SI) Program was created prior to the
launching of the CSI experiment and continues to operate as an
``incubator'' for Agency-wide sector activities. CSI accelerated the
early SI program activities with the metal finishing sector to the
successful development of the Strategic Goals Program, a first-of-its-
kind, performance based, non-regulatory process. In the transition of
CSI sector work in the Sector Plan, EPA has committed through existing
resources to complete unfinished Sector projects, as well as support
new projects that may be identified during fiscal year 1999 and fiscal
year 2000. Three former CSI sectors--metal finishers, printers, and
petroleum refiners--have ``works-in-progress'' that will be supported
with these resources. In addition, the Agency has established, through
the Federal Advisory Committee Act, a new Sector Committee to help
transition former CSI activities into core Agency functions, as well as
maintain accountability to external stakeholders on our sector work. It
is expected that sufficient resources have been requested to complete
these and other initiatives, which have already been started.
better america bonds
Question. The President's budget would give EPA a new role of
allocating bond allotments for environmental projects through the
Better America Bonds initiative.
(1) Why do we need this new program, given the existing funding
mechanisms such as the Land and Water Conservation Fund?
(2) What experience does EPA have in reviewing state and local
proposals for such activities as land acquisition?
(3) What would be the costs to EPA of administering this program,
and which program office would be responsible?
(4) What will be the cost to the taxpayer of issuing all $9.6
billion in bonds over their entire 15-year life span?
(5) How does EPA plan to provide oversight for the program to
ensure that environmental goals are accomplished?
Answer. (1) The Land and Water Conservation Fund (LWCF) is
primarily focused on federal land acquisitions whereas the Better
America Bonds is a new financing tool for communities to preserve and
enhance green space, protect water and clean up brownfields.
Both the LWCF and Better America Bonds provide a financial means
for communities to acquire lands or interest in lands for the
preservation of open space and the protection of water quality. LWCF is
used to acquire open spaces for recreation purposes or habitat
protection. Better America Bonds can be used for this and other
purposes including protecting water quality and cleaning up
brownfields. The two programs provide different funding mechanisms for
land acquisition thereby giving communities the flexibility to choose a
mechanism that is most appropriate for them.
The Clean Water State Revolving Fund (CW-SRF) and Better America
Bonds have similar goal of protecting water quality but they meet this
goal in different ways. The vast majority of CW-SRF resources fund
traditional wastewater treatment plants. Such projects would not be
eligible under the Better America Bonds program. Many communities will
have different water quality needs that the Better America Bonds
program can help address. Water quality projects that would potentially
qualify for a Better America Bonds include wetlands restoration,
purchase of land critical to watershed protection, settling ponds and
the creation of planted or forested buffer strips along waterways.
The proposed Better America Bonds program would not only be about
50 percent less costly to communities than tax exempt bonds but would
also be significantly less costly than most CW-SRF loans.
This proposed program would be another tool that communities would
have to address environmental problems.
(2) As the agency responsible for protecting public health by
cleaning up our air, water and land, and ensuring that all Americans
have access to a clean and healthy environment, EPA is best suited to
help communities meet the stated goals of the program--protecting water
quality, cleaning up brownfields for reuse, and preserving green space.
The Better America Bonds program builds upon EPA's successful existing
programs that work with communities to improve local water quality and
to clean up brownfields sites so that they can be returned to
productive community use.
Furthermore, the Agency currently manages various bond-related
programs such as the Clean Water State Revolving Fund and maintains an
Environmental Finance office. The Agency would draw upon the
significant expertise in these and other programs to run the Better
America Bonds program. Finally, parts of this program will be managed
by the Treasury Department (including enforcement by the Internal
Revenue Service.)
To ensure a broad range of expertise, EPA will chair a panel of
departments and agencies including HUD, USDA, Interior, FEMA, and
Treasury. EPA will work closely with them on the design of the program,
the selection criteria, the application process, and the awarding of
bonding authority.
(3) The Agency intends to administer this program in a cost
effective manner and anticipates being able to absorb administrative
expenses with existing agency resources. The Agency did not seek any
new resources in EPA's fiscal year 2000 budget request to run this
program.
There are several factors supporting this approach. First, as
stated by the Administrator, EPA does not intend to issue any
regulations for this program. Instead, EPA will develop basic guidance
documents to assist communities in applying for bonding authority.
Second, the program will involve several current Agency programs such
as the Brownfields office, various water quality programs, and our
Environmental Finance Office.
(4) The Treasury Department has designed this tax credit bond so
that the subsidy to the communities will in present value terms equal
approximately half the value of the bond. In other words, the
cumulative tax expenditure for this program should be approximately
$4.8 billion (in present value terms) over the entire life span of the
bonds. This tax expenditure will be incurred over a period of time that
will be longer than 15 years. (The proposal calls for five years of
bonding authority. Furthermore, communities have up to three years to
issue the bonds and use the proceeds. Therefore some Better America
Bonds could be retired 23 years after the start of the program.)
(5) As with other types of bonds, the Internal Revenue Service will
monitor communities' compliance with the requirements of the program.
During the fifteen year term of the bond, if 95 percent of the proceeds
fail to be used for a qualifying purpose or if the use changes to a
disqualified use, no further credits would accrue and issuers would be
obligated to reimburse the federal government for any credits accruing
prior to that date. If a settlement cannot be reached with the issuer,
the federal government would have the right to recover past credits
from the bondholders. Problems like this are very rare with respect to
tax-exempt bonds and we expect that to be the case with Better America
Bonds. In addition, EPA will stand ready to provide technical
assistance to communities that request it, as they implement their
programs.
environmental justice programs
Question. EPA Environmental Justice Programs. Last year at this
time you indicated that you would have a final resolution on the
Interim Guidance that EPA put forward to resolve environmental justice
complaints. In fact, you indicated that a FACA committee had been set
up and that you were targeting December 1998 to have a final guidance
in place. Can you tell me what the status of this situation is, as it
appears that there is no final guidance or rulemaking from the agency?
Answer. In March 1998, Administrator Browner established a Title VI
Implementation Advisory Committee (``Title VI Advisory Committee'').
That Advisory Committee was comprised of representatives of state,
tribal, and local governments, businesses, environmental justice
groups, and other interested stakeholders. The Title VI Advisory
Committee was asked to focus primarily on possible guidance to EPA
assistance recipients such as state permitting agencies and make
recommendations to help them design programs that will address concerns
under Title VI of the Civil Rights Act of 1964, as amended (``Title
VI'') early in the permit process. EPA believes that such an approach
will enable potentially impacted communities to be involved in the
permit process in a meaningful manner while also providing state and
local decision-makers and businesses sufficient clarity regarding the
process.
EPA committed to the Title VI Advisory Committee that it would not
issue revised Title VI guidance until after the Committee completed its
deliberations. The Title VI Advisory Committee was originally scheduled
to conclude its work in December 1998. However, the Committee requested
additional time to develop their final recommendations. EPA agreed and
the Committee completed its work in March 1999 and submitted its final
report with recommendations to the EPA Administrator in April 1999.
Issuance of the Interim Guidance for Investigating Title VI
Administrative Complaints Challenging Permits (``Interim Guidance'') in
February 1998, opened a continuing dialogue with stakeholders that is
helping to shape the Agency's revised guidance. Participants in the
dialogue include state and local officials, business leaders, and
community leaders. As part of the process for finalizing the Interim
Guidance, EPA is reviewing the Title VI Advisory Committee
recommendations and public comments. EPA also will hold a series of
focus group sessions with representatives of various stakeholder groups
to receive more feedback. Later this year, the Agency intends to issue
a draft revised guidance for additional public comment.
Question. One of the concerns raised last year was that by going
through the guidance process verses rulemaking that there were several
procedural steps that may be left out. For example, working with the
SBA on small business panels to determine the impacts of such a policy
on small business. Can you tell me if you are not going through a
rulemaking process, why not? What steps are you planning to take that
will ensure that important steps are not left out of this process? Are
you working with SBA?
Answer. EPA will not be issuing its revised Title VI guidance using
formal or informal rulemaking procedures. The revised guidance is
intended only to provide a framework for the processing by the Office
of Civil Rights (``OCR'') of complaints filed under Title VI by
updating the Agency's procedural and policy framework to accommodate
the increasing number of Title VI complaints that allege discrimination
in the environmental permitting context. It will not create any new
substantive rights, nor establish any binding legal requirements.
Accordingly, the revised Title VI guidance is expressly exempted from
the notice-and-comment rulemaking requirements of the Administrative
Procedure Act (``APA'') by section 553(b)(3)(A). Nonetheless, as
described in more detail later, EPA intends to publish the draft
revised guidance in the Federal Register and solicit written public
comment, as well as hold a series of listening sessions after the draft
revised guidance is published to obtain more feedback.
With respect to impacts on small entities, including small
businesses, because the guidance will establish no binding legal
requirements, there is no regulatory impact to any entity of any size.
The analytical requirements of the Regulatory Flexibility Act, as
amended by the Small Business Regulatory Enforcement Fairness Act, only
apply to certain regulations that impose an impact on those small
entities directly regulated by a proposed or final regulation. Mid-Tex
Electric v. FERC, 773 F.2d 327 (D.C. Cir. 1985); Motor & Equipment Mfg.
Ass'n v. Nichols, 142 F.3d 449 (D.C. Cir. 1998). That is not the case
here.
Question. What steps are you taking to ensure sufficient public
input?
Answer. Since the issuance of the Interim Guidance in February of
1998, EPA has taken a number of steps, including establishing the Title
VI Implementation Advisory Committee, to ensure appropriate input from
stakeholders, including state, tribal, and local officials, business
representatives, and environmental justice groups. Over the past year,
EPA staff have met with representatives from industry, environmental
justice communities, and states, tribal, and local governments to
discuss their concerns about environmental justice and Title VI issues.
The Administrator met with representatives from the U.S. Conference of
Mayors in Detroit last summer and met with representatives from the
Environmental Council of the States (``ECOS'') in the fall to discuss
their issues and concerns on this important subject.
EPA has established a cooperative agreement with ECOS, which will
be used to develop a state approach to environmental justice issues,
including developing effective working relationships with the
environmental justice community. The states are currently planning a
meeting with national environmental justice representatives, as a
result of this cooperative agreement.
As EPA moves toward finalizing the guidance, we will continue
meeting with individual stakeholder groups, such as ECOS, local
officials, and environmental justice groups, to discuss issues of
concern to them relative to the internal Title VI guidance.
Additionally, EPA will sponsor a series of diverse, stakeholder focus
groups to discuss issues and concerns prior to publication of the draft
revised guidance for public comment. In addition to soliciting written
comments on the draft version of the revised guidance through
publication in the Federal Register, EPA will hold a series of public
listening sessions across the country to receive public comments.
Question. Will this document go to OMB for review? What about
inter-agency review?
Answer. The Office of Management and Budget (OMB) routinely reviews
agency regulations. However, EPA has determined that this not a
regulation. On occasion, OMB also asks to review non regulatory
guidance that an agency produces. At this time, OMB has not asked to
see this guidance. EPA, however, has consulted with the Department of
Justice (DOJ) prior to issuing the Interim Guidance, and is currently
coordinating with DOJ and the Council on Environmental Quality as the
guidance is being revised.
Question. Do you envision this guidance as binding? Do you plan to
submit it to Congress under the Congressional Review Act as tendered in
a legal opinion by the GAO?
Answer. Like the Title VI Interim Guidance, the revised Title VI
guidance will be non-binding and is intended only to provide a
framework for the processing by EPA's Office of Civil Rights (``OCR'')
of complaints filed under Title VI. The revised guidance, like the
Interim Guidance, will have no binding legal effect. Since its passage,
EPA consistently has interpreted the Congressional Review Act (``CRA'')
as applying only to agency actions containing binding legal
requirements. Policy statements and guidance documents are not binding
and have no binding legal effect on the public; generally, they are
intended to provide information regarding an EPA regulation or
enforcement position that may be useful to both EPA employees and the
public. Accordingly, EPA does not believe the revised Title VI guidance
is subject to the CRA.
The General Accounting Office (``GAO'') concluded that the Interim
Guidance was subject to the CRA, in part, because EPA inadvertently
used mandatory language in the Interim Guidance; thus, GAO believed
that the ``new steps in the procedure for handling disparate impact
assessment [are] mandatory. They clearly alter the existing regulation
and give to recipients significant rights that they did not previously
possess for obtaining dismissal of the complaint.'' (Letter of Robert
P. Murphy to The Honorable David M. McIntosh, dated January 20, 1999.)
The GAO letter noted that, although the first part of the Interim
Guidance ``largely confirms requirements that largely exist in EPA
regulations,'' the Interim Guidance altered the existing regulation to
give recipients rights that they did not previously possess for
obtaining dismissal of the complaint. GAO did note that EPA's position
that the Interim Guidance was not a rule was stronger with respect to
the second part of the guidance entitled ``Impacts and Disparate Impact
Analysis.'' GAO concluded that, although the guidance stated the five
steps that OCR would follow in conducting its analysis:
``[I]t can be argued that these steps are the kinds of steps
that statisticians would be expected to follow in conducting a
disparate impact analysis. Also, OCR has broad discretion in
deciding how to proceed in conducting each of the steps of the
analysis, a factor courts often consider in determining whether
a binding rule affecting substantive rights exists under the
APA.'' \1\
---------------------------------------------------------------------------
\1\ Id. At 6.
As stated previously, EPA did not intend for the Interim Guidance
to create new substantive obligations, nor does EPA agree with GAO that
it did so. EPA only intended to provide a framework for the processing
by OCR of complaints filed under Title VI. EPA intends to draft the
revised Title VI guidance in a manner that clearly indicates it is non-
binding in nature. Mandatory language will be deleted, and a notation
will be prominently displayed indicating that EPA is free to deviate
from the guidance on a case-by-case basis, as appropriate. Accordingly,
since it will not be a binding substantive rule, EPA does not believe
it is subject to the CRA. Nevertheless, the Agency intends to submit
courtesy copies of the revised Title VI guidance to both Houses of
Congress and GAO when it is issued.
Question. What consideration has been given to letting States set
up their own environmental justice programs to resolve Title VI
complaints and providing Federal oversight in this regard verse
establishing a new large Federal program to decide these individual
siting and permitting cases which are decisions which should be handled
at the State and local levels?
Answer. Title VI of the Civil Rights Act of 1964, as amended (Title
VI) prohibits recipients of federal financial assistance (e.g., states,
universities, local governments) from discriminating on the basis of
race, color, or national origin in their programs or activities. Title
VI allows persons to file administrative complaints with the federal
departments and agencies that provide financial assistance alleging
discrimination based on race, color, or national origin by recipients
of federal funds. OCR is responsible for the Agency's administration of
Title VI, including investigation of such complaints.
EPA has a responsibility to enforce Title VI and ensure that EPA
assistance is not being used to subsidize discrimination based on race,
color, or national origin. This prohibition against discrimination
under Title VI has been a statutory mandate since 1964 and EPA has had
Title VI regulations since 1973. It is important to note that the
Department of Justice has recently reiterated its position that Federal
agencies may not delegate to states the authority to determine
compliance with Title VI. While recognizing that limitation, EPA will
explore suggestions to encourage states and local governments to
perform various preventive measures, including the discussion on this
topic in the Title VI Advisory Committee's report.
Question. Has the EPA analyzed State programs to see what works and
what doesn't work? Has the agency thought about a template or model
which could be used for States to set up their own programs?
Answer. The focus of the Title VI Advisory Committee was primarily
on possible guidance to EPA assistance recipients, such as state
permitting agencies, and make recommendations to help them design
programs that will address Title VI concerns early in the permit
process (i.e., external guidance). The directors of the environmental
agencies for Michigan, New Jersey, Texas, Maryland, and Oregon were
members of the Title VI Advisory Committee. Formal presentations on the
approaches taken in Texas and New Jersey were made to the Committee and
the efforts of other states were discussed. The report of the Title VI
Advisory Committee's recommendations were delivered to the
Administrator in April. The Report contains eight consensus principles
of the Committee, as well as a template intended to serve as a model
for state and local governments that elect to establish environmental
justice programs. It also contains the members' differing views
regarding the implications of the range of policy options available to
EPA as it develops its Title VI program.
Moreover, EPA has been supporting the development of programs to
address environmental justice and Title VI issues, as well as
facilitating communication among states and local governments on
effective approaches. For example, we are working with the
Environmental Council of the States (``ECOS'') through a cooperative
agreement which will be used to develop an effective state approach to
environmental justice issues. The starting point for ECOS's work under
the cooperative agreement is its 1998 Proposed Elements of State
Environmental Justice Programs. ECOS is currently planning a meeting
with national environmental justice representatives to discuss the
proposed elements. Part of this work should facilitate the development
of a working relationship between state agencies and the environmental
justice community.
Additionally, EPA's Office of Environmental Justice has established
the State and Tribal Environmental Justice (STEJ) Grants program to
provide assistance to states and tribes as they work to achieve
environmental justice and/or ensure their programs comply with Title
VI. For fiscal year 1998, EPA awarded five STEJ grants for a total of
$500,000 to Texas, Tennessee, New Jersey, Vermont, and the Kalispel
Tribe of Indians. EPA is currently reviewing applications for fiscal
year 1999, for which another $500,000 in STEJ grant funds are
available.
Question. How many Title VI claims are at the agency now? How are
these have been resolved in the last year? Last year we included report
language asking that these claims be resolved as expeditiously as
possible and I would like to know how this is being done?
Answer. As of April 30, 1999, a total of 75 Title VI administrative
complaints raising environmental justice concerns have been filed with
OCR. Between April 1998 and the end of April 1999, OCR accepted five
complaints for investigation, bringing the total number of complaints
accepted for investigation to 22. Three of those 22 complaints have
been dismissed--one of which was the Select Steel complaint for which
EPA issued a decision in October 1998. Informal resolution is currently
ongoing for two other complaints. Moreover, EPA is currently actively
investigating three complaints. During the past year, OCR rejected
seven complaints because they did not meet Title VI jurisdictional
requirements (e.g., untimely; alleged discriminatory actor is not EPA
recipient). The total number of rejected complaints as of April 30th
was 32 and EPA had 21 complaints for which a determination to accept or
reject has not yet been made.
safe repainting, sampling tech course, eng. octane additives
Question. The Committee added $2 million in the fiscal year 1999
for lead outreach and technical studies on ``safe repainting''. What is
the status of those efforts? Are any funds requested in fiscal year
2000? What progress has been made developing the sampling technician
course to reduce the cost and expand the availability of visual
inspection and dust sampling? When will the course be completed?
Answer. The Agency is planning to conduct various lead outreach and
technical activities with these funds. The sampling technician course
has been initiated through an existing contract mechanism and work is
anticipated to begin this month. Both courses are scheduled for
completion by December 1999. Other activities include: (1) development
of a renovation and remodeling course curriculum, (2) conduct of
analyses to support policy decisions in the development of a national
renovation and remodeling infrastructure, (3) enhancements to the
existing laboratory accreditation program to allow for accreditation of
labs using newer cost effective technologies as these methods are
developed and become available for use by sampling technicians and
during renovation and remodeling activities, (4) assessment of
technologies to reduce the cost and improve the efficiency of
identifying lead-based paint during repainting and renovation and
remodeling activities, and (5) outreach efforts to inform the public
about ``safe repainting''. In addition, the agency is considering using
some of the funds available as grants to answer specific ``safe
repainting'' or renovation and remodeling technical questions. The
Agency is not seeking additional funding in fiscal year 2000.
Question. What is the status of EPA's efforts to evaluate existing
data to examine the effectiveness of additives to reduce engine octane
demand? What is EPA's assessment of the importance of additives that
control combustion chamber deposits in reducing octane demand and
improving fuel economy?
Answer. In the final rule on the certification standards for
deposit control gasoline additives (July 5, 1996, 61 FR 35309), EPA
extensively evaluated the potential impacts of combustion chamber
deposits (CCD) and vehicle octane requirement increase (ORI) on
gasoline vehicle emissions and fuel economy. At that time, EPA
concluded that there was insufficient evidence that ORI should be
reduced to prevent an adverse impact on fuel economy. EPA also
concluded that there was inadequate evidence that a reduction in ORI
would result in a cost-effective reduction in total energy use or
emissions from gasoline refineries and motor vehicles.
The final rule also concluded that there was inadequate information
on the impacts of CCD on emissions, fuel economy, and driveability to
draw conclusions regarding the costs and benefits of requiring
additives for CCD control. It was also noted that no appropriate
performance test procedures and standards exist for evaluating the
impact of additives on CCD.
Since the publication of the final rule, EPA has continued to
evaluate information on these issues as it has become available.
Despite considerable effort by industry to evaluate additive impacts on
CCD and the impact of CCD on emissions, EPA finds the situation
fundamentally unchanged. The Coordinating Research Council (CRC), a
cooperative investigative group funded by the automotive and petroleum
industries, is currently undertaking an extensive test program to
evaluate additive impacts on CCD. EPA plans to review the results from
this program when they become available approximately one year from
now. EPA hopes that the results of this program will facilitate the
Agency's further evaluation of whether CCD control is necessary and
feasible.
gpra: performance based management
Question. What specific steps have you taken as head of the agency
to achieve performance based management within your agency, as required
by the Government Performance and Results Act?
Answer. The Agency has moved aggressively to meet and exceed the
requirements of GPRA. In 1995, EPA embarked on a far-reaching effort to
fundamentally change past approaches to planning, budgeting,
performance measurement, and accountability. This entailed core changes
to budget and financial management structures and the implementation of
processes to link budgeting and management accountability. The Agency
created a new Planning, Budgeting, Analysis and Accountability (PBAA)
process that is intended to dramatically improve EPA's ability to
achieve results.
The new PBAA process has four specific purposes: (1) to develop
goals and objectives for accomplishing the Agency's mission; (2) to
improve the link between long-term planning and annual resource
allocation; (3) to enhance our ability to use human health and
environmental risk information in setting priorities; and (4) to better
assess our accomplishments and provide feedback for making future
decisions. While this effort will take several years to fully
implement, the Agency is making real progress in the short term while
we build for the future. The new PBAA process comprises several steps,
including:
A Strategic Plan, which describes EPA's strategic mission, long-
term goals, and specific shorter-term (i.e., 5 years or more)
objectives that the Agency will meet in achieving the goals.
Annual Performance Plans and Budget Requests, which are derived
from the Strategic Plan and ongoing strategic planning efforts, serves
as the basis for budget decisions. They describe annual performance
goals, measures of outputs and outcomes, and activities aimed at
achieving the annual performance goals and making progress toward
longer-term goals and objectives.
Annual Performance Reports, required by GPRA six months after the
end of each fiscal year, which will assess the progress EPA has made
toward achieving its goals and report on the Agency's success in
accomplishing its annual performance goals.
gpra: accountability of managers
Question. How are your agency's senior executives and other key
managers being held accountable for achieving results?
Answer. Accountability is a crucial element of the Agency's overall
planning and budgeting framework. The Agency has established senior
management teams for each of its strategic goals. These teams assess
progress being made to achieve the goals, and develop recommendations
for changes in approach or emphasis needed to ensure that our strategic
goals and objectives are met. In addition, the Agency's National
Program Managers, working with the senior leadership in the Regions,
develop annual goals and performance measures that support achievement
of the Agency's long-term strategic goals and objectives. EPA's senior
managers are also working with the States under the National
Environmental Performance Partnership System (NEPPS) to negotiate
performance partnership agreements necessary to meet clearly defined
performance measures.
gpra: use of performance information
Question. How is your agency using performance information to
manage the agency?
Answer. The Agency created a new Planning, Budgeting, Analysis and
Accountability (PBAA) process that is intended to dramatically improve
EPA's ability to achieve results.
The new PBAA process has four specific purposes: (1) to develop
goals and objectives for accomplishing the Agency's mission; (2) to
improve the link between long-term planning and annual resource
allocation; (3) to enhance our ability to use human health and
environmental risk information in setting priorities; and (4) to better
assess our accomplishments and provide feedback for making future
decisions. While this effort will take several years to fully
implement, the Agency is making real progress in the short term while
we build for the future. The new PBAA process comprises several steps,
including:
A Strategic Plan, which describes EPA's strategic mission, long-
term goals, and specific shorter-term (i.e., 5 years or more)
objectives that the Agency will meet in achieving the goals.
Annual Performance Plans and Budget Requests, which are derived
from the Strategic Plan and ongoing strategic planning efforts, serves
as the basis for budget decisions. They describe annual performance
goals, measures of outputs and outcomes, and activities aimed at
achieving the annual performance goals and making progress toward
longer-term goals and objectives.
Annual Performance Reports, required by GPRA six months after the
end of each fiscal year, which will assess the progress EPA has made
toward achieving its goals and report on the Agency's success in
accomplishing its annual performance goals.
EPA is now in its first cycle of evaluating performance information
in the context of the GPRA structure. Though our processes may change
as we gain experience this year, we have already made significant
progress in incorporating performance information into the Agency's
decision-making. For example, in May the Deputy Administrator met with
the Agency's senior managers to discuss the performance data so far
received and to evaluate how this might impact our priorities in fiscal
year 2001. The Agency is committed to continuing this integration of
performance evaluation and Agency priority-setting.
gpra: use of performance information in developing fiscal year 2000
budget request
Question. How did program performance factor into your decisions
about the funding you are requesting in fiscal year 2000. Please
provide examples.
Answer. As part of the Agency's overall planning, budgeting,
analysis and accountability framework, the Agency conducts periodic
reviews of changes needed to ensure that the Agency will achieve its
long-term strategic goals and objectives. The results of these reviews
are incorporated into the annual plan and budget request. The
integration of our budget with performance planning has enabled the
Agency to identify more than 70 specific performance goals associated
with the funding requested in fiscal year 2000. Examples include:
--5 percent reduction of air toxics emissions as part of the Agency's
Air Toxics program;
--an increase to 91 percent of the population served by community
drinking water systems meeting all 194 health based standards
as part of the Agency's Drinking Water program;
--the implementation of environmental improvement projects in 350
watersheds as part of the Agency's Clean Water Action Plan;
--a 200 million pound reduction in the quantity of Toxic Release
Inventory (TRI) pollutants released, treated, or combusted for
energy recovery as part of the Agency's Pollution Prevention
program; and
--a reduction of more than 50 million metric tons carbon equivalent
of greenhouse gas emissions as part of the Agency's Climate
Change Technology Initiative.
gpra: program changes to improve performance
Question. What specific program changes have you made to improve
performance and achieve the goals established in your strategic and
annual plans?
Answer. The Agency has fully integrated its budget with strategic
and annual planning, and has revised its budget structure to allocate
100 percent of its resources within its goal--objective architecture.
Accordingly, the priorities and initiatives contained in the
President's Budget for fiscal year 2000, such as the Clean Water Action
Plan, Climate Change Technology Initiative, Health Threats to Children,
Clean Air Partnership Fund, and Chemical Right To Know program, reflect
program changes proposed to achieve the goals in the Agency's strategic
and annual plans. Since we are still in the first cycle of performance
information in the GPRA context, it is premature to suggest
programmatic changes that may be suggested by the first year's data.
gpra: link between resources and performance goals
Question. How does your budget structure link resource amounts to
performance goals?
Answer. The Agency has adopted a common framework for its planning,
budgeting and financial management structures. This has enabled EPA to
fully integrate its budget structure with its annual plan. EPA has
based its strategic plan on ten long-term goals. Each goal consists of
a number of strategic objectives which define the environmental
outcomes we are attempting to achieve over several years. EPA's budget
and annual plan use the same structure. The budget and annual plan
identify resources and performance information associated with each
strategic objective.
gpra: changes to improve link between resources performance goals
Question. What, if any, changes to the account and activity
structure in your budget justification are needed to improve this
linkage?
Answer. The Agency realigned its activity structure in fiscal year
1999 to match the structure of its strategic plan. There are no plans
at present to request a change in our account structure, but we will
continue to evaluate the need for changes, and will work with
appropriate Congressional Committees if the evaluation reveals that
changes to the account structure would enhance our ability to meet the
Government Performance and Results Act, or the Federal Financial
Management Improvement Act and associated Managerial Cost Accounting
Standards.
gpra: data for performance report
Question. Does your fiscal year 2000 Results Act performance plan
include performance measures for which reliable data are not likely to
be available in time for your first performance report in March 2000?
If so, what steps are you planning to improve the reliability of these
measures?
Answer. The Agency has completed a preliminary review of our
ability to provide valid and verified data in support of all the
performance measures used in our fiscal year 1999 annual plan. The
results of this review are included in the Agency's fiscal year 1999
Annual Plan. This review revealed that there are areas where data are
incomplete, of poor quality, or are inadequate in scope to fully
capture the goals contained in the annual plan.
The Agency's budget request for fiscal year 2000 contains resources
to address the most critical problems. For example, the Agency is
engaged in an extensive effort to improve our ability to evaluate the
effectiveness and enhance accountability of our environmental
enforcement efforts. Also, we have requested resources to modernize the
information systems needed to efficiently collect and manage
performance data. One of the Agency's key reinvention efforts is a
five-year project to implement new data standards and electronic
reporting in 13 major environmental information systems. We are also
continuing to work with our State partners to identify the specific
performance data improvements needed to measure the environmental
results of our delegated environmental programs.
To ensure that we proceed as effectively as possible, the Agency is
establishing a new Office of Information. Among other things, this
Office will be responsible for identifying a long-term strategic
assessment of the Agency's data needs, coordinating investments, and
ensuring a consistent application of data quality management practices
across the Agency.
gpra: impact on future funding requests
Question. How will your future funding requests take into
consideration actual performance compared to expected or target
performance?
Answer. The Government Performance and Results Act requires that
Agencies include in their Annual Performance Reports a ``summary of the
findings of program evaluations completed during the fiscal year
covered by the report.'' In general, these evaluations will provide a
link between planning and actual performance by helping to measure
progress against both our strategic and annual goals. In addition, EPA
has formed multi-Office teams for each of its Strategic Goals. These
``Goal Teams'' are charged with assessing progress toward achieving
long term strategic objectives and annual performance goals, and with
identifying areas where changes in resources may be necessary to
achieve those goals and objectives.
EPA is now in its first cycle of evaluating performance information
in the context of the GPRA structure. Though our processes may change
as we gain experience this year, we have already made significant
progress in incorporating performance information into the Agency's
decision-making. For example, in May the Deputy Administrator met with
the Agency's senior managers to discuss the performance data so far
received and to evaluate how this might impact our priorities in fiscal
year 2001. The Agency is committed to continuing this integration of
performance evaluation and Agency priority-setting.
gpra: cost accounting
Question. To what extent do the dollars associated with specific
agency performance goals reflect the full costs of all associated
activities performed in support of that goal? For example, are overhead
costs fully allocated to goals?
Answer. The Agency has fully integrated its budget and financial
management processes with its strategic and annual plans. As a result,
100 percent of our budgeted resources are associated with our strategic
goals and objectives. However, it is true that the Agency's goals tend
to be mutually supportive. Accordingly, the resources under each goal
do not and cannot reflect all resources that could be reasonably
associated with achieving the goal.
______
Questions Submitted by Senator Burns
fiscal year 2000 budget reduction
Question. I was surprised to see that EPA is requesting a 5 percent
(-$383 million) reduction for existing programs in its fiscal year 2000
budget. I want to compliment EPA for requesting a smaller budget for
fiscal year 2000. However, I do have some concerns with what your
budget funds and how it is allocated. What are your priorities in
fiscal year 2000 for funding in EPA?
Answer. The Agency always strives to manage its resources
prudently, while maintaining its focus on priorities to protect public
health and the environment. While we recognize the constraints placed
upon our budget annually by overall tight discretionary caps, we also
are mindful of our environmental commitments. With a decreased budget
this year, we must continue to shift resources to fund the Agency's
highest priorities and to comply with new mandates established by
Congress, including: the Safe Drinking Water Act Amendments of 1996
(SDWA), and the Food Quality Protection Act of 1996 (FQPA).
Question. Why is EPA moving into regulating health care, especially
for children?
Answer. EPA's mission includes protecting public health in the
context of environmental protection. We do not, nor do we intend to,
regulate health care, per se, which is the mission of other agencies.
Question. Don't other federal departments and agencies such as HHS
and BIA, adequately manage and regulate health care issues?
Answer. EPA does not regulate health care management. EPA has
always regulated and performed research on substances that affect the
health of the public. Through the interagency Task Force on
Environmental Health Risks & Safety Risks to Children, EPA is making
sure that it does not duplicate the work of other Federal entities.
Question. What are they doing in this area of children's health?
Answer. Administrator Browner and Secretary Shalala co-chair the
President's Task Force on Environmental Health Risks and Safety Risks
to Children. This Task Force has developed a Federal strategy to
address asthma in children and has other work groups examining issues
related to childhood cancer, developmental disorders, and unintentional
injuries. Each Federal entity brings to the Task Force its unique
contribution derived from its mission and expertise in various
children's health and safety areas. The Task Force exists both to take
advantage of the synergistic effects of cooperation for a common goal
and to avoid duplication of efforts across agencies and departments
concerned with children's health. Individual departments and agencies
can speak best to the specific activities that they are pursing in
children's health.
Question. Why does the Administration have to come up with a new
environmental initiative every year such as the new Clean Air
Partnership Fund for fiscal year 2000?
Answer. EPA's mission is to protect human health and to safeguard
the natural environment. New initiatives are created as environmental
needs become more critical. One of the Administration's most important
public health commitments is to improve the air that Americans breathe.
Over one third of Americans still live in areas where the air does not
meet the new air quality standards.
The Clean Air Partnership Fund will provide new grant resources and
opportunities for cities, states and tribes to partner with the private
sector, the federal government and each other to provide healthy, clean
air in the communities in which we live.
The Clean Air Partnership Fund will demonstrate locally managed
programs that achieve early integrated reductions in soot, smog, air
toxics and greenhouse gases. The Fund will direct new resources to
state and local governments to find the most innovative, cost-effective
and protective ways to reduce soot, smog, air toxics and greenhouse
gases that contribute to climate change.
better america bonds
Question. Concerning the ``Better American Bonds'' initiative, I am
confused on what and how these bonds will work. I understand it is part
of the Administration's Livability Initiative to help states and local
governments better protect their land and water. In Montana, we need
some protection, especially from the federal government since many
communities are surrounded by public lands. Plus we need economic
development assistance in many small rural communities in Montana. Will
these bonds allow local communities to buy conservation easements on
agricultural lands to prevent them from being developed? Will these
bonds allow local communities to purchase undeveloped lands for future
economic development or are these bonds envisioned to lock up local
lands from any economic development?
Answer. Better America Bonds can be used for three purposes--to
preserve open space, protect water quality, and clean up brownfields.
Through a competitive process, state, local and tribal governments can
apply to EPA (working in consultation with other federal agencies) for
the authority to issue Better America Bonds for these purposes. To
preserve open space, a community can either purchase the title to a
land parcel or use conservation easements. A different community might
decide that a city owned brownfield site should be cleaned up to help
revitalize the economy and create jobs, or that a wetland should be
restored. The choice is theirs. The program is entirely voluntary--if a
community doesn't want to participate, it doesn't have to.
EPA will design the Better America Bonds program to accommodate all
types of communities--large, small, urban, suburban, and rural. As EPA
works with other agencies to develop this initiative, we will include
small communities in our outreach both to provide information about the
program and to seek advice as to how to structure the program to meet
their needs.
To provide communities with the flexibility to respond to changing
circumstances, this program allows communities to change the use of the
land (sell a park financed with Better America Bonds to a developer who
builds retail space on the land, for example) after the fifteen year
term is up and the principal is repaid. We do not expect that many
communities will change the use after fifteen years, but in certain
cases it might make sense, either for environmental or economic
reasons, for the community to do so. To provide a check and balance
system, however, before a community can change the use it must allow
any 501(c)(3) organizations that are tax exempt for environmental
protection purposes the right of first refusal to purchase the land for
the purpose of maintaining its qualifying use. The government would
have to sell the land to a willing non-profit for the same price at
which it was purchased originally. If no qualified buyer is found, the
land could then be sold at its fair value for other uses.
This is not a big government program. The federal government will
not purchase one square inch of land. Nor will it micromanage local
zoning and land use decisions. Our states and communities will build
this legacy themselves. All decisions will be made at the state, tribal
or local level. We're just providing them new tools they need to grow
in ways that are best for them.
Question. How will you implement these bonds, especially since EPA
isn't in the business of issuing bonds?
Answer. As the agency responsible for protecting public health by
cleaning up our air, water and land, and ensuring that all Americans
have access to a clean and healthy environment, EPA is best suited to
help communities meet the stated goals of the program--protecting water
quality, cleaning up brownfields for reuse, and preserving green space.
The Better America Bonds program builds upon EPA's successful existing
programs that work with communities to improve local water quality and
to clean up brownfields sites so that they can be returned to
productive community use.
Furthermore, the Agency currently manages various bond-related
programs such as the Clean Water State Revolving Fund and maintains an
Environmental Finance office. The Agency would draw upon the
significant expertise in these and other programs to run the Better
America Bonds program. Finally, parts of this program will be managed
by the Treasury Department (including enforcement by the Internal
Revenue Service.)
To ensure a broad range of expertise, EPA will chair a panel of
departments and agencies including HUD, USDA, Interior, FEMA, and
Treasury. EPA will work closely with them on the design of the program,
the selection criteria, the application process, and the awarding of
bonding authority.
The Agency intends to administer this program in a cost effective
manner and anticipates being able to absorb administrative expenses
with existing agency resources. The Agency did not seek any new
resources in EPA's fiscal year 2000 budget request to run this program.
There are several factors supporting this approach. First, as
stated by the Administrator, EPA does not intend to issue any
regulations for this program. Instead, EPA will develop basic guidance
documents to assist communities in applying for bonding authority.
Second, the program will involve several current Agency programs such
the Brownfields office, various water quality programs, and our
Environmental Finance Office.
Question. Finally, don't you need authority for this bonding
authority and if so, when will we get a chance to see your requested
authority?
Answer. To create the tax credit mechanism for the Better America
Bonds program, the tax code needs to be amended by Congress. A bill, HR
2446, has been introduced in the House, and we anticipate a bill to
create the program will be introduced in the U.S. Senate in the near
future. They will be referred to the Finance and Ways and Means
Committees, respectively. Assuming that those bills pass, President
Clinton would then need to sign it into law.
clean air partnership fund programs
Question. Concerning the ``Clean Air Partnership Fund,'' I am not
sure how this compares with the state grants programs. It appears to be
another $200 million on top of the $215 million provided to states and
tribes for air quality programs. How are the programs under this new
Partnership Fund different from what is done under state and tribal
grants by the air program? What demonstrated need exists now for
developing ``partnerships'' on air quality problems or programs? If so,
give me some examples? What air problems to you expect will be
addressed by these partnerships among local, state, tribal, and federal
governments and the private sector?
Answer. State and tribal grants are awarded under Section 105(a)(1)
of the Clean Air Act which authorizes grants for the implementation of
programs for the prevention and control of air pollution and the
implementation of national air quality standards. In contrast, if funds
are appropriated for the Clean Air Partnership Fund, those funds will
be awarded under Section 103(b) of the Clean Air Act which authorizes
grants for research, investigations, experiments, demonstrations,
surveys and studies. Awards will be made to support individual
innovative demonstration projects such as those that address reductions
in air pollutants and greenhouse gases, not to implement ongoing State
and tribal air pollution prevention and control programs.
Traditionally, air programs (and grants to support them) have pursued
solutions to one air pollution problem at a time. With the multiple air
quality challenges facing states and private entities, this problem-by-
problem approach is no longer optimal. The Clean Air Partnership Fund
is designed to support demonstration projects and technologies that can
simultaneously address multiple air pollution problems.
EPA's believes that only through partnerships of government,
private sector and non-governmental entities will sustained progress
towards eliminating significant air pollution problems occur.
Partnerships of all kinds are necessary and the Clean Air Partnership
Fund will provide a catalyst for their formation. For example,
addressing regional air quality problems such as ozone nonattainment
requires states and municipalities to partner with each other to
formulate regional air quality improvement strategies. In another
example, transportation planners and air quality planners must work
together to establish transportation management systems that further
air quality improvement rather than exacerbate pollution. Similarly,
there is a need to encourage state energy officials to form
partnerships with local housing authorities to expand low income
weatherization assistance in ways that improve energy conservation and
reduce air pollution. In yet another example, to realize the potential
benefits of reducing multiple pollutants through use of new
technologies, private sector technology providers need to partner with
municipal and state governments to demonstrate the capabilities of
their clean air technologies and expand their market share.
EPA anticipates that the Fund will address a spectrum of air
quality problems including: criteria air pollution such as particulate
matter and ozone nonattainment; air toxics; and climate change.
fiscal year 2000 budget: support for states; justification for 5
percent increase in operating programs
Question. I noticed that even though your total budget request for
fiscal year 2000 is decreasing by 5 percent, your Operating Program is
increasing by 5 percent (+$191 million). That part of your budget, as I
recall supports more of the federal regulatory establishment instead of
supporting the states and tribes who are managing environmental
protection on the front lines. What percentage of your budget supports
the states and what does this consist of?
Answer. Over 40 percent of the Agency's budget is dedicated to
support of the states and tribes. Included in this funding are
resources from state grants, the Clean Water and Drinking Water SRFs,
LUST cooperative agreements, and Superfund assistance to states.
Within the Operating Programs, the President's Budget provides $885
million for categorical program grants for state and tribal
governments. This funding represents 24 percent of the Agency's total
$3.682 billion for Operating Programs
Question. Why do you need a 5 percent increase in your Operating
Program, especially if the funding for the Superfund Program is not
changing and funding for your Water Infrastructure Fund is decreasing
30 percent
Answer. The $3.7 billion request for Operating Programs includes:
most of the Agency's research, regulatory and enforcement programs, and
funds our partnership programs with states, tribes and local
governments. Our Operating Programs represent the backbone of the
nation's efforts to protect public health and the environment through
sound science, standard setting and enforcement. Through these
programs, the Agency works to ensure that our water is pure, our air is
clean and our food is safe. This 5 percent increase is critical to help
the Agency meet the expectations of the American public for a safe,
healthy environment.
superfund: proposed cleanup actions
Question. I have received quite a few complaints from people in
Montana that the EPA does not seem to care about local citizen inputs
or ideas--that the public meeting process is a joke and that anytime
someone disagrees with the EPA it doesn't matter. As you know, there
are many sensitive environmental issues in Montana. Most of the
public's complaints seem to concentrate on EPA's review of proposed
cleanup actions. However, I want to be assured that when the people of
Montana provide comments to EPA, their input will be heard and used.
What do you propose to do to counter this negative perception by my
constituents?
Answer. The Environmental Protection Agency (EPA) is committed to
involving citizens in the site cleanup process. Our community relations
effort is based on two-way communication designed not only to keep
citizens informed about site progress, but also to give them
opportunity to provide input into site decisions. Many opportunities
are available to communities to provide input into the cleanup process
through technical assistance. Technical assistance is available from a
variety of sources depending on the community. For example, Technical
Assistance grants are available to communities to hire technical
advisors who can explain technical information and documents related to
site cleanup and help articulate the community's concerns. We encourage
communities to develop community advisory groups (CAGs) which provides
an open dialogue between communities and EPA. Community members are
encouraged to attend our availability sessions. These sessions allow
community members access to the site cleanup team to ask questions and
voice their concerns regarding cleanup issues prior to large public
meetings.
regional haze: implementation of final regulations
Question. I am concerned with the release of the final regional
haze regulations. From my initial review, they seem very complex and
difficult to implement. However, the Western governors, through the
Western Regional Air Partnership, appear somewhat satisfied. However, I
need to understand how this rule will be implemented. It seems to set
the stage for a long-term regional planning process which is heavily
dependent on the cooperation of all parties. Also this process appears
to impinge on state sovereignty. What are the time lines and major
milestones of this rule? How will states who have the responsibility of
setting and managing haze in the air over the Class I areas the
authority to resolve issues of transboundary emissions from neighboring
states and from public lands on which the states have no authority?
Given this rule appears to establish a regional planning process, who
is the ultimate party to make decisions on these regional plans?
Answer. The regional haze program requires States to establish
reasonable progress goals and long term strategies for improving
visibility in Class I national parks and wilderness areas, and to adopt
control measures to meet these goals. States are to consult with each
other in setting Class I area goals and in developing appropriate
strategies to meet these goals.
The timelines and major milestones for this rule are as follows:
Initial regional haze implementation plan due dates.--The
implementation schedule for the regional haze program is consistent
with the provisions in TEA-21 and its intent for integrating control
strategies for PM2.5 and regional haze. For geographic areas designated
as attainment or unclassifiable for PM2.5, the due date for regional
haze SIPs is one year after EPA publishes the PM2.5 designation. For
geographic areas designated as nonattainment for PM2.5, the due date is
three years after the PM2.5 designation.
Because of the regional nature of visibility problems, the rule
also encourages regional planning involving multiple states.
Accordingly, if a State participates in a regional planning effort and
submits a SIP committing to continue its participation, the state may
delay submittal of a regional haze SIP for its attainment areas and
submit a regional haze SIP for the entire State on the date a SIP is
due for nonattainment areas. This will allow States to develop
coordinated regional strategies for both attainment and nonattainment
areas and submit one SIP which incorporates those strategies.
For the nine western States which participated in the Grand Canyon
Visibility Transport Commission, the final rule provides for an
implementation schedule for the 16 Class I areas addressed by the
Commission's report consistent with TEA-21 and the recommendations of
Western Governors Association. States choosing to follow this optional
approach must submit initial regional haze implementation plans in
2003.
Initial Implementation Period.--The time period for the initial
regional haze implementation plans will extend from the submittal date
of the plan until 2018. Progress Reports and Comprehensive Updates. The
rule requires progress reports every 5 years (beginning 5 years after
the first SIP submission) and, beginning in the year 2018,
comprehensive implementation plan updates every 10 years.
EPA encourages regional planning efforts for States and other
stakeholders, including federal land managers, to address the
cumulative effect of emissions from multiple States on Class I areas.
EPA plans to participate actively in these regional groups to assure
its views are known by all participants as the process moves forward.
We believe these regional planning efforts will enable participating
States and other Stakeholders to reach consensus on coordinated
strategies by highlighting the shared benefits of various emission
reduction programs, and providing for cost-effective regional control
strategies. At the same time, we recognize that under the Act, each
State has the ultimate decision making authority regarding adoption of
implementation plan provisions. State actions may not be dictated by
regional planning organizations. Ultimately, EPA has the authority to
approve or disapprove a State's implementation plan based on the
State's assessment and selection of reasonable progress goals, the
strategies it adopts to meet those goals and other factors.
Question. I hope that the Agency has improved upon its original
proposal by providing the states with the flexibility they need to
fashion their own visibility programs that Congress intended when it
enacted the visibility protection program in 1977 and revised in 1990.
What flexibilities are provided to the states in the final rule to
fashion local solutions for state visibility problems?
Answer. The final rule provides the States with substantial
flexibility in implementing the regional haze program to make
``reasonable progress'' toward the CAA's national goal of natural
visibility conditions in Class I areas. First, States have the
flexibility to take additional time to develop a single statewide SIP
rather than multiple SIPs on different timelines for attainment and
nonattainment areas, provided the State participates in regional
planning effort(s). Second, the final rule does not include a
presumptive rate of visibility improvement as was included in the
proposed rule. States have the flexibility to set progress goals based
upon a number of factors in the statute and regulation. Third, States
have considerable flexibility in developing long-term strategies
addressing an appropriate mix of stationary, mobile, and area sources
of visibility-impairing emissions to achieve Class I area progress
goals. Fourth, in lieu of requiring compliance on a source-specific
basis with the requirement for application of best available retrofit
technology (BART), States may develop a cost-effective emissions
trading program or other alternative measure that achieves greater
reasonable progress than BART, and involves participation by both BART-
eligible and non-BART sources.
regional haze: tea-21 legislation --integration with naaqs pm2.5
Question. Last year, the necessary regulatory tools for the states
to implement visibility rules were not provided. The TEA-21 legislation
was amended to provide the states with the necessary time to implement
these rules. What are EPA's plans to support the multi-year schedule
and multi-million dollar price tag for the states to implement this
final regional haze rule? How much funding was provided in fiscal year
1999 and fiscal year 2000 for the states and regional organizations to
comply with this new rule. Should additional funding be provided in
fiscal year 2000 for implementation of the regional haze rule to ensure
it does not develop into an unfunded mandate?
Answer. In fiscal year 1999, the Agency provided approximately $1.9
million in grant funds to support regional haze work. These funds
supported the operation of the visibility monitoring network (IMPROVE)
and provided support to states and multi-state organizations addressing
regional haze issues associated with the Grand Canyon and the Southern
Appalachian Mountains. Additionally and in response to Congress'
recommendation, EPA provided approximately $4.0 million in Agency
funding to support a new planning initiative for regional haze and
visibility impairment. Recognizing that regional haze is a complex
national problem, the Agency is working with all the States to identify
the composition of potential regional planning groups. Once these
regional planning groups are identified, the Agency will provide each
planning organization with initial funding to develop their multi-year
work plans and future funding needs. The Agency will incorporate the
funding needs of these regional planning organizations in its fiscal
year 2001 budget request.
For fiscal year 2000, EPA is directing approximately $3.6 million
in state grant funds for regional haze work. Funding is continued for
the visibility monitoring network and support for the Grand Canyon
visibility follow on work. Additionally funding is being provided to
the States to initiate regional haze planning activities, assess
visibility monitoring needs and identify emission inventory and source
characterization efforts.
Question. TEA-21 Act requires that the implementation of the
regional haze rule and the NAAQS PM2.5 rule be integrated. Obviously,
we do not want the implementation of the regional haze program to lead
the health-based standards. How will EPA integrate these two regulatory
programs to ensure that the implementation of the regional haze rule
follows the implementation of the NAAQS PM2.5 rule and that these funds
are being expended in the most cost effective manner?
Answer. EPA has provided an implementation schedule for the
regional haze program that is consistent with the provisions in TEA-21
and integration of control strategies for PM2.5 and regional haze. For
geographic areas designated as attainment or unclassifiable for PM2.5,
the due date for regional haze SIPs is one year after EPA publishes the
PM2.5 designation. For geographic areas designated as nonattainment for
PM2.5, the due date is three years after the PM2.5 designation.
Because of the regional nature of visibility problems, the rule
also encourages regional planning involving multiple states.
Accordingly, if a State participates in a regional planning effort and
submits a SIP committing to continue its participation, the state may
delay submittal of a regional haze SIP for its attainment areas and
submit a regional haze SIP for the entire State on the date a SIP is
due for nonattainment areas. This will allow States to develop
coordinated regional strategies for both attainment and nonattainment
areas and submit one SIP which incorporates those strategies.
For the nine western States which participated in the Grand Canyon
Visibility Transport Commission, the final rule provides for an
implementation schedule for the 16 Class I areas addressed by the
Commission's report consistent with TEA-21 and the recommendations of
Western Governors Association. States choosing to follow this optional
approach must submit initial regional haze implementation plans in
2003.
We believe that by providing opportunities for regional planning
and for the integrated implementation of the PM2.5 and regional haze
control strategies, the regional haze rule allows States to address
both air quality programs in a cost-effective manner.
risk management plan rule on propane
Question. I am very concerned with your Risk Management Plans rules
issued under Section 112(r) of the Clean Air Act especially as they
relate to non-toxic flammable fuels such as propane. Propane is a
clean-burning alternative fuel which is adequately regulated under
existing state and federal laws and independent safety codes and
standards. As you probably know, I am a co-sponsor of S. 880 just
introduced by Senator Inhofe to exempt non-toxic flammable fuels from
Section 112(r). However, I understand that the U.S. Court of Appeals
recently stayed the June 21, 1999 effective date of this rule for
propane.
What are the court's plans concerning this rule? What are EPA's
plan to extend relief to propane marketers and large consumers now?
Answer. The National Propane Gas Association (NPGA) has challenged
the coverage of propane under the RMP rule and has requested a stay of
the requirements. The United States Court of Appeals for the District
of Columbia Circuit has granted a stay until further action by the
court. This means that any (large or small) facilities handling propane
subject to the RMP requirements do not need to comply with the
requirements at this time. Further, EPA recently proposed an exemption
for any listed flammable hydrocarbon substances (e.g. propane, methane,
butane, acetylene) used or stored for use as a fuel in quantities up to
67,000 pounds (18,000 gallons). In addition, EPA stayed the RMP
requirements for facilities handling less than 67,000 pounds of a
listed flammable hydrocarbon as a fuel until the proposal is finalized.
At the House Appropriations Subcommittee on VA/HUD and Independent
Agencies hearing in April 1999, you testified that EPA intends to
increase the regulatory threshold for propane to 18,000 gallons. At the
hearing, you also indicated that it didn't mater who held this amount
in order to qualify. But in EPA's April 20 press release you announced
that the threshold is only being increased to 16,750 gallons and that
EPA's intent is not to provide any relief to marketers. I am confused
by this inconsistency.
Question. Please clarify what are EPA's plans on the regulatory
threshold and the impact on propane marketers.
Answer. The 18,000 gallon (67,000 pounds of propane) cut-off is
derived by considering a number of factors. Large quantities of
flammable hydrocarbon fuel are more likely to generate a vapor cloud
explosion in a catastrophic accidental release. A large enough vapor
cloud explosion is more likely to impact the public offsite; this is
EPA's area of concern. EPA has considerable accident data on propane
that shows that while accidental releases of small quantities can and
sometimes do result in significant on-site property damage and/or
deaths and injuries to workers or first responders on-site, they
generally do not cause off-site impacts. EPA modeled typical fuel use
conditions to calculate the outcome associated with a catastrophic
accidental release. Using modeling assumptions such as fraction flashed
after a release, mass of fuel in a vapor cloud, and the explosive yield
factor associated with a fuel/air explosion, EPA calculated the fuel
mass that could generate harm off-site. Since the vast majority of fuel
processes covered under the RMP rule use propane, EPA then reviewed the
sizes of widely-used propane tanks and set the cut-off to coincide with
the tank size closest to the quantity derived from the blast modeling.
EPA believes that 18,000 gallons (67,000 pounds of propane) represents
a reasonable upper limit for the exemption. This limit is also
consistent with accident history which generally indicates that
flammable substance accidents with serious off-site consequences most
often occur at sites handling large quantities.
A user or dealer with a storage tank or multiple tanks holding more
than 18,000 gallons subject to the RMP requirements needs to complete a
hazard assessment (worst case and alternative scenarios and 5 year
accident history), make sure an accident prevention program is in-
place, make sure an up-to-date emergency response plan is in-place, and
fill-out and submit an RMP form. As mentioned above, free software and
guides are available for preparing the hazard assessment. A facility
that has had no accidents in the past 5 years can complete this portion
quickly. For the accident prevention program, a facility that is
already in compliance with safety codes and standards (such as National
Fire Protection Association [NFPA] standard 58 for liquefied petroleum
gas) has nearly all the elements in place for safe operation. The user
or dealer will need to make sure these elements are up-to-date and add
accident prevention elements that are not addressed by industry codes
and standards, such as written operating procedures. Finally, an
emergency response plan should already be in place and coordinated with
the local fire department; if not, it will need to be prepared. All
that's left is to fill in the blank or check off the box RMP form and
submit it to EPA. The form must be submitted once every 5 years, unless
major modifications are made at the facility that affect the hazards or
prevention program. EPA estimated that a facility would likely spend
about $231 to $1,679 to prepare an RMP and supporting on-site
documentation, assuming the facility was already in compliance with
existing codes, standards and industry safety practices. Since the RMP
need only be submitted once every 5 years, the annualized cost is about
$46 to $336.
Even though I support public access to information on the Internet,
I also have concerns about the nature and quality of the information
being provided on the Internet.
Question. Given there is some potential for this type of
information falling into the wrong hands, such as potential terrorists,
what is EPA's position on releasing information from these Risk
Management Plans on the Internet? How will EPA protect this information
from Freedom of Information Requests?
Answer. I agree current FOIA laws require EPA to provide the RMP
Offsite Consequence Analysis (OCA) data in electronic format, if
requested. To address this concern, an interagency workgroup drafted
legislation to exempt OCA data from FOIA. The draft bill entitled
``Chemical Safety Information and Site Security Act of 1999'' was
transmitted to Congress on May 7th. EPA staff continue to provide
technical assistance to Congressional staff who are pursuing a
legislative solution to your concerns. It is my hope that these ongoing
discussions will lead to the passage of legislation in the immediate
future.
low sulfur gasoline proposed rule
Question. I am very interested about EPA's proposed regulation to
require nation-wide production of low sulfur concentrations in
gasoline. I do not understand why the people of Montana need to shift
to low sulfur gasoline given we do not have a problem with sulfur
emissions in our state. Why does EPA believe that a national standard
for burning low sulfur in gasoline is warranted when sulfur non-
attainment is inconsistent across the nation? What flexibilities do
states with responsibility for managing their own air quality program,
such as Montana, have to adjust sulfur concentrations in gasoline? Why
not provide flexibility to the states to determine the regional level
of sulfur needed in gasoline to meet local markets and local non-
attainment problems as you are proposing under the regional haze rule?
I am also interested about how sulfur concentrations in gasoline
affect catalytic converters. If an automobile drives from a region
burning low sulfur gasoline to another region burning high sulfur
gasoline and returns to the low sulfur region, will the catalytic
converter revert to its original performance in a reasonable period of
time? Given that California, a low sulfur gasoline state, is surrounded
by high sulfur gasoline states, what has been their experience with
vehicles failing emissions tests due to burning high sulfur gasoline
purchased while traveling in other states?
Five small refineries in California either have closed or have
stopped producing gasoline since California adopted its low sulfur
gasoline standard. What information does EPA have regarding the effect
of these refinery closures or market withdrawals on consumer gasoline
prices in California? How can EPA be confident that closures will not
affect consumer prices in areas where all refineries are small by
industry standards?
STAPPA/ALAPCO has stated that the combined Tier 2 and gasoline
sulfur rule will be equivalent of taking 54 million automobiles off the
road. Does EPA agree or disagree with this estimate? What is EPA's
estimate and reasoning for the change in automobile use due to this
proposed rule? Please provide your estimate and reasoning by state
showing the number of equivalent cars taken off the road due to (a)
improved automobile emissions technology; (b) reduced sulfur content of
gasoline to 30 ppm; and (c) being Tier vehicles, Tier I vehicles, LEV/
ULEV vehicles, and Tier 2 vehicles.
Answer. EPA proposed Tier 2 and low sulfur gasoline standards on
May 1, 1999. Without significant new controls on motor vehicle
emissions, millions of Americans will continue to breath unhealthy air.
The Tier 2 emission standards and lower-sulfur gasoline would help
achieve this goal. Gasoline sulfur is a catalyst poison and high sulfur
levels in commercial gasoline could affect the ability of future
automobiles to meet more stringent standards. Sulfur in gasoline
reduces the effectiveness of a vehicle's emission control system. Lower
sulfur gasoline is also important in order to enable the introduction
of advanced technologies that promise higher fuel economy but are very
susceptible to sulfur poisoning (for example, gasoline direct injection
engines). Therefore, low-sulfur gasoline is needed to effectively
reduce pollution and to achieve the full performance of vehicle
emission control technologies.
The focus of the proposed controls on gasoline sulfur content is to
reduce ambient levels of ozone and PM, not sulfur emissions, nor
compliance with the NAAQS for sulfur dioxide directly. EPA proposed
these gasoline sulfur controls nationwide in part because there are
areas in both the East and West which have problems with attaining or
maintaining the ozone and PM NAAQS and which experience restricted
visibility as a result of haze. Also, nationwide standards were
proposed because high levels of sulfur can have a permanent effect on
the efficiency of vehicle emission control systems. Sulfur attaches to
and penetrates the active materials of automotive catalysts, which
provide most of the control of automotive emissions currently being
achieved. The most efficient catalyst systems available currently and
those being developed for the next generation of emission control, such
as those capable of meeting the proposed Tier 2 emission standards, are
more sensitive to sulfur than catalysts used in the 1980's and early
1990's. In addition to losing much of their effectiveness when exposed
to high sulfur levels, these catalysts do not always return to their
original level of effectiveness after the use of high sulfur fuel
ceases. Even one tankful of high sulfur gasoline can cause irreversible
damage to these catalysts. EPA expects that vehicles designed to meet
the proposed Tier 2 standards will show an even more irreversible
sulfur effect than those designed to meet today's California and
Federal low emission vehicle standards. Given the fact that vehicles
are quite mobile and that popular vacation areas exist in the western
U.S., nationwide sulfur control is necessary to ensure that vehicles
operating in the worst ozone areas in the eastern U.S. emit at the
emission levels for which they were designed. California has strongly
encouraged EPA to implement nationwide sulfur controls precisely
because their own vehicles are being permanently disabled by using high
sulfur fuel in neighboring states and because out-of-state vehicles
coming into California are emitting above their certified emission
levels because of operation on high sulfur fuel.
The proposed emission reductions from this rule would provide much-
needed assistance to states facing ozone and PM air pollution problems.
When fully effective in 2030, the proposed tailpipe standards would
significantly reduce NOX emissions from vehicles by about 74
percent and particulate matter emissions by about 84 percent compared
to emission levels of current vehicles. The reductions in
NOX and SOX emissions from the proposed program
would also reduce secondary ambient sulfate and nitrate PM which are
formed from these gaseous emission. The nation's refiners would meet an
average sulfur level of 30 parts per million (ppm) by 2004, down from
the current average of more than 300 ppm. The maximum amount of sulfur
in gasoline, for purposes of averaging, would be capped at 80 ppm,
after a three-year phase-in. EPA estimates the cost of reducing sulfur
levels to 30 ppm nationwide would be about 1-2 cents per gallon. Under
Section 211 of the Clean Air Act, a state could adopt the same standard
as established by EPA, or it could, under certain conditions, establish
a more stringent standard. However, once EPA regulates the sulfur
content of gasoline, a state could not adopt a less stringent standard.
A uniform nationwide standard is supported by the fact that motor
vehicles can and do travel throughout the country and catalytic
converters of current and future vehicles will be detrimentally
impacted by high sulfur levels in gasoline.
As part of these proposed new standards, EPA has included several
measures to ensure maximum flexibility and cost-effectiveness. These
flexibilities include: (1) allowing averaging to meet both the car
emission and gasoline sulfur standards; (2) allowing extra time for
larger vehicles between 6000 and 8500 pounds and smaller refiners to
meet their respective standards; and (3) allowing for a market-based
credit trading-and-banking system for both industries to reward those
who lead the way in reducing pollution. The proposal includes special
considerations for small refiners (defined in the proposal as those who
employ no more than 1,500 employees), such as those in Montana, which
would have an additional four years (until 2008) to comply with the
proposed sulfur standards. If necessary, small refiners that
demonstrate a severe economic hardship could apply for an additional
extension of up to two years. In developing this proposal, EPA worked
closely with small refiners located throughout the United States and
convened a Small Business Advocacy Panel to collect information about
companies which meet the Small Business Administration's definition of
a small gasoline producer. Montana Refining was very active in the
Advocacy Panel process and would likely benefit from the proposed small
refiner provisions. The proposed sulfur averaging provisions should
also provide significant flexibility to small refineries owned by large
companies.
California's reformulated gasoline program, put in place in 1996,
controls many gasoline properties beyond sulfur levels. The sulfur
requirements, while significant, were responsible for about one third
of the total costs and even less of the capital investments needed to
meet the California requirements. While there were refinery closures in
California in the 90's, most of these refineries closed prior to 1996.
There are many reasons for these closings, including lost access to a
reliable source of cheap crude oil and overcapacity. The price
differential between gasoline sold in California and elsewhere is due
in part to the supply and demand of California gasoline and the
difficulty of obtaining it from sources outside the state. A nationwide
sulfur control program would help alleviate this concern in California
and other markets across the country. We believe the sulfur control
provisions, especially those applicable to small refiners, are
reasonable and do not anticipate any refinery closures or disruption in
fuel supply attributed to this proposal.
Our estimate for comparing the Tier 2/gasoline sulfur proposal
emission reductions to emissions from vehicles removed from operation
differs from the estimate provided by STAPPA/ALAPCO. By 2020, we
project that the NOX emission reductions due to the proposed
Tier 2 and sulfur standards will be the equivalent of removing 166
million baseline light-duty vehicles and trucks from the road. Of this
total, we project the equivalent of 69 million cars and trucks would be
removed due to sulfur control alone. We developed these figures by
comparing the emission rates of vehicles estimated to be in the 2020
fleet with and without the effects of the Tier 2/gasoline sulfur
proposal. These reductions reflect only the 47-state region defined by
the U.S. minus California, Alaska and Hawaii; since emission reductions
are also projected in these states, the nationwide total will be
higher. In 2020, we estimate that Tier 2 cars and trucks will account
for approximately 95 percent of all miles traveled by cars and trucks.
NLEV cars and trucks will account for 2.8 percent, and Tier 1 cars and
trucks will account for 2.2 percent.
clean water action plan: usda and epa draft strategy on animal feeding
operations
Question. Recently USDA in conjunction with EPA unveiled their
draft strategy for the Clean Water Action Plan. This Plan seeks to
address the ``problem'' of animal waste management in animal feeding
operations and essentially develop an approach to reduce phosphorous
levels in livestock waste. This proposed plan potentially has major
impacts on Montana producers because it will affect not only feedlot
operators but any producer who houses an animal in a corral for an
extended period of time. This includes producers who work with beef
cattle, dairy cattle, swine, poultry, and even horses. In this time of
depressed market prices and poor cash reserves by livestock producers,
they do not need more regulatory burdens.
Answer. The USDA-EPA Unified National Strategy for Animal Feeding
Operations (AFOs) was issued in final form by the Vice President on
March 9, 1999. The Strategy is one of over 100 action items included in
the President's Clean Water Action Plan, issued in February 1998. The
Strategy reflects a balanced and appropriate use of programs and
authorities to address water quality and public health problems caused
by AFOs.
The Strategy does not change EPA's existing regulations for AFOs.
Rather, the Strategy sets forth a range of flexible, common-sense steps
that USDA and EPA plan to take, under existing legal and most under
existing regulatory authority, to minimize the water quality and public
health impacts of improperly managed animal wastes while complementing
the long-term sustainability of livestock production. As indicated in
the Strategy, EPA plans to review and revise its regulations related to
CAFOs. This regulatory review and revision will be conducted in
accordance with applicable legal and regulatory requirements.
The Strategy relies heavily on the stewardship ethic of producers
and is based on a national performance expectation that all AFO owners
and operators should develop and implement technically sound,
economically feasible, and site-specific ``comprehensive nutrient
management plans'' (CNMPs) for managing the animal wastes produced at
their facilities. These CNMPs will include actions to prevent or reduce
runoff and result in better management of the estimated 1.37 billion
tons of manure produced each year. We expect that the large majority of
AFOs, particularly the small AFOs, will not be subject to federal
regulatory requirements, but rather will be encouraged to voluntarily
adopt CNMPs to ensure proper manure management.
EPA's regulatory definitions of AFOs and concentrated animal
feeding operations (CAFOs) were established in 1976 and are given at 40
CFR 122.23 and Part 122, Appendix B. These regulations define an AFO as
a facility that meets the following criteria:
--Animals have been, are, or will be stabled or confined and fed or
maintained for a total of 45 days or more in any 12-month
period, and
--Crops, vegetation, forage growth, or post-harvest residues are not
sustained in the normal growing season over any portion of the
lot or facility.
The Federal regulations further define a CAFO generally as an AFO
that:
--Confines more than 1,000 animal units (AUs); or
--Confines 301 to 1,000 AU and discharges pollutants:
--Into waters of the United States through a man-made ditch,
flushing system, or similar man-made device; or
--Directly into waters of the United States that originate
outside of and pass over, across, or through the facility or
otherwise come into direct contact with the animals confined in
the operation.
In addition, the permitting authority (i.e., EPA or an NPDES
authorized State) can designate an AFO as a CAFO upon determining that
the operation is a significant contributor of pollution to waters of
the United States. This determination, which takes a number of factors
into account (e.g., slope, vegetation, and the proximity of the
operation to the waters), is based on an on-site inspection by the
agency that issues NPDES permits.
An area where a producer ``houses an animal in a corral for an
extended period of time'' would qualify as an AFO or CAFO only if it
meets these regulatory definitions.
Question. What is the scientific basis of this ``problem'' in
managing animal wastes?
Answer. As a result of domestic and export market forces,
technological changes, and industry adaptations, the past several
decades have seen substantial changes in America's animal production
industries. These factors have promoted expansion of confined
production units, with growth in both existing areas and new areas;
integration and concentration of some of the industries; geographic
separation of animal production and feed production operations; and the
concentration of large quantities of manure and wastewater on farms and
in some watersheds.
In terms of production, the total number of animal units (AUs) in
the U.S. increased by about 4.5 million (approximately three percent)
between 1987 and 1992. During this same period, however, the number of
AFOs decreased, indicating a consolidation within the industry overall
and greater production from fewer, larger AFOs.
AFOs can pose a number of risks to water quality and public health,
mainly because of the amount of animal manure and wastewater they
generate. Manure and wastewater from AFOs have the potential to
contribute pollutants such as nutrients (e.g., nitrogen, phosphorus),
sediment, pathogens, heavy metals, hormones, antibiotics, and ammonia
to the environment. Excess nutrients in water can result in or
contribute to eutrophication, anoxia (i.e., low levels of dissolved
oxygen), and, in combination with other circumstances, have been
associated with outbreaks of microbes such as Pfiesteria piscicida.
Pathogens, such as Cryptosporidium, have been linked to impairments
in drinking water supplies and threats to human health. Pathogens in
manure can create a food safety concern if manure is applied directly
to crops at inappropriate times. In addition, pathogens are responsible
for some shellfish bed closures. Nitrogen, in the form of nitrate, can
contaminate drinking water supplies drawn from ground water. Nutrients
can also cause toxic algal blooms which may be harmful to human health.
EPA is working to develop better scientific data and to better
assess the scope of the problem of improperly managed animal waste both
nationally and regionally. There are, however, a number of reports and
studies and other compelling evidence to indicate that water pollution
from AFOs is a significant water quality problem. This information
falls generally into four broad categories:
(1) The States continue to report that on a national level,
polluted runoff from agriculture is a leading source of impairment in
both rivers and lakes. Although sub-categories for agriculture are not
broken out for all States, 22 States did voluntarily report that
feedlots and animal holding areas impair about 35,000 river miles, or
20 percent of impaired river miles nationwide.
(2) Numerous peer-reviewed papers and case studies demonstrate the
impact animal feeding operations can have on water quality. These
studies indicate that at the farm and watershed level, animal feeding
operations can impact water quality. These impacts usually result from
the cumulative over-application of manure from numerous farms in a
watershed and can result in increases of nutrients and pathogens in
waterways.
(3) While cumulative small additions of nutrients and pathogens can
impair water quality, it is the large catastrophic events which attract
the most attention. The well-publicized North Carolina lagoon spills in
1995 are unfortunate examples of how large amounts of animal waste, if
not properly managed, can severely impact a waterbody.
(4) There are also other areas where animal feeding operations have
been identified as a potential source of the problem. AFOs have been
identified as a possible contributing factor in the outbreaks of
Pfiesteria in both North Carolina and Maryland during the summer of
1997 and Cryptosporidium in Milwaukee's drinking water system in 1993.
Question. How will EPA take into consideration the economic impacts
of this proposed plan on agricultural producers to avoid putting
farmers and ranchers out of business. Finally, what financial relief
can EPA provide Montana's farmers and ranchers to meet the Clean Water
Action Plan? How can they apply for this relief?
Answer. The Unified AFO Strategy is not a new regulation and does
not in itself impose any binding requirements or economic burden on
producers. Instead, the Strategy describes a range of actions that USDA
and EPA plan to take to address the water quality and public health
impacts from AFOs. These actions will have to meet applicable legal and
regulatory requirements. For example, EPA is currently in the process
of reviewing and revising the existing regulations and expects to
propose changes in the near future. Consistent with small business
analysis requirements, EPA will evaluate the impacts of projected costs
on facilities that are small businesses. EPA will also evaluate the
economic impacts of any new regulations on larger operations. Both of
these analyses will address the major species of livestock.
Currently, EPA's policy is to treat only AFOs that meet regulatory
definition of a CAFO or have been designated CAFOs as point sources
subject to the NPDES program. Other AFOs may be eligible to receive
financial assistance through EPA grant and loan programs such as the
CWA Section 319 nonpoint source program and the Clean Water State
Revolving Loan program. AFOs may also be eligible for assistance from
several USDA programs including the Environmental Quality Incentives
Program. Facilities, including CAFOs, that are subject to permitting
under EPA's existing regulations are generally not able to receive
financial assistance from EPA to comply with their permit requirements.
The Unified AFO Strategy does, however, describe two types of
incentives which can allow certain CAFOs to exit the regulatory program
and work to stay out of the regulatory program.
First, the Strategy states our view that smaller CAFOs (those with
fewer than 1,000 AUs) should be allowed to exit the permit program
after the end of their permit term (which is a period of five years
from the date the permit is issued) if they meet certain conditions. To
exit the program, a facility would be expected to demonstrate that it
has successfully addressed the conditions that caused it to be defined
or designated as a CAFO and that it is fully implementing its
Comprehensive Nutrient Management Plan (CNMP) and would be expected to
offer evidence that it is in full compliance with its permit at the end
of the permit term.
Second, AFOs with less than 1,000 AUs may in many cases be taking
early voluntary actions in good faith to manage animal wastes in
accordance with a CNMP. Specifically, some AFOs that are voluntarily
implementing a CNMP may have a discharge that makes them subject to
being designated as CAFOs under the NPDES permitting program, but does
not cause them to be included in the permitting priorities described in
the Strategy. The Strategy states that NPDES permitting authorities
should consider providing an opportunity for these AFOs to address the
cause of the discharge before designating them as CAFOs.
food safety
Question. As you know, we are facing extreme problems in the
agricultural industry, especially in Montana. During the 1990's,
farmers have made only a 4 percent return while retail food chains have
made 18 percent, food processors made 17 percent, and even agricultural
banks are receiving a 11 percent return. Since 1984, consumer prices
for food has risen 3 percent while the price paid to farmers has fallen
by 36 percent. Now we are facing a potential drought in eastern
Montana. All of these factors are compounded when agricultural chemical
products are changing with reregistrations. Even though I agree safer,
less toxic pesticides should be used, how do you consider the economic
impacts of this struggling agricultural industry in making your
decision on pesticide reregistration?
Answer. Last year Vice President Gore responded to growers'
concerns about the effects of the Food Quality Protection Act (FQPA) by
asking the Environmental Protection Agency (EPA) and the U.S.
Department of Agriculture (USDA) to convene a committee of stakeholders
to assist the government in developing a process for conducting
tolerance reassessment that is required by the new law. The process
must incorporate four principles: sound science, transparency,
consultation with stakeholders, and reasonable transition for
agriculture. In consultation with the Tolerance Reassessment Advisory
Committee (TRAC), EPA and USDA identified nine science policy areas
where EPA needed to explain how it will make risk assessments, began to
explore risk management issues, and initiated a pilot process for
conducting the tolerance reassessments of the organophosphate
pesticides.
EPA's Commitment to an Open Process for Developing FQPA Policies
Taking the TRAC's advice, the Agency has made its pesticide risk
assessment and risk management processes and science policy development
far more accessible to the public through notice and comment
procedures. The Agency has created an Internet site providing access to
the same information made available at the TRAC meetings, including the
science policy papers on tolerance reassessment and risk management.
EPA also created an Internet site with up-to-date information on the
organophosphate pesticides, including the schedule for tolerance
reassessment and individual preliminary risk assessments. These
webpages enable the Agency to keep the public informed of each step in
the tolerance reassessment process and entry-points for participation.
These websites can be accessed at http://www.epa.gov/pesticides.
EPA's Commitment to an Open Process for Making Tolerance Reassessment
Decisions
With the help of the TRAC members, EPA and USDA have laid out this
pilot process for the organophosphate pesticides, complete with self-
imposed deadlines for releasing the preliminary risk assessments,
further refining the risk assessments, and providing for public
participation on risk mitigation measures and practical transition
strategies. In making decisions on tolerances, EPA relies on actual
data generated by the registrant, other agencies such as USDA, from
peer reviewed scientific literature, and from growers and other
pesticide users--not on default values based on worst-case assumptions.
In many cases, the comment process is providing additional health
and environmental effects data, use data, or other relevant information
which EPA is using to refine the risk assessments. EPA has compiled
organophosphate use and usage information for some crops and posted it
on the Agency's website. We expect to begin a public comment period on
risk management for the first of the organophosphate pesticides later
this spring or in early summer. The comment period will allow for
discussion and examination of both risk mitigation measures and
possible transition processes to alternative pest control approaches
where needed. EPA and USDA are working on the best ways to start this
phase of organophosphate tolerance reassessment and will be consulting
with the TRAC.
At the same time that we are issuing the preliminary risk
assessments and developing the risk management process for individual
organophosphate pesticides, we are also developing a method for
calculating cumulative risk for the organophosphate pesticides as a
group. We expect to issue this draft methodology for rigorous external
scientific peer review and full public comment later in the year. In
the meantime, the Agency will continue to make registration and
tolerance reassessment decisions on individual active ingredients based
on sound science.
EPA's Commitment to a Reasonable Transition for Agriculture
One of Vice President Gore's four principles is to provide for a
reasonable transition for agriculture. FQPA imposes more stringent
standards for pesticide use in food and feed crop production, and the
Agency recognizes that how it implements the law may have important and
far reaching consequences. This statute, while helping to ensure a high
level of food safety, has the potential to create uncertainty for
agricultural producers, both in the short and long term.
Expedited Review for Safer Pesticides.--FQPA reinforced EPA's
commitment to bringing new and safer technologies to the marketplace to
reduce the potential risks from pesticide exposures while helping to
maintain an abundant and safe food supply. To be sure that pesticide
users have access to a range of safer pest control tools, the Agency is
expediting review of pesticides which might be used as alternatives to
riskier pesticides. As you may know, the Agency had created a new
reduced-risk pesticide registration program to facilitate this effort
before FQPA was enacted. This expedited review includes new active
ingredients and new uses of currently registered pesticides that reduce
risks to human health or the environment. In a notice sent to all
registrants in August 1998, EPA explained its policy for the
prioritization and expedited review of applications for new active
ingredients which can be used as alternatives to organophosphate
pesticides, and new use registration applications for alternative,
conventional pesticides. Of 27 new pesticide active ingredients
registered in fiscal year 1998, 14 were done as a result of expedited
review.
Minor Uses and Other Special Situations.--EPA is focusing on
reducing the risks of existing pesticides in a manner that is least
disruptive to growers. Many existing pesticides will almost certainly
be found to meet the new standard. However, when the risk of a
pesticide is above the safety standard set by law, EPA must take
regulatory action to manage the risk. The Agency has identified a range
of regulatory approaches for achieving risk management; the most
appropriate approach is dependent upon the level of risk. Working with
USDA, it is our goal to ensure a smooth transition process that is the
least disruptive to growers. The Agency is particularly conscious of
the potential impacts on minor crop growers and integrated pest
management programs and will continue to work with growers and
registrants to focus attention on those situations where limited crop
protection alternatives exist. The final TRAC meetings will focus on
formulating ways to gain grower input on practical, feasible, and
affordable mitigation measures. The Agency will also be seeking input
from grower groups to identify potential organophosphate pesticide
alternatives for their crops. EPA's risk assessments will attempt to
identify those crops/uses that contribute most to the risk, so that the
Agency, USDA, and growers can work together to devise real and sensible
solutions.
USDA's Role in Transition to Safer Pest Management
Because of its contacts and ability to interact more readily with
the agricultural community, USDA has taken a large role in developing
transition strategies. USDA is devoting significant effort and is
requesting additional funding in its fiscal year 2000 budget to help
grower groups develop strategies that will result in reduced risk but
still ensure adequate pest control. One possible strategy for enhancing
public participation is the idea of holding informational or technical
briefings for interested parties, including commodity groups that may
be directly affected by the findings for a selected pesticide or group
of pesticides.
Regional Centers for Education and Outreach.--To promote the
advance of pest management to ensure a safe, nutritious, and economical
food supply for the American public, USDA is establishing Regional Pest
Management Centers. Since crops, pests, and weather patterns differ
from region to region within the United States, no single, national
approach to pest management is appropriate across all the agricultural
regions. Also, it is economically inefficient and not appropriate for
every state within similar production regions to organize and support
repetitive, and often competing, pest management program efforts. A
viable solution to this dilemma is the development of regional pest
management centers based on similarity of cropping patterns, pest
problems and environmental conditions.
Pest Management Centers would be organized in eight different
agricultural regions of the country. These centers would be located at
existing land-grant universities or other appropriate facilities such
that no new infrastructure would be required. Among the activities
carried out by such centers would be to: (1) develop and evaluate new
agricultural pest management technologies; (2) identify and organize
pest management expertise within the regions to ensure rapid response
capability for pest problems or public information needs; (3) organize
and deliver pest management educational programs for agricultural
producers as well as consumers; (4) provide science-based, regionally-
specific input for public policy and regulatory issues; and (5) manage
and report on pest management research projects within the region.
Three Research and Education Programs.--One of the first activities
of the Centers would be to carry out, on a regional basis, the USDA
research and education plan for helping growers overcome changes from
the implementation of FQPA. The USDA research and education plan has
three components: (1) The Pest Management Alternatives Program (PMAP),
a program to develop replacement tactics and technologies for
pesticides under consideration for cancellation or use restrictions by
EPA. The focus of this program, which was established in 1996, is
primarily towards replacement of individual chemicals in a pest
management program on a crop by crop basis. PMAP is structured to fund
short term (1-2 years) projects aimed at adaptive research and
implementation of tactics that have shown promise in previous testing;
(2) New Pest Management Strategies Contributing to Crop Productivity, a
research and implementation program, proposed to begin in 2000, for
several crops which face potentially severe economic constraints
resulting from loss of certain pesticides through implementation of
FQPA. Development of new multiple-tactic pest management strategies to
help ensure economic viability and productivity of food crops will be
the goal of the program; and (3) Reducing Risk in Major Food Crop
Production Systems, a new approach to risk reduction with a food and
grain production system focus, integrating food safety and water
quality considerations a impacted by FQPA. The program is also proposed
to begin in 2000 and will involve the major acreage crops including
corn, soybean, wheat, cotton and rice as well as the fruits and
vegetables most important in the diets of infants and children. The
program goal is to eliminate pesticide residues in food crops and
drinking water.
Question. How does EPA coordinate economic impact assessments on
the agricultural industry due to pesticide reregistrations with USDA
and FDA?
Answer. EPA establishes tolerances under the Federal Food Drug and
Cosmetic Act (FFDCA). Cost/benefit analysis is not required for
regulations made under FFDCA authority. Although the Federal
Insecticide, Fungicide and Rodenticide Act (FIFRA) is a risk/benefit
statute, the Agency does not explicitly analyze costs and benefits
except in formal cancellation proceedings. Should the Agency propose to
take formal action (under Section 6 of FIFRA) it is required to consult
with USDA regarding actions against agricultural pesticides and with
the Secretary of Health and Human Services (HHS) regarding public
health pesticides.
EPA has a number of formal and informal links with USDA to
coordinate our fact-finding and regulatory efforts. During development
of significant reregistration and tolerance reassessment actions, such
as those affecting organophosphate pesticides, EPA works closely with
USDA to obtain information on ``real-life'' exposure, potential impacts
of regulatory options, and the availability of alternative methods of
pest control. EPA also strongly encourages pesticide and agricultural
producers to provide similar information to USDA and EPA. Efforts with
HHS are well underway to develop a Memorandum of Understanding which
will outline how EPA and HHS will consult on actions that may impact
public health pesticides. As with agricultural pesticides, EPA has
worked with industry and State offices, such as mosquito control
boards, to help assess the potential impact of any actions on this
important class of pesticides.
Question. Finally, how are you ensuring that the quality of
imported agricultural products are safe for consumption, especially
imported beef from Canada?
Answer. Authority for the safety of imported meat is spread among
three Federal agencies. EPA establishes tolerances for pesticide
residues under the FFDCA while FDA monitors imports for compliance with
FFDCA requirements. USDA sets and monitors quality standards for meat,
including hygienic standards.
Differences in the regulation of pesticide residues in food can be
a trade issue. These concerns are being addressed with our North
American Free Trade Act (NAFTA) partners. Cooperative U.S./Canada
bilateral efforts on pesticides regulatory harmonization were expanded
in 1996 to include Mexico through the NAFTA Technical Working Group
(TWG) on Pesticides. The goal of the TWG is to develop a coordinated
pesticides regulatory framework among NAFTA partners to address trade
irritants, build national regulatory scientific capacity, share the
review burden, and coordinate scientific and regulatory decisions on
pesticides. This work has already begun to pay dividends by addressing
specific trade irritants, such as national differences in Maximum
Residue Limits (MRLs, or tolerances), developing a better understanding
of each regulatory agency's assessment practices, working to harmonize
each country's procedures and requirements, and encouraging pesticide
registrants (product owners) to make coordinated data submissions to
the three NAFTA countries to facilitate joint reviews.
tribal support
Question. I understand that you are requesting a total of $166
million for support to Tribal governments. Also I understand that you
are working to improve the capacity of tribes to manage their own
environmental programs. Since Montana has eight Federally-recognized
tribes which I strongly support. What is your assessment of the
environmental conditions of their tribal lands?
Answer. EPA is assisting Montana's federally-recognized tribes to
build the capacity to manage their own programs for environmental
protection of their lands, similar to our efforts to help states build
the capacity in the early years of the Agency. In addition, EPA has the
statutory responsibility to protect public health and the environment
on Indian reservations. Environmental conditions vary from reservation
to reservation, but overall the condition of the Montana tribes'
environment range from poor to good, with impacts from improper
disposal of solid wastes, drinking water and wastewater impacts due to
a lack of infrastructure and a lack of operations & maintenance, mining
impacts, oilfield contamination, and non-point source pollution the
most prevalent.
Question. What environmental problems are they having to manage on
their lands?
Answer. Environmental problems vary from reservation to
reservation, but some of the problems Montana tribes are experiencing
include disposal of solid wastes, pollution and other impacts from
mining, surface water pollution, and infrastructure needs for drinking
water and wastewater treatment systems. There is also the problem of
air pollution from off-reservation sources.
Question. What type of financial and technical assistance can you
provide to them to help address their environmental problems?
Answer. Though a variety of mechanisms in addition to broad based
multi-media funding under the General Assistance Program (GAP), Tribes
are eligible for assistance under the Drinking Water and State
Revolving Fund Programs, as well as other standing Grant Programs (Sect
319, PWSS, WQCA, Wetlands, UIC, 106).
Question. I understand that EPA is proposing a 20 percent set-aside
in the Clean Water State Revolving Fund for Indian tribes to use for
nonpoint source problems and other water quality problems. Does this
require statutory changes and, if so, when will we get to review your
proposed legislation? Why have the tribes not availed themselves of
State Revolving Fund loans that the states can provide?
Answer. The President's proposal would allow states to use up to 20
percent of their fiscal year 2000 Clean Water State Revolving Fund
(CWSRF) capitalization grants for grants for nonpoint source pollution
control projects. Indian tribes do not receive capitalization grants
because the Clean Water Act does not authorize CWSRFs for tribes. The
tribes do, however, receive 0.5 percent of the CWSRF appropriation for
use as wastewater grants. Tribes can also apply to states for CWSRF
loans, as can any municipality, as long as they meet fiscal management
and regulatory requirements. To date no tribe has received a CWSRF
loan. One reason is that all loan recipients are required to have
dedicated sources of revenue for loan repayments. Many tribes do not
have revenue sources with which to repay the loan. Tribes prefer
instead to receive grants, which require no repayment, to address their
water quality problems Another reason is that many tribes view
themselves as sovereign nations, with authority equal to that of
states. Their preference is to work with the U.S. government on a
government-to-government basis, as opposed to working through the
states. Tribes would face state oversight requirements when applying to
states for nonpoint source pollution control grants from the optional
CWSRF 20 percent set-aside.
If Congress adopts the President's proposal, implementing language
would be required in the fiscal year 2000 Appropriation Act. Such
language is proposed in the Appendix of the fiscal year 2000
President's Budget, pages 930--931, as follows:
`` * * * for fiscal year 2000, each State may reserve from
funds in its Clean Water State Revolving Fund, an amount equal
to no more than 20 percent of the sums allotted to such State
under section 604 of the Federal Water Pollution Control Act to
provide grants of no more than 60 percent of the costs of
projects eligible under section 603 (2) or (3) of such Act.
Such grants may not be made for publicly-owned treatment works
as defined in section 212 of that Act. Projects receiving grant
assistance must, to the maximum extent practicable, rank
highest on the State's priority list that is used to prioritize
projects eligible for assistance under section 603 of that
Act.''
______
Questions Submitted by Senator Shelby
grandfather regulation: environmental defense fund vs. epa
Question. Administrator Browner, it is my understanding that a few
years ago you approved the specific ``grandfather'' regulation that was
challenged and struck down in Environmental Defense Fund v. EPA. Why
did you choose not to appeal the recent conformity grandfathering
decision? Did your viewpoint regarding this regulation change? If it
did, why? Administrator Browner, did someone else, either within the
Justice Department or at the White House, make the decision not to
appeal?
Answer. After extensive review of the decision and discussions
within the Administration, including EPA and the Departments of
Transportation and Justice (DOT and DOJ), we have decided not to seek
rehearing of the decision. The Administration has developed a workable
approach for implementing conformity under the court's decision. We
believe that a combination of guidance to states, quick action by EPA
to find submitted State Implementation Plans (SIPs) adequate, and
regulatory changes to our conformity rules in response to the court's
remand make appeal of the court's decision or changes to the Clean Air
Act unnecessary. This approach properly balances economic development
with environmental protection, and minimizes any immediate disruption
to transportation activities resulting from the decision.
We are committed to an approach that recognizes the importance of
continued highway construction--providing local areas with as much
predictability and flexibility as possible--consistent with meeting our
Nation's air quality needs. EPA intends to amend the transportation
conformity rules to clarify that grandfathering of previously approved
projects can proceed during a conformity lapse, but only where DOT has
made a full funding commitment to the project prior to the lapse. EPA
believes that this is both an appropriate interpretation of the
conformity requirements of the Act, and consistent with the recent
court decision.
As a result of recent problems associated with implementation of
the prior grandfathering regulation, especially in Atlanta, Georgia,
EPA believes that grandfathering at the stage of full funding
commitment is more appropriate than at the stage of NEPA review, and
that grandfathering at this stage properly coordinates the twin desires
of advancing transportation planning and protecting clean air.
transportation construction projects list
Question. This case could have a great impact on numerous
transportation construction projects. However, I am not aware of any
definitive information regarding projects that are within the reach of
the Court's decision. Could you provide me with the list of projects
that the EPA believes that this decision affects. Could you also
provide cost estimates regarding the losses that will result from the
delays caused by this decision?
Can you consult with the Department of Transportation and provide
the list of the immediately affected projects? And the associated
project costs?
Answer. Attached please find DOT's list (as of June 15, 1999) of
projects that are immediately affected by the court decision, and the
associated project costs. We understand that the table entitled
``Status of Grandfathered Projects in Lapsed Areas'' describes in
columns 1 and 2 the total universe of projects that could be affected
by the court decision. The projects in columns 3 and 4 are the subset
that definitely can proceed even under the terms of the court decision.
It is worth noting that among the areas where conformity has lapsed
(i.e., there are conformity problems independent of the court
decision), most of these areas will have ended their lapse by September
1999 at the latest (Ashland, KY; Monterey, CA; Raleigh, NC; Santa
Barbara, CA; Winston-Salem, NC).
Of the areas where conformity was suspended following the court
decision, most are expected to re-establish conformity within weeks
(Longmont, CO; Stanislaus County, CA; Tucson, AZ). In fact, Yuma, AZ
has already re-established conformity. This reduces the total project
costs on DOT's table by $53.3 million.
transportation construction projects impact
Question. Administrator Browner, while we may not yet know the
exact number of projects that will be affected, we do know there will
be a substantial number. Most of these projects were intended to
improve transportation efficiency. The delays caused by this ruling
will keep thousands, if not millions, stuck in inefficient
transportation systems. Won't this have a detrimental impact on the
environment?
Answer. The number of projects affected by the March 2, 1999, court
decision is limited. These projects are located in areas where analysis
shows that transportation plans will cause vehicle emissions to be
higher than what is allowed for in the State implementation plans
(SIPs) for air quality. These areas may proceed with transportation
projects once they have developed transportation plans that do not
cause the vehicle emissions limits of their SIPs to be exceeded. We
expect most of these areas to fix their conformity problems by August
1999 which will restore nearly half of the project funding impacted.
Until they do so, it is more environmentally protectiveand a more
efficient use of resourcesto avoid investments that may worsen air
quality over the long term. We believe that short-term delays in
transportation efficiency improvements are preferable to irreversible
investments in a transportation system that is incompatible with long-
term attainment and maintenance of the air quality standards.
transportation partners program
Question. Administrator Browner, it is my understanding that the
EPA conducts the ``Transportation Partner's Program.'' Could you please
tell me about this program?
Answer. Transportation Partners is a U.S. EPA program that promotes
and supports innovative, local, voluntary efforts to reduce vehicle
miles traveled (VMT). Transportation Partners is one of the actions in
President Clinton's Climate Change Action Plan and is responsible for
reducing miles traveled by single occupancy vehicles in order to reduce
greenhouse gas emissions.
The Transportation Partners program is comprised of a team of
national, non-governmental organizations, called Principal Partners,
who receive EPA funding to foster innovative transportation solutions
nationwide. Principal Partners share EPA's commitment to decreasing
greenhouse gas emissions and to mitigating environmental impacts from
the transportation sector. Funds received by these organizations are
used to provide technical assistance to businesses, communities, and
organizations engaging in VMT reduction strategies. Transportation
Partners has funded nine non-profit organizations since its founding.
In cooperation with its Principal Partners, the Transportation
Partners program provides technical and networking assistance to over
300 nationwide Project Partners. Project Partners consist of national,
non-governmental organizations, community-level associations, state and
local governments, and businesses. Business partners include WalMart,
Kaiser Permanente, Bank of America, and many others. Transportation
Partner examples are provided on the attachment.
Question. Are you aware of whether the EDF, the party that brought
the suit in the [conformity] case, has ever received funding under this
program? Could funding from this program have been used by EDF to bring
the lawsuit against the EPA?
Answer. EPA has entered into cooperative agreements with EDF and
other groups that have expertise in various aspects of the
transportation and environmental issues. In some cases, groups which
have received Federal funds are also engaged in litigation with the
Federal government. EPA has strict guidelines that prevent EDF and
other groups from using EPA funds to pay for these legal actions. Every
EPA grant agreement is conditioned on compliance with OMB Circulars
that prohibit the use of grant funds for suits against the Government.
Specifically, they prohibit ``costs of legal, accounting, and
consultant services, and related costs, incurred in connection with * *
* the prosecution of claims or appeals against the Federal Government''
(OMB Circular No. A-122, Attachment B, Section 10.g, which applies to
nonprofit organizations; same provision in Circular No. A-21, Section
J.11.g, which applies to educational institutions) and ``legal expenses
for prosecution of claims against the Federal Government'' (Circular
No. A-87, Attachment B, Section 14.b, which applies to State, local,
and tribal governments). In addition, EPA's appropriation acts provide
that grant funds may not be used to pay the expenses of, or otherwise
compensate, non-Federal parties intervening in regulatory or
adjudicatory proceedings.
Examples of Transportation Partners Projects
Cornell University's comprehensive Transportation Demand Management
Program enhanced transportation choices, reduced VMT, and saved money
by eliminating the need for new parking spaces. The program combines a
three-tiered rate structure for parking, transit subsidies, and
coordination with local communities and transit operators to reduce
approximately 10 million VMT per year and an estimated 1,450 MMTCE. The
program worked with surrounding municipalities to encourage the
creation of park-and-ride lots, improved and distributed transit maps,
and created a ``Commuter Connection'' column in the local newspaper.
The increased demand created by the program lead to new routes and
improved service in previously underserved areas.
A Howard County, Maryland School Walkway Program has resulted in
hundreds of students now walking to school. A partnership between
Howard County's Department of Public Works and Department of Education
has resulted in the installation of miles of new sidewalks. Before
these sidewalks or missing sidewalk links were installed, students who
lived within walking distance of school were forced to ride a bus for
safety reasons. One 900 foot walkway enabled 141 students to walk to
school, and eliminated three buses and 2,000 bus trips per year.
The City of Xenia and Green County, Ohio have teamed up with the
Ohio Department of Transportation, the Ohio Department of Natural
Resources, and the private sector to convert 60 miles of former railway
corridors and a seven acre railroad depot into an alternative
transportation center. The transportation center includes bike and
pedestrian trails, parking facilities, and a community building. The
trails are located within a short walk of every Xenia resident and
within ten minutes of most residents in the county. It was estimated
that over 300,000 people used the trails to get to work, home, school,
and other activities by the end of 1997.
Kaiser Permanente of California is taking demonstrable steps to
reduce pollution and traffic congestion through the KAISERider program.
Throughout California, 10,500 employees at sites with the KAISERider
program use alternative means of transportation, such as carpooling, on
a regular basis. Four KAISERRider services alone eliminate approximate
37,000 passenger trips a month or nearly 4 million VMT per year (571
MMTCE).
The City of Oakland, California Oakland Broadway electric shuttle
has revitalized a key shopping and business district. Signage and
discounted merchant coupons were created to encourage the use of the
shuttle, which provides workers and shoppers in the area with a quick,
easy, and free way to move throughout the downtown area during lunch
time hours. The total estimated annual VMT reduction for the shuttle is
237,600 which would result in an annual reduction of 34 MMTCE.
______
Questions Submitted by Senator Craig
climate change: kyoto protocol implementation
Question. Has EPA taken any action or programs that seek to
implement the Kyoto Protocol.
Answer. No. The Administration has committed not to implement the
Kyoto Protocol before the Senate has considered the Protocol and
provided advice and consent to its ratification.
Question. Has EPA staff provided any formal communications to the
Administration related to the Kyoto Protocol or data used to try to
justify the Protocol? If so, please provide copies of these
communications for the record including any EPA press releases,
statements by EPA staff and documentation detailing the peer review
process used prior to release of any of this data.
Answer. We understand your question as asking whether EPA has
formally transmitted any scientific or economic data related to or in
justification of the Kyoto Protocol to the White House or another
federal Agency, through a press release or other form of public
announcement. We further understand your question as asking for
information on the peer review process for any such data transmitted in
this way. EPA has not made any such transmittal of data to the White
House or other agencies.
Question. In October 1997, the President announced a three-stage,
multi-year plan to reduce greenhouse gas emissions. One element was a
proposal to provide credits to companies that take voluntary action to
reduce their greenhouse gas emissions. Legislation to authorize such
program was introduced by Senator Chafee and others in both the 105th
and 106th Congresses, but the Administration has not endorsed the
Chafee legislation nor submitted its own legislation.
As part of its Green Lights and other voluntary programs, EPA
requires that participating companies submit detailed information
(project-by-project) on reductions. EPA spends considerable amounts of
money to compile this detailed information. If a program to provide
early credits were enacted, companies seeking such credits would
presumably need to keep track of their reductions in order to justify
their credits. If these companies were also participants in EPA's Green
Lights or other voluntary programs, it is not clear that EPA would
still need such detailed data. Thus, EPA might be able to reduce its
funding level for Green Lights and other voluntary programs without
reducing the effectiveness of these programs.
Did the President's announcement increase company willingness to
invest in energy-saving equipment? Please explain by providing the
necessary supporting documentation. Did it increase willingness in the
business community to sign up for Green Lights and other voluntary
programs?
Answer. Since the President's announcement, the rate of private
sector companies and other entities (e.g., schools, state or local
governments, or other non-profits) newly joining partnership programs
like ENERGY STAR Buildings and Green Lights has remained about the
same. EPA's voluntary climate partnerships are continuing to grow at a
steady pace and the number of partnerships now exceeds 7,000.
It does appear that there may have been an increase in overall
private sector investment in energy efficiency over this period,
paralleling the strong general investment trend in the U.S. economy
over this time.
The President's announcement did spur increased participation on
the part of companies and industries who came forward to participate in
consultations between industry and government about voluntary industry-
by-industry commitments to reduce greenhouse gases through the industry
consultation process. A significant number of new, meaningful voluntary
industry commitments have been announced in this period.
For example:
--United Technologies has committed to a sales weighted reduction of
greenhouse gas emissions of 25 percent below 1997 emissions
levels by 2007.
--British Petroleum has agreed to reduce their greenhouse gas
emissions by 10 percent below 1990 levels by 2010.
--Shell has agreed to reduce their greenhouse gas emissions 10
percent below 1990 levels by 2002.
--Dow will reduce their energy use per unit of production by 20
percent by 2005.
--Dupont will reduce their greenhouse gas emissions 40 percent below
1990 levels by 2000.
--Through their global energy conservation, product design, and
perfluorocompound emission reduction goals, IBM has committed
to reduce 40 percent of their PFC emissions by 2002 per unit
output using a 1995 baseline in semiconductor manufacturing.
They have also committed to achieve energy conservation savings
each year equivalent to 4 percent of annual electric and fuel
use.
--Finally, the most recent announcement came from Motorola which will
reduce emissions of PFCs by 50 percent from 1995 levels by the
year 2010.
Question. Can you explain why, in nearly 18 months since the
President first announced the ``early credits'' idea, the
Administration has not submitted legislation on this issue? When do
[you] expect the Administration to submit such legislation?
Answer. In his State of the Union message this year, the President
pledged to work with members of Congress in both parties to reward
companies that take early, voluntary action to reduce greenhouse gases.
Rather than submit its own bill, the Administration believes it would
be most efficient and productive to work with Congress on the basis of
early credit proposals that have already been introduced, such as S.547
in the Senate, and similar legislation expected to be introduced in the
House.
Question. If a program to provide ``early credits'' were to be
enacted, what changes in EPA's voluntary programs would be appropriate?
For example, would it still make sense for EPA to keep detailed
company-by company, project-by-project records for EPA's partners?
Answer. While there are many uncertainties as to how a program to
provide early credits would work, it is unlikely that EPA's voluntary
programs would need significant changes. Partners in voluntary programs
such as ENERGY STAR Buildings and Green Lights would need to continue
to report to EPA on a company-by-company basis in order to track the
company's progress in each particular voluntary program, as well as the
aggregate achievements of that program. EPA uses this company-submitted
information to publicly recognize the accomplishments of companies and
other organizations that make commitments under the program.
Question. How much of the $41.3 million requested for Buildings
Initiatives will be spent to compile company data?
Answer. The $41.3 million requested to expand EPA's Buildings
Programs will not to be used to compile company data for EPA's
Buildings programs. The requested funding is intended to expand
partnerships and provide essential information to organizations and
consumers so that they can choose equipment and products that will not
only save them money but reduce pollution. Current funding levels of
these programs have been and will continue to be sufficient to collect
and compile data on participant activities through the program. EPA has
already established an efficient system for updating an existing
database with new information from program partner reports. The program
partners compile and report their own data in an agreed-upon format, so
a relatively small proportion of EPA's expenditures for the voluntary
programs is used for data compilation activities.
Question. Please explain why a company would need credits for
greenhouse gas reductions. Does the Administration plan to put in place
mandatory limits on companies combustion of fossil fuels and other
activities that produce greenhouse gases? When would those limits take
effect? How would company limits be determined?
Answer. As domestic and international policy developments on
climate change unfold, a significant number of companies are
considering whether to take actions now to reduce their greenhouse gas
emissions in anticipation of a possible future market-based system to
limit emissions. Many of those firms support having credits for early
greenhouse gas reductions because they want to be assured that they
will not be inadvertently penalized in a possible future market-based
system, and that reductions they make before such a system takes effect
will be appropriately recognized and rewarded. The Administration
shares this view and thus supports the creation of a program for
appropriately rewarding early action.
The President has put forth a plan, articulated most fully in a
speech in October 1997, to responsibly and effectively address the very
real and serious problem of global warming in both the domestic and
international arenas. The President has proposed to proceed
pragmatically in three stages. In the first stage, he has directed EPA,
the Department of Energy, and other agencies to take actions that help
reduce greenhouse gas emissions while providing direct and immediate
benefits to the economy, primarily through encouraging voluntary
emissions reductions. These actions include the Climate Change
Technology Initiative (CCTI), the restructuring of the electric utility
industry, and a program to give businesses appropriate credit for early
reductions in greenhouse gas emissions. In the second stage of the
President's proposal, programs implemented during stage one would be
reviewed, evaluated, and--depending on their success--extended. A pilot
emissions trading program would be put in place and tested. The third
stage of the President's plan envisions implementation of an emissions
cap and trading system--based on the successful experience with the
acid rain program--to harness the power of the marketplace to limit
greenhouse gas emissions as flexibly and efficiently as possible, and
at the lowest possible cost. The Administration has not made any
further decisions as to when such a market-based system would come into
effect, or how emission limits at the company level would be
determined. The Administration has pledged to work with Congress on any
necessary legislation.
Question. Has EPA developed any analysis regarding the ``credit for
early action'' legislation introduced in the Senate in the 105th
Congress and the 106th Congress? If so, please provide this
documentation, including a list of any recipients of this
documentation.
Answer. Regarding the credit for early action legislation
introduced in the Senate in the 105th and/or 106th Congress, EPA has
developed two internal analyses which have been distributed to EPA
staff only. In January 1999, an analysis entitled ``Early Reduction
Credit Proposals'' was completed for Todd Stern, Special Assistant to
the President for Special Projects.
Question. In EPA's fiscal year 2000 Annual Performance Plan it
stated: ``EPA will * * * build a program that provides appropriate
credit for early action. (Page VI-30 of EPA fiscal year 2000
submission) What is EPA's statutory authority for developing a ``credit
for early action'' program?
Answer. EPA stated in its fiscal year 2000 Annual Performance Plan:
``[i]n 2000, EPA will expand its work with these industries to build a
program that provides appropriate credit for early action.'' In its
recent Climate Change Report to Congress, prepared in response to
Senate Appropriations Report 105-216, p. 74-75, EPA described this
concept more fully, stating that ``EPA will expand its work with [key
energy intensive] industries and work across the Administration to help
develop the basis for a program that could provide appropriate credit
for early action.'' This work furthers the Administration's goals. In
his January 1999, State of the Union Address, President Clinton
expressed his support for the concept of providing credit for early
reductions of greenhouse gases.
EPA's statement in the fiscal year 2000 Annual Performance Plan was
not intended to indicate that EPA will implement an early action credit
program in fiscal year 2000, but rather that EPA will work to develop a
conceptual framework for such a possible program. EPA will work with
key industries to identify areas where and the means by which
environmental and economic benefits could be obtained from early action
to reduce greenhouse gases. EPA believes these are important first
steps in considering how such a program might be structured.
Information provided by energy intensive industries also provides a
basis for evaluating the scope of the benefits that might be achieved
through providing credits for early action.
EPA's primary source of statutory authority for these activities is
section 103(a) and (b) of the Clean Air Act. Section 103 of the Clean
Air Act requires the Administrator to establish a ``national research
and development program for the prevention and control of air
pollution.'' As part of this program, section 103(a)(1) requires the
Administrator to, ``conduct, and promote the coordination and
acceleration of, research, investigations, experiments, demonstrations,
surveys, and studies relating to the causes, effects (including health
and welfare effects), extent, prevention and control of air
pollution.'' Section 103(b) provides that in carrying out subsection
(a), the Administrator is authorized to ``collect and make available,
through publications and other appropriate means, the results of and
other information, including appropriate recommendations by him in
connection therewith, pertaining to such research and other
activities.'' Section 103(g) of the CAA provides additional authority
for some of the Agency's activities in this area. Section 103(g)
provides that in carrying out subsection (a), ``the Administrator shall
conduct a basic engineering research and technology program to develop,
evaluate, and demonstrate nonregulatory strategies and technologies for
air pollution prevention.'' The program is to include among its
elements, ``[i]mprovements in nonregulatory strategies and technologies
for preventing or reducing multiple air pollutants, including sulfur
oxides, nitrogen oxides, heavy metals, PM-10 (particulate matter),
carbon monoxide, and carbon dioxide, from stationary sources, including
fossil fuel power plants. Such strategies and technologies shall
include improvements in the relative cost effectiveness and long-range
implications of various air pollutant reduction and nonregulatory
control strategies such as energy conservation, including end-use
efficiency, and fuel-switching to cleaner fuels.'' These Clean Air Act
provisions authorize EPA to explore and develop innovative,
experimental approaches for prevention and control of air pollution,
and an early action credit program would be one such approach.
Other statutes provide additional general authority for and/or
authority for specific aspects of EPA's activities in this area. Such
statutes include: Pollution Prevention Act of 1990, 42 U.S.C. 13101 et
seq.; National Environmental Policy Act of 1969, 42 U.S.C. 4321 et
seq.; Global Climate Protection Act of 1987, 15 U.S.C. 2901; and
Federal Technology Transfer Act, 15 U.S.C. 3710a.
climate change: greenhouse gas emissions--credit for early action
Question. In October 1997, the President announced a three-stage,
multi-year plan to reduce greenhouse gas emissions. One element was a
proposal to provide credits to companies that take voluntary action to
reduce their greenhouse gas emissions. Legislation to authorize such
program was introduced by Senator Chafee and others in both the 105th
and 106th Congresses, but the Administration has not endorsed the
Chafee legislation nor submitted its own legislation.
Answer. As part of its Green Lights and other voluntary programs,
EPA requires that participating companies submit detailed information
(project-by-project) on reductions. EPA spends considerable amounts of
money to compile this detailed information. If a program to provide
early credits were enacted, companies seeking such credits would
presumably need to keep track of their reductions in order to justify
their credits. If these companies were also participants in EPA's Green
Lights or other voluntary programs, it is not clear that EPA would
still need such detailed data. Thus, EPA might be able to reduce its
funding level for Green Lights and other voluntary programs without
reducing the effectiveness of these programs.
Question. Did the President's announcement increase company
willingness to invest in energy-saving equipment? Please explain by
providing the necessary supporting documentation. Did it increase
willingness in the business community to sign up for Green Lights and
other voluntary programs?
Answer. Since the President's announcement, the rate of private
sector companies and other entities (e.g., schools, state or local
governments, or other non-profits) newly joining partnership programs
like ENERGY STAR Buildings and Green Lights has remained about the
same. EPA's voluntary climate partnerships are continuing to grow at a
steady pace and the number of partnerships now exceeds 7,000.
It does appear that there may have been an increase in overall
private sector investment in energy efficiency over this period,
paralleling the strong general investment trend in the U.S. economy
over this time.
The President's announcement did spur increased participation on
the part of companies and industries who came forward to participate in
consultations between industry and government about voluntary industry-
by-industry commitments to reduce greenhouse gases through the industry
consultation process. A significant number of new, meaningful voluntary
industry commitments have been announced in this period.
For example:
--United Technologies has committed to a sales weighted reduction of
greenhouse gas emissions of 25 percent below 1997 emissions
levels by 2007.
--British Petroleum has agreed to reduce their greenhouse gas
emissions by 10 percent below 1990 levels by 2010.
--Shell has agreed to reduce their greenhouse gas emissions 10
percent below 1990 levels by 2002.
--Dow will reduce their energy use per unit of production by 20
percent by 2005.
--Dupont will reduce their greenhouse gas emissions 40 percent below
1990 levels by 2000.
--Through their global energy conservation, product design, and
perfluorocompound emission reduction goals, IBM has committed
to reduce 40 percent of their PFC emissions by 2002 per unit
output using a 1995 baseline in semiconductor manufacturing.
They have also committed to achieve energy conservation savings
each year equivalent to 4 percent of annual electric and fuel
use.
--Finally, the most recent announcement came from Motorola which will
reduce emissions of PFCs by 50 percent from 1995 levels by the
year 2010.
Question. Can you explain why, in nearly 18 months since the
President first announced the ``early credits'' idea, the
Administration has not submitted legislation on this issue? When do
[you] expect the Administration to submit such legislation?
Answer. In his State of the Union message this year, the President
pledged to work with members of Congress in both parties to reward
companies that take early, voluntary action to reduce greenhouse gases.
Rather than submit its own bill, the Administration believes it would
be most efficient and productive to work with Congress on the basis of
early credit proposals that have already been introduced, such as S.547
in the Senate, and similar legislation expected to be introduced in the
House.
Question. If a program to provide ``early credits'' were to be
enacted, what changes in EPA's voluntary programs would be appropriate?
For example, would it still make sense for EPA to keep detailed
company-by company, project-by-project records for EPA's partners?
Answer. While there are many uncertainties as to how a program to
provide early credits would work, it is unlikely that EPA's voluntary
programs would need significant changes. Partners in voluntary programs
such as ENERGY STAR Buildings and Green Lights would need to continue
to report to EPA on a company-by-company basis in order to track the
company's progress in each particular voluntary program, as well as the
aggregate achievements of that program. EPA uses this company-submitted
information to publicly recognize the accomplishments of companies and
other organizations that make commitments under the program.
Question. How much of the $41.3 million requested for Buildings
Initiatives will be spent to compile company data?
Answer. The $41.3 million requested to expand EPA's Buildings
Programs will not to be used to compile company data for EPA's
Buildings programs. The requested funding is intended to expand
partnerships and provide essential information to organizations and
consumers so that they can choose equipment and products that will not
only save them money but reduce pollution. Current funding levels of
these programs have been and will continue to be sufficient to collect
and compile data on participant activities through the program. EPA has
already established an efficient system for updating an existing
database with new information from program partner reports. The program
partners compile and report their own data in an agreed-upon format, so
a relatively small proportion of EPA's expenditures for the voluntary
programs is used for data compilation activities.
Question. Please explain why a company would need credits for
greenhouse gas reductions. Does the Administration plan to put in place
mandatory limits on companies combustion of fossil fuels and other
activities that produce greenhouse gases? When would those limits take
effect? How would company limits be determined?
Answer. As domestic and international policy developments on
climate change unfold, a significant number of companies are
considering whether to take actions now to reduce their greenhouse gas
emissions in anticipation of a possible future market-based system to
limit emissions. Many of those firms support having credits for early
greenhouse gas reductions because they want to be assured that they
will not be inadvertently penalized in a possible future market-based
system, and that reductions they make before such a system takes effect
will be appropriately recognized and rewarded. The Administration
shares this view and thus supports the creation of a program for
appropriately rewarding early action.
The President has put forth a plan, articulated most fully in a
speech in October 1997, to responsibly and effectively address the very
real and serious problem of global warming in both the domestic and
international arenas. The President has proposed to proceed
pragmatically in three stages. In the first stage, he has directed EPA,
the Department of Energy, and other agencies to take actions that help
reduce greenhouse gas emissions while providing direct and immediate
benefits to the economy, primarily through encouraging voluntary
emissions reductions. These actions include the Climate Change
Technology Initiative (CCTI), the restructuring of the electric utility
industry, and a program to give businesses appropriate credit for early
reductions in greenhouse gas emissions. In the second stage of the
President's proposal, programs implemented during stage one would be
reviewed, evaluated, and--depending on their success--extended. A pilot
emissions trading program would be put in place and tested. The third
stage of the President's plan envisions implementation of an emissions
cap and trading system--based on the successful experience with the
acid rain program--to harness the power of the marketplace to limit
greenhouse gas emissions as flexibly and efficiently as possible, and
at the lowest possible cost. The Administration has not made any
further decisions as to when such a market-based system would come into
effect, or how emission limits at the company level would be
determined. The Administration has pledged to work with Congress on any
necessary legislation.
Question. Has EPA developed any analysis regarding the ``credit for
early action'' legislation introduced in the Senate in the 105th
Congress and the 106th Congress? If so, please provide this
documentation, including a list of any recipients of this
documentation.
Answer. Regarding the credit for early action legislation
introduced in the Senate in the 105th and/or 106th Congress, EPA has
developed two internal analyses which have been distributed to EPA
staff only. In January 1999, an analysis entitled ``Early Reduction
Credit Proposals'' was completed for Todd Stern, Special Assistant to
the President for Special Projects.
Question. In EPA's fiscal year 2000 Annual Performance Plan it
stated: ``EPA will * * * build a program that provides appropriate
credit for early action. (Page VI-30 of EPA fiscal year 2000
submission) What is EPA's statutory authority for developing a ``credit
for early action'' program?
Answer. EPA stated in its fiscal year 2000 Annual Performance Plan:
``[i]n 2000, EPA will expand its work with these industries to build a
program that provides appropriate credit for early action.'' In its
recent Climate Change Report to Congress, prepared in response to
Senate Appropriations Report 105-216, p. 74-75, EPA described this
concept more fully, stating that ``EPA will expand its work with [key
energy intensive] industries and work across the Administration to help
develop the basis for a program that could provide appropriate credit
for early action.'' This work furthers the Administration's goals. In
his January 1999, State of the Union Address, President Clinton
expressed his support for the concept of providing credit for early
reductions of greenhouse gases.
EPA's statement in the fiscal year 2000 Annual Performance Plan was
not intended to indicate that EPA will implement an early action credit
program in fiscal year 2000, but rather that EPA will work to develop a
conceptual framework for such a possible program. EPA will work with
key industries to identify areas where and the means by which
environmental and economic benefits could be obtained from early action
to reduce greenhouse gases. EPA believes these are important first
steps in considering how such a program might be structured.
Information provided by energy intensive industries also provides a
basis for evaluating the scope of the benefits that might be achieved
through providing credits for early action.
EPA's primary source of statutory authority for these activities is
section 103(a) and (b) of the Clean Air Act. Section 103 of the Clean
Air Act requires the Administrator to establish a ``national research
and development program for the prevention and control of air
pollution.'' As part of this program, section 103(a)(1) requires the
Administrator to, ``conduct, and promote the coordination and
acceleration of, research, investigations, experiments, demonstrations,
surveys, and studies relating to the causes, effects (including health
and welfare effects), extent, prevention and control of air
pollution.'' Section 103(b) provides that in carrying out subsection
(a), the Administrator is authorized to ``collect and make available,
through publications and other appropriate means, the results of and
other information, including appropriate recommendations by him in
connection therewith, pertaining to such research and other
activities.'' Section 103(g) of the CAA provides additional authority
for some of the Agency's activities in this area. Section 103(g)
provides that in carrying out subsection (a), ``the Administrator shall
conduct a basic engineering research and technology program to develop,
evaluate, and demonstrate nonregulatory strategies and technologies for
air pollution prevention.'' The program is to include among its
elements, ``[i]mprovements in nonregulatory strategies and technologies
for preventing or reducing multiple air pollutants, including sulfur
oxides, nitrogen oxides, heavy metals, PM-10 (particulate matter),
carbon monoxide, and carbon dioxide, from stationary sources, including
fossil fuel power plants. Such strategies and technologies shall
include improvements in the relative cost effectiveness and long-range
implications of various air pollutant reduction and nonregulatory
control strategies such as energy conservation, including end-use
efficiency, and fuel-switching to cleaner fuels.'' These Clean Air Act
provisions authorize EPA to explore and develop innovative,
experimental approaches for prevention and control of air pollution,
and an early action credit program would be one such approach.
Other statutes provide additional general authority for and/or
authority for specific aspects of EPA's activities in this area. Such
statutes include: Pollution Prevention Act of 1990, 42 U.S.C. 13101 et
seq.; National Environmental Policy Act of 1969, 42 U.S.C. 4321 et
seq.; Global Climate Protection Act of 1987, 15 U.S.C. 2901; and
Federal Technology Transfer Act, 15 U.S.C. 3710a.
climate change: global climate issue--epa outreach
Question. Has EPA sponsored, co-sponsored, or participated in any
public meetings related to the global climate issue? If so, please
provide the dates of the meetings, a list of participants, copies of as
delivered presentations, and any presentation material used by EPA
staff or produced as a result of a grant from EPA.
Answer. Please see Attachment 1. Attachment 1 includes two lists
which summarize: (1) public meetings related to the global climate
issue that have been sponsored or co-sponsored by EPA; and (2) other
public meetings related to the global climate issue at which EPA staff
have participated as presenters and/or exhibitors. These lists include
public meetings that occurred in fiscal year 1999 (10/1/98 through 3/
18/99, the date of your request) and at which climate change issues
were specifically on the agenda. These lists cover EPA headquarters
offices (EPA Regional office information will follow shortly). We have
also attached copies of participant lists for the listed EPA sponsored
or co-sponsored meetings, lists of participants for the listed meetings
at which EPA participated (where available), and presentation materials
(hand outs and/or overheads) where available.
Question. For any program sponsored or co-sponsored by EPA, how
were/are decisions made about the participants in the program? Who is
responsible for making these decisions? How does EPA assure that the
views reflected are balanced?
Answer. It is EPA's policy to be as inclusive as possible in
determining who should participate (speak/present/exhibit) in EPA-
sponsored public events, in order to ensure that all constituencies and
all sides of the issue are represented. For the public meetings listed
in our response to question #16, the EPA staff responsible for each
meeting worked with other co-sponsors and stakeholders to identify
qualified representatives from all appropriate sectors, including:
industry; environmental groups; federal, state, and local government;
and academia. Attendance at EPA-sponsored public meetings is open to
all that are interested and the events are advertised through EPA
mailings and in such media as the trade press, public press, and the
Internet.
Question. Does EPA have plans for any more of these meetings? If
so, please provide a current list of these as well as any updates?
Answer. Please see Attachment 2, which is a list of EPA-sponsored
public meetings related to the global climate issue that are planned
for the remainder of fiscal year 1999.
Question. Has EPA been involved in any activities involving
consulting with countries implementing the Kyoto Protocol since the
fiscal year 1999 VA HUD Appropriations was signed by the President on
October 21, 1998? Have you been involved with Argentina? If so, what
was the scope of the activity and who was involved? Please provide any
documents related to this activity including trips taken and the names
of participants?
Answer. EPA has supported climate change activities in developing
countries since the negotiations leading up to the signing of the UN
Framework Convention for Climate Change in 1992. As one of the key
agencies supporting the U.S. Country Studies Program, an interagency
program, EPA has supported cooperative work with numerous developing
countries in the areas of inventories, mitigation, vulnerability and
adaptation, and capacity building. EPA is now focusing its efforts on
supporting capacity in inventories, economic analysis and modeling,
technology cooperation, and linkages between climate mitigation and
local pollution This work is being concentrated in a few key developing
countries including Argentina, Brazil, Chile, China, Korea and Mexico.
In Argentina EPA participated in several interagency trips (with
Departments of State, Agriculture, Energy and Transportation) to
discuss technical support concerning climate change to the Argentine
Department of Natural Resources and Sustainable Development. This
support focuses on the following technical areas: determine the
baseline for GHG emissions; perform GHG inventory for 1997; revise the
1990 and 1994 GHG emission inventories; determine future emission
projections; establish different mitigation scenarios and analyze their
impacts, and costs/benefits; elaborate alternative proposals for GHG
emission goals under the FCCC; and prepare a Second National
Communication or a Revision of the Initial National Communication. EPA
participants in these technical trips were Maurice N. LeFranc, Jr.,
Clare Breidenich, Leianne Clements and Peter Nagelhout.
Question. Has EPA provided any funds to state or local entities to
begin the process of implementing the Administration's proposed climate
policy, including the Kyoto Protocol? Provide the details of all grants
to state and local organizations including the date of the grant, the
funding level, agreed scope, principal contact and Requests for
Proposals for the following periods:
(a) July 25, 1997 through July 23, 1998
(b) July 24, 1998 through October 21, 1998
(c) October 21, 1998 through April 28, 1999
Answer. EPA has supported climate change activities in developing
countries since the negotiations leading up to the signing of the UN
Framework Convention for Climate Change in 1992. As one of the key
agencies supporting the U.S. Country Studies Program, an interagency
program, EPA has supported cooperative work with numerous developing
countries in the areas of inventories, mitigation, vulnerability and
adaptation, and capacity building. EPA is now focusing its efforts on
supporting capacity in inventories, economic analysis and modeling,
technology cooperation, and linkages between climate mitigation and
local pollution. This work is being concentrated in a few key
developing countries including Argentina, Brazil, Chile, China, Korea,
and Mexico. In Argentina, EPA participated in several interagency trips
(with the Departments of State, Agriculture, Energy, and
Transportation) to discuss technical support concerning climate change
to the Argentine Department of Natural Resources and Sustainable
Development. This support focuses on the following technical areas:
determine the baseline for GHG emissions: perform GHG inventory for
1997; revise the 1990 and 1994 GHG emission inventories; determine
future emission projections; establish different mitigation scenarios
and analyze their impacts and costs/benefits; elaborate alternative
proposals for GHG emission goals under the FCCC; and prepare a Second
National Communication or a Revision of the Initial National
Communication. EPA participants in these technical trips were Maurice
N. LeFranc, Jr., Clare Breidenich, Leinne Clements and Peter Nagelhout.
Question. Has EPA provided any funding for studies of either
domestic or international carbon emissions trading?
If so, please provide by May 15, 1999:
--(a) the names of the organizations or individuals receiving the
grant;
--(b) the amount of the grant;
--(c) the documents describing the initial scope of the project;
--(d) the dates of initial contact and project initiation; and
--(e) copies of these reports or preliminary drafts
Also, please provide the Agency's statutory basis for pursuing
these studies.
Answer. EPA provided funding for the following studies that deal
with domestic and/or international carbon emissions trading:
(a) grant recipients:
(21) H. John Heinz III Center for Science, Economics and the
Environment, Washington DC.
(22) Center for Clean Air Policy, Washington DC.
III. Resources for the Future, Washington DC.
(b) funding level and (d) project period
I. John H. Heinz III Center for Science, Economics and the
Environment.
Fiscal year 1999/2000--Not funded.
Fiscal year 1998/1999--Funding Level: $100,000; Project Period:
September 23, 1996-September 23, 1998.
Fiscal year 1997/1998--Funding Level: $100,000; Project Period:
September 23, 1996-September 23, 1998.
II. Center for Clean Air Policy.
Fiscal year 1999/2000--Funding Level: $160,000; Project Period:
August 1, 1999-July 31, 2000.
Fiscal year 1998/1999--Funding Level: $196,000; Project Period:
August 1, 1998-July 31, 1999.
Fiscal year 1997/1998--Funding Level: $50,000; Project Period: July
1997-December 1997.
III. Resources for the Future
Fiscal year 1999/2000--N/A.
Fiscal year 1998/1999--Funding Level: $220,000; Project Period:
July 1, 1997-June 30, 2000.
Fiscal year 1997/1998--Funding Level: $75,000; Project Period: July
1, 1997-June 30, 2000.
(c) and (e) Please see attached.
Attachment 1
The following two lists summarize: 1) public meetings related to
the global climate issue that have been sponsored or co-sponsored by
EPA; and 2) public meetings related to the global climate issue at
which EPA staff have participated as presenters and/or exhibitors.
These lists include public meetings that occurred in fiscal year 1999
(10/1/98 until 3/18/99, the date of your request).
epa sponsored and co-sponsored public meetings
Meeting: Is Climate Changing Where the Wild Things Are?
Date/location: October 7-8, 1998, Washington, D.C.
Participant: David Gardiner, Assistant Administrator, Office of
Policy
Meeting: Third Annual State and Local Climate Change Partners'
Conference
Date/location: October 13-15, 1998, Albuquerque, NM
Participant:
Katherine Sibold, staff
Jane Leggett Emil, Director, Climate Policy and Programs Division
Steve Thompson, staff, EPA Region 6
Ronn Dexter, Director, Climate Outreach and Innovations Division
Jerry Clifford, Deputy Regional Administrator, Region 6
Jack Colbourn, staff, Region 9
Clay Ogg, staff
Shari Friedman, staff
Meeting: Air & Waste Management
Association: Second International Specialty Conference on Global
Climate Change
Date/location: 10/14/98, Crystal City, VA
Participant: David Doniger, Counsel to the Assistant Administrator,
Office of Air and Radiation
Meeting: Earth Technologies Forum
Date/location: 10/26-28/98, Washington, D.C.
Participant:
Peter Robertson, Deputy Administrator
Bob Perciasepe, Assistant Administrator, Office of Air and
Radiation
David Doniger, Counsel to the Assistant Administrator, Office of
Air and Radiation
Skip Laitner, staff
Meeting: The Importance of Air Traffic Management Modernization
Action Plan to Climate Protection
Date/location: 10/7-10/98, Brussels, Belgium.
Participant:Stephen O. Andersen, Ph.D., staff
Meeting: Semiconductor Manufacturing Energy Efficiency Workshop
Date/location: 10/22/98, Austin, TX.
Participant: Jeanne Briskin, staff
Meeting: Global Climate Change: Science, Policy, and Mitigation/
Adaptation Strategies
Date/location: 10/13-15/98, Washington, D.C.
Participant: Reid Harvey, Jennifer Macedonia, staff
Meeting: Electric Utilities Environment Conference on Science,
Regulations & Impacts of SO2, CO2, O3,
NOX & Mercury/EEI
Date/location: 1/11/99, Tucson, AZ.
Participant:
Skip Laitner, Jennifer Macedonia, staff
Brian McLean, Director, Acid Rain Division
conferences at which epa staff have participated as speakers and/or
exhibitors
Meeting: The Nature Conservancy Seminar
Date/location: October 1, 1998, Edgartown, MA
Participant: Jim Titus, staff
Meeting: Rutgers University Seminar
Date/location: October 2, 1998, New Brunswick, NJ
Participant: Jim Titus, staff
Meeting: CoastFest 1998
Date/location: October 3, 1998, Brunswick, GA
Participant: Exhibit only
Meeting: Delaware Coast Day
Date/location: October 4, 1998 (Lewes, DE)
Participant:Jim Titus, staff
Meeting: Ocean Community Conference
Date/location: November 16-19, 1998, Baltimore, MD
Participant: Jim Titus, staff
Meeting: The Changing Face of Public Health
Date/location: January 21-22, 1999, Raleigh, NC
Participant:Exhibit only
Meeting: BioEnergy Meeting
Date/location: October 1998, Madison, WI
Participant:Exhibit only
Meeting: Town Hall Meeting
Date/location: Overland Park, Kansas, October 1998
Participant: Katherine Sibold, staff
Meeting: Fish Expo
Date/location: November 15-17, 1998, Seattle, WA
Participant: Exhibit Only
Meeting: RCRA National Meeting
Date/location: January 1999, Washington, D.C.
Participant: Henry Ferland, Ethan McMahon, staff
Meeting: R 99 Recovery, Recycling, Re-integration Congress
Date/location: February, 1999, Geneva, Switzerland
Participant:Eugene Lee, staff
Meeting: New Jersey Dept. of Env. Protection GHG Workgroup Meeting
Date/location: April 1999, Trenton, NJ
Participant:Eugene Lee, staff
Meeting: Resources for the Future Workshop on Emissions Trading
Systems for Greenhouse Gas Emissions
Date/location: January 15, 1999, Washington, D.C.
Participant:
Robert Shackleton, Martin Ross, staff
Michael Shelby, Director, Energy & Transportation Sectors Division
Meeting: CCAP's ``Greenhouse Gas Emissions Trading Dialogue Group''
Date/location: Quarterly meetings, Washington, D.C.
Participants:
Stuart Schare, Tracy Terry, John Thomas
Michael Shelby, Director, Energy & Transportation Sectors Division
Meeting: Clean Energy Working Group
Date/location: 12/10/98, Washington, D.C.
Participant: Robert Perciasepe, Assistant Administrator, Office of
Air & Radiation
Meeting: Edison Electric Institute Air Quality Integration Dialogue
Date/location: 12/18/98, Washington, D.C.
Participant: Robert Perciasepe, Assistant Administrator, Office of
Air & Radiation
Meeting: Federal Bar Association
Date/location: 1/27/99, Washington, D.C.
Participant:David Doniger, Counsel to the Assistant Administrator,
Office of Air & Radiation
Meeting: National Association of State Energy Officials
Date/location: 2/19/99, Washington, D.C.
Participant: Robert Perciasepe, Assistant Administrator, Office of
Air & Radiation
Meeting: Alliance to Save Energy: Talking Points to Save Energy
Date/location: 3/8/99, Washington, D.C
Participant: Robert Perciasepe, Assistant Administrator, Office of
Air & Radiation
Meeting: Ohio Farm Bureau
Date/location: 3/10/99, Washington, D.C
Participant: Robert Perciasepe, Assistant Administrator, Office of
Air & Radiation
Meeting: Global Climate Forum
Date/location: 1/28/99, Cambridge, MA
Participant: Reid Harvey, staff
Meeting:Energy Conservation Subcommittee of the National
Association of Regulatory Utility Commissioners (NARUC)
Date/location: 11/8/98, Washington, D.C.
Participant: Skip Laitner, staff
Meeting: Energy/Environment Seminar, Johns Hopkins Paul H. Nitze
School of Advanced International Studies (SAIS)
Date/location: 12/7/98, Washington, D.C.
Participant: Skip Laitner, staff
Meeting: Edison Electric Institute.
Date/location: 1/20/99, Washington, D.C.
Participant: Skip Laitner, Sam Napolitano, staff
Meeting: U.S. Advanced Ceramics Association Meeting
Date/location: 3/9/99, Washington, D.C.
Participant: Skip Laitner, staff
Meeting: Eastern Economics Association
Date/location: 3/12/99, Washington, D.C.
Participant: Skip Laitner, staff
Meeting: Emissions Trading: Extracting Revenue Opportunities for
Your Company in an Emerging Commodity Market
Date/location: 12/7-8/98, Washington, D.C.
Participant:
Brian McLean, Director, Acid Rain Division
Jennifer Macedonia, staff
Meeting: Emissions Trading and Permit Allocation Conference
Date/location: 10/14-15/98, London, England
Participant: Brian McLean, Director, Acid Rain Division
Meeting: Briefing for Congressional staff with a focus on Acid
Rain's experience with early action incentives
Date/location: 2/5/99, Washington, D.C.
Participant: Brian McLean, Director, Acid Rain Division
Attachment 2
The following two lists summarize: (1) public meetings related to
the global climate issue that will be sponsored or co-sponsored by EPA;
and (2) public meetings related to the global climate issue at which
EPA staff will participate as presenters and/or exhibitors. These lists
include public meetings that will occur for the remainder fiscal year
1999 (3/18/99, the date of your request, until 9/30/99).
upcoming epa sponsored and co-sponsored public meetings
Meeting: Climate Change: What Does It Mean for the Midwest?
Date/location: April 28, 1999, Kansas City, MO
Participant:
Dennis Grams, Regional Administrator, Region 7
David Gardiner, Assistant Administrator, Office of Policy
Meeting: Regional Conference on Potential Climate Change Issues in
Florida's Coastal Communities
Date/location: May 26, 1999, Miami, Florida
Participant:
Jim Titus, staff (tentative)
David Gardiner, Assistant Administrator, Office of Policy
(tentative)
Meeting: Technical Workshop on Sea Level Rise, Coral Bleaching, and
other Potential Global Warming Impacts in Florida Keys
Date/location: May 27, 1999, Marathon, Florida
Participant: Jim Titus, staff (tentative)
Meeting: The Second International Symposium on Greenhouse Gases
Date/location: 9/8/99, Netherlands
Participant: Reid Harvey, staff
conferences at which epa staff will participate as speakers and/or
exhibitors
Meeting: Risk and Insurance Management Society Annual Conference
Date/location: April 11-16, 1999, Dallas, Texas
Participant: Exhibit only
Meeting: Electric Power 1999
Date/location: April 20-22, Baltimore, Maryland
Participant: Exhibit only
Meeting: National Town Meeting
Date/location: May 2-5, 1999, Detroit, Michigan
Participant: David Gardiner, Assistant Administrator, Office of
Policy
Meeting: Public Risk Management Association Convention and Expo
Date/location: June 6-9, 1999, San Diego, California
Participant: Exhibit only
Meeting: Edison Electric Institute Annual Convention and Exposition
Date/location: June 13-15, Long Beach, California
Participant: Exhibit only
Meeting: National Association of Mutual Insurance Companies
Date/location: September 19-22, San Antonio, Texas
Participant: Exhibit only
Meeting: Coastal Issues Conference
Date/location: April 19-20, 1999, South Padre Island, Texas
Participant: Jim Titus, staff (tentative) and Exhibit
Meeting: Coastal Zone 1999 Conference
Date/location: July 27-29, 1999, San Diego, California
Participant: Jim Titus, staff (tentative) and Exhibit
Meeting: Maryland Coast Day
Date/location: September 18, 1999, Assateague Island, MD
Participant: Jim Titus, staff (tentative) and Exhibit
Meeting: CoastFest 1999
Date/location: September 25, 1999, Brunswick, GA
Participant: Jim Titus, staff (tentative) and Exhibit
Meeting: National Environmental Health Association Annual
Educational Conference and Exhibition
Date/location: July 1, 1999, Nashville, TN
Participant: Exhibit only
Meeting: National Association of County & City Health Officials
Annual Conference
Date/location: July 14-17, 1999, Dearborn, Michigan
Participant: Exhibit only
Meeting: American Meteorological Society Broadcasters Meeting
Date/location: June 18-25, 1999, Orlando, FL
Participant: John Foster, Karen Gibbons, staff, and Exhibit
Meeting: Radio and Television News Directors Association 1999
Date/location: September 29-October 2, 1999, Charlotte, North
Carolina
Participant: Exhibit only
Meeting: U.S. Conference of Mayors Annual Conference
Date/location: June 11-15, 1999, New Orleans, LA
Participant: Exhibit only
Meeting: National Conference State Legislatures Annual Meeting
Date/location: June 24-28, 1999, Indianapolis, IN
Participant: Exhibit only
Meeting: National Association of Counties Annual Conference
Date/location: July 16-20, 1999, St. Louis, MO
Participant: Exhibit only
Meeting: National Association of State Energy Officials Annual
Meetings
Date/location: September 19-20, 1999, Indianapolis, IN
Participant: Exhibit only
Meeting:International City/County Management Association Annual
Conference
Date/location: September 26-29, Portland, Oregon
Participant: Exhibit only
Meeting: Izaak Walton League Annual Conference
Date/location: July 1, 1999, Williamsburg, VA
Participant: Karen Gibbons, staff, and Exhibit
Meeting: Federation of Fly Fishers Annual Conference
Date/location: August 1, 1999, Gatlinburg, TN
Participant: Karen Gibbons, staff, and Exhibit
Meeting: California Resource Recovery Conference
Date/location: June, 1999, Monterrey, CA
Participant: Exhibit only
Meeting: OECD Workshop on Extended Producer Responsibility and
Waste Minimization Policy
Date/location: May 1999, Paris, France
Participant: EPA speaker to be determined
Meeting: National Recycling Coalition Annual Congress
Date/location: September 1999, Cincinnati, OH
Participant: EPA speaker to be determined
Meeting:Recycling Council of Alberta, ``Frontiers in Waste
Reduction''
Date/location: September 1999
Participant: EPA speaker to be determined
EPA's primary source of statutory authority for funding studies
that deal with domestic and/or international carbon emissions trading
is section 103(a) and (b) of the Clean Air Act. Section 103 of the
Clean Air Act requires the Administrator to establish a ``national
research and development program for the prevention and control of air
pollution.'' As part of this program, section 103(a)(1) requires the
Administrator to, ``conduct, and promote the coordination and
acceleration of, research, investigations, experiments, demonstrations,
surveys, and studies relating to the causes, effects (including health
and welfare effects), extent, prevention and control of air
pollution.'' Section 103(b) provides that in carrying out subsection
(a), the Administrator is authorized to ``collect and make available,
through publications and other appropriate means, the results of and
other information, including appropriate recommendations by him in
connection therewith, pertaining to such research and other
activities.'' Section 103(g) of the CAA provides additional authority
for some of the Agency's funding of studies that deal with domestic
and/or international carbon emissions trading. Section 103(g) provides
that in carrying out subsection (a), ``the Administrator shall conduct
a basic engineering research and technology program to develop,
evaluate, and demonstrate nonregulatory strategies and technologies for
air pollution prevention.'' The program is to include among its
elements, ``[i]mprovements in nonregulatory strategies and technologies
for preventing or reducing multiple air pollutants, including sulfur
oxides, nitrogen oxides, heavy metals, PM-10 (particulate matter),
carbon monoxide, and carbon dioxide, from stationary sources, including
fossil fuel power plants. Such strategies and technologies shall
include improvements in the relative cost effectiveness and long-range
implications of various air pollutant reduction and nonregulatory
control strategies such as energy conservation, including end-use
efficiency, and fuel-switching to cleaner fuels.''
Other statutes provide additional authority for EPA's activities in
this area. Such statutes include: National Environmental Policy Act of
1969, 42 U.S.C. 4321 et seq. and the Global Climate Protection Act of
1987, 15 U.S.C. 2901.
climate change: meeting in kansas city, mo
Question. April 28, 1999 Meeting in Kansas City, Missouri. Who
selected the speakers for the Kansas City event? Who defined the
``balance'' in terms of participants. Please provide a description of
the credentials of the speakers, whether they receive government
funding, and, if funding has been received, which agency has provided
the funding and for what.
Answer. EPA sought advice and input from a variety of sources
outside the Agency at every stage of the planning and production of the
event in order to strive for balance. In the very beginning stages of
planning, we asked 40 organizations and governmental bodies to
cosponsor the conference. At various times, we asked for their help in
identifying, contacting, and arranging for speakers and other
cosponsors. We later asked all of our initial contacts to help with
suggested lists of participant invitees and publicity, whether or not
they had chosen to cosponsor the event. For example, a Missouri-based
non-profit organization, Bridging the Gap, cosponsored the Kansas City
conference and provided us with a mailing list of approximately 900
business and governmental addresses to which we sent invitations. The
Missouri Chamber of Commerce asked for and received flyers to do a
special mailing. The Missouri Farm Bureau did their own mailing on the
meeting as well.
The biographies of the speakers for the conference are attached.
Six of the speakers are employed by the federal government: Dennis
Grams, Regional Administrator of USEPA, Region 7; David Gardiner,
Assistant Administrator, Office of Policy, USEPA; Glen Overton,
Regional Administrator for the General Service's Administration's
Heartland Region; Dr. David Easterling, Principal Scientist at the
National Climatic Data Center; Joseph Aldy, Senior Adviser at the
President's Council of Economic Advisers; and Val Jensen, Director of
the Chicago Regional Office of the Department of Energy. As far as we
know, the only ones who work for non-federal organizations that have
received government funding are the ones to whom the Office of Economy
and Environment (OEE) in EPA have provided money. They are the
following:
Anita Randolph and Steve Mahfood both work for the Missouri
Department of Natural Resources (DNR). The Missouri DNR received money
from EPA/OEE in 1991 to conduct a statewide energy survey, in 1994 to
do an inventory of greenhouse gases, and in 1995 to produce a state
action plan to evaluate mitigation options.
George Moody works for the City of Overland Park, Kansas. From 1993
to present, the International Council for Local Environmental Issues
(ICLEI)has received funding from EPA/OEE to support the ``Cities for
Climate Protection Program''. Overland Park has been a participant in
the program and receives technical support from ICLEI, but no direct
funds from OEE.
Question. Which speaker will document the uncertainty in the
science?
Answer. The April 28 conference in Kansas City addressed
uncertainties in the science of climate change in a number of ways.
Eugene S. Takle, Ph.D., professor of atmospheric science at Iowa State
University, gave a talk entitled, ``What is Global Warming and How Do
We Know It's Happening?'' In his speech he repeatedly referenced the
uncertainties involved in long-range projections of any scientific
phenomenon, including the statistical ranges of validity in the
scientific data he presented regarding observed and projected trends in
climate change. David R. Easterling, Ph.D., principal scientist at the
National Climatic Data Center (NCDC), spoke on ``Droughts, Floods, and
Other Weather-related Impacts on the Midwest.'' He reported data that
had been documented by scientists at NCDC as well as projections that
the center's scientists are making about possible future events that
may occur in the Midwest, should climate trends continue. He, too,
acknowledged some of the uncertainties inherent in such projections and
some of the controversy surrounding the scientific debate. Participants
in the audience were given the opportunity to ask both Dr. Takle and
Dr. Easterling questions about their research; many opinions varying
from those of the two scientists were presented by audience members.
Question. Which participant will discuss the inadequacy of the
models to predict local effects?
Answer. Eugene Takle noted that global climate models have poor
resolution at the regional and local level, although he demonstrated
that the models do a good job at replicating observed trends in climate
on a global scale.
Question. Which speaker will give the non-governmental assessment
of the international negotiations?
Answer. The Missouri Coalition on Global Climate Change provided a
speaker, Christopher C. Horner, Esq., member and liaison of the Cooler
Heads Coalition, to give a non-governmental assessment of the
international negotiations regarding climate change.
Question. Which participant will give the economic assessment in
contrast to the Administration's discredited analysis?
Answer. Christopher Horner included remarks in his speech about
economic assessments that had been performed outside the government
that differed from assessments produced by economists within the
federal government. David Martin, director of governmental affairs at
Kansas City Power and Light, made mention of the differing economic
reports during his speech. In addition, several participants from the
audience questioned the government economist, Joseph Aldy from the
Council of Economic Advisers, about differing analyses and assessments
after his speech. Many question/answer periods were provided throughout
the day in order to assure a forum for open, balanced discussion of the
issues.
Question. Which participant will discuss the impacts on small
business from the viewpoint of economic harm?
Answer. Several of the speakers talked about the potential economic
harm to small businesses from the impacts of climate change. In
particular, James W. Russell, Ed.D., vice president for outreach at the
Institute for Business and Home Safety, talked about the money lost by
businesses because of recent severe weather events. Several climate
models indicate an increase in precipitation intensity, suggesting a
possibility for more extreme rainfall events due to climate change.
In addition, David Martin of Kansas City Power and Light discussed
the potential economic impact of the Kyoto Protocol on electric
utilities and ratepayers, noting that climate change is one of the
leading issues facing utilities today. Christopher Horner discussed the
potential negative economic impacts of the Kyoto Protocol on jobs,
Gross Domestic Product, and international competitiveness.
Question. How and when was notice of this event provided to
interested parties? If a distribution (mail, electronic mail, or
facsimile) was made of any notice, please provide this list.
Answer. In total, more than 5,000 invitations were sent to diverse
lists of potential participants. We placed announcements on at least
two Internet mailing lists and the U.S. EPA Kansas City-based Region 7
web page. We put a notice on the Region 7 ``Headliners'' page, which
provides regulatory announcements to the public. Notices were placed in
bulletins of various public and private organizations in Iowa and
Missouri. We issued press releases and a press advisory from Region 7.
We did a mailing to press contacts of the 100 largest newspapers and
electronic media organizations in Region 7. We provided press packets
in advance to those who requested them (Kansas City Star, Wichita Eagle
Beacon, etc.) We worked with each state Energy Office in the Region
(Kansas, Missouri, Iowa and Nebraska) to get them to alert their
clients about the meeting. And in planning of the meeting we talked
with the state Energy Offices, business organizations, energy
organizations, a number of university personnel, and others. All of
this was done in an effort to assure that the cosponsors, speakers, and
participants represented a balance of backgrounds and viewpoints on the
issue of climate change.
Though many of our co-sponsors and other interested parties asked
for information about the conference throughout the months of January
and February 1999, and received phone calls, emails and faxes in reply,
all formal notices were sent during the months of March and April,
1999, including postal and electronic mailings using ``distribution
lists''. The lists we used are attached.
In addition to the mailings we did, were mailings sent out by
various groups who preferred sending their own notices along with or
instead of the flyers we produced. Those provided flyers by us were:
Heartland Solar Energy Industries Association, 100; Bridging the Gap,
500; Metropolitan Energy Center, 100; Missouri Department of Natural
Resources, 50; Mid America Regional Council, 50; Department of Energy,
Denver Regional Support Office, 50; Department of Energy, Kansas City
Plant, 100; Competitive Resources Incorporated, 50; General Services
Administration, 50; and Missouri Coalition for Global Climate Change,
200.
Question. When was this event initially planned? Who were the
participants in the planning?
Answer. Planning for this conference began in March 1998. As stated
above, a committee of EPA staff at Washington Headquarters and at EPA's
Region 7 Office in Kansas City approached approximately 40
organizations to help in cosponsoring the event, identifying speakers,
and inviting participants. One of these organizations, Bridging the
Gap, participated in several conference calls in the later stages of
planning (January through March 1999) to set up some of the logistics.
Question. What other events are planned for the balance of this
fiscal year? Please provide the dates, preliminary agendas, and planned
speakers.
Answer. There is just one other such climate change event planned
for the rest of this fiscal year. The title of that conference will be
``Climate Change: What Does It Mean for South Florida?'' It will be
held May 26 and 27, 1999, in Miami and in the Keys. Each venue will
host a half-day event to provide information about the potential
impacts of climate change on South Florida's economy, infrastructure,
and natural resources. Strategies and sustainable solutions for
reducing the potential risks associated with global warming and sea
level rise will also be addressed. Confirmed speakers include: Dr.
Stephen P. Leatherman, director of the International Hurricane Center
at Florida International University; L. Benjamin Starrett, a fellow at
the Growth Partnership, Collins Center for Public Policy; Dr. Pamela
Hallock, professor of marine science, University of South Florida; and
Dr. Harold C. Wanless of the Department of Geological Sciences at
University of Miami.
Question. What Members of Congress have been invited to this
program? What Congressional staff have been invited to this program?
When were they invited?
Answer. Congresswoman Jo Ann Emerson and Congressman McCarthy
Benson were both invited to the climate change conference in Kansas
City held April 28. The invitations that were sent to Representatives
Emerson and Benson were intended to include the entire staff of their
offices, as were all the conference invitations we sent to government,
nonprofit and private business offices. Both Members of Congress were
sent invitations in our initial mailing to invitees about March 20,
1999, and in a subsequent ``reminder'' mailing about April 10, 1999.
climate change: greenhouse gas emissions credit for early action
Question. On April 15, 1998, EPA entered into a proposed consent
decree with the Natural Resources Defense Council (NRDC) that included
an agreement to study how CO2 emissions would be controlled.
This step appears to be an effort towards implementation of the Kyoto
Protocol. Why did EPA entertain the possibility of regulating
CO2 when the original October 1994 consent agreement with
NRDC made no mention of CO2? Did EPA decide to take this
step after it realized that it had no authority to proceed to regulate
CO2 based on an April 10, 1998 General Counsel memo on this
subject to the Administrator?
Answer. The settlement agreement that you refer to calls for a
multiple pollutant analysis that looks at the relationship among the
four most significant air pollutants from electric power generation:
NOX, SO2, CO2, and mercury. In
agreeing to undertake that analysis, EPA proposed simply to update a
series of multi-pollutant analyses of utility emissions that were first
undertaken more than two years ago. The updated analysis called for in
the proposed agreement was specifically intended to inform a decision
that EPA must make under the Clean Air Act on whether to regulate
mercury emissions from electric power plants.
Multiple pollutant analysis of utility emissions makes sense
because pollution control strategies to reduce emissions of these
pollutants are highly inter-related. Strategies to reduce emissions of
any one pollutant from power generation can have effects of differing
magnitude on emissions of the other pollutants. The cost and other
impacts of control strategies for these pollutants are also highly
interdependent. Multiple pollutant analyses examine these inter-
relationships and can provide valuable information to the electric
power industry, the public, Federal agencies, and Congress about the
relationships among policy choices to address the major pollutants from
this industry.
The options that were examined in the study are hypothetical
approaches to emission controls on the electric power industry for each
pollutant and do not represent the EPA or Administration position on
how any of these pollutants should be reduced in the future.
Specifically with regard to carbon dioxide, the Administration has
committed not to implement the Kyoto Protocol without the advice and
consent of the Senate.
Although the Agency has legal authority to regulate CO2
as an air pollutant under provisions of the Clean Air Act if the
Administrator makes certain determinations (see Memorandum of Jonathan
Cannon, General Counsel, April 10, 1998), the Administrator has not
made any such determinations.
climate change: climate science
Question. Has EPA factored into its budget and programs the 1998
recommendations of the National Research Council regarding science
priorities? If so, please provide the document that describes the
issues raised by the National Research Council and the detailed plan to
respond to these issues. If not, please provide this analysis by March
15, including the funding requirements.
Answer. Yes. EPA, along with the entire US Global Change Research
Program (USGCRP) incorporated the recommendations of the National
Research Council (NRC) into the development of its programs. This
consideration is reflected in the fiscal year 2000 USGCRP Our Changing
Planet annual report to Congress and the USGCRP's fiscal year 2000
Implementation Plan. (A draft of this report has already been delivered
to Congress by the USGCRP.) It is also reflected in EPA's new Research
Strategy for the Global Change Research Program, which is still being
drafted and will soon go through a rigorous, external peer review.
One example of how EPA responded to the recommendations of the NRC
is its new support for Human Dimensions research as part of its
assessment program. The NRC identified a wide range of Human Dimensions
research questions that should be considered by the USGCRP. EPA is
coordinating with other federal agencies to address many of these
questions. EPA is working with other federal agencies to ensure that
efforts are not duplicated and that each agency focuses on specific
human dimensions questions related to its own program and niche within
the USGCRP.
Humans have many different impacts on natural systems, including
changes in land use, industrial processes, agricultural and forest
management practices, and emissions of air and water pollutants. Humans
also respond to the effects of global change. Human dimensions research
entails understanding how humans, who are an integral component of the
Earth system, contribute and respond to global change. Research on the
environmental effects of human activities is critical for understanding
long-term global change. The NRC's report reaffirmed the need to
articulate how the science of global change is important to people and
society. The new assessment-oriented EPA Global Change Research Program
incorporates considerations of ``human dimensions'' into both its
assessment activities and its foundation research program. In the
assessment program, this will occur in two ways: (1) through ongoing
engagement of stakeholders to define the specific measures of change
that are of interest; and (2) through coordination of findings from the
social sciences with those from the physical and biological sciences to
attain a policy-relevant perspective. In the foundation research
program, the near-term priorities for human dimensions research that
are relevant to EPA's Global Program include understanding how humans,
who are an integral component of the Earth system, contribute and
respond to global change.
Question. The October 16, 1998 issue of Science carried the story
about the possibility that North America appears to be a massive sink
for carbon. The article `` A Large Terrestrial Carbon Sink in North
America implied by Atmospheric and Oceanic Carbon Dioxide Data and
Models'' presents evidence that North America (US+Canada) sops up
enough carbon each year ``to cover every ton of carbon discharged
annually by fossil fuel burning in the United States and Canada. `` The
recommendations for further study included:
--Intensive atmospheric sampling and ecological field studies to
identify the location and cause of North American terrestrial
CO2 uptake,
--New atmospheric measurements to include Eurasia, South America,
Africa, and Australia,
--Studies to better characterize oceanic CO2 uptake,
particularly in the Southern Hemisphere, and
--Reduced uncertainty in atmospheric transport modeling.
Has EPA developed a program to address these issues? If so, what
funds are budgeted?
Has EPA had any discussions with Canadian authorities to address
CO2 monitoring as a joint scientific effort? If so, what are
the plans?
Answer. EPA is no longer conducting any research related to the
carbon cycle (which includes analysis of carbon sinks). This is an area
of disinvestment for EPA's Global Program, given its redirection
towards a more assessment-oriented program with primary emphasis on
understanding the potential consequences of global change for human
health, ecosystems, and socioeconomic systems in the United States. EPA
is no longer doing carbon cycle work. Within the context of the entire
USGCRP, other federal agencies now have responsibility for the carbon
cycle work.
issues in the 1998 nas/national research council analysis of science
uncertainties and the october 1998 hansen nas paper
Question. In October 1998 Jim Hansen published a paper in the
Proceedings of the National Academy of Sciences entitled ``Climate
Forcings in the Industrial Era''. Key conclusions included:
--The forcings that drive long-term climate change are not known with
an accuracy sufficient to define future climate change.
--Quantitative knowledge of all significant climate forcings is
needed to establish the contribution of deterministic factors
in observed climate change and to predict future climate.
The paper identified a number of important areas for further
research that should be addressed in the fiscal year 2000 budget:
Aerosols.--advanced capability for global satellite measurement of
aerosol scattering and absorption properties.
Aerosols-clouds.--coordinated research program including accurate
global measurement of aerosol and cloud changes, as well as in situ
field studies and aerosol modeling.
Land-use.--comprehensive historical data on land-use change and
increased realism of land processes in climate models.
Solar variability.--need to monitor and understand.
Has EPA reviewed this paper as input to its research funding
request? If so, please provide the detailed analysis of the issues and
the original EPA budget request (not the President's budget request)?
If not, please provide this analysis by April 30, 1999.
Answer. EPA has not reviewed this paper as input to its research
funding request because all of the uncertainties identified by Hansen
in his paper relate to the development of global circulation models
that predict future climatic conditions. EPA no longer is involved in
the development of climate models. This is an area of disinvestment for
EPA's Global Program, given its redirection towards a more assessment-
oriented program with primary emphasis on understanding the potential
consequences of global change for human health, ecosystems, and
socioeconomic systems in the United States. EPA is no longer doing
climate modeling (in the same way that it is no longer doing carbon
cycle work). Within the context of the entire USGCRP, other federal
agencies now have responsibility for the carbon cycle work.
It is important to note that EPA coordinates closely with all other
federal agencies in the U.S. Global Change Research Program (USGCRP)
and benefits from the work being done by the agencies developing
climate models. EPA is part of the larger USGCRP and is involved in the
development of the USGCRP's fiscal year 2000 implementation plan and
the USGCRP's Our Changing Planet annual report to Congress. Through
this process, EPA coordinates its activities with those of other
federal activities. Opportunities to cooperate with other federal
agencies are also identified.
Question. In 1999, Tim Barnett, Scripps Institution of
Oceanography, ran 11 models and concluded: ``There is no model that
consistently agrees well with the observations.'' Is EPA using any
models to predict the effects of global climate change on a regional or
local level? If so, what models are being used?
Answer. EPA's assessments do not make predictions of the effects of
future climate change on a regional or local level. EPA uses input from
climate models to define scenarios of potential climate futures. That
is, the scenarios are used to understand the sensitivity and
vulnerability of human and ecological systems to potential future
climate change, but not to make actual predictions of future
conditions. All of the regional assessments being sponsored by the EPA
as part of the National Assessment effort use state-of-the-art climate
scenarios generated by the Canadian and British climate modelers. In
some cases, these model outputs are used as input to Regional Climate
Models in order to develop scenarios for future climatic conditions are
a regional level. Also, EPA--and the regional coordinators it is
sponsoring in the research community--are using the VEMAP model output
to understand the potential changes in vegetation that may occur as the
climate changes.
EPA has conducted one study that assigns probabilities to
particular future effects of climate change: The Probability of Sea
Level Rise, which was published in October 1995. This study, conducted
by the Office of Policy, Planning, and Evaluation, developed
probability-based projections that can be added to local tide-gauge
trends to estimate future sea level rise at particular locations around
the coast of the United States.
Question. Since, according to the Hansen paper, as well as others,
models are not capable of predicting natural variability and global
effects, how can EPA justify using these models to predict effects on a
smaller, ``microscopic scale'' as planned for the 3 regional
assessments (Mid-Atlantic, Great Lakes, & Gulf Coast)?
Answer. EPA's assessments of the potential consequences of climate
change and variability on the United States rely on a diversity of
information. Some of the EPA assessment work uses input from climate
models to define scenarios of potential climate futures. For example,
all of the regional assessments being sponsored by the EPA as part of
the National Assessment effort use state-of-the-art climate scenarios
(specifically ones that are generated by the Canadian and British
climate modelers). It must be emphasized that the climate model output
is viewed as scenarios, not predictions of future climate. They are
being used to understand the sensitivity and vulnerability of human and
ecological systems to potential future climate change, but not to make
actual predictions of future conditions.
It is also important to understand that the regional assessments
are not limited to scenarios generated by climate models. The
assessments also use other information to illustrate the potential
consequences of climate variability and change for human health and
ecological systems. In addition to climate model output, EPA's
assessment work also relies on historic data to understand the
sensitivity of human and ecological systems to change (e.g., changes in
the profile of the Blackwater National Wildlife Refuge as sea level has
risen during the past 50 years). Also, plausible ``what if'' scenarios
are used to illuminate the sensitivity of various systems. These
sensitivity analyses help to define the potential risks and
opportunities posed by climate change and variability to human health,
the ecosystems, and social well-being.
Question. Because of these substantial modeling problems, what is
the basis for EPA conducting a ``Health Sector Assessment'' in fiscal
year 2000?
Answer. An important goal of the Health Sector Assessment is to
understand the various pathways through which weather and climate may
affect human health (i.e., to understand the sensitivity of human
health to weather and climate). That is, the Health Sector Assessment
is attempting to understand how important changes in weather and
weather extremes (e.g., heat waves; storms) are for human health even
under current climatic conditions. A better understanding of the
sensitivity of human health to weather and weather extremes under
current climatic conditions is essential before one can assess the
potential effects of climate change and variability on human health.
Also, this research into current sensitivities yields immediate
benefits to society by enabling the public health community to develop
better systems for responding to the risks posed by weather and climate
(e.g., extreme heat and extreme cold).
These research and assessment activities do not rely upon climate
change models.
It is also important to understand that analyses being done in the
Health Sector Assessment of potential consequences of future climate
change are not limited to scenarios generated by climate models. The
assessments also use other information to illustrate the potential
consequences of climate variability and change for human health. In
addition to climate model output, the assessment work also relies on
historic data to understand the sensitivity of human to change. Also,
plausible ``what if'' scenarios are used to illuminate the sensitivity
of various systems. These sensitivity analyses help to define the
potential risks and opportunities posed by climate change and
variability to human health and social well-being.
The human health sector is looking at how climate affects human
health in the United States and at how climate change and variability
might affect our health. For example, heat waves can cause death and
illness, especially among the elderly poor. Air pollution, which is
worse in hot weather, can make people with respiratory disease sicker
and can make breathing harder for everyone. People can be hurt or even
killed in severe storms and floods, or can be made sick by unclean
storm water. A change in climate might increase the risk of exposure to
disease-carrying rodents and insects.
The health sector team will analyze scientific research and
government data on our country's health and how climate change might
affect our health. In addition, the team may develop a limited number
of quantitative models of projected or possible future health impacts,
where reliable data is available.
The eleven members of the health sector team come from a range of
government, academic, and private institutions, including the U.S.
Centers for Disease Control, the Environmental Protection Agency, the
Johns Hopkins University School of Public Health, Harvard Medical
School, the University of South Florida, the National Oceanic and
Atmospheric Administration, and the Electric Power Research Institute.
coeur d'alene superfund
Question. Since the federal government has continued to spend huge
sums of taxpayer money on studies and additional research outside the
21 square mile Bunker Hill Superfund site, does the Agency have an end
plan or remedy in mind? What is that plan?
Answer. The purposes of the Superfund process are: (1) to determine
the nature and extent of contamination; (2) to identify existing and
potential risks to human health or the environment; (3) to evaluate
cleanup options; and (4) to identify a cleanup plan. EPA is in the
investigation and evaluation phase of the process at this time and does
not have a specific remedy identified. The remedy proposed will be a
result of the RI/FS process and input from affected stakeholders and
communities.
Question. How much money has been spent on the RI/FS (remedial
investigation and feasibility study) outside the existing 21 square
mile Superfund site?
Answer. EPA estimates that as of 5/2/99, approximately $10,200,000
in cost associated with work in the Basin, including the RI/FS and the
costs associated with litigation. In addition, EPA has incurred
$750,000 conducting residential and school soil removals outside of the
existing 21 square mile Superfund site.
These costs are estimates and have not been reconciled by EPA
finance personnel. All site costs are reconciled as part of the cost
recovery process which occurs when the sites reach completion.
Question. How much more do you anticipate spending on the RI/FS?
Answer. EPA estimates spending an additional $6.1 million in fiscal
year 1999 and approximately $8.8 million in fiscal year 2000 to
complete the RI/FS for the Basin. These costs are estimates; actual
cost will be dependent upon factors that are unknown at this time, such
as the nature and extent of contamination found, the need for
treatability studies, and input from a large number of stakeholders
involved in the Basin.
Question. How long do you think the RI/FS will take?
Answer. EPA hopes to have the RI/FS completed in fiscal year 2000.
However, schedule modifications may be necessary depending on timely
receipt of funding, the findings of the study, and additional
requirements resulting from stakeholder input.
Question. When do you anticipate EPA will be involved in more
cleanup efforts in the Coeur d'Alene Basin rather than simply to
continue studies?
Answer. EPA has been involved in numerous cleanup actions in the
basin since 1993. Examples include early removal actions at the Success
and Douglas tailings piles. In addition, since 1997, EPA has been
conducting early actions at residential and school properties and in
common use areas such as parks and beaches. EPA has also used its
removal authority in the basin to support actions by other parties such
as the State trustees and the mining companies. These removal actions
do not address the overall contamination that is present in the basin.
The RI/FS will provide the information needed to determine what
appropriate actions must be implemented for a comprehensive remedy to
protect human health and the environment.
Question. Can EPA pursue any cleanup activities in the Basin
without completing the RI/FS?
Answer. Even before completing the RI/FS, EPA is presently
conducting cleanup activities in the Coeur d'Alene basin. However,
these actions in themselves may not permanently protect human health
and the environment. Permanent protection may only be achieved by
addressing the various sources of contaminants in the basin, which may
include individual outfalls and waste piles, or segments of river banks
or stream beds. In order to determine what comprehensive long-term
actions need to be taken in the basin, EPA needs to conduct the RI/FS.
Question. How could damages have been assessed (under the NRD
lawsuit) when an RI/FS had not been conducted? Isn't this backward?
Answer. The damages associated with injuries to natural resources
may be calculated whether or not an RI/FS has been completed. However,
in the present litigation, the United States has argued to the district
court that it would be most logical to determine the amount of natural
resource damages after determining the appropriate cleanup actions
through the RI/FS and Record of Decision. Accordingly, the district
court has decided that the actual dollar amount of natural resource
damages would be determined in a second trial following a first trial
on liability and production of the Record of Decision (ROD) for the
Coeur d'Alene Basin.
Question. Is the RI/FS being used to support the NRD lawsuit? If
not what is the purpose of the RI/FS?
Answer. EPA is conducting the RI/FS in the basin because we believe
that there are significant human health and ecological risks associated
with releases of mining wastes. These risks must be accurately
identified so that appropriate cleanup actions may be selected to
protect human health and the environment. In addition, data and
analyses from the RI/FS process will be made publicly available and can
be used by various parties. For example, data developed by the RI/FS
may be used to develop Total Maximum Daily Loads for rivers and other
waterbodies under the Clean Water Act and may be relevant to the NRD
litigation.
Question. Is the EPA still considering the expansion of the 21
square mile Superfund site?
Answer. The United States' position remains that the Bunker Hill
NPL facility extends to all areas with mining contamination in the
Coeur d'Alene Basin. While the district court's contrary determination
is being appealed, EPA may proceed with formal NPL listing action to
ensure that all affected areas of the basin are included in an NPL
facility. At this time, however, no preliminary determinations have
been made and no decisions will be made prior to further coordination
with state, local, and tribal governments and a period for formal
public comment.
Question. Is EPA willing to consider a legislative remedy to the
Basin's problems?
Answer. At the present time, it is too early to make any
determinations as to the type(s) of remedy(ies) that may be necessary
to address the contamination in the basin; therefore, it is premature
for EPA to consider a legislative remedy. The RI/FS process was
designed to determine the extent of contamination and to develop
cleanup alternatives. Once the RI/FS is complete, a remedy is selected
with stakeholder and community input. EPA believes that this public
process is the appropriate method for selecting a remedy in the basin.
Question. What is the TMDL standard that's been set for the
Superfund site in Kellogg?
Answer. A final TMDL standard has not yet been established for the
Bunker Hill Superfund site in Kellogg. In April, 1999 the United States
Environmental Protection Agency (EPA) and the State of Idaho Division
of Environmental Quality issued a draft TMDL for public comment for
dissolved cadmium, lead and zinc in surface waters of the Coeur d'Alene
River Basin in Idaho. Waste load allocations are based on river flow.
The draft TMDL document is currently out for public comment. In that
draft document, the most stringent wasteload allocations for the Bunker
Hill Central Treatment Plant (CTP), at the lowest 7-day average daily
river flow that occurs with a 10-year return period, are: 4.23E-03
pounds/day for cadmium; 1.30E-02 pounds/day for lead; and 3.09E-01
pounds/day for zinc.
Questions. Can this standard be met by the EPA in their management
of effluent at the site?
Answer. The EPA is currently developing a work plan to carry out a
treatability study to determine the extent to which the wasteload
allocations noted above can be achieved at the CTP. EPA will be able to
make that determination once the treatability study has been conducted
and the results are available for review.
carney site, st. maries, idaho
Question. What is EPA's intention for the Carney site in St. Maries
where there is creosote leakage from underground storage tanks?
Answer. EPA intends to complete characterization of creosote
contamination at the site and determine what additional actions, if
any, need to be taken to prevent or mitigate the further release of
creosote to the St. Joe River.
Question. What types of cleanup activity is occurring?
Answer. To date, the City of St. Maries and Carney Products Company
have performed a Superfund removal action under a Unilateral
Administrative Order (UAO) with the EPA, to remove exposed creosote and
creosote-contaminated soil from the bank of the St. Joe River. They
have also completed a removal site evaluation under the UAO to
characterize the extent of contamination in soils and groundwater.
Question. Do you anticipate clean up in conjunction with the city/
county?
Answer. It is likely that additional cleanup action will be
required to mitigate extensive creosote contamination present in bottom
sediments of the St. Joe River and to prevent further release of
creosote from the site. The City of St. Maries has been identified as a
potentially responsible party (PRP) and may be responsible, along with
other PRPs, for this work.
Question. Is the EPA recommending this site for the NPL?
Answer. EPA has just recently received the data from the site
investigation, that will be used to calculate a preliminary Hazard
Ranking System Score. This evaluation will determine whether the site
is eligible for the NPL.
regional haze rules
Question. Last year, in the EPA Appropriation Conference Report,
Congress encouraged EPA to re-propose the Regional Haze Rule. How do
you feel you responded to this report language?
Answer. The EPA gave serious consideration to the congressional and
other recommendations to re-propose the regional haze rule. However, we
decided that re-proposal would not be necessary for a number of
reasons. First, the EPA provided an extensive opportunity for comment
on the proposal, including an extension of the original comment period
by six weeks. More than 1200 comments were received on the proposal,
many of which requested EPA to move forward with the rule.
Second, EPA provided a second comment period in September 1998 on a
notice of availability of additional information that became available
after the close of the initial comment period. This information
included the regional haze SIP timing requirements included in the TEA-
21 legislation, adopted in June 1998, and a June 1998 letter including
significant comments from the Western Governors' Association, developed
with input from a broad range of stakeholders.
Third, over the course of the proposal period, EPA engaged in many
meetings and discussions with interested stakeholders on various
aspects of the rule. EPA was very aware of stakeholder views on the
range of issues in the proposed rule. The issues raised by those
requesting re-proposal generally were issues already under
consideration by EPA due to comments received on the proposed rule or
the notice of availability.
Fourth, EPA believed that a re-proposal would only serve to further
delay the finalization of the regional haze program when its statutory
deadline had already been exceeded. In fact, several environmental
groups later issued a notice of intent to sue the Agency for failure to
issue the rule in accordance with the statutory schedule for action.
As we anticipated at the time we decided not to repropose the rule,
the final rule reflects many changes that are significant issues
identified in public comments.
Question. Approximately 15 Governors from throughout the country
requested EPA to re-propose the Regional Haze Rule, even after last
fall's comment period. Why did you ignore these requests? What specific
contact concerning this rule did you have with Governors on this rule
prior to its issuance.
Answer. EPA considered these requests for re-proposal, and we also
considered requests from the Governors of Utah, California, Maine,
Vermont and New Hampshire who urged that we proceed with the regional
haze rule. For the reasons noted above in the response to the previous
question, EPA decided not to re-propose the final rule.
Since the close of last fall's comment period, we have had the
following specific contacts with Governors related to the Regional Haze
Rule:
(1) November 13, 1998 letter from Robert Perciasepe, EPA, in
response to October 5, 1998 letter from Florida Governor Lawton Chiles.
(2) December 1, 1998, Meeting with Governor Leavitt of Utah.
(3) December 9, 1998 letter from Midwest Governors' Conference
signed by Governors of Indiana, Kansas, Wisconsin, Michigan, Ohio,
Illinois, Minnesota, Iowa, Missouri, Nebraska, South Dakota, and North
Dakota.
(4) January 4, 1999 letter from Southern Governors Association to
the President signed by Governors of Virginia, North Carolina,
Tennessee, Kentucky, Mississippi, Missouri, Arkansas, West Virginia,
Alabama, Oklahoma, and Louisiana.
(5) January 27, 1999. Meeting with Midwest Governor's conference.
(6) February 8, 1999 meeting with EPA and Southern Governors'
Association to discuss Regional Haze Rule and Regional Planning. March
24, 1999 meeting with the Southern Governors' Association.
(7) March 30, 1999 letter from Southern Governors' Association to
Lydia Wegman, EPA.
(8) March 5, 1999 letter to Vice President Gore from Governor
Shaheen of New Hampshire and Governor Dean of Vermont.
(9) April 6, 1999 letter to Vice President Gore from Governor King
of Maine.
(10) March 24, 1999 letter from Governor Davis of California.
(11) April 15, 1999 letter from Governor Leavitt of Utah on behalf
of the Western Governors' Association. April 15, 1999 meeting with
Western Governors' Association.
(12) April 21, 1999 letter from Robert Perciasepe, EPA in response
to March 20, 1999 letter from Colorado Governor Owens.
Question. If all power plants in the West were subjected to Best
Available Retrofit Technology (BART), what degree of visibility
improvement would you expect in the West?
Answer. Power plant sulfur dioxide emissions are a significant
contributor to sulfate concentrations in the West, and sulfate
particles are a significant contributor to visibility impairment in the
West. We have estimated that sulfates contribute about 30 to 60 percent
of the aerosol light extinction on the worst visibility days in most
western Class I areas. We do not, however, have a precise estimate of
the fraction of that sulfate contribution that is due to power plants,
nor do we have an available estimate of the degree of visibility
improvement that would be achieved from BART-level controls in the
West. It should be noted that the BART provision does not affect all
power plants in the West, but rather potentially affects any power
plant with the potential to emit more than 250 tons of any visibility
impairing pollutant that was placed in operation between August 1962
and August 1977. However, to the extent that sulfate is a significant
contributor to class I area visibility impairment, BART level emission
controls on power plants would be expected to achieve a significant
improvement in visibility.
Question. What is the statutory authority for a ``regional BART''
in view of the specific source requirement?
Answer. In establishing appropriate BART emission limits section
169A(a)(2) of the Clean Air Act requires States to take into account
the following factors:
--The costs of compliance;
--The energy and nonair quality environmental impacts of compliance;
--Any existing pollution control technology in use at the source;
--The remaining useful life of the source; and
--The degree of improvement in visibility which may reasonably be
anticipated to result from the use of such technology.
The statutory language is clear that the State should consider
``the existing pollution control technology at the source'' and ``the
remaining useful life of the source.'' The statute also requires the
States to consider ``the degree of improvement in visibility which may
reasonably be anticipated to result from the use of such technology.''
EPA interprets the language ``from the use of such technology'' to
refer to the general application of BART to sources subject to BART. As
a result, EPA believes that it reasonable to interpret this provision
as requiring the State to consider, as part of its source-specific
analysis, the cumulative impact of applying retrofit controls to all
sources subject to BART to estimate the degree of visibility
improvement which may reasonably be anticipated to result from the use
of BART.
Question. What will be the cost of imposing the Regional Haze Rule
on power plants? On stationary sources generally?
Answer. The Regional Haze rule provides States with the opportunity
to make decisions on reasonable progress goals, emissions management
strategies, and best available retrofit technology. Until those
decisions are made by the States, the cost of the regional haze rule
for power plants and other stationary sources is unknown.
However, in order to comply with the requirements of Executive
Order 12866 and the Congressional Review Provisions of the Small
Business Regulatory Enforcement Fairness Act, the U.S. Environmental
Protection Agency completed an illustrative assessment of the potential
annualized cost of the rule in 2015, a year near the end of the first
long term progress period. The scope of the illustrative cost analysis
included 4 hypothetical reasonable progress goals and two sets of
control strategies. For the example strategies analyzed, the estimated
range of power plant costs is $248 million (for a control strategy
which provides for the use of fugitive dust controls and is aimed at a
1.0 deciview improvement in 15 years) to $595 million (for a control
strategy which precludes the use of certain fugitive dust controls and
is aimed at a 10 percent deciview improvement in 10 years). These cost
estimates are in 1990 dollars and represent 23 and 16 percent of the
corresponding total cost estimates. For the same scenarios, the range
of estimated cost for non-utility sources with industrial
classification codes is $787 million to $2858 million in 1990 dollars.
We stress that the above estimates are illustrative, and that
States have considerable discretion to establish their own reasonable
progress goals so long as they consider the statutory factors and take
into account the results of the analyses required by the rule. In
addition, States are responsible for selecting and adopting control
strategies, and have flexibility to select cost-efficient programs,
including those which provide for emissions trading across emission
source categories.
______
Questions Submitted by Senator Mikulski
orimulsion: conclusive report on research
Question. From correspondence I have seen that has been sent to
colleagues of mine who have inquired about the research on the use of
Orimulsion as a fuel, I understand that research will be conducted this
calendar year. I agree that this is an appropriate time frame.
Therefore, am I correct in expecting that a conclusive report on
Orimulsion will be issued from the EPA by the end of the year?
Answer. A report on Phase 1 research activities is planned to be
submitted for OMB review by the end of the fiscal year and should be
available to Congress by the end of the calendar year. Phase 1 research
activities are pilot-scale testing of air emissions from Orimulsion,
toxicology testing of particulate matter captured during the pilot-
scale tests, a review of existing scientific results, and a preliminary
environmental assessment of using Orimulsion as a fuel for power
generation.
The Orimulsion Technology Assessment Plan (OTAP) states that the
research program will be completed in three phases, if necessary. The
OTAP calls for an evaluation of the Phase 1 results before making a
decision as to whether further work will be necessary to address
questions found during Phase 1. If further study is required to
adequately address remaining questions, the report of Phase 1 results
will be issued and will include a discussion of the remaining questions
and additional research requirements. If scientific results indicate no
further work is necessary, the Phase 1 report will be conclusive, and
it is unlikely the Agency will proceed with Phase 2 and 3.
orimulsion: research funding
Question. Is there adequate funding that is currently dedicated to
the research activity that will allow EPA to complete its conclusive
report by year's end? If not, how do you plan to obtain such funding
from existing sources to permit the completion of the report by the end
of 1999?
Answer. There is adequate funding to complete the planned Phase 1
activities, which are scheduled to be submitted for OMB review by the
end of the fiscal year. Phase 1 activities include: pilot-scale testing
of air emissions from Orimulsion, toxicology testing of particulate
matter captured during the pilot-scale tests, a review of existing
scientific results, and a preliminary environmental assessment of using
Orimulsion as a fuel for power generation.
______
Questions Submitted by Senator Leahy
dioxin reassessment study
Question. It is my understanding that EPA has been drafting a
dioxin reassessment study and plans to release it by the end of this
year. As we found with the Mercury Report to Congress, a factual basis
detailing emission volumes, sources, and health considerations is
needed for developing legislative proposals and to shape the public
policy debate. Please provide to the Subcommittee your timetable for
completing the study, interim milestones and deliverables leading up to
release of the final reassessment.
Answer. EPA's Dioxin Reassessment effort is producing three
documents:
Estimating Exposure to Dioxin-like Compounds.--This document,
discusses chemical/physical properties, sources, environmental levels
and background exposures and site-specific assessment procedures.
Health Assessment Document for 2,3,7,8-TCDD and Related
Compounds.--This document discusses pharmacokinetics, epidemiology,
cancer, various noncancer health effects and dose-response.
Integrated Summary and Risk Characterization for Assessment of
2,3,7,8-TCDD and Related Compounds.--This document summarizes the
findings of the health and exposure documents and integrates the
information to reach general conclusions about the impacts of dioxin
like compounds on human health and specifically identifies the risks
that may be occurring in the general population at background exposure
levels. The risk characterization articulates the strengths and
weaknesses of the available evidence and presents assumptions made and
inferences used. It is meant to provide a balanced picture of dioxin
science for use by risk managers inside and outside of EPA.
The process for developing these documents has been open and
participatory. They have all been developed in collaboration with
scientists from inside and outside the Federal Government. Each
document has undergone extensive internal and external review,
including review by EPA's Science Advisory Board (SAB). In their 1994
review, the SAB recommended substantive revisions to both the Dose-
Response Chapter of the Health Effects Document and the Risk
Characterization. These two sections were to be revised with the
participation of and input from a broad cross-section of outside
interests from both the public and private sectors, then submitted for
external peer review, and subsequently brought back to the SAB for re-
review. In addition, the SAB suggested adding a de novo chapter on the
Toxic Equivalency Factors (TEF) to gather in one place the discussion
and scientific information on the complex issue and use of TEFs for
dioxin and dioxin-like compounds.
Another major part of the dioxin reassessment activity is the
exposure assessment. During the SAB's review of the draft assessment,
the Board recommended some revisions to the dioxin emissions inventory
that were included in the draft exposure assessment document. In
response to both SAB comments and public comments on this section, EPA
has substantially revised the source inventory and held a two-day
external peer review meeting for expert scientific review of the draft
document in June 1998. Currently, the exposure assessment is undergoing
revision and incorporation of the peer reviewed inventory. As
recommended by the SAB, this section will not undergo any further
review by the Board. Information from the exposure assessment has been
feeding into the revision of the Integrated Summary and Risk
Characterization.
Status and Schedule
Integrated Summary and Risk Characterization:
--Internal EPA review--June 1999
--External review--July 1999
--External Peer Review--September 1999
--SAB review--November 1999
TEF Chapter:
--Internal EPA review--June 1999
--External review--July 1999
--External Peer Review--September 1999
--SAB review--November 1999
Dose-Response Modeling Chapter:
--Internal review--December 1996/January 1997
--External Peer Review--March 1997
--Writing Team Meeting--July 1999
--SAB review--November 1999
Completed reassessment: Publically available--Expected Early 2000
It is important to note that EPA remains committed to a fully open
and participatory process as it finalizes the dioxin reassessment.
Note: All dates are contingent on the extent and nature of the peer
review comments.
known or suspected carcinogens
Question. The Occupational Health and Safety Administration (OSHA)
under the Department of Labor maintains a list of ``known or suspected
carcinogens.'' Many, if not all, of these have been reported on several
years in the Toxics Release Inventory reports. I would appreciate
receiving an analysis that looks at emissions of ``known or suspected
carcinogens'' for each of the past five years. Please provide the
following three reports for 1993--1997 with the total change since
1993: (1) the top 20 3-digit SIC codes for on-site releases and total
releases, (2) releases of OSHA carcinogens by state, and (3) on-site
releases and total releases by chemical and media. For each ``known or
suspected carcinogen'' and associated industry, I would like to know
whether a regulatory emissions control strategy is in place (e.g., a
final MACT standard has been promulgated) or, where a strategy is not
yet in place, EPA's current schedule for developing and implementing a
strategy.
Answer. In addition to providing an analysis of air, water and land
releases from the TRI data (see attached charts), EPA can provide an
analysis of air releases (emissions) from the National Toxics Inventory
(NTI). The NTI contains much of the air release information from TRI,
which is self-reported by industry, but also includes additional data.
For example, while the 1996 TRI contains estimates of air toxics
emitted from about 13,000 facilities, the 1996 National Toxics
Inventory (NTI) contains emissions estimates of air toxics emitted from
more than 38,000 facilities.
The TRI requires manufacturing facilities and facilities in seven
new sectors to report annual chemical releases and other chemical waste
management. Although the NTI includes various other sources of
emissions (i.e., mobile and area, in addition to point sources), the
NTI relies on emission estimates, and, as such, the NTI emission data
varies in quality and completeness among source categories, geographic
location, and estimation method.
EPA has a baseline NTI which represents data for the period 1990-
1993, and a draft NTI for 1996. The NTI contains estimates of 188
hazardous air pollutants from point, area, and mobile sources. Of these
188 hazardous air pollutants, 134 have been classified by either EPA or
the International Agency for Research on Cancer as carcinogens (list is
attached).
The emissions data in the NTI could be presented by Source
Classification Code (SCC) and/or MACT code, which is more closely
aligned with the source of emissions than would be the SIC code, which
is related to the economic sector. An analysis that could be done to
summarize carcinogen emissions and identify regulatory strategies which
are targeting these emissions is:
Use baseline NTI data (1990-1993) and 1996 draft NTI data to
compare carcinogenic hazardous air pollutant emissions by source
category nationally and for each state. Identify source categories with
existing and planned MACT standards, and industries for which the
Agency has other types of regulatory activities planned or in place
(for example, control technology guidelines to reduce volatile organic
compounds, which are a precursor to ozone formation).
Question. Lastly, I would like to know whether EPA currently
coordinates with OSHA or has plans to begin working with OSHA, to
ensure that workers and people living in the proximity of significant
sources of ``known or suspected carcinogens'' are being adequately
protected from these emissions.
Answer. EPA began discussions with OSHA this Spring on the
potential to coordinate a number of air toxics regulations with OSHA
regulations. On June 17-18, 1999, EPA, OSHA and NIOSH jointly sponsored
a workshop on ``Common Sense Approaches to Protecting Workers and the
Environment.'' At this workshop, EPA and OSHA acknowledged that they
would work cooperatively on a number of toxics issues.
To the extent possible, the Agency plans to include OSHA review
prior to proposal of future air toxics regulations. In addition, EPA
and OSHA are in the process of coordinating on worker exposure issues.
Specifically, EPA has committed to help address any major issues that
may exist where reductions in environmental emissions inadvertently
have an adverse effect on worker exposures. Also, OSHA plans to provide
EPA with quantitative risk assessments to help with EPA's priority-
setting and efforts to address emissions impacting people living in the
proximity of significant sources of air toxics. Staff from both
Agencies plan to meet later this year to further coordinate these
efforts.
Below is a list of 134 HAPs that either EPA or IARC have classified
as carcinogens. Most of these are listed singly under section 112(b) of
the Clean Air Act Amendments, but some (particularly PAHs) fit within
HAP categories.
------------------------------------------------------------------------
Ratings
------------------------------------------------------------------------
EPA:
A.................................. Known.
B.................................. Probable.
C.................................. Possible.
D.................................. No evidence.
IARC:
1.................................. Known.
2A................................. Probable.
2B................................. Possible.
3.................................. No evidence.
------------------------------------------------------------------------
Compounds classified by EPA and/or IARC as known, probable, or
possible human carcinogens.
------------------------------------------------------------------------
Chemical name CAS No. EPA IARC
------------------------------------------------------------------------
4-Aminobiphenyl................... 92671............... ...... 1
Radon............................. 14859677............ ...... 1
N,N-dimethylaniline............... 121697.............. ...... 3
Diethyl sulfate................... 64675............... ...... 2A
Styrene oxide..................... 96093............... ...... 2A
2,4/2,6-Toluene diisocyanate 26471625............ ...... 2B
mixture (TDI).
2,4-Toluene diisocyanate.......... 584849.............. ...... 2B
4,4'-Methylenedianiline........... 101779.............. ...... 2B
Acetamide......................... 60355............... ...... 2B
Anisidine......................... 90040............... ...... 2B
Dibenzo(j)fluoranthene............ 205823.............. ...... 2B
Dimethyl.......................... 68122............... ...... 2B
Ethyl carbamate................... 51796............... ...... 2B
N-Nitrosomorpholine............... 59892............... ...... 2B
Styrene........................... 100425.............. ...... 2B
Vinyl acetate..................... 108054.............. ...... 2B
Arsenic and Compounds............. 7440382............. A 1
Asbestos.......................... 1332214............. A 1
Benzene........................... 71432............... A 1
Bis(chloromethyl)ether............ 542881.............. A 1
Chloromethyl methyl ether......... 107302.............. A 1
Chromium (VI) Compounds........... 18540299............ A 1
Vinyl chloride.................... 75014............... A 1
Benzidine......................... 92875............... A ......
Coke Oven Emissions............... 8007452............. A ......
Nickel refinery dust.............. NI-DUST............. A ......
Nickel subsulfide................. 12035722............ A ......
Radionuclides..................... Radio............... A ......
Nickel and Compounds.............. 7440020............. A 2B
Beryllium and Compounds........... 7440417............. B1 1
Cadmium and Compounds............. 7440439............. B1 1
Ethylene oxide.................... 75218............... B1 1
Acrylonitrile..................... 107131.............. B1 2A
Formaldehyde...................... 5000................ B1 2A
Aniline........................... 62533............... B2 3
Bromoform......................... 75252............... B2 3
Captan............................ 133062.............. B2 3
Chlorinated dibenzofurans (as furans.............. B2 3
2,3,7,8-equivalents).
1,2-Dibromo-3-chloropropane....... 96128............... B2 ......
1,2-Diphenylhydrazine............. 122667.............. B2 ......
1,2-Tropyleneimine................ 75558............... B2 ......
2,3,7,8-Tetrachlorodibenzo-p- 1746016............. B2 ......
dioxin.
2,4,6-Trichlorophenol............. 88062............... B2 ......
2,4-Toluene diamine............... 95807............... B2 ......
3,3'-Dimethylbenzidine............ 119937.............. B2 ......
7,12-Dimethylbenz(a)anthracene.... 57976............... B2 ......
alpha-Hexachlorocyclohexane (a- 319846.............. B2 ......
HCH).
beta-Hexachlorocyclohexane (b-HCH) 319857.............. B2 ......
Carbazole......................... 86748............... B2 ......
Chlorinated dibenzo-p-dioxins (as dioxins............. B2 ......
2,3,7,8-equivale).
Chrysene.......................... 218019.............. B2 ......
DDE............................... 72559............... B2 ......
Dichloroethyl ether............... 111444.............. B2 ......
Hexachlorodibenzo-p-dioxin, 19408743............ B2 ......
mixture.
Methyl hydrazine.................. 60344............... B2 ......
Nickel carbonyl................... 13463393............ B2 ......
Propoxur.......................... 114261.............. B2 ......
Propylene dichloride.............. 78875............... B2 ......
Selenium sulfide.................. 7446346............. B2 ......
technical Hexachlorocyclohexane 608731.............. B2 ......
(HCH).
1,3-Butadiene..................... 106990.............. B2 2A
4,4'-Methylene bis(2- 101144.............. B2 2A
chloroaniline).
Acrylamide........................ 79061............... B2 2A
Benzo(a)anthracene................ 56553............... B2 2A
Benzo(a)pyrene.................... 50328............... B2 2A
Dibenz(a,h)anthracene............. 53703............... B2 2A
Dimethyl sulfate.................. 77781............... B2 2A
Epichlorohydrin................... 106898.............. B2 2A
Ethylene dibromide................ 106934.............. B2 2A
Nitrosodimethyla.................. 62759............... B2 2A
Polychlorinated biphenyls......... 1336363............. B2 2A
Vinyl bromide..................... 593602.............. B2 2A
1,1-Dimethylhydrazine............. 57147............... B2 2B
1,3-dichloropropene............... 542756.............. B2 2B
1,4-Dioxane....................... 123911.............. B2 2B
2,4/2,6-Dinitrotoluene (mixture).. 25321146............ B2 2B
2,4-Dinitrotoluene................ 121142.............. B2 2B
2-Nitropropane.................... 79469............... B2 2B
3,3'-Dichlorobenzidine............ 91941............... B2 2B
3,3'-Dimethoxybenzidine........... 119904.............. B2 2B
Acetaldehyde...................... 75070............... B2 2B
Antimony trioxide................. 1309644............. B2 2B
Benzo(b)fluoranthene.............. 205992.............. B2 2B
Benzo(k)fluoranthene.............. 207089.............. B2 2B
Benzotrichloride.................. 98077............... B2 2B
Benzyl chloride................... 100447.............. B2 2B
Bis(2-ethylhexyl)phthalate........ 117817.............. B2 2B
Carbon tetrachloride.............. 56235............... B2 2B
Chlordane......................... 57749............... B2 2B
Chloroform........................ 67663............... B2 2B
DDT............................... 50293............... B2 2B
Dichlorvos........................ 62737............... B2 2B
Ethyl acrylate.................... 140885.............. B2 2B
Ethylene dichloride............... 107062.............. B2 2B
Ethylene thiourea................. 96457............... B2 2B
Heptachlor........................ 76448............... B2 2B
Hexachlorobenzene................. 118741.............. B2 2B
Hydrazine......................... 302012.............. B2 2B
Indeno(1,2,3-cd)pyrene............ 193395.............. B2 2B
Lead and Compounds................ 7439921............. B2 2B
Methylene chloride................ 75092............... B2 2B
o-Toluidine....................... 95534............... B2 2B
Pentachlorophen................... 87865............... B2 2B
Propylene oxide................... 75569............... B2 2B
Toxaphene......................... 8001352............. B2 2B
Lindane........................... 58899............... B2-C ......
Tetrachloroethene................. 127184.............. B2-C 2A
Trichloroethylene................. 79016............... B2-C 2A
1,1,2,2-Tetrachloroethane......... 79345............... C 3
1,1,2-Trichloroethane............. 79005............... C 3
Acrolein.......................... 107028.............. C 3
Allyl chloride.................... 107051.............. C 3
Dibromochloromethane.............. 124481.............. C 3
Hexachlorobutadiene............... 87683............... C 3
Hexachloroethane.................. 67721............... C 3
Parathion......................... 56382............... C 3
Pentachloronitrobenzene........... 82688............... C 3
Trifluralin....................... 1582098............. C 3
Cresols (mixed)................... 1319773............. C ......
Cyanazine......................... 21725462............ C ......
Ethylidene dichloride............. 75343............... C ......
Isophorone........................ 78591............... C ......
m-Cresol.......................... 108394.............. C ......
Mercuric chloride................. 7487947............. C ......
Methyl chloride................... 74873............... C ......
Methyl iodide..................... 74884............... C ......
Methyl mercury.................... 22967926............ C ......
Naphthalene....................... 91203............... C ......
o-Cresol.......................... 95487............... C ......
o-Phenylphenol.................... 90437............... C ......
p-Cresol.......................... 106445.............. C ......
Quinoline......................... 91225............... C ......
Vinylidene chloride............... 75354............... C ......
p-Dichlorobenzene................. 106467.............. C 2B
Nitrobenzene...................... 98953............... D 2B
------------------------------------------------------------------------
tri on-site and total releases of osha carcinogens, by state, 1993-1997
Question. Odd pattern B did one new plant open up in 1995?
Answer. Wyoming--Two facilities account for most of the increase
from 1994 to 1995 in total releases of carcinogens in Wyoming. FMC
Corp. in Sweetwater, WY reported other chemicals in 1994 but did not
report any OSHA carcinogens until 1995. The large increase is in
benzene (64,000 pounds of air emissions). Frontier Refining Inc. in
Cheyenne, WY reported 8,861 pounds releases of benzene in 1994 (mostly
air emissions) and 25,495 pounds of releases of benzene in 1995 (mostly
air emissions). The total increase in OSHA carcinogens from 1994 to
1995 from these two facilities is 78,392 pounds. The total increase for
Wyoming is 82,994 pounds. Therefore, these two facilities account for
94 percent of the increase in total release of OSHA carcinogens in
Wyoming from 1994 to 1995.
Question. Washington, D.C., Explain the total release change.
1994.............................................................. 5
1995.............................................................. 255
1996.............................................................. 250
1997....................................................................
Answer. The facility that reported these numbers is the Bureau of
Engraving and Printing. This facility has reported to TRI as a federal
facility since 1994. The above mentioned numbers are transfers to
dispose of nickel.
Question. Louisiana--Explain the increase from 1996 to 1997.
Answer. Two facilities account for the majority of the change from
1996 to 1997. Borden Chemicals & Plastics Ops. LP, LA HWY. 73 & 30,
Geismar, LA reported an increase of 1,627,322 pounds. This increase was
primarily benzene. Monsanto-Luling, 12501 River Rd., Luling, LA
reported an increase of 1,516,000 pounds. This increase was primarily
formaldehyde.
Question. Is the reporting universe the same from 1993-1997?
Answer. For the purpose of this table (TRI On-site and Total
Releases of OSHA Carcinogens, by State, 1993-1997), the reporting
universe is the same for 1993 to 1997. The same list of chemicals is
used for comparison across all years, see Anote at bottom of table
regarding this issue.
Question. If not, should EPA be comparing 1993 to 1997?
Answer. N/A--answer provided above.
mercury thresholds and emissions
Question. On March 12, 1999, the Governors of the seven New England
states wrote to you urging that EPA adopt ``dramatically lower
reporting thresholds for mercury and expand reporting sectors to
include all the largest sources of mercury emissions.'' The letter went
on to state that ``the proposed limit of 10 pounds is far too high and
will not help state efforts to achieve virtual elimination of
anthropogenic mercury emissions.'' How has EPA responded to the
Governors? Please provide the subcommittee a copy of that response.
Answer. The EPA's Administrator received the attached letter dated
March 12, 1999, from the New England Governors Conference, Inc., urging
EPA to adopt activity thresholds for mercury dramatically lower than
the Agency's preferred option of 10 pounds as proposed in the January
5, 1999 proposed rule expanding and modifying the EPCRA section 313
reporting requirements for persistent bioaccumulative toxic (PBT)
chemicals. The letter was routed to the Office of Pollution Prevention
and Toxics where it was logged into the docket [# OPPTS 400132] created
for receiving comments on the proposed rule.
Guided by the requirements and principles of the Administrative
Procedures Act, the Agency will consider the views of those who
commented during the public comment period which closed April 7, 1999.
Typically, all of the comments received are logged-in, categorized by
issue and evaluated as part of the development of the final rule, which
is currently scheduled to be issued in late October 1999. As required
by law, the Agency will respond to significant comments in the preamble
to the final rule, and the Agency also prepares a more detailed
Response to Comments document.
The Agency received well over 37,000 submissions to the docket
(including 35,000 postcards expressing a similar comment) on the
proposed rule. The activity threshold level for reporting EPCRA section
313 PBT's is of concern to many constituents. The Agency received
numerous comments regarding the threshold levels as proposed, including
recommendations similar to those submitted by the New England Governors
Conference, Inc. Serious consideration will be given to those concerns
regarding the threshold levels for mercury and the other relevant PBT
chemicals in our deliberations toward development of a final rule.
noX trading program
Question. Regarding the NOX trading program, what are
EPA's plans and timetable for implementing environmental measures of
progress for this program? Will those measures reflect regional
differences?
Answer. The Acid Rain Program will be developing and operating the
NOX Allowance and Emissions Tracking Systems for the
NOX Budget Program, as requested by the 12 States of the
Ozone Transport Region (OTR). This is in addition to administering the
SO2 and NOX provisions under Title IV of the
Clean Air Act. The first year of compliance for this program is 1999
(with the first compliance certification process being conducted by EPA
for the OTR States in the first quarter of 2000). Over 900 facilities
will require certification of emissions monitors and will report
quarterly emissions to EPA beginning in 1999. The OTR program is
expected to increase EPA's allowance trading activities by
approximately 50 percent over the Acid Rain Program.
Beginning in 1999, we expect that the OTR NOX Budget
Trading program will result in approximately a 50 percent reduction of
NOX emissions from the 1990 baseline; this level will be
maintained annually through 2002. These reduction will be over and
above those achieved through implementation of Title IV of the Clean
Air Act Amendments. As with other programs under Title I of the Clean
Air Act, the OTR States are required to conduct audits to ensure that
the Program is providing expected environmental outcomes. These audits
will be conducted every three years beginning in 2002.
lake champlain: survey of fish and great lakes epidemiological study
Question. On page II-19 of your fiscal year 2000 request, the
Agency lists one of the activities to help meet the goal of ensuring
safe drinking water, fish, and recreational waters continued work on a
``nationwide survey of toxic residues in fish and complete
epidemiological studies in the Great Lakes * * * on health effects of
exposure to selected bioaccumulative toxics.'' Is there an opportunity
for Lake Champlain to be included in this survey? What would be the
cost of including Lake Champlain in the study and does the Agency have
any plans to expand the survey outside of the Great Lakes?
Answer. There is a chance that Lake Champlain will be included in
the national fish tissue survey to determine the extent to which fish
in waters of the United States are contaminated with persistent
bioaccumulative toxic chemicals. A set of 900 lakes was randomly
selected for this study. Lake Champlain was not included in this set.
The random selection was based on latitude/longitude positions. Upon
making an actual physical check of the randomly selected sites, we are
finding that some of the information in the geographic database was not
correct. Thus, we suspect that many of the 900 in the first set will
not meet the study definition of a lake. If and when the sample size
falls below 750 lakes, we will make subsequent selections of 25 lakes
from a second sample of 900 lakes in the U.S. Lake Champlain is one of
the randomly selected lakes in this second set; so there is a chance
that it will be selected.
The Agency will collect and analyze two composite samples of fish
(one bottom fish species and one predator/sport fish species) at each
sampling site. We expect that the two samples will cost about $8,000
each to analyze. Costs to physically collect the samples in the field
for the lakes in New York and Vermont could range from $2,000 to
$4,000. Thus, we expect that total costs for obtaining and analyzing
the samples from Lake Champlain, if selected, would range from $18,000
to $20,000.
The Great Lakes National Program Office also conducts a fish
contaminant program in the Great Lakes in conjunction with the Great
Lakes States. Although this program does not include Lake Champlain,
information and lessons learned in the Great Lakes program are
transferable to other fish contaminant programs (e.g. the nationwide
fish survey).
The Great Lakes epidemiological studies are conducted by the Agency
for Toxic Substances and Disease (ATSDR). These studies are generally
local in nature and would not include Lake Champlain.
lake champlain: great lakes program
Question. EPA is requesting an increase over the fiscal year 1999
enacted funding level to reduce transboundary threats in shared North
American ecosystems through the Great Lakes National Program. Again, is
there an opportunity for Lake Champlain to be included in this program?
What type of activities are currently being undertaken under this
program?
Answer. Lake Champlain is not directly included in the Great Lakes
National Program, which is established by statute, Section 118 of the
Clean Water Act, and international agreement, the Great Lakes Water
Quality Agreement with Canada (GLWQA). The Clean Water Act and GLWQA
both describe the program as encompassing bodies of water ``at or
upstream from the point at which [the St. Lawrence River] becomes the
international boundary between the United States and Canada'' (quoting
from the Great Lakes Water Quality Agreement). Lake Champlain is
downstream from this point.
Notwithstanding this limitation, EPA's Great Lakes activities do
benefit Lake Champlain because of the similarity of the environmental
problems of both, particularly invasive species, persistent toxics, and
nutrients. EPA's Great Lakes National Program Office acts as a
laboratory to pilot ways of addressing those problems. Much of what is
learned in the Great Lakes is applicable to Lake Champlain.
Under the Clean Water Act, GLNPO oversees fulfillment of EPA's
international commitments under the U.S.-Canada Great Lakes Water
Quality Agreement. It monitors Lake ecosystem indicators; manages and
provides public access to Great Lakes data; helps communities address
contaminated sediments in their harbors; supports local protection and
restoration of important habitats; promotes pollution prevention
through activities and projects such as the Binational Toxics Strategy
with Canada; and provides assistance to implement community-based
Remedial Action Plans for Areas of Concern and for development and
implementation of Lakewide Management Plans. Assistance is provided in
all of these areas through grants and the provision of direct technical
support. In addition, to support efforts for the Lake Champlain
Management Conference the fiscal year 2000 budget requests $1 million.
lake champlain: action plan time frame
Question. There has been considerable interest within Vermont and
New York for speeding up the timeframe for the Lake Champlain Action
Plan from 20 to 10 years. Focusing on the action items where EPA is
identified as a key federal partner, how much annual funding would be
required for EPA to meet the goals of the Action Plan within 10 years?
Since additional agricultural non-point cost share funding is required
to accelerate phosphorus reduction, will EPA consider committing funds
to supplement those currently made available by USDA and the states of
Vermont and New York?
Answer. Accelerating the Lake Champlain Basin Program (LCBP)
implementation plan from 20 years to 10 years relates only to
phosphorus reduction goals. The LCBP's Opportunities for Action plan
was completed in October 1996 and is based on a 20-year phosphorus
reduction schedule. Opportunities for Action states that the estimated
annual cost needed to implement a phosphorus reduction strategy in the
Lake Champlain Basin is about $12.6 million. This would achieve all in-
lake phosphorus standards except those established for the southern
portion of the Lake and Missisquoi Bay.
On May 18, 1999, the LCBP Steering Committee discussed the growing
public interest associated with accelerating the Lake Champlain
phosphorus reduction strategy time frame from 20 years to 10 years.
Although the Steering Committee embraced the general concept as a
worthy goal, it was decided more analysis is needed to determine the
feasibility of accelerating the time frame. In making this decision,
the Steering Committee must ensure that
--We look at this issue holistically (recognizing both point and
nonpoint source needs);
--The 10-year implementation time frame is a realistic program goal;
--The public and regulated community are aware of the time frame
reassessment;
--Natural Resources Conservation Service (NRCS) technical support
will increase in the LC Basin during the next 10 years;
--Funding will not be obtained at the expense of other key Clean
Water programs; and,
--Future growth issues are factored in.
The Steering Committee supported an evaluation of this idea. An
outline is now being developed to discuss the formation of a focus
group to consider the strengths and weaknesses of this proposal. The
focus group will determine a realistic time frame for achieving
phosphorus goals (20 years as originally intended, 10 years, or other)
and additional issues associated with technical feasibility, cost,
staffing, implementation, and monitoring of success. The focus group
will report back to the Steering Committee in September.
With respect to supplementing USDA and state funding, EPA has
provided and continues to provide millions of dollars in Clean Water
Act funds to Vermont and New York which can be used to implement
agricultural nonpoint source pollution control practices. The funding
provided through the Clean Water Act is obligated to the States, who in
turn make specific funding decisions.
clean lakes program (section 314): 319 program funding
Question. EPA has stated that it intends to fund Clean lakes
Program (Section 314) elements as part of the 319 program. How much
funding from the 319 program in fiscal year 1998 and 1999 was used to
address the elements of the Clean Lakes Program such as water quality
monitoring, feasibility studies and lake demonstration projects? How
does this compare to when the 314 program was funded separately from
the 319 program?
Answer. In recent years, EPA has encouraged states to use the
section 319 Nonpoint Source Program to support the lakes and reservoir
work which was previously done under the section 314 Clean Lakes
Program. In our guidance, we have emphasized that the Clean Lakes
Program elements (e.g., Statewide Lake Water Quality Assessments to
assess water quality across a state, Phase I Diagnostic/Feasibility
Studies to determine the causes of pollution in a specific lake and to
recommend control actions, Phase II Restoration and Protection
Implementation Projects to implement needed controls, and Phase III
Post-Restoration Monitoring Studies to monitor the effectiveness of
projects)which were previously funded under the section 314 Clean Lakes
Program are eligible for funding under the section 319 Nonpoint Source
Program. (Questions and Answers on the Relationship Between the Sec.
319 Nonpoint Source Program and the Sec. 314 Clean Lakes Program, US
EPA., Nov. 1996, can be found on the Internet at: http://www.epa.gov/
owow/NPS/Section319/q percent 26a.html).
EPA developed a section 319 Grants Reporting and Tracking System
(GRTS) with the States to track mutually agreed upon mandatory data
elements for all section 319 grants. GRTS shows that states are using
section 319 to support restoration and protection activities for lakes
and reservoirs. However, states do not always refer to their lakes
activities using historic Clean Lakes Program element nomenclature
i.e., Lake Water Quality Assessments, Phase I studies, etc.
To estimate section 319 resources directed specifically to lakes
and reservoirs in fiscal year 1998 (GRTS data is not yet available for
fiscal year 1999), EPA queried the tracking system to identify section
319 projects where ``lake,'' ``reservoir,'' or ``pond'' are included in
the project title and also where states identify only lakes as the
water body type benefitted in the project. The tracking system shows
that in fiscal year 1998 about 9.2 percent of reported section 319
program funds were used in specific projects for lakes, reservoirs or
ponds (see Table 1 for a national summary and Table 2 for specific
lakes projects funded by States in 1998). Based on these figures, we
estimate that nationally $9.7 million in section 319 grants were
provided to directly benefit lakes and reservoirs in fiscal year 1998.
In addition, we queried the GRTS tracking system to determine the
amount of section 319 funds that states identified as benefitting
multiple water body types e.g., projects that benefit lakes as well as
other water bodies in a watershed such as streams, rivers, wetlands,
etc. The query identified $17.4 million of section 319 funds for fiscal
year 1998 that states report benefit multiple water bodies (again,
fiscal year 1999 data is not yet available).
While it is difficult to determine exactly how much of the above
funds benefit lakes, clearly a portion of these funds support the
objective of restoring and protecting lakes and reservoirs. These
projects that benefit multiple water body types run the gamut of
nonpoint activities i.e., from statewide educational programs, to
specific watershed projects, to support for state/local nonpoint source
personnel.
Thus, in addition to the section 319 program funds which are used
in specific projects for lakes, reservoirs or ponds, a portion of the
projects that benefit watersheds as a whole also help to protect and
restore lakes. Further, in fiscal year 1999, funds appropriated for the
section 319 program doubled from $100 million to $200 million. We
expect that with this increase in resources we will see an increase in
the amount of lakes work funded under section 319.
Regarding your second question, in 1994, the last year that the
section 314 Clean Lakes Program was funded, Congress appropriated $5
million for the program. Following is the percentage of these funds
which were awarded for the various Clean Lakes Program elements in
fiscal year 1994:
--43 percent were invested in Statewide Lake Water Quality
Assessments;
--34 percent were invested in Phase 1 projects;
--19 percent were invested in Phase II projects; and
--4 percent were invested in Phase III projects.
We do not have comparable data in the GRTS system to directly
compare how much of the section 319 grants are being used for the Clean
Lake Program elements. But as the above data indicates, a considerable
amount of lakes work is being funded under section 319. Further, while
projects may not be identified as ``Phase I'' or ``Phase II'' projects,
similar lakes-related work as was funded under section 314 is now
funded under the section 319 program. Table 1 Amount of Lakes Work
Funded Under the Section 319 Nonpoint Source Program in fiscal year
1998
TABLE 1.--AMOUNT OF LAKES \1\ WORK FUNDED UNDER THE SECTION 319 NONPOINT SOURCE PROGRAM IN FISCAL YEAR 1998
----------------------------------------------------------------------------------------------------------------
Amount of 319
funds reported Estimated
Amount of 319 in 319 Amount of Percent of national total
Fiscal year funds tracking lakes work reported 319 amount of
appropriated system as of reported by funds used for appropriated
(in millions) 5/3/99 (in states \2\ lakes work funds used for
millions) lakes work \3\
----------------------------------------------------------------------------------------------------------------
1998............................ $105 $51 $4.7 9.2 $9.7
----------------------------------------------------------------------------------------------------------------
\1\ For the purposes of this table, ``Lakes'' refers to lakes as well as reservoirs and ponds.
\2\ This includes section 319 projects where ``lake,'' ``reservoir'' or ``pond'' is included in the project
title, and also projects where states identify only lakes as the water body type benefitted in the project.
\3\ The percentage of section 319 funds used for lakes by states which reported is assumed to be the same for
all non-reporting states, multiplied by the total section 319 funds appropriated.
TABLE 2.--CWA SECTION 319 PROJECTS WITH ``LAKES'' IN THE PROJECT TITLE
OR IN THE WATER BODY TYPE: FISCAL YEAR 1998
------------------------------------------------------------------------
Project title State Amount
------------------------------------------------------------------------
LAKE W Q A IN THE BLACK WARRIOR RIVER BASIN..... AL $41,800
LAKE ACWORTH RIPARIAN BUFFER & WETLAND DETENT... GA $315,000
LAKE LANIER WATERSHED NPS IMPROVEMENT PROJ...... GA $262,804
CLEAR LAKE ENHANCE. & RESTOR. PROJ.............. IA $80,000
STORM LAKE WATERSHED PROJECT.................... IA $58,000
CASCADE RESERVOIR W S RDS & FORESTED LANDS...... ID $100,000
PROJECT: BIG PAYETTE MARINA PROJECT............. ID $27,750
PITTSFIELD NATIONAL MONITORING PRO.............. IL $30,000
PROBABLITY BASED LAKE SURVEY.................... IN $15,000
SPRING MILL LAKE................................ IN $112,500
DONNELL LAKE.................................... MI $7,323
DONNELL LAKE (MSU).............................. MI $39,677
PICKERAL CROOKED LAKES.......................... MI $200,000
INTEGRATED CROP MANAGEMENT SPEC................. MO $133,000
CLEAN LAKES NEUSE RIVER STUDY................... NC $55,051
OLIVE CREEK LAKE--SALT VALLEY CLEAN LAKES....... NE $120,000
STANDING BEAR LAKE MGMT. PROGRAM (56-9810)...... NE $148,897
98-E BONITO LAKE CRITICAL AREA TREATMENT........ NM $59,468
INDIAN LAKE WATERSHED PROJECT................... OH $105,880
LAKE EUCHA WATERSHED IMPLEMENTATION PROJECT..... OK $619,598
GREAT LAKES INITIATIVE.......................... PA $94,500
LACKAWANNA LAKE WATERSHED ASSESSMENT............ PA $19,500
LAKE GALENA ACCELERATED LAND TREATMENT PROG..... PA $116,100
CROOKED CK/LAKE WALLACE BIO-ASSESS.............. SC $30,400
FIRESTEEL CK/LAKE MITCHELL WATERSHED............ SD $20,000
LAKE HENDRICKS WATERSHED........................ SD $213,152
LAKE POINSETT WATERSHED PROJECT................. SD $20,000
RAVINE LAKE WATERSHED PROJ-PHASE II............. SD $20,000
SHADEHILL LAKE PROTECTION....................... SD $20,000
STATEWIDE LAKE ASSESSMENT....................... SD $20,000
OAK CREEK/LAKE TRAMMELL W Q PROJECT............. TX $500,000
WQMP IMPLEMENTATION ASSISTANCE.................. TX $878,926
PROJECT: SALT LAKE CO. SOURCE PROTECTION........ UT $20,000
LAKE WATERSHED ASSESSMENT AND MONITORING........ WA $128,619
LAKE WHATCOM W S--COOP DRINKING WATER PRO....... WA $48,000
WHEELING CK & MOUNTWOOD PARK LAKE............... WV $34,506
---------------
Total 1998................................ $4,715,451
------------------------------------------------------------------------
nonpoint source pollution projects
Question. The EPA is requesting authorization for new flexibility
to allow states to allocate up to 20 percent of their Clean Water State
Revolving Fund for nonpoint source pollution projects. If this
authorization is granted, how will EPA monitor the use of these funds
and will there by any requirements for coordination with the USDA
Natural Resources Conservation Service priority watershed areas under
the Environmental Quality Incentives Program? Will the states have the
flexibility to use the funding by either their agriculture department
or their environmental agency?
Answer. EPA will monitor and track the use of the CWSRF nonpoint
source and estuary management grant funds through the existing CWSRF
National Information Management System (NIMS). Each year states submit
data for NIMS regarding all loan activity and the types of projects
funded. The additional grant flexibility will allow states to provide
grant resources (not to exceed 60 percent of project costs) separately,
or in combination with loans to make projects affordable. All proposed
CWSRF activities are discussed in each state's annual Intended Use Plan
(IUP), which describes the funds available and proposed projects. The
IUP is made available to the public for comment. Actual CWSRF
activities are described in Annual Reports as well as NIMS.
There are no requirements for coordination with USDA. However,
under the Clean Water Action Plan, all States have developed Unified
Watershed Assessments delineating their priority watersheds for
restoration activities and are now working on specific Watershed
Restoration Action Strategies for these watersheds. EPA and USDA are
committed to work with States to target and mutually marshal all
available funding that can help restore State priority watersheds,
including CWSRF and EQIP funds.
The state agency designated to receive the CWSRF capitalization
grant will receive the entire state allotment. Up to 20 percent of that
allotment may be used for nonpoint source or estuary management grants,
at the state's discretion. In most cases, state environmental agencies
have direct responsibility for the CWSRF program and state agricultural
agencies have a leadership role on EQIP. States do, however, have the
flexibility to determine how to best use and coordinate these funds to
meet their high priority agricultural nonpoint source needs. Projects
that the Agricultural Department wants to fund would need to be
included in the state's 319 Nonpoint Source Management Plan or 320
Estuary Comprehensive Conservation and Management Plan, as well as the
CWSRF Integrated Priority List. Many state CWSRF loan programs have
already developed partnerships with state Agricultural Departments to
provide CWSRF loans for nonpoint source projects. For instance,
Delaware, Minnesota, West Virginia, and Ohio work with NRCS to identify
needed agricultural Best Management Practices, design projects, and
develop cost estimates before making a CWSRF loan.
______
Questions Submitted by Senator Harkin
animal waste: livestock permits funding
Question. I am told that many states lack the personnel to make the
regular inspections of large animal feeding operations that would be
required for meaningful environmental oversight under the Clean Water
Act. What additional funding is EPA making available to states to
implement the Administration's directives on livestock permits? What
funding do you think could effectively be used in 2000?
Answer. In fiscal year 1999, the President requested and Congress
appropriated a $20 million dollar increase in Clean Water Act (CWA)
Section 106 grants for State and Tribal water quality program
administration. The fiscal year 2000 President's Budget continues this
grant increase. These additional funds can be used by States for
programs including inspections to address concentrated animal feeding
operations (CAFOs), which are regulated under the CWA permitting
program. Also, EPA has awarded a $5 million dollar grant to America's
Clean Water Foundation (ACWF). ACWF, working with the National Pork
Producers Council, will train individuals to do environmental
assessments of pork production facilities.
One of the actions in the Strategy is for EPA and USDA to develop a
joint evaluation of the costs and benefits of this Strategy and the
options that may be considered in developing revised CAFO regulations.
Currently EPA is focusing on the C-B for the revised CAFO rules. We
also plan to work with USDA to develop a joint evaluation of the Cost
Benefits of developing and implementing Comprehensive Nutrient
Management Plans (CNMPs). EPA and USDA are also working with our State
partners on ways to coordinate our respective programs to achieve the
needed water quality goals through proper manure management. In the
near term, EPA and USDA will continue to support ways to use existing
programs such as Section 319 (Nonpoint Source), Section 106 State
Program Funds) and Environmental Quality Incentives Program (EQIP) to
support implementation of the Strategy. At the same time, EPA and USDA
expect that the private sector will provide key support for helping
producers, both technically and financially, to ensure that the 1.37
billion tons of manure produced by AFOs is managed in a way that
protects water quality.
animal waste: research and development techniques for pollution
standard
Question. The development of a new generation of management tools
and technologies for handling manure at large-scale livestock
operations is essential for environmental protection. I understand EPA
is currently revising its effluent guidelines to specify the kinds of
technological approaches livestock operations should use to limit water
pollution. What funding is EPA making available for the research and
development of a range of affordable technologies that will help
livestock producers comply with stricter pollution standards?
Answer. EPA is funding studies to identify a new generation of
management tools and technologies in support of the effluent guidelines
regulation. Most of this work focuses on technology operating on a
full-scale basis at existing animal feeding operations. The focus of
the studies is to better understand the performance of some of these
technologies and to quantify the costs to install, operate and maintain
these technologies.
Through the Effluent Guidelines effort, EPA has contracted with
North Carolina State University. They have provided EPA with expertise
gained through their research at the Animal and Poultry Waste
Management Center. Other studies being done by EPA to examine
technology include:
--Evaluation of the economic and environmental feasibility of
combustion of poultry litter for energy recovery on the Eastern
Shore of the Chesapeake Bay. (3/99)
--Poultry waste incinerator pilot project in Maryland. (in process)
--Six-State Animal Waste Consortium (IN, IA, NC, MI, OK, MO)
research. Since the proposals are currently being evaluated by
a review panel, it is uncertain how many of them may deal with
researching affordable technologies. (in process)
--Partial funding of a study in Texas evaluating the feasibility of a
centralized manure processing facility for dairy waste. (9/98)
As part of the outreach and education effort that must follow the
issuance of these revised regulations, EPA will provide guidance to the
livestock producers regarding manure treatment and how to determine the
best method for managing their manure to comply with the regulation.
animal waste: regional mechanism for manure management
Question. I believe that in certain areas of the country, where
livestock production is most concentrated, we need to establish
regional mechanisms for treating and distributing manure and fertilizer
products. A number of European countries have adopted this kind of
approach, and I think it would relieve the burden on individual
producers to adopt new treatment technologies and deal with excess
manure. Is EPA taking a solid look at what technologies are being used
in Europe and elsewhere in the World that might be adopted in our
country?
What is EPA doing to help states and local governments establish
regional approaches to manure management and to provide information
about some of the advanced technologies that are available? What
research is EPA doing in this area?
Answer. EPA has met with representatives of European governments
and companies conducting business in Europe and has become familiar
with European programs, especially those employed in the Netherlands.
EPA agrees that regional mechanisms will be necessary for some
areas to deal with excess manure, and will encourage businesses that
attempt to establish these mechanisms. For example, EPA has evaluated
the centralized incineration of poultry litter to generate electricity
on the Eastern Shore of the Chesapeake Bay.
EPA's Region III, the Agency's representative at the Poultry
Dialogue, has worked closely with the poultry industry and businesses
interested in providing regional mechanisms for handling excess manure.
Region III has worked with the poultry processors to encourage them to
take a lead in identifying the technology that best suits their needs
and the needs of their growers.
pollution prevention and the federal government: bio-based epps
Question. What has the EPA accomplished in moving forward towards
increasing the government's purchase of bio-based EPPs, as required by
the Executive Order?
Answer. Under Executive Order 13101, the USDA is responsible for
issuing a bio-based products list, and the EPA is responsible for
issuing guidance for Federal agencies to use in identifying
environmentally preferable products. Bio-based products and
environmental preferable are defined differently under the Executive
Order. Our objective is to identify areas of overlap that can benefit
both efforts.
For example, in developing the guidance on environmentally
preferable products, we are identifying rapidly renewable bio-based
products in our category of products with positive environmental
attributes. In working with NIST on life cycle assessment decision
support software, we are evaluating product categories that include
bio-based alternatives.
In addition, there are federal pilot projects underway or being
planned in 17 product categories. 12 of those categories have bio-based
alternatives. They include:
--printing, where the products include soy-based inks and bio-based
press cleaners;
--alternative fiber paper, made from annual crops (e.g., kenaf) or
agricultural waste (e.g., wheat, rye, or rice straw) which
would have been burned;
--degreasers, where aqueous-based solvents serve as alternatives to
halogenated solvents in parts washing.
We are actively seeking opportunities to further the federal goals
of promoting bio-based products in our environmentally preferable
purchasing efforts.
Question. What are the barriers that EPA sees in aggressively
implementing Executive Order 13101 and moving the government towards
bio-based EPPs?
Answer. The most significant barrier is the lack of infrastructure
to support and sustain environmentally preferable purchasing. Our new
emphasis on pilots, especially those enlisting traditional voluntary
standard setting organizations (like Underwriters Laboratories and the
National Sanitation Foundation) to help develop environmental
standards, is aimed at building the critical infrastructure at reduced
cost to the government.
New EPP tool development contributes to infrastructure, as well. We
are developing a series of tools for federal purchasers, including a
training program, a database of existing environmental standards, and
an assessment tool to incorporate life cycle considerations in
procurement decisions (developed by NIST). We are trying to build this
program as much as possible upon existing private sector capabilities
and expertise.
Competing goals have been an obstacle. Procurement officials have
struggled to reconcile environmentally preferable purchasing with the
goals of procurement reform and there have been sharp conflicts over
trade and environmental concerns. In addition, industry has generally
opposed efforts to make environmental impacts of products another
factor on which they must compete.
Question. The Committee provided an additional $1 million for this
initiative in the fiscal year 1999 budget. How are those added funds
being used?
Answer. The primary use for these funds will be to engage voluntary
standard setting organizations in developing environmental standards
and in developing tools to train and provide environmental information
to federal procurement officials. The funding break out is as follows:
Pilots ($405K)
The National Technology Transfer and Advancement Act of 1996
obliges the federal government to utilize standards and processes
developed by voluntary consensus-based organizations. We are drawing on
the private sector's capacity to develop environmental standards, as
they have for performance and safety, with this mandate. In particular,
we are looking to the traditional standard-setting organizations which
operate on voluntary and consensus basis.
We recently published a Federal Register notice soliciting private
sector involvement in identifying environmentally preferable products
and services. Several organizations, including Underwriters'
Laboratories, the National Sanitation Foundation, and ASTM, are very
interested in this effort and we anticipate that they will move forward
with developing environmental standards for one or more product
categories. Although this approach is still in the beginning stages, we
have received very positive reception from stakeholders in federal
agencies, in congressional offices, and in some environmental
organizations.
Tools to reach procurement officials ($310K)
We are developing tools for procurement officials, to help them
understand how to bring environmental factors into purchasing
decisions. We are supporting the development and refinement of the
National Institute of Standards and Technology (NIST)'s life cycle
assessment software which measures the environmental and economic
performance of building products. We are also developing a series of
tools to help federal purchasers understand the concepts of
environmental preferability and to facilitate access to available
environmental standards about products from a variety of sources. These
tools, which will be accessible through the EPP web-site in May, are
anticipated to be integrated into the Federal Acquisition Institute's
training for procurement officials.
Outreach ($235K)
Outreach includes case studies, the EPP Update Newsletter, outreach
to federal agencies, and the EPP website.
Coordination ($50K)
Coordination includes funds for Office of Federal Environmental
Executive, and support for the ``summit'' meeting of state/local/
federal green purchasing programs.
radon standards: air mitigation-technical assistance to small water
systems in rural areas
Question. EPA is moving forward with a drinking water standard for
radon which is usually associated with air pollution.
I understand that EPA is looking at a set of standards that may set
two different levels depending on whether a water system is also
engaged in a mitigation program to reduce radon levels in the air.
Clearly, air mitigation is a new area for water systems. I believe they
would need considerable technical assistance, particularly for our
smaller systems in rural areas.
If EPA moves ahead with such a dual standards system, what kinds of
support do you think would be appropriate to provide for smaller water
systems? What do you estimate would be an appropriate annual cost of
such a federal effort?
Answer. The radon rule will be one of the first to follow the new
cost-benefit analysis requirements of the 1996 Amendments to the Safe
Drinking Water Act (SDWA) and will be based on an innovative framework
designed to provide flexibility in risk reduction. The statute provides
for a Maximum Contaminant Level (MCL) as well as an alternative
(higher) Maximum Contaminant Level (AMCL) coupled with a multimedia
mitigation program to reduce radon in indoor air from soil gas. If EPA
promulgates an MCL ``more stringent than necessary to reduce the
contribution to radon in indoor air from drinking water to a
concentration that is equivalent to the national average concentration
of radon in outdoor air,'' SDWA requires the Agency to establish an
AMCL. The level of the AMCL is thus linked to the average outdoor radon
level.
If an AMCL is established, EPA must publish guidelines for state
multimedia radon mitigation programs. States may develop (and submit to
EPA for approval) a multimedia mitigation program to mitigate radon
levels in indoor air. EPA must approve state multimedia mitigation
programs if they are expected to achieve ``equal or greater health risk
reduction benefits'' than compliance with the MCL alone. If EPA
approves a state multimedia mitigation program, public water supply
systems within the state may comply with the AMCL. If states elect not
to develop multimedia mitigation programs, public water systems may
develop their own such programs and submit them to EPA for review and
approval.
We do not expect that State multimedia mitigation programs will
require that water systems be responsible for any more than meeting the
AMCL for radon in drinking water. Systems must, however, provide
information to their customers (through the Consumer Confidence
Reports) regarding whether they are meeting the MCL or the AMCL. Other
entities within the state will need to implement programs for the
reduction of radon in indoor air which comes from soil gas, as is the
case with the current voluntary state radon-in-air reduction programs.
We expect that many states will consider and adopt state multimedia
mitigation programs, thereby obviating the need for public water
systems to consider doing so independently. Until states make decisions
regarding whether or not to implement multimedia mitigation programs,
and until water systems consider their own options, it is difficult to
estimate what kinds of, and how much, support will be appropriate to
provide for the needs of smaller water systems. Under any circumstance,
however, EPA plans to provide both financial and technical assistance
to aid in the implementation of this rule. In addition, states are
authorized to use up to 2 percent of their annual Drinking Water State
Revolving Fund capitalization grant to provide technical assistance to
systems serving 10,000 or fewer people.
radon standards: increased costs for radon abatement in water
Question. I am told that there are about 160 deaths associated with
radon in water compared to 15,000 to 20,000 from air borne radon. This
is according to a 1998 National Academy of Sciences Report.
I am also told that the annualized cost of radon abatement in water
is estimated to be about $24 million nationwide per year on average to
meet a 4000 pico-curies per liter standard. It rises to $100 million at
a 1000 pico-curies standard and $800 million at a 100 pico-curies
standard. Is that correct?
Answer. The estimated annual costs of radon abatement mentioned
above, are drawn from EPA's Health Risk Reduction and Cost Analysis
(HRRCA). The HRRCA was published in the Federal Register in February
1999 as required by the 1996 Amendments to the Safe Drinking Water Act
(SDWA). The 4000 pico-curies per liter standard is the standard that
will be proposed as the alternative Maximum Contaminant Level (AMCL)
and is based on the recommendations contained in the National Academy
of Sciences (NAS) report, referred to above. The 1996 SDWA Amendments
require that if EPA promulgates a Maximum Contaminant Level (MCL)
``more stringent than necessary to reduce the contribution to radon in
indoor air from drinking water to a concentration that is equivalent to
the national average concentration of radon in outdoor air,'' the
Agency must establish an AMCL. The other two standards listed above
reflect a range within which an MCL will most likely be established.
We believe the opportunity to realize equal or greater human health
protection at lower cost from reducing radon in indoor air was the
principal motivation for the option developed by Congress in the 1996
SDWA Amendments, which provide for the AMCL and multimedia mitigation
alternative. We support this approach and will reflect this in the
regulation, supporting guidance, and in technical assistance to states
and public water systems.
radon standards: effect of radon rule
Question. Will the likely radon rule create a situation where we
will be forcing water systems and their customers to spend large sums
in order to bring the danger of drinking water to a point far below
that of breathing regular outdoor air?
Answer. It is likely that the Maximum Contaminant Level (MCL) will
create a standard that will result in radon levels from drinking water
in indoor air below the national average concentration of radon in
outdoor air. To address this possibility, the 1996 Safe Drinking Water
Act (SDWA) Amendments require that if EPA promulgates an MCL ``more
stringent than necessary to reduce the contribution to radon in indoor
air from drinking water to a concentration that is equivalent to the
national average concentration of radon in outdoor air,'' the Agency
must establish an Alternative Maximum Contaminant Level (AMCL). The
level of the AMCL is linked to average outdoor radon levels. The AMCL
coupled with a multimedia mitigation program to reduce radon in indoor
air from soil gas is designed to provide a less costly alternative for
mitigating radon in indoor air while still providing effective public
health protection. We support this approach and will encourage states
to develop multimedia mitigation programs that will enable the water
systems in their states to meet less stringent and more cost effective
AMCL. Individual water systems have the option of developing multimedia
mitigation programs in the event that states elect not to do so.
radon standards: impact of radon reduction on small water systems
Question. Coming from Iowa, I have a special concern for the impact
on small systems. And, for small systems the costs can be very high
indeed. While the cost of radon reduction might be $6 per person in New
York, it would be $20 in Des Moines and $34 in a system with a couple
thousand users. For the smallest systems the costs really escalate
further going to well over $300 per user for systems with fewer than
100 people. And there are a great many systems like that in Iowa.
I know you cannot give a figure for what is the maximum sum that
should be spent. But, I want to know if this subcommittee can have your
commitment that you will take personal care to establish standards for
systems that consider the real economic realities of smaller systems?
Answer. The Administration and EPA are committed to establishing
standards that fully consider the real economic realities of small
public water systems. We are acutely aware of the fact that, due in
large part to poor economies of scale, regulatory costs per household
dramatically increase for the smaller public water systems. Among other
steps aimed at fully considering the concerns of small public water
systems, we convened a panel under the terms of the Small Business
Regulatory Enforcement and Fairness Act (SBREFA) in which we
specifically discussed and reported on small entity concerns. This
report will be a part of the supporting documentation accompanying the
proposed rule. This panel process was informed by several meetings that
we conducted with approximately 20 representatives of small drinking
water utilities from around the country. One specific output of that
process will be an identification in the proposed regulation, and
supporting guidances, of affordable and simple-to-operate water
treatment technologies for small systems.
As mentioned in our response to some of your related questions on
the radon provisions of the 1996 Amendments to the Safe Drinking Water
Act (SDWA), we also think the most economical and cost-effective means
of compliance with this regulation, in general, will be for small
systems to meet the higher, alternative Maximum Compliance Level
(AMCL).
______
Questions Submitted by Senator Byrd
noX sip call: imbalance between control burden and
nonattainment
Question. On September 24, 1998, the EPA signed the regional
nitrogen oxide state implementation plan (NOX SIP Call)
requiring substantial reductions in emissions of nitrogen oxides from
various stationary sources in 22 Eastern states. The allocation of the
emission reduction burden appears to be inequitable and clearly in
conflict with the alleged purpose of the rule, which is to assist
downwind states in attaining ozone standards. The burden placed on
states like West Virginia is extremely high compared to many of the
Northeastern states. Given the fact that the EPA itself has
acknowledged that local source controls are more effective at reducing
ozone than reductions made at sources hundreds of miles away, how can
you justify this clear imbalance between the imposition of the control
burden and the need to address remaining nonattainment problems?
Answer. As you may be aware, the United States Court of Appeals for
the District of Columbia Circuit has recently issued two opinions that
may impact the NOX SIP Call. On May 14, 1999, the court
issued an opinion regarding the ozone and particulate matter air
quality standards that EPA revised in July 1997. American Trucking
Associations v. EPA, Nos. 97-1440, 97-1441 (D.C. Cir.). We disagree
with this decision and are recommending that the Department of Justice
take all necessary legal steps so that these important public health
protections may move forward. On May 24, 1999, the court stayed the
September 30, 1999 SIP submittal date for the NOX SIP call
pending further court action. State of Michigan v. EPA, No. 98-1497
(D.C. Cir.). We are currently analyzing the impact of these opinions on
several of our air quality programs, including the NOX SIP
Call. We hope to have a more complete picture of the impacts in the
near future.
By way of background, the EPA worked in partnership with the 37
easternmost States and the District of Columbia, industry
representatives, and environmental groups to address ozone transport.
From May 1995 to June 1997, the Ozone Transport Assessment Group (OTAG)
held meetings to identify and evaluate strategies for reducing long-
range transport of ozone and ozone precursors. This planning body was
brought together in recognition that ozone is not only a local issue,
but must be addressed as a regional problem. This multi-year
collaboration resulted in the most comprehensive analysis of ozone
transport ever conducted.
The OTAG and EPA modeling analyses indicate that upwind emissions
from States such as West Virginia contribute significantly to downwind
nonattainment problems. As a result, upwind emitters contribute to
unhealthful levels of ozone. It was EPA's judgment when it issued the
NOX SIP call that upwind States should reduce at least the
portion of their emissions for which cost-effective controls are
available. Further, it should be recognized that the major urban
nonattainment areas have been required to incur control costs for ozone
precursors since the early 1970's. These controls have already led to
substantial reductions in ozone levels. In addition, EPA has reviewed
the status of the northeastern States' efforts to comply with the
requirements of the 1990 Clean Air Act Amendments and has found that
these States have completed the vast majority of the SIP submission
requirements. In cases where those States have not made the required
submissions, they are subject to sanctions under the Clean Air Act.
noX sip call: analysis or studies on impact of individual
air quality
Question. In the past two years, the EPA has promulgated four major
new regulatory requirements and has focused much attention on the
electric utility industry to achieve the air quality goals set forth in
them. These rules include: (1) a new national ambient air quality
standard for ozone; (2) a new national ambient air quality standard for
fine particulates (PM 2.5); (3) the NOX SIP call in 22
Eastern States; and (4) a regional haze rule designed to improve
visibility in national parks, forests, and wilderness areas. In
addition, the EPA is in the process of finalizing a new rule to reform
the existing New Source Review regulatory program affecting existing
sources of power generation. The cumulative affects of these actions,
if they withstand judicial review, will be to drive up the cost of
electricity and force the premature retirement of some existing plants.
These policy objectives clearly appear to be in conflict. It is
troubling to me that these air quality issues are seemingly being
addressed with little regard for the associated economic, energy
supply, and national security implications associated with their
intended implementation. Has the EPA done any analyses or commissioned
any studies to determine how these individual air quality regulations
will cumulatively impact specific states of industries and their
ability to comply with these regulations?
Answer. As mentioned previously, the United States Court of Appeals
for the District of Columbia Circuit has recently issued two opinions
that may impact various air quality programs, including some of the
ones you mention. The answer that follows does not reflect how these
decisions may impact our programs, which we are currently analyzing.
In response to your specific question the EPA has conducted several
studies which addressed the rules identified in the question and the
electrical power generation sector. These included the Clean Air Power
Initiative Study, 1996; the Regulatory Impact Analyses for the
Particulate Matter and Ozone National Ambient Air Quality Standards and
Proposed Regional Haze Rule, 1997; the Regulatory Impact Analysis for
the NOX SIP call, 1998; and, the Regulatory Impact Analysis
for the Final Regional Haze Rule, 1999.
These assessments are designed to look at the incremental effects
of separate but related rule makings. The results of these analyses
illustrate the complementarity amongst the related rules. Since ozone
and particulate matter share some of the same precursor gases, control
strategies designed to reduce emissions of these precursors can lower
ambient concentrations of both pollutants. Also, because of the
interrelationship between these pollutants and their precursors,
strategies aimed at meeting the national ambient air quality standards
(NAAQS) for both pollutants will also improve visibility at mandatory
Federal Class I Areas. For example, the Final Regulatory Impact
Analysis for the Regional Haze Rule found that mandatory Federal Class
I areas in the Midwest/Northeast and Southeast met or exceeded a
variety of illustrative reasonable progress goals through 2018 as a
result of strategies targeted at the particulate matter and ozone
NAAQS. Hence, although we have issued multiple rules responding to
different mandates, the impacts are not necessarily additive.
Although the EPA has not done a cumulative assessment, the
aforementioned economic studies do address the energy supply and
economic considerations. In fact, the Department of Energy is part of
the interagency review process for the Regulatory Impact Analyses. But,
there are limits to these as well as cumulative impact studies
especially given the discretion the States have in designing State
implementation plans, emission management strategies, and reasonable
progress goals for Regional Haze. Such caveats are noted in the various
Regulatory Impact Analyses.
In addition, EPA has conducted extensive analyses of the impacts of
the NOX SIP call. The Agency assumed only cost-effective and
technically feasible NOX controls when developing the State
budgets and supported those assumptions with analyses in the docket. In
the Agency's report, Analyzing Electric Power Generation Under the
CAAA, EPA investigated the impacts of the control levels assumed in the
SIP call on the electric generation sector and found controls of .15
lb/mmBtu were cost-effective (about $1500/ton). In the Agency's report,
Feasibility of Installing NOX Control Technologies by May,
2003, EPA looked specifically at the ability of the electric generation
sector to install control technologies in the time frame required by
the NOX SIP call and found that this sector should be able
to comply with the regulations. In addition, the Agency examined the
impacts of a section 126 rulemaking or a Federal Implementation Plan on
small entities as well as municipally-owned entities.
noX sip call: noX reductions compliance deadline
Question. The electric utility industry and several states have
raised concerns about the ability to comply with very stringent
NOX reduction requirements in a very short time frame
without threatening the reliability of electrical supply in the
affected and neighboring states. Midwestern electric utilities will
have to take many of their facilities offline to install new
NOX controlling technologies under the NOX SIP
Call. This could place additional pressures on the electricity grid
because the seasonal window for installing these technologies is
limited so as not to disrupt the power supply during high demand
periods. Given these limited time frames, the North American Electric
Reliability Council is preparing a comprehensive report to assess this
issue. If it should determine that the compliance deadline poses a
certain threat to the reliability of electricity, will the EPA be
willing to extend the compliance deadline to alleviate this problem?
Answer. As mentioned previously, the United States Court of Appeals
for the District of Columbia Circuit has recently issued two opinions
that may impact various air quality programs, including the
NOX SIP Call. The answer that follows does not reflect how
these decisions may impact our programs, which we are currently
analyzing.
In response to your particular question the EPA looked thoroughly
at the issue of threats to the reliability of electricity in developing
the NOX SIP Call compliance dates and found that reliability
problems should not emerge. See Feasibility of Installing
NOX Control Technologies by May, 2003, EPA, September 1998.
However, in response to concerns about the potential effects of the
rule on the availability of electricity, the final rule creates an
additional pool of emission credits for each State to use. States may
issue the emissions credits to sources that achieve their emission
reductions earlier than required or to sources that demonstrate a need
for relief from the compliance deadline.
The North American Electric Reliability Council (NERC) raised the
NOX SIP Call as a concern for the future in its 10-Year
Reliability Assessment report last fall in the executive summary. Two
other studies, one by a section of NERC, the MAIN region, and a second
by M.J. Bradley and Associates, did not find that the SIP call would
cause a reliability problem.
The Ozone Transport Assessment Group (OTAG) that worked together
for two years to address the ozone transport issue was a partnership of
the 37 easternmost States, the District of Columbia, EPA, environmental
groups, and industry representatives, including the utilities industry.
EPA has worked with the utilities industry in this and other capacities
and will continue to work with utilities to develop and implement cost-
effective pollution controls without compromising the industry's
ability to provide service to its customers.
EXECUTIVE OFFICE OF THE PRESIDENT
Council on Environmental Quality and Office of Environmental Quality
STATEMENT OF GEORGE T. FRAMPTON, JR., ACTING CHAIR
Senator Bond. In order to accommodate Senator Craig, we
will now call Mr. Frampton up and ask him to begin with a--if
you would a summary of your opening statement as briefly as
possible and we will then turn to Senator Craig. We welcome you
to the committee.
We are in the home stretch. Mr. Frampton, welcome before
this committee.
Mr. Frampton. Mr. Chairman, thank you for the opportunity
to appear before you and to present the President's proposed
budget on environmental quality. Since I have not worked with
this subcommittee in my 4 years with the Interior Department,
I've tried to get around to see each person personally before
this hearing. I did not succeed in this but I hope to be able
to succeed in doing that in the coming week, those members I
did not get to see before.
I have submitted a written statement. You have our budget
justification. Since I know that you and Senator Craig want to
get to questions, let me just take a minute to summarize. We
are asking for an increase for fiscal year 2000 of $345,000 for
a total amount of $3,020,000. It is the same we asked for last
year and the year before.
The principal need that I see, as the new acting chair here
since November, is to have a few more staff people to work on
issues that relate to building partnerships between Federal
agencies and stakeholders and partnerships between Federal
agencies and State and local governments not only in the
administration of environmental impact statements and reviews,
but in just seeing that the Federal family speaks with one
voice and works with State and local government. Two examples,
Mr. Chairman, and then I will conclude.
There was some discussion this morning about the Food
Quality Protection Act. That is an example of a situation in
which Congress passed really a landmark statute. Tremendous
opportunity is there to improve health. But after it passed,
people realized what some of the ramifications were for
manufacturers and for people who grow the produce. And CEQ was
instrumental in making sure that EPA and the U.S. Department of
Agriculture could get together and create a process that would
give the folks who were regulated and who would grow the
products some sense that it would be based on science and it
would be rational.
I am sorry that last week some of the environmental folks
walked away. I think we are going to go ahead and do this right
and I think CEQ is a part of that. I hope we will be successful
in the future and I hope those people come back.
The second example is last fall the Governors of Oregon,
Washington, California and Alaska wrote to the Vice President
asking that the Government set up a coastal salmon fund, the
money going directly to the Governors and the Tribes to help
them deal with salmon restoration challenges. There is a
proposal in the President's budget fiscal year 2000 to do that.
They asked that we make sure that the money got to the
Governors with a minimum of paperwork and rules but that there
was a system for accountability.
prepared statement
These are the kinds of issues that I think CEQ is uniquely
well positioned to work on. It is for these kinds of programs
that we are asking for a budget increase. With that, Mr.
Chairman, I hope to answer any questions.
[The statement follows:]
Prepared Statement of George T. Frampton, Jr.
Mr. Chairman, Senator Mikulski, members of the Subcommittee: I am
pleased to appear before you today to testify on behalf of President
Clinton's fiscal year 2000 budget request for the Council on
Environmental Quality (CEQ) and the Office of Environmental Quality
(OEQ) (hereinafter collectively referred to as CEQ). The President's
request is the same as in fiscal year 1999--$3,020,000 and 23 Full Time
Equivalent (FTE) staff positions, an increase of $345,000 over CEQ's
enacted fiscal year 1999 budget. The increased budget request reflects
the President's ongoing commitment to a CEQ that fully satisfies its
statutory obligations under the National Environmental Policy Act
(NEPA).
Before outlining for you some of CEQ's major accomplishments this
past year, and our objectives for the coming year, I would like briefly
to describe our agency, the role it plays in the Federal family, and
how we have defined our mission under the leadership of President
Clinton.
CEQ was created by the Congress in 1969 with strong bipartisan
support amid growing concern about the state of our environment. NEPA,
the statute that established CEQ and defined its goals and
responsibilities, is truly a landmark law. It declares it to be the
policy of the Federal government ``to use all practicable means and
measures * * * to create and maintain the conditions under which man
and nature coexist in productive harmony, and fulfill the social,
economic, and other requirements of present and future generations of
Americans.'' CEQ strives to serve those ends in a number of ways. The
agency advises and assists the President in developing environmental
policies and legislation; assesses and reports on trends in
environmental quality and recommends appropriate response strategies;
coordinates the environmental activities of all federal agencies and
departments; fosters cooperation among federal, state and local
governments, the private sector and the public; oversees agency
implementation of the environmental impact assessment process; and
mediates disputes regarding the adequacy of such assessments and the
policy judgments inherent in them.
This is an ambitious portfolio for a small agency, and one of
utmost importance to our Nation. Twenty-nine years after Congress so
wisely sought fully to integrate environmental concerns into federal
decision making; our challenges have grown only more daunting, and the
need for innovative solutions all the more imperative. Our actions are
guided by three core principles. First--and this is clear in the very
words of our authorizing statute--our goal is not to balance the
environment and the economy as if they are competing interests, but
rather to demonstrate their fundamental interconnection. The choice
between the economy and the environment is a false one. The economy and
the environment can and must go hand in hand. Second, we must move
beyond the chronic conflict that too often characterizes environmental
decision making and forge collaborative approaches that meet our common
needs. And third, we must devise innovative, common sense solutions
that achieve the greatest protection for our environment while
minimizing the burden on taxpayers and the regulated community.
I am pleased to report that CEQ has made great strides in advancing
these principles, both as we carry out our day-to-day responsibilities
and through focused efforts to reshape federal environmental programs.
CEQ is working to reinvent the way government goes about protecting
our environment. For instance, CEQ has helped forge public-private
partnerships to protect water quality through incentives to landowners
and to produce the cutting-edge technology that will triple the fuel
efficiency of the American car. We are encouraging collaborative
efforts to protect habitat before species become endangered and to
avoid future flood damage by offering communities a range of options in
preparing for and responding to floods. We are promoting job creation
through support for the $180 billion-a-year environmental technology
industry. We are working with federal agencies to streamline
regulations and environmental reviews, saving precious time and
taxpayer dollars. And we helped formulate the Administration's climate
change policy, which would harness market forces to achieve cost-
effective reductions in greenhouse gas emissions.
CEQ is working to break gridlock and resolve longstanding disputes.
For instance, CEQ intervened to resolve a ten-year impasse among
federal resource agencies, state environmental agencies, and a local
development agency concerning the development of a Special Area
Management Plan for the Hackensack Meadowlands in Northern New Jersey.
We are hoping to conclude this process, and to develop a better model
for comprehensive wetlands planning that provides certainty to the
regulated community and closer partnership with state regulators, while
enhancing environmental protection.
CEQ is working to formulate comprehensive policy and coordinate the
environmental actions of all federal agencies. For instance, CEQ
coordinated land acquisition strategy with regard to the Everglades
restoration, including closing on the transaction involving the
Talisman tract in the Everglades Agricultural Area; helped to develop
the Administration's initiative to reduce environmental health and
safety risks to children; and oversees a series of initiatives to
harmonize our environmental policies as they affect America's farmers
and ranchers.
CEQ provides an institutional avenue to address special needs and
concerns that cannot be addressed in a timely manner without the
discipline and focus that CEQ can bring to the process. Recently,
Representative Lowey asked to expedite an interagency process because
the opportunity to dredge Mamaroneck harbor would have been lost if
decisions had been delayed past the first of the year. Just last week,
we helped Governor Vilsack resolve disputes among Federal and State
agencies concerning permits for the urgently needed closing of
agriculture drainage wells in Iowa.
Finally, CEQ is working to restore and preserve precious
environmental values for future generations of Americans. Over the past
year, we have played a critical role in efforts to protect Yellowstone,
the Everglades, and our oceans.
In fiscal year 1999 CEQ has an approved level of 23 FTE positions.
This staffing level is below the total allowed by the fiscal year 1993
enacted level, which itself was less than half the historic peak for
the agency. I believe the fiscal year 2000 budget request will permit
CEQ to fulfill its statutory requirements and make continued progress
toward the goal of common sense, cost-effective environmental
protection.
partnership program
In the fiscal year 2000 budget request, CEQ is proposing additional
funding to enhance its ability to assist federal departments and
agencies in responding to requests from states, metropolitan and local
governments, and businesses for partnership opportunities. For example,
the Administration's fiscal year 2000 budget proposes funding:
--to promote smart growth, where local governments have already
developed plans and are seeking federal partners;
--to protect open space including greenways in urban, suburban, and
near-urban areas;
--to promote the retention of agricultural land near expanding
residential areas in traditional agricultural use;
--to protect sensitive habitat in the context of metropolitan,
regional, and ecosystem planning; and
--to clean up and restore bays, estuaries, and rivers.
These programs pose new partnership opportunities, but additional
potential challenges for CEQ.
The President's budget proposals provide the resources that state
and local governments and community leaders need to advance local and
regional initiatives for environmental protection in partnership with
the Federal government. Building more effective partnerships increases
the need for the leadership and discipline CEQ can bring to issues that
involve numerous agencies with very different missions. This is
illustrated by our involvement in our ongoing major partnerships which
include the following: the Natural Communities Conservation Planning
process in which Orange, San Diego, and Riverside Counties in southern
California are doing comprehensive planning with cities, real estate
developers, environmentalists, businesses and scientists and the
federal government to avoid future Endangered Species Act and Clean
Water Act mandates; Everglades Restoration; the use of Habitat
Conservation Plans (HCPs) with timber companies in the Southeast and
Northwest; restoration of the San Francisco Bay-Delta (CALFED); a
recent Utah land purchase; and the protection of Sterling Forest in New
York and New Jersey.
We believe that there are additional opportunities for more
effective partnership. This new partnership approach could foster many
additional opportunities. For example:
The Governors of California, Oregon, Washington and Alaska and the
tribes have asked for new federal funding for coastal salmon
restoration plans to be developed and implemented by the States, and
have also asked for federal coordination by the Acting Chair of CEQ to
ensure that the federal agencies are working together in a partnership
with the state on these important plans. The Executive of King County
and the mayors of Seattle and other cities around Puget Sound have
asked for a similar effort to assist their MetroSmart Growth Initiative
in a way that also helps them and major businesses in the area recover
salmon as well as preserve open space and plan urban and suburban
densities.
In northern New England, bipartisan legislation has been introduced
seeking federal funding, technical assistance, and coordination to
allow the states (and non-profits) to purchase easements protecting the
working forests from development and pollution. This legislation would
advance the overall goal of preserving the quality of rivers, the
working forests, timber-dependent communities, open spaces, and access
to recreation for millions of Americans--not only those of the region
but those within a day's drive of these vast forests.
As issues of watershed degradation, loss of open space and
agricultural land, and sprawl attract the attention of more Americans
as a premiere ``quality of life'' issue, urban metropolitan and state
governments which bear the principal responsibility for addressing
these issues are seeking federal funding, federal technical assistance,
and limited strategic use of federal mandates to make their jobs easier
(or, in some cases, remove federal barriers to solutions).
Only CEQ in many cases can provide the coordinated federal agency
response that is helpful in forging these partnerships. No single
individual at CEQ is tasked to respond to these initiatives. We believe
that a program allowing us to devote a senior staff member to undertake
such efforts will pay countless dividends to state and local government
and their business and environmental partners.
accomplishments of the council on environmental quality
Over the past year we have endeavored to live up to the promise of
NEPA--exercising fully our responsibility to coordinate policy and
resolve disputes, advancing a new way of doing business, promoting
consensus-based decisions, providing advice and guidance, responding to
emergencies and resolving interagency disputes as early as possible,
thus avoiding the need for more formal, time-consuming processes. We
also have worked very hard to respond to matters raised by the Congress
last year. This portion of my testimony will report on some of our
achievements during the past year and on some projects that we hope to
accomplish in the coming year.
statutory integration
CEQ is identifying sites for pilot projects that integrate
compliance requirements under a range of statutory authorities and
programs. The purpose of this effort is to develop local, on-the-ground
models of comprehensive environmental planning that build on the
objectives and principles explored by the Center for Strategic and
International Studies (CSIS), the National Academy of Public
Administration, the Keystone Center, and others (see The Environmental
System in Transition: Final Report of the Enterprise for the
Environment (CSIS 1998)). Ideally, these models would provide more
effective resource protection strategies while offering greater
certainty and flexibility to the regulated community. In many cases,
initial planning done under the Endangered Species Act, particularly
for HCPs, can be the building block or the model for more comprehensive
strategies that employ a ``no surprises'' approach incorporating a
broader array of statutory requirements. The following examples suggest
promising areas for this approach.
Pacific Northwest.--Successful coordination among Federal, state,
and tribal resource agencies to respond to threatened and endangered
salmon has established framework for regional coordination under the
Endangered Species Act and the Clean Water Act. An integrated approach
would expand this model to integrate remedial work under Superfund and
the Natural Resource Damage programs and offer expedited resolution of
compliance and restoration issues for responsible parties.
Southern California.--Dairy producers in the Santa Ana Watershed
have asked for CEQ's assistance in integrating agricultural and clean
water requirements in the area. Residents in Irvine and Newport,
California, have asked for CEQ's assistance in expanding their Natural
Communities Conservation Plans (HCPs in Orange County and San Diego
County) under the Endangered Species Act (administered by the
Department of the Interior and the National Oceanic and Atmospheric
Administration) to incorporate a comprehensive wetlands management plan
under the Clean Water Act (administered by the Army Corps of Engineers
and the Environmental Protection Agency (EPA)).
dispute resolution
CEQ is a mediator between agencies and our efforts often prevent
stalemates and litigation.
The U.S. Institute for Environmental Dispute Resolution,
established by Congress in 1998, is open for business in fiscal year
1999. The Institute is authorized to resolve environmental disputes
among federal agencies or between a federal agency and a non-federal
party, as well as offering training and other services associated with
alternative dispute resolution. Congress placed the Institute under the
auspices of the Morris K. Udall Foundation, which was established in
1992 as an independent agency of the Executive branch and is governed
by a Presidentially-appointed, Senate confirmed board. Because the
Institute's role is linked to the NEPA and CEQ's role in interagency
dispute resolution, Congress made CEQ an ex officio member of the Udall
Foundation Board when it created the Institute. In that role, CEQ has
been helping to advise the leadership of the Institute as it
establishes its program. In addition, under the authorizing
legislation, CEQ must concur in federal interagency disputes being
referred to the Institute.
CEQ worked with the Idaho Congressional Delegation to ensure that
the Air Force and the Bureau of Land Management worked together to
provide a streamlined and efficient NEPA analysis upon which to base a
decision on the Idaho Bombing Range. Further, CEQ worked with the
Congressional delegation to provide sufficient mitigation measures to
ensure the habitat for the bighorn sheep and other sensitive species
was preserved.
A large number of the nation's hydropower facilities will be under
consideration for relicensing by the Federal Energy Regulatory
Commission (FERC) in the near future. These relicensing processes
involve consideration of a number of environmental issues within the
expertise and jurisdiction of a variety of Executive Branch agencies
including the Departments of Agriculture (USDA), Commerce, Interior and
the EPA. CEQ is working with a team of all agencies involved in the
relicensing process including the FERC to ensure consistency and
efficiency of consideration of environmental issues during the
relicensing process.
CEQ has worked with the Departments of Defense, Transportation, and
the EPA, and interested Members of Congress to address serious public
health, environmental, and worker safety concerns that have been raised
in connection with export of surplus vessels for scrapping by overseas
scrapping yards. This work culminated in an Administration decision
(September 23, 1998) to extend for one year an initial moratorium on
overseas ship-scrapping while agencies work to identify opportunities
to scrap surplus vessels under appropriate safeguards in U.S. yards.
CEQ will continue to oversee implementation of the directive as well as
to decide any requests for exceptions.
CEQ managed an interagency team including the Federal Aviation
Administration, Department of Interior, National Park Service and
Department of Transportation to craft a solution to the contentious
issue of parks overflights. This effort culminated in issuance of final
rules governing overflights in Grand Canyon and Rocky Mountain National
Parks published on October 31, 1997, which balanced the needs of
aircraft operators with those who prefer maximizing quiet in those
parks. Administration work continues on additional aspects of the Grand
Canyon issue including drafting of new flight corridors. In addition,
CEQ coordinates the ongoing work on a national rule to provide general
guidance to those grappling with these issues in other parks, as well
as to interagency efforts to ensure that any regulation of overflights
deemed necessary is streamlined, efficient, and fair to all concerned.
An advisory group of stakeholders established as part of this
interagency effort to assist the agencies has produced a template for
this rule that also has been a model for legislative initiatives to
address this issue.
policy coordination
As mandated by the National Environmental Policy Act, CEQ's role is
to advise the President on environmental policy matters and coordinate
activities of the federal agencies and departments with regard to
environmental matters that cross agency jurisdictional lines. In the
past year, CEQ has played a role in the development and coordination of
policies that have more effectively integrated environmental, economic,
and social objectives into federal decision making. Outlined below are
a few recent efforts undertaken by CEQ.
CEQ has coordinated the federal response to the environmental
threat and public health concerns associated with Pfiesteria
piscicidia, the organism linked to massive fish kills in Maryland,
North Carolina, and Virginia. After pfiesteria outbreaks resulted in
closure of several Chesapeake Bay tributaries in the summer in 1997,
CEQ organized the work of federal agencies to provide affected states
with needed federal support, ensuring that federal resources were
deployed effectively and wisely. CEQ has been monitoring the work of
involved federal agencies through regular meetings to develop a
coordinated research strategy and to ensure that other steps are
closely coordinated and responsive to the states. CEQ also worked
directly with Congressional offices to arrange briefings for the
delegations of affected states to keep Members fully informed
concerning the Administration's efforts. On August 6, 1998, Chief of
Staff Erskine Bowles announced targeted support for North Carolina in
response to a significant pfiesteria outbreak in the Neuse River. CEQ
coordinated this response.
CEQ continues its work with EPA and USDA, the co-chairs of the
Clean Water Action Plan announced by President Clinton on February 19,
1998, to coordinate the efforts of all of the federal agencies in
addressing the second generation of water quality protection under the
Clean Water Act. Through the Action Plan, CEQ is developing and
supporting a series of locally-led water quality initiatives, beginning
with the Administration's Seacoast Estuary initiative in New Hampshire,
which will cut in half the time required to reopen shellfish beds that
have been closed by polluted runoff.
CEQ has overseen a series of initiatives to harmonize our
environmental policies as they affect America's farmers and ranchers.
CEQ has worked with USDA to focus conservation programs on
environmental goals. CEQ developed the Administration's process for
ensuring that agricultural groups and other affected constituencies are
effectively heard as EPA implements tougher public health protections
under the Food Quality Protection Act. CEQ is coordinating the work of
the White House Wetlands working group on a new policy for wetlands
delineation on agricultural lands, so that farmers and ranchers, to the
extent the law permits, will get reliable wetlands guidance from one
agency. Working with USDA and interested states, CEQ has accelerated
development of Conservation Reserve Enhancement Program agreements,
such as those announced recently in Oregon and Washington, which
deliver more than $200 million in new support in each state for farmers
acting to protect critical habitat and water quality.
CEQ has initiated a dialogue among academics, citizen groups, and
interested Federal agencies concerning the erosion of citizen access to
courts to enforce environmental laws, particularly with respect to
community right-to-know about toxic releases. We expect that this
dialogue will help shape legislative proposals that could be considered
as freestanding legislation or in the context of major statutory
reauthorizations.
To celebrate the U.N. Year of the Ocean, the Administration held a
National Oceans Conference in Monterey, California in June, 1998. The
conference, co-chaired by the Department of Commerce and the Department
of Navy, involved departments and agencies that manage programs
affecting the oceans, a vital natural resource. CEQ is monitoring
progress toward implementing those proposals.
Working with the Domestic Policy Council, other White House
offices, and affected agencies, CEQ helped to develop President
Clinton's initiative to reduce environmental health and safety risks to
children. A Presidential Executive Order, which was announced on April
21, 1997, requires federal agencies to assign high priority to
addressing these risks, to strengthen policies to protect children, to
coordinate agency research focused on children's health, and, as
suggested by the report of the National Academy of Sciences, to ensure
that agency standards take into account special risks to children. The
Administration's fiscal year 2000 contains an expanded effort to
achieve these objectives.
The Administration's effort to restore the Everglades made
significant progress in 1998. The Army Corps of Engineers released the
draft ``restudy'' of the Everglades ecosystem and went through an
extensive public comment period. CEQ coordinated land acquisition
strategy, including closing on the transaction involving the Talisman
tract in the Everglades Agricultural Area. CEQ continued to help
resolve interagency disputes involving Everglades restoration including
the issues involved in the preparation of the Supplemental
Environmental Impact Analysis on the redevelopment of Homestead Air
Force Base and measures needed to ensure the protection of the Cape
Sable Seaside Sparrow.
a new way of doing business
The Clinton Administration is committed to reinventing the way
government operates so that it works better and costs less. CEQ
continues to take the lead in reinventing federal environment policy by
encouraging approaches that work to reduce burdens, break gridlock,
provide incentives, and build partnerships with state and local
government and the private sector. Below are some examples of how CEQ
accomplishes this task.
The introduction and spread of invasive species in the United
States is a major ecological and economic problem for diverse
environments and economies in the United States. Invasive species are
generally considered to be the second biggest threat to native wildlife
(following habitat destruction). Approximately $5 billion per year are
spent by ranchers and farmers in this country for noxious weed control,
and indirect costs in losses to crop and rangeland productivity are
estimated at about $7.4 billion per year. Utilities spent $3.1 billion
over the last ten years to control invasive species.
To address this difficult problem in a coordinated, systematic
manner, the President recently issued an Executive Order on invasive
species. The Order establishes an interagency council to coordinate
federal efforts to address this problem, as well as an advisory
committee to involve state, tribal and local governments, scientists,
commercial interests, conservation organizations and academic
institutions in developing and implementing solutions.
CEQ has worked with EPA, the Chemical Manufacturers Association,
and the American Petroleum Institute on a challenge to industry to
produce basic public health data on the 3000 chemicals now in high-
volume use in the United States. Under a voluntary agreement announced
on October 14, 1998, U.S. chemical firms have agreed to a schedule to
produce all of this data and to make the data available to the public.
CEQ is working to support the domestic effort by ensuring continued
Administration pressure on overseas firms and governments to contribute
their fair share to the testing effort.
CEQ initiated and is overseeing an ongoing process to develop
administrative reforms to guide programs for restoring natural
resources and recovering damages for the costs of such restoration.
This process is a response to concerns among natural resource trustees
about the extent to which federal and state cleanup programs take
natural resource issues into account and strong concern in the business
community that natural resource trustees might require cleanup measures
that would be inconsistent with remedial steps required by EPA and
state response agencies responsible for toxic waste cleanup.
As part of President Clinton's initiatives for reforming
environmental regulation, CEQ coordinated the development of bipartisan
alternative compliance legislation to provide greater regulatory
flexibility to firms that can achieve superior environmental results at
reduced cost. This bill, introduced in the Senate by Senator Lieberman
and in the House by a bipartisan coalition of Members, builds on the
success of EPA's Project XL program, enabling EPA to overcome statutory
impediments to greater program flexibility. CEQ will coordinate the
Administration's work in advancing this or similar proposals and is
currently working with Members of Congress who have been developing new
alternative compliance proposals as the basis of bipartisan legislation
in the 106th Congress.
The President's Council on Sustainable Development (PCSD) is a
federal advisory committee that includes members of the President's
cabinet, corporate CEOs, national environmental leaders, local
officials, and representatives of other interests. CEQ is the lead
agency coordinating the work of the PCSD. In March 1996, the PCSD
produced a report entitled, ``Sustainable America; A New Consensus for
Prosperity, Opportunity, and a Healthy Environment.'' Since 1996, the
PCSD has continued to work to implement recommendations in
``Sustainable America,'' as well as developing new policy
recommendations for the Administration. The PCSD is also the sponsor of
the ``National Town Meeting for a Sustainable America.'' This event
will occur from May 2 to May 5, 1999. The hub event will be in Detroit,
Michigan, with concurrent events to be held simultaneously in
communities across the nation. The National Town Meeting will serve as
a means to foster and promote innovative practices in business, in
government, and in communities that can help harmonize our nation's
economic, social, and environmental goals.
Among the recommendations contained in the PCSD's ``Sustainable
America'' report, are policies to build more sustainable communities,
including recommendations concerning ``collaborative regional
planning.'' These recommendations reflect a growing concern across the
nation about the traffic congestion, loss of open space, and reduction
of quality of life that can result from sprawl development. They also
respond to growing interest in encouraging greater cooperation among
cities, suburbs, and surrounding rural areas within a region to address
transportation and land use issues that cross local jurisdictional
boundaries. These issues will remain a high priority at CEQ in the year
ahead.
nepa reinvention
One of the overarching goals of CEQ is to achieve higher levels of
environmental protection with lower costs and less red tape. CEQ has
made important strides in improving the way NEPA operates in its day-
to-day administration. Improving NEPA implementation fundamentally is
the purpose of the NEPA Reinvention Project, a multi-phased effort
aimed at the NEPA process across all federal agencies. CEQ was given a
small increase in fiscal year 1999 appropriations to build on our work
to reinvent NEPA through this project. However, a statutory restriction
in the CEQ appropriations bill continued a prohibition on the use of
agency detailees by CEQ, preventing CEQ from using a detailee to
support NEPA reinvention work in fiscal year 1999 as CEQ had in fiscal
year 1997.
Last year, CEQ was able to make notable progress in our efforts to
reinvent NEPA. For example:
CEQ has been working with the Army throughout the year to provide
advice and assistance in streamlining its NEPA regulation. We expect in
the coming year the Army will issue a draft regulation for public
comment.
CEQ has been working with the Department of Energy throughout the
last year in its efforts with NEPA reinvention by participating in a
symposium hosted by the National Association of Public Administrators.
A final report was issued by NAPA on further actions DOE should take to
make their regulations more efficient and effective.
CEQ has been working with the National Oceanic and Atmospheric
Administration (NOAA) to streamline the NEPA process that is part of
the national marine sanctuaries' management plan revision process. The
majority of the nation's twelve national marine sanctuaries will be
revising their management plans within the next few years, and CEQ has
worked with the sanctuary managers and NOAA headquarters to establish a
blueprint for moving forward with revisions in an organized, efficient
and timely manner.
In energy policy, CEQ has started to work with the appropriate
agencies to expedite review of natural gas pipeline projects and has
also supported the Federal Energy Regulatory Commission's recent
proposal to eliminate ex parte requirements for purposes for the
environmental impact assessment process.
Mr. Chairman, Senator Mikulski and members of the Subcommittee, as
the Acting Chair of CEQ, I am committed to continue the work that our
agency was chartered to do 29 years ago. CEQ plays an important role in
making sure that the federal family speaks with one voice on
environmental issues. With the modest additional resources that we have
requested, we can fulfill this role with an even greater effectiveness.
I look forward to working with you in the coming year.
Thank you for the opportunity to appear before the Subcommittee. I
am happy to answer any questions you might have.
Senator Bond. Thank you very much, Mr. Frampton. Senator
Craig.
ceq responsibility
Senator Craig. Thank you very much, Mr. Chairman.
George, it is good to have you before the committee and I
hope we can reschedule the meeting. We were not able to get
together today. I have got several areas I would want to visit
you about.
I guess the value of the length of time we spent with Carol
gave me time to read your testimony because I had not had that
opportunity yet. Let me suggest one thing to you, which is my
first impression of it, and I know a first impression is not
the best approach. I am a bit astonished at the broadened, wide
range of responsibility that you suggest CEQ ought to have or
does have. I say that because I always felt, as many do, that
some of these problems we have can best be solved at a more
local level, and I am not sure that CEQ is headed in that
direction.
fish mitigation process
For instance, you cite on Page 5 of your testimony that you
have successfully coordinated or are successfully coordinating
among Federal, State and Tribal resource agencies to respond to
threatened and endangered species of salmon in the Northwest.
That is something I am spending much time on in the West and in
the Northwest. Quite honestly, I am not aware of any successful
coordination yet. I am very aware of struggling, power
struggles, lawsuits and a region that now feels very, very
threatened by the potential impact of decisions made by Federal
agencies as it relates to a fish mitigation process.
And I suggest to you that there is not yet time to take
credit for having solved a problem that is still in the phases
of being designated. And tragically the lines are still getting
drawn out there as to how big the battle is going to be over
this issue. That is a tragedy. That is my first reaction.
different purposes
Let me also suggest, you conclude in your testimony that
CEQ plays an important role in making sure--you mention the
Federal family speaks with one voice and you cite. I want the
right hand and the left hand of Government to know what they
are doing. Let me suggest to you, and you know it, that U.S.
Fish and Wildlife Service is required to protect and enhance
fisheries throughout the country. FERC is required to balance
that interest with the need for power development. And my guess
is those are two very different roles. And I am not sure that
FERC speaks of coordinating actively with Fish and Wildlife
Service. There are different purposes. Isn't there a natural
relationship that agencies must have, some degree of
understanding? That is another concern.
So I guess the question is if CEQ's job is to oversee the
balancing work of FERC and if that is the case, who is in
charge? And the same thing would be with U.S. Fish and Wildlife
Service.
I have grown to be very concerned that CEQ gets into
micromanaging decision making that goes on in other agencies
simply because of where it rests in the hierarchy of any
administration and sometimes that becomes a political decision
and not a decision based on good science. It is the politics of
the administration or of the day, instead of the right decision
coming out of the process of long term working it through the
laws of these different agencies.
I would tell you that not on my watch will CEQ become the
super agency of managing the Federal Government. I don't think
that was our intent. And if that is where it appears to be
headed, then it will be my intent to work with the Chairman to
make sure that doesn't happen.
I want you to have tools but I do not want you to have the
power to cram it down Interior or U.S. Fish and Wildlife or
FERC's throat that which they, by law, by policy of the
Congress and Government have the right to do.
I guess that is my question and my concern, George.
Senator Bond. What was the question?
Senator Craig. It is a multiple.
Mr. Frampton. Let me try to put a question together and----
Senator Craig. First of all, are you planning to become a
super agency?
Mr. Frampton. No. I think it is--you asked me for a
personal response and I gave that. After 4 years at the
Interior Department, which was a very good preparation for
coming to CEQ because I have seen this from an agency
perspective. And I have no desire to either run or micro-manage
agencies. In fact, to the contrary. I have said for the last
few months and keep saying to my own staff and others from the
agencies and the White House, we are here to help the agencies
do their job and make them work together and solve
discontinuities and help them work with State and local
governments. We are not here to run their programs. So that is
a strong philosophy that I have, to push things back to the
agencies where they belong.
On the salmon issue, I did not intend in my testimony to
take credit for any great coordination to be achieved, only to
identify a great challenge. I agree with you, there are
terrible problems, lots of agencies, Tribes and States. But CEQ
was created in some part by Congress in 1969 as a place free of
what commentators have called agency bias, commitment to a
particular regulatory scheme or a particular agency mission, to
try to harmonize different agency objectives and also to
balance them with social and economic considerations.
So I think there is an important role for CEQ. But it is
the role of a mediator and a catalyzer, not the role of a czar.
Senator Craig. Thank you. Mr. Chairman, thank you for the
courtesy.
Senator Bond. Thank you very much, Senator Craig.
superfund
Mr. Frampton, I am interested in discussing Superfund. What
you said yesterday, we are looking at introducing a limited
Superfund bill. But is it not time to begin to ramp down the
program? Are we reaching the conclusion on Superfund?
Mr. Frampton. Senator, it is certainly a mature program.
The point that I made to the Environment and Public Works
Committee yesterday was that perhaps unlike 6 years ago,
cleanup has been accelerated. Most of the fundamental cleanup,
at that time, decisions have been made. And while the
administration has been very committed to work toward
comprehensive reform over the last several years, perhaps we
need to work on a few things to speed it up. I think that the
program is naturally ramping down but the administration does
support obviously, the reauthorization of the Superfund Act
because without that the program, we will go off the boat ramp
into the water pretty quickly.
Senator Bond. But we are moving to the point where we are
cleaning up the most significant ones. So there is less of an
urgency for any new resources in it.
Mr. Frampton. I think there is a need for 5 or 6 more years
of significant resources but we are looking toward a time
around 2005 when a very substantial amount of the site
construction will be completed.
ceq's coordination role
Senator Bond. You mentioned in your discussions earlier, in
your testimony that you coordinated activities in the Federal
Government. Do you see areas where you can assist in
coordinating with our partners? We have talked a lot about
devolution of environmental responsibilities to State and local
entities. What role do you see CEQ playing? And do you have any
specifics on where you may be heading in working with Governors
or others to devolve additional environmental responsibilities
to State and local governments where it could be more
expeditiously handled and where the results might be quicker?
Mr. Frampton. I think the coastal salmon fund that I
mentioned is to provide resources--to have the Federal
Government to rely on those States to do their own salmon
recovery plan. I think there are a number of new initiatives in
the President's proposed budget for this year which try to
respond to the philosophy that we cannot do everything by
regulation, and put some resources on the ground.
Administrator Browner talked about Better America Bonds,
whether it is wetland protection or urban recreation, to try to
put the money and decision making in local government. The same
thing is true of the Clean Air Fund that is proposed in EPA's
budget.
better america bond
Senator Bond. Let me assure you that we do not have the
money for those new priorities when we are talking about
devolving those responsibilities.
You have heard many comments on the Clean Water SRFs. We
are going to fund that before we fund any of those new things.
And, frankly, when you look at the Build a Better America, that
bonding activity to get EPA into local land use management, you
are going to have to convince a lot of people who will have to
vote to overcome my objection before you ever see that one see
the light of day. When we are talking about devolving
responsibilities, this is not a year where we are going to find
new dollars.
Mr. Frampton. I understand what you are saying. Just to
respond to the Better America Bond issue for a second. The
proposal here uses EPA as the conduit because the purpose is
for, among other things, clean water and brownfields and people
working those fields, but it is going to be an interagency
program. EPA is simply a conduit.
Number two, there is nothing in that proposal for the new
tax-exempt bond system that involves EPA or any Federal agency
in any way in any land-use decisions. All the initiatives to
propose bond issues to use the money that comes in will be with
State, local and county governments.
Senator Bond. And my State has developed an 8-percent sales
tax for conservation needs. I think that is the appropriate
way. It enables the State, in this instance, to be the
conservation agency to implement. We have land and water
conservation funds and I think this Build a Better America bond
is--has not too rosy a future. I would not spend a lot of time
devoting energies to how that is going to be implemented.
Mr. Frampton, I thank you for your testimony. For the
record, I am going to add--do you have any further questions?
Mr. Frampton. No, Mr. Chairman.
chemical safety board
Senator Bond. I am going to add a brief statement about the
Chemical Safety Board which is subject to the jurisdiction of
this committee. Concerns have been raised by the operations of
the board and based on the questions we asked, the General
Accounting Office is to do a formal review of the board. GAO is
presented in testimony.
The General Accounting Office has identified significant
problems with the timeliness and with inappropriate resource
allocation, including the fact that there are as many external
affairs personnel as there are investigators. About two-thirds
of the board's contract dollars is not related to
investigation.
And the board has had problems managing its contracts
because it has no formal written procedures for staff to follow
in awarding and managing contracts. Ineffective use of
resources resulted in an announcement recently not to begin any
new investigations this fiscal year, but the year is only half
over.
[The information follows:]
[The General Accounting Office, April 29, 1999]
Chemical Safety Board: Status of Implementation Efforts
(By David G. Wood)
Mr. Chairman and Members of the Subcommittee: We appreciate this
opportunity to provide a statement for the record for use in the
Subcommittee's hearing on the fiscal year 2000 budget request for the
Chemical Safety and Hazard Investigation Board (the Board). The Board
recommends steps to enhance industrial safety based on its
investigations of accidental release of toxic and hazardous chemicals
and its other activities. The Board was funded at $4 million in fiscal
year 1998, its first year of operation, and $6.5 million in fiscal year
1999. The Board is required to submit its budget request concurrently
to the Office of Management and Budget (OMB) and the Congress. For
fiscal year 2000, the Board has requested $12.5 million while the
President's budget, after OMB's review, has requested $7.5 million for
the Board.
You expressed concern that the new organization's operational
costs, especially salaries, might grow too quickly and become
excessive. At your request, we reviewed the status of the Board's
efforts to carry out its mission. Specifically, we are providing
information on the status of the Board's (1) investigations and
recommendations, (2) pay structure and use of staff, and (3)
contracting activities. We are also providing information on our
concerns about the Board's actions.
In summary, we found the following:
The Board has undertaken 11 full-scale investigations of chemical
incidents and issued reports with recommendations on 2 of them. In
addition, draft reports are in process for the remaining
investigations. The Board's recommendations have aimed at encouraging
industry and government agencies to upgrade their procedures, training,
and communication of hazards.
As of February 1, 1999, the Board had 20 employees widely
distributed among its offices, such as investigations, general counsel,
and external relations, and 4 Board members. The average compensation
is about $89,000 in salary and benefits. The Board expects this average
compensation to be reduced to about $68,000 if it receives approval to
hire up to 60 employees.
We identified eight contracts between the Board and other entities
that cost $100,000 or more. The total cost of the 8 contracts was about
$3 million. About one-third of this amount directly supported the
Board's investigations. The balance involved acquiring such goods and
services as the development of a web site, the establishment of a
chemical incident data base, and the production of an informational
video.
We have two main concerns about the Board's actions to date. First,
the Board has not updated its August 1997 Business Plan to reflect the
unanticipated backlog of ongoing investigations. Critical to any
effective plan for addressing this backlog is an examination of how the
Board chooses cases to investigate and how it allocates its existing
and future resources. Second, the Board has not instituted formal,
written procedures for its staff to follow in awarding and managing
contracts. Such procedures can help ensure adequate internal controls
and help avoid some contracting problems encountered by the Board.
background
The Board was created as an independent agency under the Clean Air
Act Amendments of 1990.\1\ However, the Board did not become
operational until 1998 because of funding constraints. The act directed
the Board to (1) investigate and report on the circumstances and
probable causes of any accidental release of toxic or hazardous
chemicals resulting in a fatality, serious injury, or substantial
property damages; (2) recommend measures to reduce the likelihood or
the consequences of accidental releases and propose corrective
measures; and (3) establish regulations for the reporting of accidental
releases. The act authorized the Board to conduct research and studies
with respect to the potential for accidental releases and to issue
reports concerning the prevention of chemical accidents to the
Environmental Protection Agency (EPA) and Occupational Safety and
Health Administration (OSHA). Furthermore, the Board is to coordinate
its activities with other federal agencies such as the National
Transportation Safety Board (NTSB) and OSHA.
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\1\ 42 U.S.C. Sec. 7412(r)(6).
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According to relevant legislative committee reports, the Board is
modeled after the NTSB, which retained the lead role in investigating
transportation-related chemical incidents. The Board has no enforcement
authority and a very limited regulatory role. Because the EPA and OSHA
also have responsibilities in responding to chemical incidents, the
Board has developed memorandums of understanding with these agencies to
coordinate efforts and minimize potential duplication if they are
investigating the same incident.
Chemical incidents occur regularly and often have serious
consequences. According to a Board report, during the period 1987 to
1996, about 605,000 known chemical incidents occurred, including about
250,000 chemical incidents that occurred at fixed locations occupied by
industrial and commercial businesses and about 260,000 incidents
related to the transportation of chemicals.\2\ On average, 127
incidents per year involved fatalities.
---------------------------------------------------------------------------
\2\ The 600K Report--Commercial Chemical Incidents in the United
States, 1987-1996. February 1999.
---------------------------------------------------------------------------
status of investigations and recommendations
To carry out its mission of enhancing industrial safety, the Board
conducts full-scale investigations and limited investigations (called
reviews) of chemical incidents and makes recommendations. The status of
these activities is discussed in the following sections.
Investigations
By statute, the Board investigates accidental chemical releases
resulting in a fatality, serious injury, or substantial property
damage. These investigations often involve extensive site visits,
evidence collection, and analytical work. Because of limited resources,
the Board decides where to initiate investigations. In these decisions,
it weighs such factors as the expected impact of its work and the
potential for similar incidents at other locations. The Board uses in-
house and contractor staff, but assigns leadership to its own staff.
The lead investigator is expected to direct the work, visit the site as
necessary, and manage the report writing process. While the Board
currently follows the Department of Energy protocols for accident
investigations, it is now developing its procedures and expects to
complete them by next year.
The Board started five full-scale investigations in 1998 and,
through March 30, six in 1999.\3\ Of the 11 investigations, 2 from 1998
have been closed and in each case, a report was issued. The first
investigation took about 9 months and the second about 11 months from
start to finish. Draft reports are in process for the remaining three
investigations begun in 1998 and the six investigations begun in 1999.
---------------------------------------------------------------------------
\3\ Unless otherwise noted, all references to years will be fiscal
years.
---------------------------------------------------------------------------
Reviews
The Board conducts reviews when resources are not available to
perform a field investigation, but knowledge about an incident could
still provide valuable information for preventing future incidents. A
review is performed within the Board's offices and relies mainly on
documents and reports from other federal agencies and state agencies,
as well as the companies' internal investigations. According to the
Board, it takes about 40 days to gather and analyze information, which
may not be available until 6 months after the incident, and additional
time may be used to verify the facts and resolve legal and technical
issues.
The Board started 14 reviews in 1998 and 9 in 1999. The Board has
not issued any reports stemming from its reviews. As of March 30, 1999,
it had closed 6 reviews with no report, was preparing a draft report
for 3 ongoing reviews, and had yet to begin drafting a report for 14
ongoing reviews. According to an agency document, the six reviews were
closed without reporting because, among other reasons, information was
insufficient or conflicting, and some cases had limited application.
Board officials told us, however, that the draft reports for the
ongoing reviews are expected to result in valuable information for
preventing future incidents.
Recommendations
As of March 30, 1999, the Board made a total of 22 recommendations
in its two issued reports. The first report, dated September 1998,
involved an accident at the Sierra Chemical Company in Nevada, where
four workers were killed. The report contained 16 recommendations. The
Board directed 10 recommendations to Sierra Chemical and other
explosive manufacturers, 3 to the Institute of Makers of Explosives, 2
to the Department of Defense, and 1 to the Nevada Occupational Safety
and Health Enforcement Section. The recipients of the first report have
agreed to take corrective actions on 3 recommendations and are
considering whether to take actions on the remaining 13.
The second report, dated February 1999, involved an accident at a
Union Carbide plant in Louisiana, where 1 worker was killed. The report
contained six recommendations. The Board directed two recommendations
to Union Carbide and one each to the National Institute for
Occupational Safety and Health, OSHA, the Center for Chemical Process
Safety, and the Compressed Gas Association. The Board has received a
formal response from Union Carbide and is aware of actions being
considered by two other recipients of the recommendations. The company
identified new safety policies that it would follow.
The Board's recommendations have aimed at encouraging industry and
government agencies to upgrade their procedures, training, and
communication of hazards. For example, the Board suggested that
explosive manufacturers evaluate their safety programs to ensure that
(1) written operating procedures are specific to the process being
controlled; and (2) procedures and chemical hazards are communicated in
the languages understood by personnel. It also suggested that the
Institute of Makers of Explosives develop safety training guidelines
and distribute the Board's report to its member companies. A listing of
each recommendation and its status is provided in appendix I.
To obtain recipients' reactions to the Board's recommendations, we
contacted the Department of the Army and OSHA. Officials from both
agencies told us that the reports were on target. An Army official
indicated that his agency was considering the recommendations, and an
OSHA official confirmed that the agency intended to implement the
recommendation.
A Board official said the Board plans to have a system in place to
track recommendations by the spring of 1999. According to a draft
directive, this system will be called the Safety Recommendation
Tracking System and will track recommendations from the time they are
issued until they are closed. The system will be used to follow-up on
open recommendations and keep a permanent record of all
recommendations.
current and planned staffing levels, responsibilities, and salaries
The Board established a single-location organization with a central
management office and five program functions, located in Washington,
D.C.
Current Staffing Level and Responsibilities
As of February 1, 1999, the Board had 24 employees, including 4 of
the 5 Board members. It expects to grow from 24 to 30 employees,
including an additional board member, by the end of fiscal year 1999
and to 60 employees by the end of 2000 if its budget request of $12.5
million is approved. According to its August 1997 Business Plan, the
Board planned to grow to 88 employees in 2000, but it has now extended
its timeline for this level of staffing to the end of 2001.
Table 1 identifies the allocation of staff, both current and
planned, and assigned responsibilities in the agency organizational
structure.
TABLE 1.--THE BOARD'S STAFFING LEVELS, CURRENT AND PLANNED, AND RESPONSIBILITIES, BY ORGANIZATIONAL UNIT
----------------------------------------------------------------------------------------------------------------
End of End of
Current 1999 2000
Office staffing staffing staffing Responsibilities
(2/1/99) (planned) (planned)
----------------------------------------------------------------------------------------------------------------
Board member................................. 3 4 4 Reviews and approves reports
recommendations end regulations.
Chairman/Chief Executive Officer and 4 7 9 Provides daily program
Management. supervision and ongoing
operational planning and
evaluation; provides budgeting
technical writing and overall
support to the organization.
General Counsel.............................. 3 3 9 Provides full range of
administrative and programmatic
legal services.
Safety programs.............................. 1 2 7 Directs design of safety policies
and programs for the Board;
oversees recommendations.
Investigations............................... 5 6 13 Conducts accident investigations
and reviews; prepares reports.
External relations........................... 4 4 9 Disseminates public and media
information; acts as liaison
with business and academia;
conducts governmental relations
and international activities.
Information technology....................... 4 4 9 Oversees information technology
systems and operational
programs; conducts
administrative operations.
--------------------------------
Total.................................. 24 30 60
----------------------------------------------------------------------------------------------------------------
Note: The head of the Office of General Counsel also acts as head of the Office of Safety Programs.
Source: The Chemical Safety Board.
Salaries
As of February 1, 1999, the Board had one GS-7 staff member, one
GS-12, two GS-13s, 16 GS-14s or above, and 4 Board members. With this
grade structure in place, the average annual salary is $81,146,
excluding benefits, for on-board employees. (See app. II for more
details.) Combining salaries and benefits, the average annual
compensation per employee will be an estimated $89,100 at the end of
1999. Board officials said that the 1999 average salary will decrease
as the Board hires more employees and the personnel base on which the
average salary is computed increases. In fact, the Board is requesting
$4.1 million in personnel compensation and benefits in 2000 for 60
positions; that would result in an average annual compensation package,
combining salaries and benefits, of $68,183 per employee in 2000.
In a proposal to the Office of Personnel Management, the Board
asked approval for six senior executive positions. After consulting
with OMB, the Office of Personnel Management approved one permanent and
two temporary positions. The Office said that it was awaiting the
completion of this ongoing GAO study and it was obligated to maintain a
reduced number of senior executives in the government. The Office of
Personnel Management told the Board that its request would be re-
evaluated during the fall, 2000-2001 biennial assessment period.
contracting activities
The Board contracted with outside entities to help carry out its
mission during 1998 and 1999. Excluding the contract for renting office
space, we identified eight contracts costing $100,000 or more.\4\ The
total cost of these contracts was about $3 million. Table 2 provides
information on these contracts.
---------------------------------------------------------------------------
\4\ We excluded the contract for leasing office space because of
its nondiscretionary nature.
TABLE 2.--BOARD CONTRACTS OF $100,000 OR MORE, 1998 AND 1999
------------------------------------------------------------------------
Purpose/description of Amount
Contractors contracts obligated
------------------------------------------------------------------------
Oak Ridge National Laboratory Investigative $758,000
(ORNL). support.--The 915,000
contractor assists
the Board by
conducting several
investigations and
preparing reports,
including managing
investigations,
collecting evidence,
and conducting
interviews. Strategic
Plan.--The contractor
assists the Board in
the development of a
5-year information
technology plan. ORNL
is a Department of
Energy laboratory
that provides support
to various federal
agencies. The
$758,000 listed here
is the cost of
requested services
during 1998; as of
March 1999, the Board
has requested an
additional $915,000
of services.
Battelle Memorial Institute..... Investigative 410,000
support.--The
contractor assisted
the Board in
conducting the Sierra
Chemical
investigation in
Nevada, including
labor and material
for technical
services and
preparing a written
report of the
chemical incident.
Tri-Data........................ Establishment of 350,000
chemical incident
baseline and
database.--The
contractor analyzed
and prepared a
summary report on 10
years of data from
five federal
government agencies'
data bases to
establish a chemical
incident baseline.
Currently, the Board
is designing a
chemical incident
data base that will
be located at the
Board and populated
with data from at
least the five
government data
bases. The data base
is to be used to help
show where, when, and
how often incidents
are occurring in a
particular area. The
information will form
the basis for
recommendations on
programs,
regulations, and
other actions to help
reduce chemical
incidents. The report
is scheduled for
completion by May 31,
1999.
Bell-Atlantic................... Internet and Intranet 231,000
web site
development.--The
contractor is
expected to create
and maintain a web
site with
documentation that
includes file
structures, database
table structure, site
architecture, and
security information.
A technical person
from the contractor
is dedicated fulltime
to the Board. The
cost is not to exceed
$231,000 through
September 1999.
Rowland Productions............. Informational video. 160,000
In August 1998, the
Board contracted with
Rowland to produce a
video that portrays
what the agency does.
The intended audience
for the video
includes the general
public, industry,
employee and
environmental groups,
and government
officials. Five
companies competed
for the contract. The
selected vendor's
offer includes plans
for video insets
tailored for specific
audiences. Work was
temporarily suspended
on the video because
of the press of other
business in early
1999.
Federal Emergency Management Internet service.--The 137,000
Agency (FEMA). Board contracted with
FEMA to host, update,
and administer the
Board's web site and
e-mail at a cost up
to $100,000 in 1998.
National Emergency
Coordination Center.--
During 1998 and 1999,
FEMA provides the
Board with a 24-hours-
a-day, 7 days-a-week
communications center
that supports the
Board at a cost of
$50,000 per year.
(The 1998 charge was
prorated.).
Bell-Atlantic................... Helpdesk support.-- 130,000
This is a 1999 award
that covers helpdesk
support and local
area network support.
National Ground Intelligence Software development.-- 100,000
Center. In July 1998, the
Board contracted with
the National Ground
Intelligence Center,
an oarganization
within the Department
of Defense, to
develop a civilian
version of military
intelligence software
that will help a
facility determine
where its safety
systems are prone to
failure and how to
best address the
problems. The Center
would develop a
prototype intitially
then build toward a
full operational
capability that the
Board plans to make
available to
companies for their
confidential use.
Software development
would continue for a
number of years. The
total cost is not yet
known, but the Board
obligated $100,000 in
1998 funds for this
purpose and expectgs
to spend another
$200,000 each year
from 2000 through
2002, if funds are
made available..
---------------
Total..................... ...................... 3,191,000
------------------------------------------------------------------------
Note: Dollar amounts are rounded to the nearest thousand.
Source: The Chemical Safety Board.
concerns about the board's actions
On the basis of our review of the Board's actions to date, we have
two main concerns. First, the Board has not updated its Business Plan
to reflect the unanticipated backlog of ongoing investigations. Second,
the Board has no written procedures for its staff to follow in awarding
and managing contracts with outside entities.
Updated Business Plan
In its August 1997 Business Plan and support for its 1999 budget
submission, the Board set forth its expectations that it would be able
to complete its investigations within 6 months and conduct from 5 to 10
investigations during 1998 and from 13 to 19 investigations during
1999. However, the Board has completed and reported the results for two
investigations since commencing operations in January 1998. These
investigations took 9 and 11 months from start to finish. Actual in-
the-field investigations have been concluded for another seven
investigations, and draft reports have been in process since as long as
April 1998. The Board has also yet to issue any reports based on its
reviews. It closed 6 reviews without a report and, as of March 30,
1999, has 17 open reviews. Draft reports are in process for 3 of the 17
open reviews. Board officials told us that their expectations for
conducting investigations in 1999 were based on getting requested
funding. Also, their agency was not yet fully operating, and existing
investigation resources were needed to complete the backlog of open
investigations and reviews. As a result, the Board could undertake no
new investigations from mid-March 1999 through the end of the fiscal
year in September. On March 29, the Board wrote to this Subcommittee
confirming its freeze on new investigations.
In our view, the unanticipated backlog and the slower-than-expected
progress in completing ongoing investigations and reviews raise
questions about how the Board decides which incidents to look into and
how it allocates its staffing and financial resources. The Board does
not intend to update its August 1997 Business Plan but is working with
OMB to develop a strategic plan by February 2000 that complies with the
Government Performance and Results Act. The Board intends to identify
the criteria for selecting incidents in this strategic plan and
reallocate resources as a management decision after addressing the
backlog.
Criteria for Selecting Incidents to Investigate and Review
According to Board officials, about 200 chemical incidents are
reported to the Board each day. Fatalities, serious injuries, and
significant property damage often occur, and the Board does not have
the resources to conduct an on-site, full-scale investigation of every
incident with serious consequences or even a limited review of such
incidents. In deciding which incidents to investigate and review, the
Board uses criteria weighted toward accidents in which fatalities
occur. Some judgment is still, of course, involved, and the Board uses
factors such as a high level of interest that should make it easier to
implement recommendations and the potential for similar incidents at
other locations. The Board would have to weigh the various consequences
of revising the criteria in ways that would either raise or lower the
barin other words, be more or less selective in choosing which cases to
pursue. By raising the bar, workload would be limited. Although factors
such as complexity of the incident and the extent of cooperation by
company officials affect how quickly cases can be completed, a more
limited workload would help to speed up the closure of existing cases.
By lowering the bar, workload would be increased and existing cases
would tend to take longer to close or additional resources would need
to be allocated to investigations, helping the Board to complete these
cases more quickly.
Allocation of Resources
The Board's Business Plan, in setting expectations for the new
organization, assumed a $4 million budget in 1998 and a $7 million
budget in 1999. In its formal budget request, the Board asked for $8.2
million for 1999. In its actual appropriations, the Board received the
full $4 million in its first year and $6.5 million in 1999. According
to the Board, it spent 30 percent of its $4 million budget in 1998 on
incident prevention (primarily investigations and reviews). The Board
expects to spend 37 percent of its 1999 budget and 44 percent of its
2000 request for this purpose.
Regardless of what the Board expected its funding levels to be, the
Board has encountered difficulties in handling its workload. An
examination of how the Board would allocate its existing resources and
spend future fundsassuming differing levels of funding in 2000 and
beyondis critical to any effective plan for addressing the backlog of
ongoing investigations and reviews.
One area for review is the Board's staffing allocation. According
to the plan, the Board would establish a flat organization. To the
maximum extent possible, it would buy services when and as needed,
thereby keeping staffing levels and overhead costs low, and permitting
the bulk of resources to be devoted to its mission. As of February 1,
1999, the Board employed four in-house investigators; one began work in
July 1998, two in September 1998, and the other one in November 1998.
The investigators have a caseload of two to three investigations and
five to six reviews. At times, the Board also uses noninvestigative
staff, such as program analysts, to assist with investigations and
reviews. The Board also allocated four staff members to its external
relations and three to its general counsel offices. If its budget
request for 2000 is approved, the Board intends to have 13 (or 22
percent) of its 60 total personnel in its investigations unit compared
with 9 each in its external relations and general counsel units
(together equaling 30 percent of total staffing). The Board would
allocate the remaining 29 staff (48 percent) to other offices, such as
the Chairman's staff, safety programs, and information technology.
For comparison purposes, we obtained resource allocation
information from NTSBthe agency considered in the legislative history
as the model for the Chemical Safety Board. NTSB investigators comprise
40 percent of the organization's staffing while personnel in its legal
and public affairs offices together comprise about 5 percent.\5\ Like
the Board, NTSB investigators work on multiple investigations at a time
and use contractors to support their work. Unlike the Board, NTSB can
obtain voluntary serviceslabor hours that are not reimbursedfrom
outside entities. The Board has recommended to the Congress that it be
authorized to obtain these voluntary services.
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\5\ Of the 402 personnel on board in April 1999, NTSB has 162
investigators, 11 employees in its Office of General Counsel, and 11
staff members (excluding those performing the function of working with
affected families after an accident) in its Office of Government,
Public, and Family Affairs. NTSB also has other staff, such as
Administrative Law Judges, performing legal-related work.
---------------------------------------------------------------------------
To deal with the existing backlog of cases and expected new cases,
the Board could also review its use of funds now spent on contracting.
About two-thirds of these funds are not related directly to
investigations but support accomplishment of its mission in other ways.
An updated Business Plan would help the Board to determine the
appropriate balance, at different levels of funding, between using more
of its resources to do investigations versus investing in other
mission-related activities.
Controls Over Contracts
In its Business Plan and other key documents, the Board stated that
its approach to doing business would emphasize contracting out or
outsourcing. The Board contended that doing so would enable it to avoid
the expense associated with establishing a large permanent
administrative infrastructure and having to make a long-term commitment
of funds for such items as space and equipment.
The Board pursued this approach within a week of its commencing
operations when it asked an outside entity to investigate an accident.
A chemical incident causing four fatalities occurred at Sierra Chemical
Company's plant in Mustang, Nevada, on January 7, 1998. Two days later,
the Board wrote a letter to Battelle authorizing the contractor to
begin incurring labor and travel costs starting January 8 and before a
formal contract had been signed. According to the statement of work,
Battelle would provide labor and materials to assist the Board in the
investigation and would also provide a written report delineating the
explosion. The Board estimated the contract would be in the $250,000
range. The Board believed that it was entering into a work for others
arrangement with the Pacific Northwest National Laboratory, which is
owned by the Department of Energy (DOE) and run by Battelle. Under a
work for others arrangement, a DOE laboratory may conduct work for
other federal agencies on a cost-reimbursable basis.
On the basis of our file reviews and interviews with Board
officials, we found that concerns surfaced almost immediately about the
growing costs of Battelle's work. The Board was surprised to learn that
it was using Battelle directly rather than working through DOE's
Pacific Northwest National Laboratory, with Battelle as a
subcontractor. As a result, the Board noted that it was being charged
higher rates under a noncompetitive arrangement with Battelle.
According to Board officials, they attempted to control costs by asking
Battelle to take people off of the investigation and proposing contract
terms that put Battelle in the position of working through the federal
laboratory. The Board ultimately signed an agreement with Battelle
directly, dated March 17, 1998, to pay $410,000, including a fixed fee
of $54,000, for its services. On that day, a Board official wrote a
memorandum to the file that the Board was still trying to get
information from Battelle that would support the contract cost.
The Board has taken some steps to ensure that a repeat of the
problems described earlier would not recur. First, it has decided not
to use Battelle directly again in a noncompetitive arrangement. Second,
the Board has employed a more structured approach for acquiring support
for its investigations. In an agreement with DOE's Oak Ridge National
Laboratory, the Board identifies tasks, the laboratory estimates the
costs for performing those tasks, and the Board provides authorization
and reimbursement for services provided by the laboratory as
appropriate. The Board also receives a monthly report from the
laboratory on progress, accomplishments, status, and planned work for
the next month. We believe these are prudent steps for protecting the
government's interests.
In the Battelle case, formal, written contracting procedures--based
on the Federal Acquisition Regulation but tailored to the Board's
needs--were not available to the staff. The Board told us that these
procedures are now being developed. However, more than a year has
elapsed since it signed the agreement with Battelle for which the Board
expressed such concern. The importance of instituting formal procedures
is even greater given the Board's reliance on contracted support for
not only investigations but also other mission-related tasks.
Under the Federal Acquisition Regulation, contracting officers are
responsible for ensuring that applicable procedures have been followed
before an agency enters into a contract. For the major contracts we
reviewed, we found that the contracting officer has been the Board's
Program Officer, the second-in-command in the organization, who has
multiple responsibilities. We asked the Board about its need for a
full-time contracting officer. The Board told us that there were only
seven full-time-equivalent employees in 1998, and the Board did not
award enough contracts to justify establishing and filling a
contracting officer position. The Board did not comment on its reasons
for not establishing such a position in 1999. In the Battelle case,
even with a limited staff, such an officer could have informed the
Board of the proper procedures for obtaining work-for-others-type
assistance. If the Board does not consider it cost-effective to
establish a contracting officer position in-house, alternatives such as
the use of technical support from the General Services Administration
or another federal agency could be explored.
scope and methodology
To review the status of the Board's efforts to carry out its
mission, we reviewed documents supplied by the Board related to its
planning, budgeting, and programs; personnel data such as salary
information; and contract files. We interviewed officials from the
Board; other federal agencies, including the NTSB, OSHA, the Department
of the Army, and OMB. We conducted our work between January through
April 1999 in accordance with generally accepted government auditing
standards.
agency comments
We provided a draft of this statement to the Board for its review
and comment. We met with the Chairman and other Board officials. They
generally agreed with the information contained in this statement but
provided clarifications and corrections, which we incorporated as
appropriate.
The Board also pointed to considerations that it believes, in the
interest of fairness, should be recognized. First, the Board has the
unique status of being a start-up agency. It did not have the
advantages of having staff or even office space and found itself
putting an infrastructure in place to provide services while at the
same time beginning to provide those services. The Board stated that
our concerns about the unanticipated backlog of investigations and
absence of written procedures for contracting should be viewed in the
context of their being a new agency. Second, the Board is expected to
accomplish a broad and complex mission but has only limited resources
to do so. The Board said that while this mission extends beyond
investigations to other activities designed to enhance industrial
safety, the Board has had the equivalent of only 5 full-time employees
in 1998 and 24 in 1999.
We recognize in our statement that the Board is a start-up agency.
Accordingly, we believe the Board's comments highlight the opportunity
the Board now has to consider its future allocation of staff and
financial resources. For example, the Board has greater flexibility as
a start-up agency to find the appropriate balance, at different levels
of funding, between using its resources to do investigations versus
investing in other mission-related activities.
[GRAPHIC] [TIFF OMITTED] T05AP29.026
[GRAPHIC] [TIFF OMITTED] T05AP29.027
[GRAPHIC] [TIFF OMITTED] T05AP29.028
[GRAPHIC] [TIFF OMITTED] T05AP29.029
FIGURE II.1.--GRADE STRUCTURE AND SALARIES OF BOARD EMPLOYEES, AS OF FEBRUARY 1, 1999
----------------------------------------------------------------------------------------------------------------
Office Start date Position title Grade Salary
----------------------------------------------------------------------------------------------------------------
Board members..................... 11/97............... Board member........ EX-4................ $118,400
11/98............... Board member........ EX-4................ 118,400
12/98............... Board member........ EX-4................ 118,400
Chairman/CEO and management....... 11/97............... Chairman/Board EX-4................ 118,400
12/97............... member. GS-15............... 94,098
7/98................ Program Officer..... GS-14............... 70,855
11/98............... Management Analyst.. GS-14............... 68,570
Program Analyst.....
Investigations.................... 9/98................ Senior Investigator. GS-15............... 80,658
7/98................ Investigator........ GS-14............... 82,284
9/98................ Investigator........ GS-14............... 75,427
10/98............... Program Analyst..... GS-7................ 27,508
11/98............... Investigator........ GS-14............... 82,284
Safety program.................... 6/98................ Program Analyst..... GS-14............... 68,570
General counsel................... 2/98................ Attorney............ GS-15............... 99,474
7/98................ Attorney............ GS-14............... 79,999
10/98............... Attorney............ GS-13............... 63,829
External relations................ 1/98................ Public Affairs GS-15............... 94,098
2/98................ Specialist. GS-14............... 70,855
8/98................ Public Affairs GS-14............... 70,855
1/99................ Specialist. GS-14............... 68,570
Intergov. Relations
Mgr.
Constituent
Relations Mgr.
Information technology............ 12/97............... Program Analyst..... GS-12............... 48,769
6/98................ Program Analyst..... GS-13............... 65,763
7/98................ Computer Specialist. GS-15............... 86,034
2/99................ Program Analyst..... GS-14............... 75,427
-----------
Average Salary.............. .................... .................... .................... 81,147
----------------------------------------------------------------------------------------------------------------
Source: The Chemical Safety Board.
conclusion of hearings
Senator Bond. We recognize this is a new agency and some
time is needed to for it to become fully operational. We
acknowledge the mission set forth for the board is important.
The message needs to be heard loud and clear from us. However,
the agency needs to improve significantly its operations if it
expects to continue receiving support from this Committee.
And with that statement, we will conclude the hearing.
[Whereupon, at 12 p.m., Thursday, April 29, the hearing
were concluded, and the subcommittee was recessed, to reconvene
subject to the call of the Chair.]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT AND
INDEPENDENT AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2000
----------
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
MATERIAL SUBMITTED BY AGENCIES NOT APPEARING FOR FORMAL HEARINGS
[Clerk's note.--The following agencies of the Subcommittee
on VA, HUD, and Independent Agencies did not appear before the
subcommittee this year. Chairman Bond requested these agencies
to submit testimony in support of their fiscal year 2000 budget
request. The statements submitted by the chairman follow:]
INDEPENDENT AGENCIES
Department of Health and Human Services
Agency for Toxic Substances and Disease Registry
Prepared Statement of Jeffrey P. Koplan, Administrator
Thank you for the opportunity to provide a written statement
regarding the Agency for Toxic Substances and Disease Registry's
(ATSDR) President's budget for fiscal year 2000.
ATSDR is a federal agency created by Congress in 1980 by the
Comprehensive Environmental Response, Compensation, and Liability Act
(CERCLA), or what is more commonly known as Superfund legislation. As
such, ATSDR is the public health agency charged with determining the
nature and extent of health problems at Superfund sites, and advising
the U.S. Environmental Protection Agency (EPA) and State environmental
agencies on needed clean-up and other actions to protect the public's
health. To accomplish this mandate, ATSDR received $76 million in
fiscal year 1999.
We are proud of our accomplishments in addressing a key mandate--
learning more about the association between exposure to toxic
substances and adverse health effects and the prevention of illness at
Superfund sites. As presented in other Congressional testimonies,
ATSDR's health studies have revealed an increased risk of birth
defects, certain cancers, respiratory illness, neurologic disease and
other health conditions in populations living near hazardous waste
sites.
ATSDR works in close collaboration with the EPA, other federal,
state, local, and tribal governments, health care providers and
affected communities. The agency has made a difference to all of these
partners by providing new information to assist in remedial decision-
making, answering the health questions of impacted community members,
recommending preventive measures to protect public health, and
providing diagnosis/treatment information to local health care
providers.
The President's budget of $64 million will allow the agency to
continue to conduct many programs that support our mandate (see Program
Output table on the following page). ATSDR will administer public
health activities through: state partnerships; public health assessment
and consultation activities; exposure investigations; health studies
and registry activities; development of toxicological profiles and
attendant research; emergency response; health education and health
promotion; and community involvement during fiscal year 2000.
determining nature and extent of public health problems at sites
Public health assessment and consultation activities
ATSDR's public health assessment and consultation program is the
starting point for all of the agency's site-specific health activities.
The assessment is the basis for public health advisories or other
health recommendations, and for identifying studies or actions needed
to evaluate human health effects and mitigate or prevent adverse health
effects. During the initial phase, ATSDR evaluates the available
information, determines data needs, assesses the exposure scenarios
(e.g., whether or not people are being exposed to environmental hazards
and how exposure may be occurring) and determines which actions,
products and services are necessary to provide an effective and
efficient public health response.
ATSDR PROGRAM OUTPUT TABLE
----------------------------------------------------------------------------------------------------------------
Fiscal years--
--------------------------------------------------------
Program $74 million 1998 $76 million 1999 $64 million 2000
actual estimated projected
----------------------------------------------------------------------------------------------------------------
Cooperative Agreement States........................... 26 29 23
Sites Addressed........................................ 495 500 400
Public Health Assessment Documents..................... 110 110 90
Health Consultations................................... 915 1,000 800
Exposure Investigations................................ 50 65 30
Site-Specific Environmental Health Intervention........ 10 8 6
Backlogged Sites Addressed............................. 38 56 .................
Health Studies:
New................................................ 10 12 .................
Continued.......................................... 22 23 27
Exposure Registry (number of sites).................... 21 22 21
Minority Health Professions Foundation Research 13 12 9
Projects..............................................
Great Lakes Research Projects.......................... 10 10 5
Toxicological Profiles................................. \1\ 6 8 6
Pediatric Environmental Health Specialty Units......... 3 6 1
Medical Monitoring..................................... \2\ 1 \3\ 1 .................
----------------------------------------------------------------------------------------------------------------
\1\ In addition to beginning six profiles in FY 1998, ATSDR updated 21 profiles with children's health sections.
\2\ Feasibility study in fiscal year 1998.
\3\ To be initiated in FY 1999 depending on outcome of feasibility study.
ATSDR's public health assessment (PHA) program evaluates data and
information on the release of hazardous substances into the environment
and assesses past, current, or future effects on public health. The PHA
program is ATSDR's principal tool for identifying communities that need
further public health follow-up. In fiscal year 2000, ATSDR anticipates
developing 90 public health assessment documents.
ATSDR develops health consultations to provide advice and/or
technical assistance on specific public health issues that result from
actual or potential human exposure to a hazardous material. A health
consultation is often quickly needed to permit mitigation or prevention
of adverse human health effects from such exposure. The agency provides
consultations on hazardous waste sites to EPA, other federal agencies,
state and local health and environmental agencies, individual members
of the public, and communities. ATSDR will provide approximately 800
health consultations in fiscal year 2000.
In May 1997, ATSDR presented to Congress 234 hazardous waste sites
for which the agency and its public health partners were not able to
conduct necessary public health activities. In fiscal year 1998 and
1999, ATSDR addressed 94 of these sites through public health
assessment activities, health education and promotion activities,
exposure assessments, and health studies. Significant results have been
noted, with five sites found to be public health hazards and ten sites
requiring follow-up health activities. In fiscal year 2000, the agency
will be unable to initiate action at any of these historic
``backlogged'' sites, and the number of such sites is anticipated to
increase.
State partnerships
When Congress reauthorized Superfund, the health section of the
statute was strengthened, and a partnership was envisioned between
states and ATSDR. The agency committed to building or enhancing state
health departments' capacity in environmental health. For the last
three years, ATSDR has provided more than $10 million per year to
states for health assessments, health studies and health education and
promotion activities at the sites where we work. This cooperative
agreement program enhances the collaboration between Federal, state,
local, and tribal health and environmental officials who are the
experts on issues related to site characterization, contaminant removal
activities, site remediation, site-specific health education and health
promotion, and health studies. This collaboration ensures that risk
managers are provided timely public health input throughout the site
characterization, assessment, and remediation process; and that
community and health professional educational needs are met with early,
integrated involvement. It further insures that health outcome data,
environmental monitoring results, and demographic data are collected
and analyzed in a scientifically valid manner. In fiscal year 2000,
ATSDR anticipates supporting 23 states through the state cooperative
agreement program.
Exposure investigations
The lack of reliable information on actual human exposure has
hampered ATSDR's assessments of adverse impacts of environmental
contamination. ATSDR has therefore initiated independent activities to
provide better measures of exposure, to better define populations
likely to be exposed, and to develop more accurate estimates of
exposure. An exposure investigation is a key approach that ATSDR uses
to develop better characterization of past, current, and future human
exposures to hazardous substances in the environment and to evaluate
existing and possible health effects related to those exposures. ATSDR
will conduct exposure investigations in fiscal year 2000 at 30 sites.
Emergency response
ATSDR is responsible for providing technical assistance to Federal,
state, and local government and emergency organizations during
emergency situations resulting from the unplanned release of hazardous
substances. In emergency situations, site-specific or chemical-specific
consultation teams can be convened to provide immediate pubic health
support 24 hours a day, seven days a week--usually within 30 minutes.
Consultation teams can operate independently on focused, short-term
tasks or can serve as part of a large multi-agency task team addressing
more complex issues. ATSDR will continue emergency response activities
in fiscal year 2000.
Health education and promotion
ATSDR's health education and promotion program encompasses the
overall goals of educating individuals, communities, and health-care
providers about the health effects of hazardous substances in the
environment; working with affected communities to develop and promote
public health strategies to mitigate the health impact of hazardous
substances; and disseminating environmental health education materials,
training, and information. The agency will conduct a range of site-
specific health education activities at a total of 400 sites in fiscal
year 2000.
A critical part of ATSDR health education activities is involving
communities in public health decisions and actions that affect them. We
assure collaborative opportunities are available for communities by
integrating them into the process of planning, goal-setting, and the
design and implementation of public health activities. This interactive
process requires new and creative ways of thinking and working that
lead to broad understanding of agency public health activities and
responses.
The hallmark of ATSDR's health promotion program is the use of
community-driven approaches to promote education and training for
health care providers and other health professionals, to facilitate
access to environmental medical services, and to establish the
connection between environmental and public health practice. Provider
education affords health care practitioners with a better understanding
of the situation so that they can assist in making appropriate public
health decisions for the community and themselves.
Health promotion activities also include site-specific
environmental health interventions (EHI). These interventions cover
such services as specialty clinical evaluations, diagnosis, and
referrals for exposed individuals at risk of adverse health effects.
The EHI establishes a partnership between public health professionals,
primary care practitioners, and environmental specialists and involves
the diagnosis and prevention of illness caused or influenced by
hazardous substances in a community environment. In fiscal year 2000,
ATSDR will support anticipated site-specific environmental health
interventions at six sites.
A medical monitoring program is broader in scope than an EHI, and
may be conducted over a longer period of time. ATSDR is currently
conducting the first phase of the Bunker Hill medical monitoring
program. Approximately 8,500 persons living in the area around a
refinery located in Kellogg, Idaho, between the years 1973 and 1981,
were placed at significantly increased risk of adverse health effects
as a result of excessive exposure to lead, cadmium, and arsenic.
Initial outreach and feasibility assessment activities are being
conduced in the State of Idaho, where an estimated 1,700 persons who
were exposed to contaminants continue to live.
association between toxic exposure and illness
Health studies
ATSDR conducts and supports health studies to evaluate the
relationship between exposure to hazardous substances and adverse human
health effects. This relationship can be described as a sequence of
events leading from contamination in the environment to possible
presence of illness in exposed people.
As ATSDR has reported previously, when evaluated in aggregate
(i.e., by combining health data from many Superfund sites), living near
hazardous waste sites seems to be associated with increased risk of
some kinds of birth defects and, though less well documented, some
specific cancers. Several ATSDR health studies completed in the last
couple of years confirm and help clarify this finding. For example:
--Women who live within \1/4\ mile of National Priorities List (NPL)
sites in California were more than three times as likely to
have infants with conotruncal heart defects and more than twice
as likely to have infants with neural tube defects.
--Women who were 35 years old or older and who had been exposed to
tetrachloroethylene (PCE) in drinking water at Camp Lejeune,
North Carolina, were four times more likely to have infants who
were small for their gestational age.
--Women who lived closest to 38 landfills in New York had a fourfold
elevation in incidence of bladder cancer and leukemia, in
comparison to women living further away.
--Women who lived near a Connecticut NPL site in areas where exposure
to TCE was estimated to be highest had an elevated risk for
non-Hodgkin's lymphoma.
Examples of other adverse health outcomes include:
--Nineteen to 20 years later, young adults who had been exposed
during childhood to high levels of lead at the Bunker Hill NPL
site were more likely to have neurologic signs and symptoms and
infertility than were young adults in a comparison group.
--Children in Groton, Massachusetts, who were most likely exposed to
solvents in drinking water generally had lower scores on two of
four tests that indicate they had learning disabilities.
--Women formerly employed at a lead smelter, now an NPL site, in
Silver Valley, Idaho, had an earlier onset of menopause than
did women in a comparison group.
As the above findings demonstrate health studies are key to
formulating public health actions for specific Superfund sites. Ongoing
studies will continue in fiscal year 2000.
In the past year, ATSDR has initiated activities to investigate
possible links between elevated rates of children's cancers in Toms
River and exposures to hazardous substances. These actions include: a
multi-site study examining the rates of brain cancer among residents, a
multi-state case control study of childhood brain cancers, a review of
available chemical data for the Dover Township area, and public health
intervention activities including health care provider updates.
Elevations in overall cancer incidence were confirmed for Dover
Township and the Toms River section, particularly among female children
under 5 years of age. At the $64 million level, ATSDR will continue
many of these activities in Toms River.
Health registry activities
The ATSDR National Exposure Registry catalogs reported health
information from individuals with documented exposures into chemical-
specific sub-registries. These sub-registries are designed to aid in
assessing the long-term health consequences of low-level, long-term
exposures to hazardous chemicals identified at hazardous waste sites.
The National Exposure Registry currently consists of four established
subregistries: Trichloroethylene (TCE), Dioxin, Trichloroethane (TCA),
and Benzene. Registrants on all four subregistries have reported
increases of such problems as birth defects, diabetes, stroke, anemia,
and learning disorders.
Analysis of the approximately 5,000 female registrants across all
registries revealed statistically significant increases in reports of
several health outcomes. Those found predominantly in women included
diabetes, kidney problems, liver problems and urinary tract disorders.
A more definitive assessment of these associations is currently
underway.
Substance specific information and research
Serious gaps exist in scientific knowledge about the toxicity,
bioavailability, and human health effects from individual hazardous
substances and mixtures of substances released from Superfund sites and
during emergency releases. ATSDR's Applied Research Plan heavily
emphasizes the collection of human data to validate the substance-
specific exposure and toxicity findings of animal and human studies
that are currently open to interpretation.
ATSDR's mechanisms for filling priority data needs include
academic-based research conducted through the Minority Health
Professions Foundation, a congressionally mandated program. ATSDR-
supported research on lead has found (1) a highly significant
relationship between lead levels in blood and blood-pressure in
pregnant women; and (2) that infants born to mothers with higher blood-
lead levels demonstrate differences in the areas of motor skill
development, general muscle tone, and hand-to-mouth activities shortly
after birth. Another significant study is being conducted on di-n-
butlyphthalate, a compound often used in making plastic products--there
is a great potential for exposure to babies and young children through
items such as soft plastic toys, pacifiers, and teething rings. Results
have shown that this compound caused endocrine disruption in laboratory
animals. In fiscal year 2000, ATSDR will continue research for filling
critical data needs.
ATSDR supports another congressionally earmarked research program
which investigates the potential for adverse human health effects
resulting from consumption of contaminated fish. Contaminants of
concern include dichlorodiphenyl trichloroethane (DDT), methylmercury,
polychlorinated biphenyls (PCBs), dioxin and alkylated lead.
Principally focused in the Great Lakes area, current activities include
analyzing biologic samples of study populations; analyzing sub-clinical
health effects data and other identified sensitive health endpoints;
conducting tests to identify neurobehavioral impacts in newborns,
infants, the elderly, and native Americans; assessing the impact of
exposure to toxic substances on male and female fertility; initiating
studies for trans-generational effects in at-risk populations; and
evaluating mercury levels in women before, during and after pregnancy.
In fiscal year 2000, activities will continue.
ATSDR provides critical information to Federal, state, and local
public health agencies and other organizations that respond to toxic
chemical emergencies and assess hazardous waste sites through our
toxicological profiles. The profiles interpret the available exposure
and health effects data of a substance, determine the levels of
exposure that present a significant risk to humans, and identify the
research necessary to determine the types or levels of exposure that
might present significant risks for adverse health effects in humans.
At the President's budget of $64 million, ATSDR will develop six
toxicological profiles.
atsdr has made a difference
Improved remediation decision making
ATSDR's recommendations to EPA (or the state counterpart) have been
routinely adopted. Our data show that more than 80 percent of the
recommendations we have made in public health assessments or
consultations have been accepted or are still pending. This percentage
is even higher for those recommendations dealing with reducing
exposure.
A good example of this close positive working relationship is the
use of ATSDR's work by EPA in the clean-up of methyl parathion in
Mississippi and then later in Alabama, Arkansas, Illinois, Louisiana,
Tennessee and Texas. Using both the EPA environmental sampling coupled
with ATSDR's biological measurements, the agencies jointly developed
criteria to set priorities concerning temporary relocation of
residents, reentry back into homes, and referral to local health care
providers. Overall, approximately 18,000 people (including 10,000
children) were positively impacted by this collaboration.
Responded to community concerns
ATSDR has made a concerted effort in the past several years to be
more proactive in dealing with community concerns. We have revised the
public health assessment process to actively seek out health data from
the affected community as an integral part of the process. This has
also resulted in a new group of individuals hired by the agency whose
sole job is to routinely interact with the affected community early in
the process and throughout ATSDR's involvement at their site. At sites
where there are heightened concerns, ATSDR has formed community
assistance panels to insure ongoing partnerships in investigating the
site to insure full community involvement in health assessments and
health studies.
One example of a site where ATSDR successfully dealt with a
community's concerns is the Trinity American Site in Glenola, North
Carolina. Local residents petitioned ATSDR with concerns about possible
air emissions from a foam-making process which resulted in chronic and
acute adverse health affects in nearby residents. ATSDR's investigation
of these complaints included environmental monitoring which showed
elevated levels of toluene diisocyanate (TDI) at the plant and in the
community, and blood testing which indicated the community's exposure
to TDI. ATSDR's public health advisory alerted the State and EPA to the
problem. As a result the plant stopped manufacture of fiber and foam
until the company could come into compliance with air emission
standards, and individuals with high antibody levels for TDI were
referred to the Duke University Medical Center for clinical evaluation.
Improved access to and training for health care providers
ATSDR's data indicates that over 1.5 million children 6 years and
younger live within a one- mile boundary of current NPL sites. Compared
to adults, children often have greater exposures, greater potential for
health problems, and less ability to avoid exposures. Most
pediatricians need a reliable clinical resource for specialty referrals
and training in environmental medicine. As one method to address this
issue, the children's health program is in the process of establishing
environmental and pediatric cross-specialty units focused on pediatric
environmental medicine, education, training, and expert consultation,
as well as clinical specialty referrals for children.
ATSDR, and its partners, have developed a national strategy
establishing Pediatric Environmental Health Specialty Units (PEHSUs).
PEHSUs are designed to develop medical expertise in pediatric
environmental health by: (1) implementing regional pediatric
environmental medical education and health promotion programs; (2)
serving as pediatric environmental medicine consultants; and (3)
functioning as referral centers for clinical evaluations of children
exposed to hazardous substances.
In fiscal year 1999, ATSDR will maintain the three existing PEHSUs
and add three additional clinics. The three new units will
significantly enhance ATSDR's and EPA's ability to address the wide
ranging environmental health problems. PEHSUs collaborate with ATSDR in
the development of pediatric environmental medicine clinical evaluation
guidelines.
In addition, ATSDR is working with other federal agencies to
evaluate the feasibility of developing a national childhood cancer
registry; strengthening and accelerating focused research into the
environmental factors that cause or worsen childhood asthma; examining
associations between childhood autism spectrum disorders and pre-natal/
post-natal exposures to environmental pollution; and determining the
magnitude of children's inordinate risk of exposure to hazardous waste
sites due to the proximity of schools to these sites. In fiscal year
2000, ATSDR will maintain one operational PEHSU to provide physician
training, consultation and referrals for children who have had
environmental exposures and health-related problems.
ATSDR has for more than 15 years applied the disciplines of
environmental health science, epidemiology, toxicology, and health
education to assess real and potential human health effects as related
to hazardous substances. The agency has learned valuable information
about the association of certain diseases and exposure to toxic
substances and has used this information to help communities and
environmental and health organizations to prevent and reduce
potentially hazardous exposures. The agency has made a difference in
the daily lives of many communities and in the body of knowledge in
environmental health science. As the principal public health agency
charged with determining the nature and extent of health problems at
Superfund sites we will continue to strive to prevent exposures to
hazardous substances and adverse human health effects.
This concludes our testimony. Once again, we want to thank the
Subcommittee for the opportunity to provide written testimony on our
budget. We would welcome any questions subcommittee members might have
and will be happy to provide written answers for the record.
______
American Battle Monuments Commission
Prepared Statement of Gen. Fred Woerner, Chairman
Mr. Chairman and Members of the Committee: Thank you for the
opportunity to testify on our fiscal year 2000 Appropriation Request.
The special nature of the American Battle Monuments Commission places
it in a unique and highly responsible position with the American
people. The manner in which we care for our country's Honored War Dead
is, and should remain, a reflection of the high regard in which we, as
a nation, respect their service and sacrifice.
As you know, the American Battle Monuments Commission is a small,
one-of-a-kind organization, that is responsible for commemorating the
services of American Armed Forces where they have served since April 6,
1917 (the date of U.S. entry into World War I) through the
establishment of suitable memorial shrines; for designing,
constructing, operating, and maintaining permanent American burial
grounds in foreign countries. In performing these functions, the
American Battle Monuments Commission administers, operates, and
maintains twenty-four permanent memorial cemeteries and twenty-seven
monuments, memorials, and markers in the United States and fifteen
countries around the world.
We have eight World War I and 14 World War II cemeteries located in
Europe, the Mediterranean, North Africa and the Philippines. All of
these cemeteries are closed to burials except for the remains of the
War Dead who may occasionally be discovered in World War I or World War
II battlefield areas. In addition, we are responsible for the American
cemeteries in Mexico City, established after the Mexican War, and in
Panama.
Presently, 124,914 U.S. War Dead are interred in these cemeteries--
30,921 of World War I, 93,243 of World War II and 750 of the Mexican
War. Additionally 5,857 American veterans and others are interred in
the Mexico City and Corozal (Panama) American Cemeteries. Commemorated
individually by name on stone tablets at the World War I and II
cemeteries and three memorials on U.S. soil are the 94,120 U.S.
servicemen and women who were Missing in Action, or lost or buried at
sea during the World Wars and the Korean and Vietnam Wars.
We continue to provide services and information to the public,
friends, and relatives of those interred in, or memorialized at ABMC
cemeteries and memorials. This includes information about grave and
memorialization sites as well as location, suggested routes, and modes
of travel to the cemeteries or memorials. Immediate family members are
provided letters authorizing fee-free passports for overseas travel to
specifically visit a loved one's grave or memorial site. Photographs of
headstones and sections of the Tablets of the Missing on which the
service person's name is engraved are also available. These photographs
are mounted on large color lithographs of the cemeteries or memorials.
In addition, we assist those who wish to purchase floral decorations
for placement at a grave or memorial site in our cemeteries. A
photograph of the in-place floral arrangement is provided to the donor.
The care of these shrines to our War Dead requires a formidable
annual program of maintenance and repair of facilities, equipment, and
grounds. This care includes upkeep of 131,000 graves and headstones; 73
memorial structures; 41 quarters, utilities, and maintenance
facilities; 67 miles of roadways and walkways; 911 acres of flowering
plants, fine lawns and meadows; nearly 3,000,000 square feet of shrubs
and hedges and over 11,000 ornamental trees. Care and maintenance of
these resources is exceptionally labor intensive, therefore, personnel
costs account for nearly 62 percent of our budget for fiscal year 2000.
Some of this maintenance is performed by casual labor, in peak seasons,
since the permanent cemetery staffs are not large enough to provide the
required maintenance during the peak-growing season. The remaining 38
percent of our budget is required to fund our engineering, maintenance,
utilities, equipment, and administrative costs.
As an organization responsible for permanent burial facilities, we
do not have the option of closing or consolidating cemeteries. In light
of this, we have increased our efforts to achieve greater efficiency
and effectiveness, through automating and contracting, in the
operational and financial management areas, where we do have
alternatives. This Commission recognizes and fully supports the efforts
of the President and the Congress to improve efficiency, focus on
results, and streamline the government overall.
During fiscal year 1998, we completed work on our second Strategic
(FY 1999-2004) and Annual Performance Plans (FY 1999). We have
subsequently forwarded copies to Congress and the Office of Management
and Budget. We believe these plans provide our agency a comprehensive
roadmap for the future.
During fiscal year 1998, as part of our Strategic Plan, and at the
request of the Office of Management and Budget (OMB), we conducted the
first comprehensive manpower study of our European and Mediterranean
cemeteries since 1982. The study consisted of a review of current
position descriptions and interviews with top management officials in
our Paris and Rome Offices, cemetery superintendents, foreman, guides,
and most key personnel such as equipment mechanics, masons, gardeners,
and others.
This study will help us define the manpower requirements for each
of our cemeteries. To ensure that we are taking advantage of
streamlining opportunities from additional outsourcing and automation
and to maintain productivity and efficiency incentives, ABMC and OMB
will jointly review the manpower survey. This review will consider the
changing capital /labor ratio regarding the work week and employee
standards. We will develop a comprehensive long-term automation,
employment, and funding plan. We will also undertake a joint study to
determine if automation, technology, and outsourcing improvements can
reduce the growing costs of foreign employment.
In line with the study, the Office of Management and Budget has
approved the addition of two positions, a personnel specialist for the
agency, who will be located in our European Regional Office, and a
systems accountant for our Headquarters Office.
In 1996, Congress specifically directed (Public Law 104-275) that
ABMC prepare agency-wide financial statements annually beginning with
fiscal year 1997, and that the financial statements be audited by the
U.S. General Accounting Office (GAO) in accordance with accepted
government auditing standards. Our first audit resulted in an
unqualified opinion on our balance sheet, which is not normally earned
on initial financial statement audits. We were one of the first
agencies in the Executive Branch to ``early comply'' with the fiscal
year 1998 accounting standards prescribed by the Office of Management
and Budget in Bulletin No. 97-01, Form and Content of Agency Financial
Statements. We have recently completed the second audit and are
awaiting the results.
As I reported to you last year, we contracted with the Department
of Treasury's Financial Management Services Center regarding the
replacement of our accounting system. During fiscal year 1998, we
selected a new system which will be implemented in March of this year.
Implementation of this new, single and integrated accounting system
will resolve a long-standing problem of non-integrated systems.
With our initial success in auditing and the implementation of a
new financial system, we expect ABMC to achieve a higher level of
management excellence in the next two to three years.
During fiscal year 1998 a large part of our focus was on the World
War II Memorial. President Clinton unveiled the winning design by
Friedrich St.Florian at a White House ceremony on January 17, 1997.
Since that time, reviews by the Commission of Fine Arts (CFA) and the
National Capital Planning Commission (NCPC) have resulted in the
requirement to modify the design to more appropriately fit the Rainbow
Pool site. On April 7, 1998, the ABMC forwarded Professor St.Florian's
revised design concept to the CFA and the NCPC for their consideration
and approval. On May 21, 1998, in a public hearing, the CFA unanimously
and enthusiastically approved the location, site plan, and revised
design concept. On July 9, 1998, in a public hearing, the NCPC approved
the revised design concept of the World War II Memorial.
Our National Capital Campaign Chairman, former Senator Robert Dole,
and our Co-Chairman, Mr. Fred Smith of Federal Express, continue to
work diligently to raise the $100 Million required for construction of
the Memorial. The introduction of new films, e.g., Saving Private Ryan,
has substantially raised awareness of the sacrifices of the WW II
generation and the planned recognition through the National World War
II Memorial. Mr. Tom Hanks, star of Saving Private Ryan, has
volunteered his support to the World War II Memorial Project's Public
Service Advertising (PSA) Campaign. He will be featured in television,
radio, and print public service ads. Distribution of these PSA's is
scheduled to run for two years beginning in March 1999 and continuing
through 2000. In addition, prominent corporate and public sector
leaders have been enlisted to assist with the solicitation and advocacy
process.
ABMC faces several significant challenges concerning the World War
II Memorial. Our greatest challenge is to collect private contributions
to ensure that construction is completed so that as many of the World
War II generation as possible will live to see and be honored by the
Memorial. Our goal is to break ground for the Memorial in the year
2000. However, this is dependent on our ability to raise the required
funding by the year 2000.
To respond to these challenges, the ABMC is proposing legislation
which would extend the authorization to fiscal year 2005 in order to
obtain a construction permit and develop the Memorial. The current
authority on the Memorial's construction permit lapses in May 2000. In
addition, the legislative proposal allows ABMC the necessary
intellectual property authority, confirms ABMC's authority to accept
voluntary services in furtherance of the activities of the Commission,
and permits future acceptance of funds. The Office of Management and
Budget advises that, from the standpoint of the Administration's
program, there is no objection to the presentation of this proposal for
the consideration of Congress.
While our attention has been focused on management improvements and
the design and construction of the World War II Memorial, we have not
ignored our primary mission of operating and maintaining twenty-four
memorial cemeteries and twenty-seven monuments, memorials, and markers.
The Congress has been instrumental in our success in maintaining a
high standard of excellence by providing the funds required to
accomplish our objectives. The additional funding of $3 Million in
fiscal year 1998 and $2.5 Million in fiscal year 1999, for engineering
and maintenance projects, allowed us to significantly reduce our
backlog of essential projects. We have grouped together certain types
of projects, such as sprinkler systems, replacement of fuel tanks, and
repair of roadways and walkways, in order to achieve economies of
scale. Grouping these projects by region has and will allow contractors
to consolidate bids and provides ABMC with the most cost-effective use
of managing available resources.
Our fiscal year 2000 request provides $3.0 Million for engineering
and $1.3 Million for maintenance projects which will allow us to
continue to reduce our backlog of projects. In addition, our request
provides for cost of living increases for our U.S. and foreign national
personnel, funding to develop a maintenance data base, establishment of
an information systems contract, the addition of two FTE previously
mentioned, and the OMB suggested studies of our personnel survey and
capital improvement plans. We have focused our fiscal year 2000 program
to ensure we accomplish these essential high priority projects.
For the third year, in agreement with the Office of Management and
Budget, we have repriced our budget to conform to the Fiscal year 2000
foreign currency rates established for the Department of Defense.
Since 1923, the American Battle Monuments Commission's memorials
and cemeteries have been held to a high standard in order to reflect
America's continuing commitment to its Honored War Dead, their
families, and the U.S. national image. The Commission intends to
continue to fulfill this sacred trust while ensuring the prudent
expenditure of appropriated funds.
The American Battle Monuments Commission appropriation request for
fiscal year 2000 is $26,466,526.
This concludes my prepared statement. I will be pleased to respond
to your questions.
______
Chemical Safety and Hazard Investigation Board
Justification
general overview
Mission.--The Chemical Safety and Hazard Investigation Board's (the
Agency) mission is to reduce the occurrence of chemical incidents,
thereby protecting workers, the public and the environment and
lessening associated economic consequences. The Agency's major
responsibilities include: (1) conducting chemical incident-related
investigations under the Clean Air Act Amendments of 1990; (2)
providing the Congress and the President with independent, expert fact
finding and technical advice to assist in the development,
implementation and evaluation of chemical safety policy and government-
wide resource allocation decisions; (3) performing statutory
responsibilities pertaining to chemical safety-related matters, ranging
from special studies and analyses to quasi-legislative functions (e.g.,
recommending operational improvements in federal chemical safety
programs within the Occupational Safety and Health Administration, the
Environmental Protection Agency, and other organizations); (4)
responding to requests for information from the Congress and the
President on various matters affecting chemical safety; and (5)
providing technical information and assistance to government, business
and industry on causes of and ways to prevent chemical incidents. To
carry out these responsibilities and to improve the current picture of
chemical safety, the Agency must maintain the highest level of
expertise.
Challenges.--The Agency first opened its doors in January 1998,
with the need to address a full range of both the most basic
organizational and the most sophisticated mission-specific
requirements. For fiscal year (FY) 1998, the Agency had a $4 million
budget and an authorized staffing level of 20 full-time equivalent
employees (FTE's) to begin building a new independent federal agency
from the ground up. The Agency began without any inherited
infrastructure, personnel, agency-specific policies or procedures,
space, or other fundamental resources. Nevertheless, by the end of
September it had two of its five Presidential-appointed Board Members,
had hired the annual full-time equivalent (FTE) of 5 employees, and had
prioritized use of its resources to initiate development of the most
critical baseline operations. One key baseline operation involved
measuring the scope of the national chemical incident problem, which
had not before been attempted by any organization. The importance of
this effort was emphasized to the Agency during a February 1998 meeting
between Agency staff and representatives from a variety of offices
within the General Accounting Office (GAO). The GAO recommended the
Agency focus on the results it was established to achieve. The GAO said
``rather than focus on the number of accidents CSHIB plans to
investigate, or the number of reports it plans to review, [we] suggest
focusing on the results of doing this work, such as preventing or
eliminating accidents shown by the analysis of data trends. . . . it
will take time to see some of the results of these actions and the
board needs to begin by establishing a baseline.'' The Agency followed
this advice and, by the end of fiscal year 1998, had plans in place to
assess federal data on the scope of the chemical incident problem.
Structure.--The Agency's business plan, prepared in 1997, serves as
the overall strategic plan for building the Agency during its formative
years. This is supplemented with complementary, functional-level
strategic plans and operating procedures subsequently developed to
shape and support specific program activities. By fiscal year 2001 the
business plan will be replaced by a GPRA-compliant, agency-wide
strategic plan, to be prepared in fiscal year 2000. Agency growth from
nascent to functional level was originally scheduled to occur over a
three-year period (fiscal year 1998-fiscal year 2000), during which
time the staff would develop the knowledge, infrastructure, and
programs that would permit the Agency to function as a mature
organization. This timeline now has been extended to four years (fiscal
year 1998-fiscal year 2001) as the result of a better assessment of the
effort required to reach full operational capability. The Agency's
intent, based on its concept of operations, is to grow to an estimated
staffing level of 100 FTE's by fiscal year 2002, and its organization
and staffing reflect this plan. The Agency is a flat organization with
only a single layer of management. It acquires, to the maximum extent
possible, and has its staff manage requisite administrative and
technical services from outside sources. The reasons for this mode of
operation are the use of FTE's to provide administrative services
reduces the number of staff available for technical, mission-related
duties. Also, because chemical incidents occur in such diverse
industries under a wide variety of circumstances, the Agency cannot
have individuals on staff with technical expertise on all subjects that
could be factors in all possible chemical incidents. As a result of
these constraints, the Agency will continue to contract for or
otherwise obtain (e.g., through interagency agreements) the expertise
as needed for specific investigations and other programmatic
activities.
Resources.--In fiscal year 1999, the Agency budget grew to $6.5
million for 12 months of operation from the $4 million appropriated for
and expended over nine months of operation during fiscal year 1998, and
its authorized staffing level increased from 20 to 30 FTE's. The Agency
requests $12.5 million for the necessary expenses to carry out its
mission and meet its goals during fiscal year 2000. This represents a
$6 million increase from the fiscal year 1999 funding level, and is $5
million above the $7.5 million requested in the President's fiscal year
2000 Budget. The $12.5 million request will allow the Agency to
continue moving from a startup to a fully operational federal agency.
The Agency has learned through its efforts to date that the volume,
scope and complexity of its work is greater than purported by others.
Nevertheless, the Agency has limited its budget request to ensure the
fiscal year 2000 increase is consistent with the growth projected in
the Agency's business plan, which was submitted to Congress, the Office
of Management and Budget (OMB), and the GAO. Judicious use of
government contracting opportunities (i.e., buying, not building
capabilities) have already enabled the Agency to realize significant
savings over more traditional operating strategies. Through continued
use of these alternative venues, the Agency expects to be able to meet
its fiscal year 2000 goals in a cost-effective manner.
budget application
The Agency requests $12.5 million to accomplish the work planned
for fiscal year 2000. Funding at this level will allow the Agency to
continue its development by hiring additional staff, providing the
concomitant needs for space, equipment and supplies, and contracting
for requisite services. We note that OMB elected to arbitrarily reduce
this request by $5 million, in spite of statutory language regarding
the independence of the Agency [42 U.S. Code Sec. 7412 (6)(R)]. If the
Agency's request is reduced by $5 million, it will not be able to grow
because most of the $1 million increase over the fiscal year 1999
budget level will be used to fund mandatory increases. The following
are the significant consequences that will result if the Agency's
budget request is reduced to $7.5 million.
--The Agency will not be able to hire any new employees. As a result,
the planned increase in the investigative workload will not be
realized.
--The studies on chemical incident reporting and on federal chemical
incident prevention programs, designed to determine ways to
improve program performance and to reduce costs and burdens on
government and business, will be delayed due to lack of staff
to execute these projects.
--Development of technical guides and educational materials for
industry and other stakeholders will not occur.
--The Agency will curtail efforts to develop technical training
programs for its staff to help them perform their various
technical duties (e.g., conduct investigations, review others'
investigative reports, and plan and manage special studies).
--No further information technology development work in support of
the Agency's mission will be funded. For example, the Agency
uses the Internet to disseminate information about chemical
safety and prevention. Without sufficient funding, work will
not continue enhancing the information-sharing process the
Agency began in fiscal year 1999. In addition, the Agency will
not develop a program to collect ``near miss'' information from
industry (similar to what the aviation industry voluntarily
provides to help prevent aircraft incidents).
--The ten-year consolidated incident database will not be expanded
through the planned annual inclusion of new (e.g., the prior
year's) incident reports and additional types of available
government data. Failure to keep this database current, and to
expand the depth of the information it contains, will prevent
this resource from being used by the Agency for operational
planning and evaluation purposes, and by Congress to evaluate
agencies' performance and budget requests, adjust laws and the
federal chemical safety system, reduce costs and otherwise
improve effectiveness, and to track progress in addressing the
problem of chemical incidents.
budget utilization
Incident prevention
One of the Agency's primary responsibilities is to conduct chemical
incident-related investigations under the Clean Air Act Amendments of
1990. These investigations result in reports addressing the nature,
causes and recommendations for preventing incidents. The ultimate goal
of the investigation activity is to persuade those to whom safety
recommendations are directed to implement these recommendations.
Incident examinations, which are conducted pursuant to Section
112(r)(6)(C)(i) of the Clean Air Act Amendments of 1990, may take the
form of either field investigations or reviews of work done by others.
Each incident is unique. Extensive time must be devoted to researching
and verifying all aspects of the incident, waiting for production of
documents by the company and other investigative authorities, and
conducting analyses of evidence. Depending upon the complexity of the
incident, availability of documents, and other matters that may impede
progress, a report may take 9 to 12 months to complete.
The Agency learned in its first year of conducting investigations
that a variety of personnel are required on a field investigation team
to ensure the effectiveness of each phase of the investigation. For
each investigation, we assign at least one staff member from the
Offices of Investigations, Safety Programs, General Counsel, and
External Relations, for a total Agency investigation team of four or
more staff members. These teams are responsible for the activities
outlined below.
Office of investigations
--Establishing and operating the field command center, which provides
assistance to investigators by obtaining documents, scheduling
witness interviews, maintaining technical communication with
Agency headquarters, and otherwise supporting the investigative
work.
--Compiling business and technical details about the company involved
in the incident, previous incidents within the same industry or
involving similar circumstances.
--Surveying the incident site, determining the scope of the
investigation, and working with local jurisdictional officials
to secure the incident scene and to assure that evidence is not
jeopardized. Coordinating Agency and contractor personnel at
the site.
--Ensuring the investigation is conducted in accordance with Agency
policy, and that methods and techniques are used that will
promptly and effectively identify pertinent facts, conditions
or circumstances surrounding the accident and result in the
timely completion of the field phase of the investigation.
--Developing and preparing documentation from the incident including
reports, photographs, records and other relevant material.
Determining requirements for special tests, studies and
assistance that may be necessary for one or more aspects of the
investigation.
--Reconstructing incident dynamic and sequence of events; determining
the authenticity and adequacy of data; examining the reported
facts, conditions and circumstances of the incident and their
relationship to determination and support of probable cause;
assuring that analyses are consistent with applicable
scientific, technical and engineering methods and standards.
--Preparing the formal incident report in accordance with Agency
policies, procedures, and technical requirements, and defending
the report's contents, conclusions, and recommendations at
formal Board meetings.
Office of safety programs
--Crafting sound recommendations based on the comprehensive
evaluation of what caused the incident. The recommendations are
based on the best scientific solutions to prevent a
reoccurrence and must be feasible to implement.
--Identifying appropriate audiences to which recommendations should
be addressed.
--Developing and implementing a tracking system to ensure
recommendations are closed.
--Evaluating the long-term effectiveness of recommendations.
Office of general counsel
--Obtaining access for Agency investigators to incident sites,
company employees and documents.
--Resolving legal issues with law enforcement and other responding
local, state and federal agencies.
--Working with attorneys from the company involved, as well as
attorneys representing other interested parties, to resolve
matters so the investigation process proceeds efficiently and
effectively.
--Working with Agency investigators to share draft reports, including
the confidential business information, with the company's
attorneys.
--Processing Freedom of Information Act requests and other civil
litigation matters, which invariably follow chemical incident
investigations.
Office of external relations
--Establishing incident-driven external-relations operations in the
field and at headquarters.
--Serving as a liaison and source of information to local, state and
federal officials, industry, labor and the public.
--Identifying organizations (governmental and non-governmental) to be
informed of the Agency's reports and recommendations.
--Arranging for the broadest possible dissemination of reports;
arranging for articles, op-ed pieces, editorials and other
published materials that support acting on Agency findings.
--Responding to questions about Agency actions; monitoring
communications media for evidence of action in response to
Agency recommendations; making presentations (or supporting
presentations by others) on Agency findings and
recommendations.
In addition to the Agency investigation team, the Agency acquires
external support for investigations. Sources of this support include
other federal agencies, the Department of Energy's National
Laboratories, private contractors with specialized technical expertise,
and private laboratories. The Agency also uses contracted support for
technical writing and graphic design of our reports. An average of four
contract staff are used for an investigation.
Due to the complexity of chemical processes, the technical and
legal issues involved in unraveling every incident, and the sheer
quantity of chemical incidents that occur annually, the Agency
carefully screens chemical incidents to decide whether to undertake an
investigation. The Agency usually conducts an initial assessment of the
incident to determine whether a field investigation is warranted.
Factors considered include whether: (1) commonly used chemicals or
processes are involved, (2) hazards of the chemical or the process are
not apparent, (3) regulatory coverage is lacking, (3) the industry
sector is large or is growing, (4) the process or operation involved is
labor intensive, (5) state or local agencies, or safety organizations
have specifically requested Agency involvement, and (6) the industry is
aware of and committed to chemical safety and incident prevention.
The Agency is an independent, scientific, nonregulatory
organization. As a result, its investigations differ from those
conducted by other federal organizations in their focus, depth, purpose
and outcome. The Agency is not limited to examining incidents involving
only certain industries, chemicals or processes. Rather, it selects for
investigation those incidents which appear will provide the widest
audiences with the most useful information on causes of and means of
preventing chemical incidents. As the Agency is precluded by law with
finding fault, matters of regulatory compliance and punitive actions
are outside its investigative purview. Instead, it seeks to determine
the root causes of incidents in order to develop recommendations aimed
at improving safety and preventing future incidents. These
recommendations may be targeted at private industry, government bodies,
professional associations or any other organization in a position to
implement the recommendations. The Agency's investigations result in
objective, technical reports, not enforcement actions and fines. The
Board-approved reports cannot, by law, be used in civil litigation, a
fact which encourages companies to cooperate fully with the Agency as
it conducts its investigations. The Agency disseminates its reports to
key federal, state and local government entities, specific companies
and industries, safety professionals, first responders, trade
associations, and the general public.
No one can say with certainty what the demographics (e.g., size,
characteristics, cost to the economy) are of the annual universe of
United States chemical incidents. Therefore, any assertions as to these
factors are suspect and cannot be relied upon with confidence. The
Agency's preliminary findings from its study of 10 years of incident
data reveal that the numbers, just for incidents resulting in one or
more deaths, are far greater than the Agency could hope to investigate.
Annually, an average of 127 incidents occur that result in at least one
death. In fiscal year 2000 the Agency will continue to examine a select
number of incidents to continue to expand its first-hand knowledge
about problems, but will devote at least equal attention to alternative
strategies for bringing about change.
In fiscal year 1999, the Agency initiated work, to continue in
fiscal year 2000, on development of the federal government's first
comprehensive national database of chemical incidents. As emphasized by
the GAO, absent this resource and the baseline it establishes, there is
no objective way to determine the scope, nature or change in the
chemical incident picture within the United States. There is no
objective way to determine how best and at what level of effort to
apply the Agency's (and the totality of the federal government's)
resources to address the problem posed by chemical incidents, or how to
devise and implement meaningful prevention strategies. Consequently,
there is no way to establish and report on performance measures
required by Congress under the Government Performance and Results Act.
Representatives from the GAO endorsed, as an efficient use of
government resources, the Agency's plan to develop a basline using
information contained in databases already developed by other agencies.
The GAO noted that when using data from different sources, it is
important to recognize that both data comparability and data
reliability are key issues to address.
For this function the Agency projects the use of 24.2 workyears and
$5,493,000 in direct costs in fiscal year 2000, compared to 10.7
workyears and $2,421,000 in fiscal year 1999.
Safety studies
These are discrete activities to support specific program
operations within the Agency or develop products and services for
stakeholders to assist them in improving chemical safety. In fiscal
year 2000 the focus of the work under this function will be on
technical training for Agency staff and assessment of the effectiveness
of federal chemical safety programs in contributing to attainment of
the government's goal of eliminating chemical incidents.
Currently, available technical training dealing with investigation
of chemical incidents does not address with specificity matters within
the purview of the Agency, i.e., how to identify root causes of
incidents and design recommendations to correct those causes. The vast
number of industries and their varied operations complicate the process
of conducting investigations and make it imperative that Agency
investigators have available to them the training and references needed
to understand the facility at which an incident has occurred. By
developing training for Agency staff, materials also become available
for industry use, which may assist in identification of problems before
they lead to incidents. Agency training materials are to be multi-
dimensional and multi-purpose, designed for use both in the office as
an educational tool and at an incident site as a reference tool. These
materials will provide technical treatment of pertinent laws,
regulations, industry standards and current safety research, and
checklists and other aids to guide and assist in the conduct of an
investigation. In fiscal year 2000 the Agency intends to develop
targeted training for its staff, focusing on particular technical
issues and on the process of conducting an investigation and writing
reports. It also intends to develop training on human factors, in order
to address issues noted by the Congress in the Agency's legislative
history: ``. . . special emphasis should be put on expertise in ``human
factors'' and the role that operator failures play in causing
accidents. In other fields, the United States has fallen behind the
international community in the use of operator training and the
development of operating and emergency procedures to prevent accidents
and minimize their consequences.'' [Senate Report No. 101-228 (1989);
Page 229]
The Agency is required by law to provide Congress and the President
with an annual report that addresses, among other matters,
recommendations for legislation or regulatory changes. Congress further
suggested the Agency ``. . . may issue more general reports to the
Congress and make recommendations to other Federal or State or local
agencies and to owners and operators of facilities engaged in chemical
production or handling to suggest measures that might be taken to
improve the safety of operations.'' [Senate Report No. 101-228 (1989);
Page 235] In addition to issuing formal reports, Congress suggested in
the legislative history that the Agency ``. . . may also serve as a
point of communication among the various Federal agencies to improve
the effectiveness of accident prevention programs and reduce the burden
of duplicative requirements on regulated entities.'' [Senate Report No.
101-228 (1989); Page 208] In order to offer sound recommendations for
improving the performance, streamlining the operation and reducing the
cost of the federal government's chemical safety programs, the Agency
first needs an in-depth understanding of the various programs. To gain
this understanding, in fiscal year 2000 the Agency will initiate a
comprehensive, multi-phase study of the federal government's chemical
safety system. The Agency will issue reports to Congress and other
appropriate parties that contain findings and any recommendations for
improving the system and the coordination between the federal agencies
involved with chemical safety. The Agency also intends to undertake a
study of the economic cost of chemical incidents to industry, state and
federal government, and other definable entities.
For these activities the Agency projects the use of 1.9 workyears
and $417,000 in direct costs in fiscal year 2000, compared to 1.0
workyears and $211,000 in fiscal year 1999.
Information dissemination
The main product of the Agency is chemical safety information.
Chemical safety information includes not only the safety
recommendations generated from incident investigations, but also
various other types of safety information--data, operational guidance,
technical references--that exist throughout the commercial and
government sectors, or that will be developed by the Agency. The
information will help a variety of stakeholders make decisions about
chemical safety, e.g., the Congress and federal agencies, corporate
management, workers, communities, first responders and safety
professionals.
The intended repository of and distribution point for information
is the Agency's safety information center. A variety of products,
accessible via the World Wide Web and other venues, will be available
from the center to assist stakeholders in improving safety and reducing
the number of incidents. The Agency's web site, designed to serve as an
entry point to the center, already is serving a large and varied
domestic and international clientele in both the public and private
sector. It provides more information on what is currently happening
relative to chemical safety than has ever been available on a real-time
or near-real-time basis in one place before. The regularity with which
the Agency's web site is consulted is evidence of the desire for and
interest in a centralized center, where safety professionals can share
information, benchmark their safety practices and the safety of their
technologies, and locate safety-related references and statistics.
In fiscal year 2000 information dissemination efforts will more
formally identify and begin to satisfy needs for chemical safety
information. As part of this initiative, the Agency will broaden the
depth and breadth of Agency interactions and communications with
external audiences and expand the availability of electronic
information via the Internet. The Agency will for the first time devote
one full-time equivalent position to supporting the content development
tasks associated with the Agency's World Wide Web site. Content
development in fiscal year 1998 and fiscal year 1999 was handled solely
as additional duties by other staff. As the Agency has developed
significantly more original materials and has engaged in significantly
more interaction with external parties, the content development
workload has exceeded the ability of staff to keep pace. In addition,
the development of large databases, investigation reports and
recommendations, and special studies requires corresponding Internet-
specific platforms, and information technology staff to develop,
support, and administer the databases and web site.
In fiscal year 2000 the Agency will continue building the nation's
primary repository of chemical safety data, which is modeled after the
Federal Aviation Administration's National Aviation Safety Data
Analysis Center. Chemical safety data will be used by the Agency in
decision-making, resource allocation, and to support investigative and
safety program analyses. Chemical safety data will also be available to
our stakeholders. However, many of the repository's source databases
from other government agencies contain incomplete and sometimes
inaccurate historical incident data. Moreover, even similar data from
different sources are inconsistent due to confusing and often
contradictory regulatory reporting requirements. To build and use the
chemical safety data repository, and to effectively disseminate
information to the Agency staff and stakeholders, the information
technology operations require additional staff to identify data
sources, and to acquire, manage and analyze the data.
Another critical information dissemination function is the
monitoring of chemical incident reports received from a number of real-
time sources, such as the U.S. Coast Guard's National Response Center
and commercial news wire services. This information plays a role in
deciding whether to conduct an investigation. In fiscal year 2000 the
Agency plans to produce, for publication on its web site and inclusion
in its incident database, short synopses of incidents based on this
information. In this way the Agency expects to compile incident details
that may be searched for insight into causes of those incidents not
investigated due to resource constraints. The Agency also expects to
design in fiscal year 2000 a voluntary, confidential reporting program
on ``near miss'' events (similar to the one developed for use by the
aviation industry and operated by NASA for the FAA) that provides early
warning of conditions that may lead to actual incidents.
Information dissemination activities also are intended to comply
with several government-wide mandates. For example, the Agency must
inform Legislative and Executive Branch members, and the taxpayers,
about its routine and non-routine activities. At a minimum, such
notification occurs via the Agency's Annual Report and budget materials
it submits to the Congress.
For information dissemination activities, the Agency projects the
use of 11.1 workyears and $2,723,000 in direct costs in fiscal year
2000, compared to 5.6 workyears and $1,342,000 in fiscal year 1999.
Board members
In fiscal year 2000, it is anticipated the Agency's five-member
Board will, for the first time, be fully staffed for an entire fiscal
year. The Board Members are Presidential appointees whose salaries are
set by law. The Board Chairman manages the Agency in his concurrent
role as its Chief Executive Officer. The Board was established by law
to perform a technical review and vote on release of investigation
reports and recommendations prepared by Agency staff. Board Members may
also pursue personal projects of interest to them in the field of
incident prevention, may be called upon by Agency staff for expert
assistance in addressing specific Agency concerns, and may perform
outreach services on behalf of the Agency at the CEO's request.
For this function the Agency projects the use of 4.5 workyears and
$1,325,000 in direct costs in fiscal year 2000, compared to 3.6
workyears and $1,002,000 in fiscal year 1999. We note that workyears
are projected to be 4.5 in fiscal year 2000, because the Chairman's
time is split between activities performed as a Board Member and as
Chief Executive Officer.
Executive direction
These are general management activities (e.g., developing the
Agency's strategic plan, and evaluating Agency-wide operations)
performed by the Agency's Chief Executive Officer, the Chief Operating
Officer, the Executive Officer (responsible for execution of
administrative functions), and individuals responsible for directing
the work of the Agency's program offices.
For this function the Agency projects the use of 1.8 workyears and
$503,000 in direct costs in fiscal year 2000, compared to 2.1 workyears
and $537,000 in fiscal year 1999.
Indirect costs
This encompasses all administrative operations (human resources,
finance and budget, and management services), whether performed by
Agency staff or by public or private sector vendors operating under
their direction, and all activities pertaining to installation and
maintenance of the Agency's information technology infrastructure. It
also includes time to devoted by staff to develop written procedures
for Agency activities such as contracting, and time devoted to general
Agency-wide activities, such as regularly scheduled briefings for Board
Members to keep them aware of work being performed by the Agency.
These activities also include work benefiting the entire Agency,
such as provision of legal services. This is a new agency with unique
statutory provisions. It is continually faced with complex, novel legal
issues that it must resolve. In many legal areas, such as the Agency's
authority to compel companies and other agencies to cooperate with it,
there are no precedents. In addition, because this is a new agency, it
has no legal structure in place to assist it in complying with the
various federal laws. For example, the Agency still has not published
in the Federal Register any regulations, directives, orders, or other
institutional documents to guide its activities. Consequently, it needs
lawyers to draft and promulgate these comprehensive documents. Finally,
the Office of General Counsel serves as advisor to the Chairman of the
Agency and assists in providing advice to concerns raised by specific
Board members. As the five-member Board becomes fully functional,
additional legal time will be necessary to meet their demands.
These activities also include work undertaken by that person
serving as the Agency's Inspector General. That individual is
responsible for directing and carrying out financial and management
audits of the Agency's operations, and for reviewing and commenting on
proposed procedures and other documents regarding their economy,
efficiency, and effectiveness. In fiscal year 1999 financial statements
for the Agency's first year of operations (fiscal year 1998) were
produced, and it is anticipated that in fiscal year 2000 this work will
be expanded to address the Agency's system of records, internal control
procedures, policies for marking and controlling sensitive data, and
the ability to report on performance measurement goals.
In addition, the Agency must acquire appropriately configured,
permanent office space. The Agency has grown from an onboard staff of
15 employees at the end of fiscal year 1998 to a current level of 27
employees. The Agency plans to hire an additional 30 FTE's in fiscal
year 2000, and to have 100 FTE's by fiscal year 2002. It was not cost-
effective or even financially possible to enter into a long-term lease
for space that could accommodate the needs of a 100-employee agency
when the Agency was staffed with only a few employees. Accordingly, the
Agency leases temporary space to accommodate the startup staffing
levels. In fiscal year 2000, the Agency will locate and prepare its
permanent office space. Build-out costs to prepare the space include
standard expenses incurred by the government in preparing space for
occupancy (architectural design services and space alterations). It
also includes creation of such technology infrastructure to support the
Agency as fiber optic network wiring, primary uninterruptible power
supply (UPS) installation, air conditioning, and specialized electrical
wiring to support the infrastructure.
The Agency projects the use of 8.5 workyears and $2,039,000 in
fiscal year 2000, compared to 3.8 workyears and $987,000 in fiscal year
1999 for the indirect cost category.
______
Consumer Product Safety Commission
Prepared Statement of Ann Brown, Chairman
Mr. Chairman, and members of the Subcommittee, I am Ann Brown,
Chairman of the U.S. Consumer Product Safety Commission (CPSC).
I am pleased to have this opportunity to testify in support of our
fiscal year 2000 appropriation request. The modest increase in our
budget to $50.5 million, the establishment of a small, carefully
targeted, applied research program and other initiatives assure the
Agency will continue on the effective path we have followed for the
past five years.
Before I begin my testimony on our budget, I want to give you a
quick update on the two tasks given us by the conferees on our fiscal
year 1999 appropriations. As you will recall, Section 423(a) of the
Conference Report directed us to contract with the National Academy of
Sciences within 90 days, for a 12-month study of the potential
toxicologic risks of all flame-retardant chemicals identified by the
NAS and the Commission as likely candidates for use in residential
upholstered furniture. These chemicals could be used to comply with our
draft proposed regulations for flame resistance of this furniture. We
entered into the contract with the NAS prior to the deadline on January
15 of this year.
Section 429(a) of the Conference Report directed us to propose for
comment within 90 days, a revocation of the amendments to the
children's sleepwear standard previously issued on September 9, 1996.
FR Vol. 61, No. 175, p. 47634 et. seq. The proposed revocation was
published in the Federal Register on January 19 of this year, which was
also prior to the deadline.
Section 429(c) directed us to promulgate a final rule revoking,
maintaining or modifying these latest sleepwear amendments by July 1,
1999. We will complete that assignment on time.
awards for innovations
The Commission has recently received two prestigious awards for
innovations in the way we carry out our work. The first award for
innovation is from the Ford Foundation, the Council for Excellence in
Government and the JFK School of Government, which administers the
awards program. Last year, CPSC was chosen from over 1,400 entries as
one of 10 winners of the 1998 Innovations in American Government Award.
We received the award for our Fast Track Product Recall Program. With
this new program we are seeing dangerous products removed from store
shelves more quickly and three times as many returned as with a regular
product recall--without a preliminary product defect against a company.
The second award was from the Institute for Dispute Resolution,
which honored us for our innovative use of mediation in carrying out a
recall of defective high temperature plastic vent pipes, that are part
of certain furnaces and boilers, which could leak deadly carbon
monoxide. Instead of lengthy and costly litigation involving many
companies, CPSC employed the services of an experienced mediator who
persuaded the companies to accept a program to replace the dangerous
pipes at no cost to consumers.
These two awards from highly respected organizations demonstrate
that CPSC is an innovative, effective organization that performs its
work in a praiseworthy manner.
fiscal year 2000 budget
Despite the progress in product safety in recent years, there are
still an average of 22,000 deaths and 29.5 million injuries annually
due to unsafe consumer products. These deaths, injuries and associated
property damage cost the nation about $400 billion a year.
To carry out the second year of our six year strategic plan to
reduce further the number of deaths and injuries and property damage,
we propose a budget of $50.5 million for fiscal year 2000.
As you will recall, last year we set forth and discussed in detail
our eight strategic goals. They are:
--Reduce the head injury rate to children from consumer products by
15 percent.
--Prevent any increase in the death rate from poisonings to children.
--Reduce the death rate from fires by 10 percent
--Reduce the death rate from carbon monoxide poisonings by 20
percent.
--Reduce the death rate from electrocutions by 20 percent.
--Increase public contacts through the Worldwide Web by 500 percent
and through the Consumer Product Safety Review by 200 percent.
Maintain capability to handle 250,000 Hotline calls annually.
--Attain 85 percent success with services CPSC provides industry
through the Fast Track Product Recall Program, and 80 percent
success in the Ombudsman Program.
--Sustain the current satisfaction of consumers with CPSC's Hotline
and Clearinghouse, and sustain the states' satisfaction with
CPSC's State Partners Program at 90 percent or better.
This year we have restructured our budget to more closely reflect
our goals in these specific areas. Previously, we organized our budget
along functional lines. Thus, compliance, consumer information, hazard
assessment and reduction and agency management were each separate
categories.
In our new format we have just two categories, reducing product
hazards to children and families and identifying and researching
product hazards. There are four activity areas included in the first
category.
--Children's Hazards
--Fire and Electrocution Hazards
--Household and Recreation Hazards
--Child Poisoning and other Chemical Hazards
research budget
There are two activity areas in the second category:
--Hazard Identification and Analysis
--Applied Product Hazard Research
For the first time this year, we are proposing a separate, specific
research budget. We have always done some product research, when funds
were available. Section 5(b)(1) of the Consumer Product Safety Act
specifically authorizes the Commission to ``conduct research, studies
and investigations on the safety of consumer products and on improving
the safety of such products.''
Our proposal is supported by the recent report of the highly
regarded National Academy of Sciences Institute of Medicine. After
reviewing the Commission's performance in recent years, the report
concluded:
``The committee believes that the CPSC is on the right course,
relying heavily upon cooperative efforts with industry to raise
prevailing standards of safety . . . the committee believes the
agency's capacity to carry out this strategy needs to be strengthened
by increasing its resources for . . . applied research.'' Report p.
215-216.
The committee recommended that research funds be used ``to enhance
the CPSC's capacity to study safety problems and stimulate product
innovations, examine the feasibility and efficacy of safer product
designs and proposed safety standards and develop and test
methodologies for setting performance standards and for monitoring
compliance with such standards.'' Report p. 217.
One of the research projects we are considering could improve the
safety of certain House office buildings. In a compliance investigation
last year, we found that certain fire sprinklers, like those in the
House office buildings, are defective. Accordingly, they have been
recalled, by the manufacturer with an offer of free replacement. We
have been unable to obtain any information about defects in the
sprinklers in the Senate office buildings, because the Architect of the
Capitol has not responded to our requests for such information. If you
grant our research request, one of the projects we are considering is
an investigation into the adequacy of existing fire sprinkler
standards. We would study the reliability and performance of these
products to determine what improvements are needed.
information technology and other program initiatives
In recent years we have repeatedly stressed to you our need for
improvements in our information technology. We do so again this year.
As a data-driven agency, we must strengthen the tools we use to
identify and analyze product hazards if we are to continue making sound
risk-based decisions. CPSC requests $500,000 for an integrated hazard
database. This is a key improvement because it will speed up hazard
analysis and investigations.
We further ask an additional $355,000 to fund various initiatives
that strengthen the agency's ability to reduce death and injury to
children and those resulting from fire and electrocution hazards,
household and recreation hazards, and child poisonings and other
chemical hazards. Some of these initiatives include oversight of the
all-terrain-vehicle (ATV) industry safety program, the distribution of
safety information to the nation's families through pediatricians, the
purchase of laboratory testing equipment, expanded consumer Hotline
services, and an additional safety video news release.
The balance of the additional request, $2.1 million, is to maintain
the agency's current safety effort at 2000 prices. The $2.1 million
will fund projected increases for salaries and benefits of $2 million
and General Services Administration estimates for space rent increases
of $126,000. These costs are outside the control of CPSC. CPSC did not
increase our office space; the increase represents the GSA allocation
of cost increases GSA projects it will need to operate the Federal
office space program in 2000.
The National Electronic Injury Surveillance System (NEISS) is the
foundation for Commission efforts to collect information on product-
related injuries. NEISS provides estimates of the frequency and
severity of product-related injuries treated in hospital emergency
rooms. In fiscal year 2000, CPSC is planning to expand the NEISS, which
is currently limited to consumer product injuries, to include all
injuries. This will be done in partnership with other Federal health
and safety agencies at no additional cost to CPSC. In its recent report
on injury, the Institute of Medicine recommended that the federal
government expand CPSC's NEISS to increase our knowledge of the causes
and severity of nonfatal injuries. This endorsement of the NEISS is
another example of the increasingly important role that CPSC plays in
the injury-prevention community.
new partnership
In previous years I have told you about our partnership with Gerber
Products and other companies to promote consumer product safety. I have
recently announced a new partnership with CNA, a major insurance
organization based in Chicago. With CNA's support we are issuing today
a new free brochure highlighting low-cost safety devices for making
homes safer for young children: Childproofing your home: 12 Devices to
Protect Your Children. Each year over 2.5 million young children are
injured or killed in often-preventable incidents in their own home.
This brochure will tell parents about safety devices that will help
keep children safe in their homes. CNA Financial Corporation of Chicago
has underwritten the costs of producing and distributing this colorful
easy-to-read brochure that will be distributed free of charge by the
Consumer Information Center. This is the kind of public/private
cooperation that helps us get our life-saving information to the
American public without regulation or red tape.
cpsc is a cost effective agency
Mr. Chairman, and members of the Subcommittee, we take great pride
in the awards we have recently received. They inspire us to rededicate
ourselves to the mission of our agency--keeping children and families
safe.
As we prepare for our 26th year, I want to cite just a few of our
accomplishments. We have played a key role in the 30 percent decline in
the rate of deaths and injuries related to consumer products since
1973. During this time we have:
--Saved the nation about $10 billion annually in health care,
property damage, and other societal costs through past agency
work on electrocutions, children's poisonings, children's
cribs, power mowers, and fire safety. These savings are almost
200 times CPSC's request for 2000 or about $200 million in
savings for each $1 million of the agency's request.
--Required cigarette lighters to be child-resistant. This action is
expected to prevent over 100 deaths annually and provide net
benefits of over $500 million in societal costs.
--Reduced societal costs by about $1 billion annually by working to
curb carbon monoxide (CO) poisoning.
--Prevented about 50,000 injuries and reduced societal costs by over
$1 billion each year by removing dangerous fireworks from the
marketplace.
These and other recent achievements are strong evidence supporting
the conclusion of the Institute of Medicine report that CPSC is now ``a
model of regulatory efficiency.''
Mr. Chairman, the $50.5 million we are requesting is equal to about
1/1,000 of the $400 billion annual cost of deaths, injuries and
property damage caused by hazardous consumer products. Your approval of
the full amount of our budget will be returned many times over in
better health and safety for all American children and families.
______
Court of Appeals for Veterans Claims
Prepared Statement of Hon. Frank Q. Nebeker, Chief Judge
Mr. Chairman and distinguished members of the Committee: On behalf
of the Court, I present for your consideration the fiscal year 2000
budget of $11,450,000 for the United States Court of Appeals for
Veterans Claims. (The Court was renamed last year by the Veterans
Programs Enhancement Act, Sec. 511, Pub. L. No. 105-368, 112 Stat.
3315, 3341 (1998), effective on March 1, 1999.)
The Court's fiscal year 2000 budget request includes $910,000
requested by the Veterans Consortium Pro Bono Program (Representation
Program). The Representation Program provided its own supporting
statement to accompany its budget request.
The budget request of $11,450,000 reflects a $1,255,000 increase
over the funding for Court and Representation Program operations
appropriated for fiscal year 1999. The net increase for Court
operations is $1,210,000. This increase is based primarily on a request
for funding of 8 full-time equivalent (FTE) positions, above the fiscal
year 1999 authorized level of 80 FTEs, for a total of 88 FTE positions.
This funding would permit the Court to hire a third law clerk for each
judge and an additional staff attorney in the Central Legal Staff
(CLS). The additional personnel are needed, in response to a sharp
increase in the number of cases filed in the Court during the last two
years, to prevent the backlog of cases from growing further and causing
dramatic delay in the resolution of veterans' appeals.
As background for the current situation, I will give you a quick
synopsis of the Court's caseload history. The Court began operations on
October 16, 1989. The number of new cases filed in the Court fluctuated
substantially during the first few years, and leveled off at slightly
more than 1,200 per year by fiscal year 1995. In fiscal year 1996 there
were 1620 new case filings, an increase of 27 percent over fiscal year
1995, and in fiscal year 1997 case filings jumped to 2,229, an increase
of almost 38 percent over fiscal year 1996. The upward trend continued
in fiscal year 1998, with 2,371 case filings, a 6 percent increase over
fiscal year 1997. Our current rate of case filings is approximately 200
cases per month. In recent months, there has been a dramatic increase
(approximately 11 fold during the first quarter of fiscal year 1999) in
petitions for extraordinary relief--cases that demand prompt action. In
addition, since the 1992 enactment of legislation extending the Equal
Access to Justice Act (EAJA) to the Court, the number of EAJA
applications acted upon by the Court has increased dramatically (from
290 in fiscal year 1995 to 527 in fiscal year 1998).
I anticipate that the number of cases filed in the Court will
either continue at the current elevated level (about 200 per month), or
increase further. I will tell you why this is likely. The number of
denials by the Board of Veterans' Appeals (Board or BVA), from whose
decisions the Court's appeals derive, increased from 6407 denials in
fiscal year 1995, to 10,444 denials in fiscal year 1996, and to 15,865
denials in fiscal year 1997. The numbers remained at that high level in
fiscal year 1998 with 15,360 denials. The Court anticipates a
corresponding continued proportion of appeals to the Court.
Furthermore, as noted in the Court's budget submission, the statistics
kept by the Board on ``denials'' do not include Board decisions that
deny some, but not all, of the benefits sought. The denials in such
partial-denial cases are also appealable to the Court. Finally, the
Board's jurisdiction, and the Court's, was broadened by legislation
that became effective in November 1997 (see Pub. L. No. 105-111, 111
Stat. 2271 (1997) (codified at 38 U.S. Sec. 7111)) to include review of
claims of clear and unmistakable error (CUE) in past Board decisions
that have become final. In January 1999, the Secretary promulgated
final rules governing review for CUE, permitting the Board to issue
decisions in all such cases, including those stayed awaiting the mid-
February effective date of the rules. Thus, especially in view of the
present dramatic increase in petitions for extraordinary relief and new
CUE cases, the number of pending cases may exceed the rate that would
be predictable as a set percentage of the number of ``denials''
reported by the Board.
Another factor affecting the Court's workload is the effect of
unrepresented appeals. Unrepresented appeals continue to pose a
challenge. The percentage of appeals filed by unrepresented appellants
remained almost constant at 74 percent in fiscal year 1996 and 73
percent in fiscal year 1997, down from its highest level--80 percent--
in fiscal year 1995. In fiscal year 1998 the trend was upward, with 77
percent of appeals filed by unrepresented appellants. This rate remains
much higher than the unrepresented civil appeal rate in U.S. courts of
appeals. The rate is not surprising because nearly half of the
claimants who were denied all benefits by the BVA were unrepresented
there, or were represented by organizations that do not provide
representation before the Court. In addition, by law, attorney fees may
not be charged for representation until the BVA has rendered a final
decision on a case. Although by the time of merits disposition the rate
of unrepresented appeals is reduced to about 47 percent, all
unrepresented cases require extra processing attention as they progress
through the various appeal stages.
Late in fiscal year 1998, as a result of the growing backlog of
cases in the Court's CLS and in chambers, the Court comprehensively
reevaluated its personnel requirements and determined that the
increasing caseload necessitated hiring additional staff for each judge
and the CLS. At that time, the Court reported to this Subcommittee that
it planned to reprogram fiscal year 1999 funds from operations to pay
and benefit accounts to cover the additional salary expenses for these
new personnel in the fourth quarter of fiscal year 1999. However,
because of the possibility of a period of operation under a Continuing
Resolution, the Court has concluded that it should not employ
additional staff until the fiscal year 2000 appropriation is in place.
Should the Court's appropriation be for the amount requested, the new
staff members would be hired at that time.
As I summarize the reasons for this request for increased staffing,
I am reminded of the Chinese proverb: be careful what you wish for,
because you may get your wish. In past years, I have joined those who
supported the BVA's being given sufficient resources to reduce a
burgeoning backlog and cut down the amount of time that benefits
claimants had to wait for a BVA decision. In addition, when I testified
concerning the Court's fiscal year 1999 appropriations request, I urged
that sufficient funding be provided to VA General Counsel Group VII
(the appellate attorneys who represent the Secretary before the Court)
for adequate staffing and equipment to cut down on the very large
number of requests by Secretary's counsel for extensions of time.
Overburdened attorneys were slowing proceedings before the Court by
repeated requests for extensions of time for the actions, required of
the Secretary's General Counsel by statute and Court rules, to develop
a case for disposition by the Court. Both the BVA and VA General
Counsel Group VII have been given needed funding. Their increased
capability has moved the ``bubble'' to the Court and has dramatically
raised the number of cases ready for action by the Court. To move cases
expeditiously and with integrity is, and must be, the Court's goal. Our
request for increased staffing will permit us to avoid an unacceptably
high, further backlog in the face of the enhanced production by the
Board and VA General Counsel's Group VII. The injustice done by delays
at the Board level and in the General Counsel's Group VII must not be
allowed to occur at the Court's level of adjudication when the cost is
relatively small, compared to that experienced by the other two
entities. The requested 88 FTE positions are required to maintain
timely and careful case processing and dispositions for benefits
claimants seeking judicial review, particularly those who come to the
Court unrepresented.
In addition to personnel requirements, the Court's fiscal year 2000
budget request reflects funding to continue revision and upgrade of the
court's automated case management system to accommodate changes in the
Court's processes and to complete updating a now-obsolete system for
Windows.
Finally, in the last two years I have urged that the Representation
Program be authorized and funded outside the Court's appropriation. I
continue to be concerned that linking the Court to any party before the
Court can serve to undermine the public's trust and confidence in
judicial review of veterans' claims. However, the Appropriations
Committee's consideration of the Program's request as separate from the
Court's budget request and the removal of discretion from the Court
over the Program's funding level has separated the Court, to the
greatest extent possible under current legislation, from direct
involvement in the Program. Accordingly, consistent with Congress'
direction, the Court has forwarded to the Congress the Pro Bono
Representation Program's own supporting statement for its fiscal year
2000 request for $910,000 as an appendix to the Court's budget
submission and, also consistent with that direction, has included that
amount in the Court's total fiscal year 2000 budget request. The Court
has also communicated to the Representation Program's Executive Board
the Subcommittee's request for a statement in support of the fiscal
year 2000 budget request.
In conclusion, I appreciate the opportunity to present this
statement in support of the Court's budget request for fiscal year
2000. On behalf of the judges and staff, I thank you for your past
support and request your continued assistance.
______
Prepared Statement of David B. Isbell, Chair, Executive Board, Veterans
Consortium
Mr. Chairman and distinguished members of the Committee: On behalf
of the Executive Board (formerly called the Advisory Committee) of the
Veterans Consortium, I submit this statement in support of the request
for a fiscal year 2000 appropriation of $910,000 for the Pro Bono
Program of the United States Court of Appeals for Veterans Claims--a
program for which the Consortium has, from inception, had operational
responsibility. The appropriation requested would represent an increase
of $45,000, or 5.2 percent, from the fiscal year 1999 appropriation of
$865,000.
I understand that the Subcommittee has previously received the
Program's proposed fiscal year 2000 budget (bearing the title The
Veterans Consortium Pro Bono Program, fiscal year 2000 Budget and
Narrative), as an attachment to the fiscal year 2000 budget submission
by Chief Judge Nebeker on behalf of the Court. For ease of reference,
however, I have also attached a copy hereto as Exhibit A. That
document, I believe, provides a full explanation of the reasons for the
increase in the level of anticipated expenditures, and I will not
repeat its substance here. Two points do, however, deserve brief
mention.
First, it will be noted that the proposed budget calls for
expenditures totalling $909,014, or slightly less than the rounded
amount of the requested apppropriation.
Second, and of more substance, let me offer a comment on a question
that arose in connection with the hearing on the Court's fiscal year
2000 budget by the House Appropriations Subcommittee (on March 3 of
this year). The Court has requested a proportionately larger increase
in its budget for fiscal year 2000 than has the Program. Given that the
Court's request rests largely on an anticipated increase in the Court's
caseload, the question was raised in that hearing, as to whether the
Program has asked for a sufficiently substantial increase to deal with
a similarly enlarged caseload. The answer is, we believe that what we
have requested will in fact suffice. The principal reason for this is
that, as noted in Exhibit A (p. 1), the Program in 1998 processed
roughly 150 more requests than it received in that year--i.e.,
approximately 750 compared to 600--thereby substantially eliminating an
accumulated backlog of requests. Although this required an
extraordinary effort on the part of the staff involved, it demonstrated
that we have the capability, if need arises, of dealing with a larger
caseload than we anticipate. In addition, we do not anticipate as large
an increase in our caseload as is the case with the Court. The reason
for this is that Program seems to be experiencing a somewhat lower rate
of requests for assistance from appellants before the Court than has
been the case in the past, presumably because a larger proportion of
those who would otherwise be unrepresented are being offered and
accepting representation on a fee-paying basis before they have been
advised that pro bono representation might be available. Thus, the
overall pro se rate among those filing notices of appeal with the Court
has been declining; and it appears that the proportion of those who are
at that point pro se and who subsequently seek assistance from the
Program is also declining. In consequence, we believe that the Program
has the capability of dealing with its share of the expanded caseload
that the Court is planning for.
Finally, I would mention two significant statistics about the
Program. By the end of 1998, the Program had recruited and offered
training to 536 volunteer pro bono lawyers, and had provided pro bono
counsel in a total of 1351 cases.
The Veterans Consortium Executive Board is grateful for this
Committee's consideration of our budget submission.
______
Deparment of Defense--Civil
Department of the Army
Cemeterial Expenses
Prepared Statement Dr. Joseph W. Westphal, Assistant Secretary of the
Army for Civil Works
introduction
Mr. Chairman and distinguished members of the subcommittee: I
appreciate the opportunity to provide testimony to the subcommittee in
support of the fiscal year 2000 appropriation request for Cemeterial
Expenses, Department of the Army. I am providing this testimony on
behalf of the Secretary of the Army, who is responsible for the
operation and maintenance of Arlington and Soldiers' and Airmen's Home
National Cemeteries.
Arlington National Cemetery is the Nation's premier military
cemetery and it is an honor to represent the cemetery. This committee
has historically been very supportive of the cemetery, and we
appreciate your support.
fiscal year 2000 budget overview
The request for fiscal year 2000 is $12,473,000, an increase of
$807,000 over the fiscal year 1999 appropriation. This increase will
permit Arlington National Cemetery to improve its infrastructure and
work toward implementation of the cemetery's Master Plan. The funds
requested are sufficient to support the work force, to assure adequate
maintenance of the buildings, to acquire necessary supplies and
equipment, and to provide maintenance standards expected at Arlington
and Soldier's and Airmen's Home National Cemeteries.
Priority investments
I would like to summarize some of the Administration's priority
investments we are proposing this year.
The Army has recently completed a Master Plan for Arlington
National Cemetery, which is designed to ensure that Arlington will
remain active as the Nation's premier military cemetery. This plan
identifies fourteen parcels of land that are located in close proximity
to the cemetery and that could be used for future burials. We intend to
examine those parcels that could be made available so that the future
needs of the cemetery are met. These parcels include contiguous land
sites that would be vacated by the Army, Navy, and Marine Corps,
including the Navy Annex and a portion of Fort Myer. We solicit your
support for this initiative. Funds are included in the President's
Budget for fiscal years 1999-2003 to prepare concept plans to develop
those parcels of land owned by the Federal government when they become
excess to other government needs. Acquisition of this property would
allow for continued operation of the cemetery through the 21st century.
The President's Budget for fiscal year 2000 includes $60,000 for this
activity.
Second, $200,000 is included to develop a comprehensive automation
plan for the cemetery. Improved automation will not only help improve
internal communications and operations, but we also envision improved
services to visitors such as automated gravesite locators.
Third, $150,000 is budgeted to develop a ten-year capital
investment plan for financing construction projects and full funding of
capital investments in the most technically and financially efficient
manner.
Fourth, $300,000 continues an initiative started in fiscal year
1996 to expand contracts for enhancing the appearance of the cemetery,
while reducing the overall cost and number of government employees as
part of government-wide streamlining.
budget details
The funds requested are divided into three programs, Operation and
Maintenance, Administration, and Construction. The principal items in
each program are as follows:
Operation and maintenance
The Operation and Maintenance Program, $10,133,000, will provide
for the cost of daily operations necessary to support an average of 20
interments and inurnments daily and for maintenance of approximately
630 acres. This program supports 96 of the cemeteries' total 102 FTE's.
Contractual services as part of Operation and Maintenance total
$4,267,000, including:
--$1.755 million for grounds maintenance,
--$840,000 for information guide services,
--$698,000 for tree and shrub maintenance,
--$110,000 for custodial services (Custodial services used to cost
about $210,000, however, competition resulted in a much lower
bidder receiving this contract, leading to significant savings
in fiscal year 1998 and 1999. This contractor has now worked
during the busiest season at Arlington, and performed
adequately.) and,
--$864,000 for regular recurring maintenance items, such as headstone
cleaning and realignment, maintenance of the eternal flame and
many other minor contracts.
Administrative program
The Administration Program, $928,000, provides for essential
management and administrative functions, including staff supervision of
Arlington and Soldiers' and Airmen's Home National Cemeteries. Budgeted
funds will provide for personnel compensation, benefits, and the
reimbursable administrative support costs of the cemeteries.
Construction program
The Construction Program includes $1,412,000, of which $792,000 is
for new construction projects and $620,000 is for ongoing construction
projects. The new construction projects include:
Service Complex.--There is $420,000 included in the fiscal year
2000 budget submission to correct building code problems at the Service
Complex, bringing operations there into environmental compliance and
improving the ability to service equipment at the complex.
Vehicle Storage Building.--There is $222,000 included in the fiscal
year 2000 budget submission to provide for design of a vehicle storage
building at the Facility Maintenance Complex to protect the equipment
used in cemetery operations and extend the life of the equipment by
keeping it out of inclement weather.
Capital investment plan.--The 1997 proposed Master Plan for
Arlington National Cemetery has identified projects to repair and
replace aging facilities and utilities, preserve and protect historic
resources, enhance visitor access and circulation, and provide
sufficient capacity to ensure interment and inurnment of eligible
veterans to the extent possible within the cemetery's boundaries. There
is $150,000 included in the fiscal year 2000 budget submission to
develop a multi-year plan for financing such projects, consistent with
full funding of capital investments in the most technically and
financially efficient manner.
Ongoing construction projects include:
--$60,000 to continue preparation of concept utilization plans for
developing contiguous lands,
--$165,000 to perform minor road repairs throughout the cemetery,
--$60,000 to install a heating and air-conditioning system in a bay
at the new facility maintenance complex, and
--$335,000 to continue the graveliner program.
funerals
In fiscal year 1998, there were 3,604 interments and 2,034
inurnments. In fiscal year 1999, we estimate there will be 3,600
interments and 2,100 inurnments, and in fiscal year 2000, we estimate
there will be 3,700 interments and 2,150 inurnments.
ceremonies
Thousands of visitors, both foreign and American, visit Arlington
to participate in events. During fiscal year 1998, about 2,700
ceremonies were conducted and the President of the United States
attended the ceremonies on Veterans Day and Memorial Day.
During fiscal year 1998, Arlington National Cemetery accommodated
approximately 4 million visitors, making Arlington one of the most
visited historic sites in the National Capital Region. This budget
includes $25,000 to continue a study, begun in fiscal year 1998, to
develop more reliable estimating procedures and meaningful estimates of
the kinds of visitors that Arlington National Cemetery serves. This
increased orientation to our ``customers'' is consistent with the
Government Performance and Results Act and the National Partnership for
Reinventing Government.
donations
A donation of $250,000 was recently accepted by the Secretary of
the Army for replacing trees on Arlington National Cemetery grounds,
above that of normal maintenance.
conclusion
The funds included in the fiscal year 2000 budget are necessary to
permit the Department of the Army to continue the high standards of
maintenance Arlington National Cemetery deserves. I urge the
Subcommittee to accept this budget.
Mr. Chairman, this concludes my remarks. We will be pleased to
respond to questions from the Subcommittee.
______
Federal Deposit Insurance Corporation
Office of Inspector General
Prepared Statement of Gaston L. Gianni, Jr., Inspector General
Mr. Chairman and Members of the Subcommittee: I appreciate the
opportunity to appear before this Subcommittee to discuss the fiscal
year 2000 budget request for the Office of Inspector General (OIG) of
the Federal Deposit Insurance Corporation (FDIC). This is our third
year as an appropriated office, and it is my second appearance before
the Subcommittee to request an appropriation.
fdic oig funding history
The FDIC OIG has had an appropriated budget since fiscal year 1998
in accordance with Section 1105(a) of Title 31, United States Code, and
is the only appropriated entity in the Corporation.\1\ Our proposed
fiscal year 2000 budget for $33,666,000 represents a decrease of $1
million, or approximately 2.9 percent under the fiscal year 1999 budget
and a decrease of 10 full-time equivalent positions. This reduction is
consistent with the OIG's downsizing plans developed in 1996 and the
overall downsizing plan of the Corporation. The appropriation to fund
OIG expenses is derived from the Bank Insurance Fund (BIF), the Saving
Association Insurance Fund (SAIF), and the Federal Savings and Loan
Insurance Corporation (FSLIC) Resolution Fund.
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\1\ Prior to fiscal year 1998, the OIG budget was part of the FDIC
annual operating budget approved by the Board of Directors from deposit
insurance funds and other funds under the Board's stewardship.
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The proposed appropriation will fund 231 full-time equivalent
staff, less than half the 370 employees and approximately 150
independent public accountant contractor equivalent staff that the OIG
employed in January 1996. The proposed fiscal year 2000 budget is 44
percent less than the FDIC OIG's 1996 corporate budget of approximately
$60 million, adjusted for inflation. The budget and staffing reductions
have been possible due to the shrinking size of FDIC, completion of
much of the carryover work that came from the Resolution Trust
Corporation OIG in 1996, and prospects for continuing strength of the
banking industry.
the fdic--a long history of success
The FDIC was created by Congress through the Banking Act of 1933 to
provide protection for bank depositors and to foster sound banking
practices. During the period from 1980 through 1994, the FDIC managed
the failures of 1,617 depository institutions. From 1988 through 1992,
the Bank Insurance Fund reported net income losses totaling $25.3
billion, the first losses since the Great Depression. However, in every
year since that period, the insurance fund income has been positive.
The FDIC successfully liquidated billions of dollars in assets from
failed banks in the 1990s and assets of failed thrifts transferred from
the former Resolution Trust Corporation in 1996. Banks and thrifts in
recent years have had strong earnings, and FDIC experienced no
significant bank failures for 2 years until July 1998. Consequently,
the BIF and SAIF accumulated the largest reserves in FDIC history,
totaling $38.8 billion in November 1998.
Given the overall stability of the banking system in more recent
years, the FDIC has been able to shift its focus quite significantly.
Rather than managing and resolving failed institutions as it did during
the 1980s and into the 90s, the FDIC's focus now is on monitoring and
assessing various existing and emerging risks to insured depository
institutions. As of September 30, 1998, the FDIC insured deposits
totaling $2.8 trillion at 10,649 banks and savings associations and is
the primary regulator for almost 6,000 state-chartered nonmember banks
whose deposits are covered by FDIC insurance funds.
Ms. Donna Tanoue, Chairman of the FDIC, has identified the
potential computer glitches in Year 2000 as ``the number one safety and
soundness priority'' facing the FDIC and the banking industry. The
Chairman has pointed out in recent speeches that there are also other
risks to the insurance funds, such as stressed economies in Asia, Latin
America, and Eastern Europe; rapidly growing banks with high
concentrations of commercial real estate lending; sub-prime rate
lending practices; insuring and supervising large, complex institutions
formed through merger activities; and banking activities related to
cyberbanking, electronic cash, and other highly technical financial
delivery systems.
oig focus on existing and emerging risks to the corporation
During fiscal year 1998, the OIG's work resulted in approximately
$50.7 million in total actual and potential monetary recoveries and
benefits. Additionally, our 103 audit and evaluation reports contained
165 non-monetary recommendations to FDIC management to improve internal
controls and operational effectiveness in diverse aspects of the
Corporation's operations, including automated systems, contracting,
bank supervision, financial management, and asset disposition.
Our investigations during the year resulted in 26 indictments, 21
convictions, 53 referrals to the Department of Justice, 9 employee
disciplinary actions, and 3 contractor actions. Our office also
completed a 2-year joint effort with FDIC management to close out 414
contracts and resolve over 1,000 open recommendations issued by an RTC
contracting oversight group. This effort resulted in $94.6 million in
disallowed costs and agreement to seek recovery of an additional $28.8
million.
oig works in partnership with fdic
Notwithstanding our hallmark of independence, the OIG must work
with many others as we pursue our mission of promoting economy,
efficiency, and effectiveness in FDIC programs and operations and
protecting the Corporation from fraud, waste, and abuse. As I discuss
the major issues that face the Corporation and the nature of the OIG's
work to address those issues, it will be evident that we have many
successful cooperative efforts in place and at work. I will briefly
elaborate on each area.
FDIC year 2000 readiness
The most immediate risks to the banking industry and the FDIC are
those brought about by the coming of Year 2000. The FDIC Chairman, in
testimony before the House Committee on Banking and Financial Services,
outlined the Corporation's three roles in addressing the Year 2000 date
change. First, in its capacity as regulatory supervisor, the FDIC must
oversee institutions' management of their Y2K projects, identify
potential shortcomings in advance, and, if necessary, take aggressive
actions to induce institutions to take timely steps to prevent
disruptions caused by the date change. Second, given its deposit
insurance role, the FDIC must maintain public confidence in the
financial system. Finally, if institutions do experience disruptions or
failure, the FDIC must be ready to resolve failing and failed
institutions.
The FDIC established a five-phased approach to ready its internal
systems and monitor the institutions it oversees: awareness,
assessment, renovation, validation, and implementation. In monitoring
each of the five phases, the OIG has adopted a proactive approach--
briefing responsible officials and then issuing advisory memorandums
when issues of concern arise. Our approach has been successful, and
prompt action has been taken to improve internal and external Y2K
efforts. The proactive approach has allowed us to assist the
Corporation in avoiding unnecessary costs that result from incomplete
requirements, not considering alternatives, inaccurate or overly
optimistic feasibility and cost-benefit studies, and inadequate
testing. In addition, my office is quickly raising issues for
management consideration and closely coordinating with the Offices of
Inspector General of the member agencies of the Federal Financial
Institutions Examination Council to address Y2K issues. Thus far, the
FDIC has made positive Y2K progress in both readying its internal
systems and operations and in monitoring the efforts of the
institutions it oversees. According to the FDIC Chairman, as of
February 1999, 97 percent of the industry is on schedule in making sure
their computer systems are ready for the Year 2000 date change and
there is no safer place to keep your money than in a federally insured
account at a bank or savings institution.
Supervising insured institutions
Another challenge to the Corporation is to ensure that its system
of supervisory controls will identify and effectively address financial
institution activities that are unsafe. To help the FDIC more
effectively fulfill its bank supervision responsibilities, the OIG has
targeted a number of key areas, including: safety and soundness
examinations; coordination with other federal and state banking
regulators; problem bank identification, supervision, and monitoring;
specialty areas in supervision, including capital markets instruments,
international banking, and on-line banking activities; the compliance
examination program, including the frequency, priority, and scope of
these examinations, and the Community Reinvestment Act examinations and
related programs.
Here are some recent results of audits:
--We completed a material loss review on the failure of BestBank,
Boulder, Colorado. This review is mandated by section 38(k) of
the Federal Deposit Insurance Act, and in accordance with that
statute addressed the FDIC's supervision of the institution and
causes of the bank's failure. BestBank was closed in July 1998
and is the most significant bank failure in the last 2 years,
with losses to the insurance fund estimated by the FDIC to be
at least $171.6 million. We reported that FDIC's regulatory
oversight of BestBank could have been more effective in
controlling the bank's rapid asset growth and curbing the
subsequent insurance fund losses.
Obstacles created by BestBank management impeded the regulators'
access to the bank and questions regarding existing regulatory
authority restricted access to a third-party entity that
directly controlled a majority of the bank's assets. The
examiners continued to rate BestBank although they did not have
sufficient or reliable information to support the ratings,
particularly asset quality. Moreover, the supervisory tools
that were available to the regulators were not aggressively
pursued in a timely or effective manner. The audit recommends
that examiners have full access to all pertinent bank records
when conducting safety and soundness examinations.
--The OIG completed an audit of the Corporation's policy for
determining the frequency, scope, and priority of compliance
and the effectiveness of CRA exams. The FDIC revised its policy
on examination frequency, scope, and priority to allow for a
period of up to 5 years between full-scope examinations for an
estimated 90 percent of FDIC-supervised banks. Our audit report
focussed on the risks associated with the new policy as it
related to extended examination frequencies and methods used to
identify compliance risk in FDIC-insured institutions. As a
result of our audit, FDIC management has agreed to rescind its
policy and to conduct all compliance reviews on a maximum 3-
year cycle.
Additionally we have initiated the following audit:
--We initiated an audit of FDIC's Community Reinvestment Act
examination process in Washington headquarters and selected
regional offices. The objectives will be (1) to determine
whether CRA criteria and benchmarks are well defined, (2)
determine whether CRA examination guidelines are consistently
applied within and among regional offices, (3) determine
whether CRA examination procedures are applied in a manner that
ensures that the resulting ratings provide an accurate measure
of the banks' performance, and (4) evaluate the consistency of
the application of procedures on an interagency basis based on
the results of the 1998 FFIEC CRA Examination Consistency
Project.
Maximizing returns from failed institutions
The FDIC's challenge in its receivership management program is to
reduce the negative financial effects of failing and failed insured
depository institutions. The Corporation focuses its efforts on four
areas: resolving institutions in the least costly manner, managing and
marketing failed-institution assets to maximize return, pursuing monies
due to the failed institution, and resolving debts to the institution
fairly. As of March 31, 1999, the FDIC managed receivership assets
totaling $2.134 billion in book value. The FDIC held $3.3 billion in
its reserve fund balance for securitizations and as of February 28,
1999, held $786 million in book value of assets for equity
partnerships. In addition, of the $1.2 billion in court-ordered
restitution owed to the FDIC from several hundred individuals and
entities, about $139 million has been collected as of March 31, 1999.
As the amount of retained assets decreases, the FDIC's asset
management and disposition responsibilities will be reduced, and the
overall risk associated with this area will decline. Similarly,
receivership and resolution activities will lessen. However, two of the
most current significant risk areas for FDIC assets are securitizations
and equity partnerships. These areas are critical because of the large
dollar amounts involved and the structure of the transactions. During
the last 3 years, the OIG has issued 19 audit reports and 1 survey
memorandum related to securitizations and equity partnerships. Our work
in this area has resulted in almost $8 million in questioned costs and
recommendations to improve FDIC's oversight. We currently have 6 audits
ongoing in the securitization and equity partnership areas and will
focus on calculations of realized losses, unallowable expenses, the
adequacy of oversight, and affiliate transactions.
Our Office of Investigations has been active in investigating cases
in the area of contractor fraud and concealment of assets by FDIC
debtors. Some recent results of OIG investigations include:
--The Ryland Mortgage Corporation pled guilty to two counts of
impeding the functions of the Resolution Trust Corporation
(RTC). Ryland Mortgage was ordered to pay $8.7 million in
restitution and fines, the largest monetary recovery ever to
result from an FDIC OIG investigation. Our 3-year investigation
uncovered a complex scheme in which the contractor defrauded
the RTC of $3.5 million by misrepresenting the amount of funds
it collected in connection with the servicing of loans on RTC's
behalf. Two former officials of the corporation who pled guilty
to similar charges received sentences comprised of monetary
fines, home detention and probation.
--In partnership with the Corporation's Division of Resolutions and
Receiverships, the U.S. Attorney's Offices, and other federal
agencies, we have begun to see significant results from a
series of investigative initiatives involving FDIC debtors who
have concealed assets or committed other fraud in attempting to
avoid repayment of their obligations to FDIC. One of our
initial efforts in this area resulted in a $1.1 million
recovery from two felons who concealed assets and lied to the
court to avoid paying their court-ordered restitution. In
another joint investigation with the FBI and IRS, an FDIC
debtor was criminally convicted, sentenced to serve 37 months
in prison, and was ordered to pay $2.9 million in restitution.
Our investigation found that the debtor, who defaulted on a
$4.9 million loan from a failed financial institution,
concealed his financial interests during a bankruptcy
proceeding.
Our investigators will continue to seek to uncover similar
situations in order to help the Corporation receive the restitution it
is due.
Oversight of contracting activities
The FDIC and the former RTC relied heavily on the private sector to
accomplish the mission of managing and selling assets of failed banks
and saving institutions. Over the past 9 years, the FDIC and RTC spent
billions of dollars in contractor fees to assist the Corporation in
fulfilling the many urgent assignments mandated by legislation and the
banking and thrift industry crises. Although 3 years have passed since
the RTC's sunset and RTC-related contracting has lessened, the FDIC
continues to rely on private-sector contractors in conducting its work.
Contractors assist the FDIC in many areas, including legal matters,
property management, information technology, and financial services.
The OIG has continued to focus its resources on auditing contracts
and agreements and during fiscal year 1998 we identified a total of
$19.3 million in questioned costs for the strategic area of contract
award and oversight. Overall, during the period April 1996 to September
1998, our work in the contracting award and agreement area has resulted
in about $75 million in questioned costs.
One of the most significant areas of contract audits has been our
joint effort with the Corporation's Legal Division to review legal fee
bills submitted by firms doing business for both the former RTC and
FDIC. In fiscal year 1998, we issued 62 legal fee bill audits in which
we questioned over $13 million. Management agreed to disallow slightly
more than $4 million of that amount. In total, the former RTC and FDIC
OIGs have issued nearly 300 legal fee bill audit reports with
questioned costs of more than $37 million.
Our partnership with FDIC management to close out over 414 RTC
contracts since 1996, previously discussed, is another example of the
OIG's efforts to contain the costs of FDIC and the former RTC's use of
contractors.
Other OIG reviews
My office continues to work with the U.S. General Accounting Office
(GAO) toward the goal of the OIG assuming full responsibility for the
annual audits of the FDIC's financial statements that the Chief
Financial Officers Act requires of all government corporations. The
OIG's increased involvement with the annual audit began in 1995, and
the OIG continually assumes additional duties. For the 1998 financial
statement audit, the OIG has assigned 65 percent of the staff, as the
OIG has assumed full responsibility for several key areas of the audit
including cash management, investments, and asset valuation. My office
is committed to this project and OIG and GAO management have agreed
that there are mutual benefits of the OIG assuming responsibility for
the annual financial statement audit. We expect to streamline the audit
process and provide cost savings to the Corporation through our work on
this audit.
During this fiscal year we have provided advisory assistance to
FDIC management on its revised Strategic Plan for 1998-2003 and its
Annual Plan for 1999 to assure that these plans comply with the Results
Act. The OIG will continue to monitor and review proposed legislation
in the Congress to amend the Results Act and will actively participate
through the President's Council on Integrity and Efficiency and
interagency groups it sponsors to define an appropriate OIG role in the
Results Act arena. In the interim, we have initiated evaluations to
verify and validate the data and systems supporting information
reported by the Corporation in its GPRA reports. We also plan to
address GPRA objectives and goals, when appropriate, in the course of
doing audits and evaluations.
We issued 5 evaluation reports to FDIC management that covered a
wide range of issues, including the Corporation's Office of Diversity
and Economic Opportunity's discrimination complaint program. As a
result of our recommendations on the discrimination complaint program,
the Corporation has completed and issued agency decisions on a number
of older cases; agreed to develop office-wide performance goals and
performance expectations for individual staff, and to carry out EEO-
required tasks more timely; implemented a new case tracking system, and
taken positive steps toward developing an alternative dispute
resolution program. Another evaluation report on the corporate lease
acquisition process resulted in the following actions: (1) better and
more timely information being provided to FDIC's Board of Directors on
proposed leases for its use in making decisions; (2) justification for
lease terms in excess of the Corporation's staffing projections; and
(3) improved tracking and reporting of renovation costs.
We referred 65 substantive Hotline allegations for review or
investigation during fiscal year 1998. During its most recent 3-year
period, the Hotline has referred almost 200 allegations for further
review or investigation, targeting a wide variety of alleged
wrongdoing, including employee misconduct, contract abuse, and asset
management issues. Almost 40 percent of these cases were referred to
the OIG Offices of Investigations, Audits, or Evaluations, and the
other 60 percent were referred to FDIC management for review and
action.
We reviewed 61 proposed corporate policies and reviewed 25 draft
regulations and proposed legislation, and provided comments when
warranted. In addition, we responded to 51 Freedom of Information Act
and Privacy Act requests and appeals during fiscal year 1998. We have
also provided oversight of FDIC's internal control activities under the
Chief Financial Officers' Act and the Federal Managers' Financial
Integrity Act.
We participated with 3 other OIGs--Department of the Treasury,
Federal Reserve and the National Credit Union Administration--on an
interagency task force, which reviewed the Federal Financial
Institutions Examination Council (FFIEC) training program. The FFIEC
was created in 1979 as an interagency body to prescribe uniform
principles, standards, and report forms for the federal examination of
financial institutions and promote uniformity in the supervision of
these institutions. The task force reported to the FFIEC Chairman that
the Council is reasonably successful in fostering coordination of
training activities among the 5 federal financial institution
regulatory agencies. The report detailed two recommendations for the
Council to consider immediately, one related to the FFIEC's
appropriation and another dealing with a supervisory issue. The report
also outlined plans for future joint audits of the FFIEC.
oig management initiatives
Since I became Inspector General in April 1996, we have continually
sought to enhance the OIG's effectiveness. During fiscal year 1998, we
began an effort at self-evaluation of our work processes, including
having a peer review of our audit operations by another OIG. The peer
review concluded that the system of quality control used by the FDIC
OIG was designed in accordance with standards established by the
President's Council on Integrity and Efficiency and provided reasonable
assurance that our office was in conformance with professional
standards in the conduct of its audits. We also updated our own
strategic plan and annual performance plan to be consistent with the
Corporation's plans and to comply fully with Results Act requirements.
Our 1999 annual performance plan is included in the fiscal year 2000
budget we previously sent to the Subcommittee. Our strategic goals,
objectives, and operating principle are intended to provide a value-
added focus to the Corporation and are directly related to the FDIC's
mission, strategic goals and objectives, and corporate operating
principle. Also, consistent with our strategic and annual plans, we
recently initiated client and employee surveys to identify
opportunities to improve our effectiveness as an organization.
In addition, we are moving forward in assuming the personnel and
contracting authority afforded the OIG under the Inspector General Act.
The FDIC Chairman agreed in July 1998, that, in line with the
independence of the OIG, my office should have the authority to make
its own personnel and contracting decisions--authority that had
previously resided with other corporate officials. We are in the
process of hiring staff and anticipate that we will fully take over
this responsibility in fiscal year 1999. I view the Chairman's decision
as a major step in enhancing the OIG's independence.
Another significant initiative is our effort to review workplace
diversity issues. The Corporation and the OIG strive to ensure that our
workforce draws more broadly from the diverse population found in
various American professions. By including individuals with diverse
backgrounds in every aspect of our operations, we strengthen our
ability to serve OIG employees as well as our clientele. The
Corporation is developing a plan with several diversity initiatives
designed to maintain and enhance the quality and diversity of its
workforce. Likewise, my office is conducting its own study, in
accordance with the House Subcommittee on VA, HUD, and Independent
Agencies; Committee on Appropriations' report on the fiscal year 1998
appropriation, that will address the diversity of our staff and issues
that staff believe are important to successfully have a diverse
workplace.
fiscal year 2000 budget
Our reduced budget will result in a slightly lower level of audit
and investigation activity for fiscal year 2000 than planned for fiscal
year 1999, but this reduction is consistent with planned corporate
downsizing. The fiscal year 2000 budget reflects decreases in salaries
and benefits consistent with the reduced staffing funded by the budget.
The budget also includes money to (1) fund higher travel expenses, (2)
pay outside printing expenses required by the OIG, and (3) replace
computer equipment in accordance with the Corporation guidance on
equipment replacement cycles.
In fiscal year 2000, the OIG will continue to focus on areas of
highest risk to the Corporation and deposit insurance funds. A key goal
is to assess the manner and extent to which FDIC programs and
activities achieve their intended objectives, as outlined in the
Corporation's Strategic Plan. Among specific audit work planned, we
will continue to review FDIC's efforts to ensure that banking
institutions and the Corporation itself have automated systems capable
of recognizing dates properly in Year 2000. Also, we plan to closely
oversee the Corporation's large investment in information technology
initiatives, including automated systems development and security over
access to information. We will continue to review the strategic area of
contract award administration and oversight; the supervision of insured
institutions; and play a greater role in our cooperative effort with
the General Accounting Office to audit FDIC's financial statements.
Investigative work will focus on fraudulent bankruptcies where FDIC is
a creditor, hiding assets to avoid paying court-ordered restitution to
FDIC, and making false statements to FDIC to secure favorable loan
compromises and settlements. Also, we anticipate continuing our active
role in providing advisory assistance to management in its strategic
and annual performance plan initiatives.
Mr. Chairman, throughout my testimony I have addressed existing and
emerging risks to the Corporation and its insurance funds. Also, I have
discussed how my office is working with the Corporation in a
partnership to address these risks and to help make FDIC programs work
better. FDIC Chairman Tanoue has been supportive of the OIG since she
took office last spring. She has recognized the need for an independent
OIG and has been receptive to my advice--making this a true
partnership.
In closing, I believe very strongly that the OIG continues to be a
valued asset to FDIC. As the FDIC OIG marked its 10th anniversary and
we celebrated over 20 years since passage of the Inspector General Act,
I want to thank the Subcommittee for its commitment and urge your
continued support for our work.
Additional details supporting our budget request are in documents
that have been provided to the Subcommittee staff.
______
General Services Administration
Consumer Information Center
Justification
Mr. Chairman and Members of the Subcommittee, thank you for the
opportunity to present the fiscal year 2000 budget request of the
Consumer Information Center (CIC).
The Consumer Information Center was established by an Executive
Order in 1970, and for 30 years CIC has served consumers through
partnerships with more than 40 Federal departments and agencies. CIC
provides an effective vehicle to inform the public about vital topics
such as health and safety issues, developments in Federal programs, and
the impact and effects of Federal research and regulatory actions. CIC
fulfills its mission mandate by ensuring public awareness of and access
to this information and by making it available to the public through a
variety of new and time-proven programs.
In recent years, we have been experiencing a revolution in the ways
that Americans obtain and use information. During much of CIC's
history, the public got Federal consumer information primarily by
writing for printed publications from CIC's distribution facility in
Pueblo, Colorado. But with the dominance of computers and their
emphasis on instant access to information, Americans are now relying
less on printed materials for information, especially those ordered by
mail.
To meet this challenge, CIC has reinvented the way it serves the
public. Moving from a concentration on the printed word to a larger
vision of a central reservoir of information that can be accessed in a
variety of ways, CIC continues to make it easy for citizens to use and
benefit from Federal information. Specifically, last year CIC
significantly improved its toll-free telephone ordering service and, at
the same time, added a publication ordering system to an expanded and
improved web site.
Consumers can now place publication orders by calling the toll-free
number, 1 (888) 8 PUEBLO, while customers with Internet access can
visit the CIC web site (www.pueblo.gsa.gov). They can then view the
information online, copy it to their home computers, or use CIC's
secure online ordering system to place credit card orders for printed
copies of the information. CIC has the full text of approximately 500
consumer publications available on the Internet along with Federal
agency recalls and special notices, consumer news, and links to
consumer sites in the Federal and the private sector.
Reflecting the nation's new information environment, CIC saw
printed publication distribution decrease from 8.3 million in fiscal
year 1997 to 7.6 million in fiscal year 1998. During the same time,
page accesses to CIC's web site increased from 4 million to 6.5 million
and CIC's toll-free telephone system received nearly 300,000 requests.
These program successes and accomplishments reinforce CIC's commitment
to its mission mandate. Throughout any program transition that CIC
undergoes, our goals and objectives remain focused on delivering to the
public useful and reliable information that is a by-product of ongoing
Government activities.
In keeping with the goal of delivering the best government consumer
information, in fiscal year 1998 CIC updated and released the 1998-99
Consumer's Resource Handbook (CRH). The CRH is a prime example of
Government empowering individuals to solve their own problems and
answer their own questions by providing them with the best and most
direct sources of assistance. Published continuously since 1979, the
CRH is one of the most popular consumer documents ever issued by the
Government. The requested appropriation of $2,622,000 includes an
amount of $300,000 for producing and distributing the CRH. During
fiscal year 1998, CIC distributed 340,000 copies and will distribute a
comparable amount in fiscal years 1999 and 2000.
CIC also produces the Consumer Information Catalog which lists the
CRH and hundreds of other popular titles on subjects such as money
management, health, and Federal programs and benefits. I'm pleased to
present our newly redesigned Catalog featuring four colors, bright
graphics, a photographic cover, livelier copy, and simplified ordering
instructions. The new version makes it easier than ever to order
Federal consumer publications, and offers the options of mailing in the
order form, or faxing it, or calling in to our toll-free number, or
reading the publications and ordering them online. In fiscal year 2000,
CIC will distribute approximately 12 million Catalogs primarily through
educators, nonprofit associations, large and small businesses,
libraries, and Members of Congress.
During fiscal year 2000, CIC will also continue to build the
cooperative publishing program, where private sector entities share the
costs of making publications available for listing in the Catalog. In
fiscal year 1998, 19 private sector partners worked with Federal
agencies to develop and fund publications on topics of mutual interest,
bringing the total number of cooperative publications to date to 162.
In conclusion, CIC will continue to meet the information challenges
offered by the new century. Its accomplishments will be measured by its
successful research and identification of valuable Federal information;
its media and marketing programs; its centralized publication
distribution system in Pueblo, Colorado; and its widely acclaimed web
site. I am confident that the services CIC delivers to the public will
continue to play an important role in maintaining a healthy consumer
economy and in providing a vital communications bridge between citizens
and their Government.
Mr. Chairman, again I thank you for the privilege on behalf of the
Consumer Information Center to present its budget request for fiscal
year 2000. We trust that the Committee will agree that CIC is a
valuable Federal program and that it will look favorably upon our
request.
______
National Credit Union Administration
Prepared Statement of Norman E. D'Amours, Chairman
Thank you for allowing me to present the National Credit Union
Administration's request for the NCUA Central Liquidity Facility (CLF)
and report on the condition of federally-insured credit unions.
The CLF, established in 1979, serves as a liquidity source for
credit unions. It is funded by its credit union members and may borrow
from any source; it currently has a borrowing arrangement with the
Federal Financing Bank. The CLF borrowing authority is not used to
build up loan volumes because the Federal Credit Union Act prohibits
using proceeds from CLF loans to expand credit union portfolios.
Rather, the funds are advanced strictly to meet credit union liquidity
needs, in response to circumstances dictated by market events. NCUA is
not requesting an appropriation for the CLF, merely removal of the
appropriations cap on the CLF's borrowing authority. Removal of this
cap would have no budgetary or scoring impact.
The limit on CLF borrowing for new loans to credit unions has
remained at $600 million for the last 18 years. The budget submitted by
the Office of Management and Budget requests a $600 million limit on
borrowing and a $257,000 limit on administrative expenditures for
fiscal year 2000. Although the statutory language submitted in our
justification tracks the OMB's request, we are requesting the removal
of this borrowing cap in anticipation of possible liquidity demands
credit unions may face due to the approach of the Year 2000.
Removing the appropriations cap on CLF borrowing does not mean that
there is no cap on CLF borrowing, but rather that the cap contained in
Section 307 of the Federal Credit Union Act (12 U.S.C. 1795f) applies.
Under the provisions of the Federal Credit Union Act which established
the CLF, the CLF is permitted to borrow up to 12 times its subscribed
stock and surplus, or currently about $18.5 billion. While the $600
million appropriations limit has, in the past, been adequate to address
isolated liquidity needs in credit unions, this amount represents less
than 3.25 percent of the $18.5 billion which the CLF would be permitted
to borrow under its enabling legislation. When the $600 million limit
was first inserted into the Appropriations measures, in 1980, $600
million exceeded 12 times the subscribed stock and surplus of the CLF.
Clearly, Congress did not intend to restrict the borrowing ability of
the CLF to an amount less than the cap contained in the Federal Credit
Union Act.
Despite general inflation, dramatic growth in credit union assets,
and the increase in the CLF's subscribed stock since 1980, the
appropriations limit has never been adjusted. The approach of the Year
2000 may trigger a system-wide increased demand for liquidity, and the
$600 million CLF borrowing cap could frustrate NCUA's ability to
address short-term liquidity needs of credit unions at the end of this
year.
Before I go any further, I want to emphasize that credit unions are
quite prepared for the Year 2000 transition. As of December 31, 1998,
97 percent of all federally insured credit unions were Y2K ready or on
schedule to become so. The few credit unions which have not met NCUA's
deadlines are subject to intense supervision and we will ensure that
they are also ready. Although NCUA sees no need for credit union
members to withdraw larger than usual amounts of cash before the year
2000, it is possible that excessive media focus on the date change will
cause an increased demand for cash at the end of 1999. I repeat--there
is absolutely no substantive reason to withdraw large amounts of cash.
But we all know that sometimes human actions are not based on logic,
and NCUA has a responsibility to ensure that credit unions are able to
deal with the threat of increased liquidity demands at the end of 1999.
The $600 million limit on CLF borrowing could impede our efforts in
that regard.
While it is difficult to gauge the potential demand on the credit
union system due to the Year 2000 date change, estimates range from $2
billion to $20 billion. For example, if each of the estimated 15
million households which use a credit union as their primary financial
institution withdraws an extra $500 at the end of 1999, the credit
union system will be faced with an extra liquidity demand of $7.5
billion. While the credit union system, through its network of
wholesale credit unions known as corporate credit unions, has some
capacity to supply liquidity and may have the capacity to meet this
level of demand, it would need to rely on the CLF in order to meet
liquidity needs above this level. While some have suggested that credit
unions access the Federal Reserve's discount windows, 42 percent of
credit unions do not offer the types of accounts which would allow them
to qualify for discount window access. Further, the number of credit
unions with actual access is extremely low--only 20 of more than 11,000
credit unions currently have discount window access, with an additional
300 in the application process. Moreover, eligibility to apply to the
discount window does not guarantee approval.
NCUA is committed to achieving a workable solution to the potential
Y2K liquidity demand. Removal of the CLF's borrowing cap is by far the
best solution because it eliminates the need to create new, untested
systems and structures to distribute liquidity. Nonetheless, we have
been examining other alternatives with the assistance of the Federal
Reserve. Such alternatives should accomplish the goal of providing the
credit union system with adequate liquidity, but they have not been
tested, they are not yet in place, and they lack the economy and
simplicity of lifting the cap.
I am pleased to report to the Subcommittee that we continue to
streamline the CLF, resulting in cost savings for credit unions. Our
fiscal year 1998 operating expenses were $154,000--significantly below
our budget limitation of $203,000. In 1998, all of CLF's net income was
returned to member credit unions in the form of capital stock
dividends. While next year's operating expense request of $257,000 is
slightly higher because of the addition of one staff member, this still
represents a substantial decline over the past few years, as CLF
expenses in fiscal year 1993 were $767,000.
Mr. Chairman, we respectfully request that you support our
authorization request in order to continue the NCUA's and CLF's ability
to respond to adverse liquidity situations.
Turning to another subject, I would like to thank the Subcommittee
for providing an additional $2 million for NCUA's Community Development
Revolving Loan Fund in fiscal year 1999 for loans to low-income credit
unions. Since 1987, when the NCUA began administering the Fund, we have
revolved our $10 million appropriation ($6 million initially, $1
million in both fiscal years 1997 and 1998, and $2 million in fiscal
year 1999) into 141 loans totaling $19.3 million. In 1998 alone, we
approved 17 loans to 17 credit unions for a total of $3 million. As of
January 31, 1998, our pending applications total $1.4 million. We
appreciate the Subcommittee's support of our efforts to provide
assistance to low-income credit unions.
Finally, I would like to briefly summarize the current condition of
credit unions and the National Credit Union Share Insurance Fund
(NCUSIF). Once again, credit unions had a banner year in 1998--assets
are at a record level, while the number of problem credit unions
remains low. During 1998, total assets of federally-insured credit
unions increased by 7.4 percent, from $351.2 billion to $388.7 billion.
Despite the increase in assets, credit unions' overall capital to asset
ratio remained strong at 11.5 percent, on average. The number of
problem credit unions (those rated code 4 or 5) is also down, to 297
from 330 at year-end 1997; these problem credit unions represent less
than 1 percent of total shares. These figures demonstrate the continued
overall safety and soundness of the credit union system.
The credit union insurance fund also remains strong. For the fourth
consecutive year, and the fifth time in its history, the National
Credit Union Share Insurance Fund returned a dividend to credit unions
on their deposits in the fund. The dividend this year--$118 million--
was the largest dividend ever returned to credit unions. In October,
before the dividend payout, the equity level of the Share Insurance
fund reached 1.32 percent. Even after the largest dividend in its
history, the Insurance Fund returned to the 1.30 level by December 31,
1998.
In summary, the credit union industry remains in excellent
condition, with a strong insurance fund. While demand still outstrips
supply, low-income credit unions are receiving more assistance than
ever before, thanks to this Subcommittee's efforts. With the removal of
the CLF's borrowing cap, we will be able to address any possible Y2K
credit union liquidity needs. NCUA's justification and budget tables
follow below.
______
Neighborhood Reinvestment Corporation
Prepared Statement of George Knight, Executive Director
Thank you, Mr. Chairman and Members of the Committee, for the
opportunity to submit a written statement supporting our fiscal year
2000 budget request and especially for your long-time support of the
NeighborWorks network and the Neighborhood Reinvestment
Corporation. I am honored to update you on the exciting results of
fiscal year 1998 and present the Corporation's fiscal year 2000 budget
request for level-funding of $90 million.
fiscal year 1998 results
FY 1998 was an amazing year! Building on the opportunities in this
unprecedented era of economic growth, over the last year the 184
organizations in the NeighborWorks network:
--Assisted 13,769 families by creating new homeowners, sustaining
existing owners through major rehabilitation, and creating
affordable mutual and rental housing units- a 20 percent
increase;
--Repaired an additional 12,702 homes, enabling better living
conditions and more attractive neighborhood blocks--an 18
percent increase
--Owned 19,296 units of affordable mutual and rental housing (at
year's end)--a 28 percent increase; and
--Secured public/private investments of more than $819 million--a 48
percent increase over fiscal year 1997.
In addition, through this NeighborWorks system which
includes the national NeighborWorks network, Neighborhood
Reinvestment and Neighborhood Housing Services of America (NHSA), we:
--Purchased (through NHSA) $42.8 million in loans made from
NeighborWorks organizations' revolving loan funds;
--Expanded by 9 organizations the number of NeighborWorks
organizations that now serve 825 communities nationwide; and
--Provided over 7,297 community development practitioners 149,106
contact hours of nuts-and-bolts training.
fiscal year 1999 year to date
None of these exciting achievements would be possible without this
Committee's steadfast commitment and confidence in the
NeighborWorks system. Last year's fiscal year 1999
appropriation allowed for a significant expansion of the
NeighborWorks Campaign for Home Ownership 2002 by dedicating
$25 million to a Homeownership Pilot. The pilot allowed for expansion
from 25,000 to 35,000 homeowners and requires securing an additional
$700 million in lending capital. The two-year pilot requires a
significant increase in productivity at the local levels, strengthened
systems (including financial controls), and increased conventional
capital available for first mortgage lending and property casualty
insurance. I am pleased to report that the Campaign's major partners,
as exemplified by our national partners: Allstate; BankAmerica/
NationsBank; Fannie Mae and the Fannie Mae Foundation; Fleet Bank;
Freddie Mac; State Farm; USAA; and World Savings; as well as 12
regional partners and more than 100 other local partners are stepping
up to the plate with enthusiasm.
In order to meet the ambitious two-year goal of creating 10,000
additional homeowners, Neighborhood Reinvestment had to play its part
in expeditiously committing the funds in the most effective and
efficient manner. Our plan was to commit 92 percent ($23 million) of
the Homeownership Pilot's $25 million in grants to
NeighborWorks organizations' revolving loan funds, systems
development and financial/rehab counseling needs. By targeting these
grants to removing the bottlenecks to greater productivity, our
anticipation is that 10,000 additional homeowners may be secured
without experiencing unacceptable delinquency and default rates.
Perhaps most importantly, these activities institutionalized an
increased capacity for the future.
I'm pleased to report that all but $1 million is committed:
--We issued the Request for Proposals on October 30, within one week
of the fiscal year 1999 VA, HUD and Independent Agencies
enacted Appropriations bill;
--97 Responses were received by the deadline, December 9; and
--Neighborhood Reinvestment's board committee met on January 12 and
finalized 74 awards totaling $22 million.
Most of the additional $1 million was awarded to participating
NeighborWorks organizations based on applications received on
April 15, 1999; the remainder will be disbursed by the end of the
fiscal year.
Needless to say, the local NeighborWorks partnerships are
grateful for the opportunity and are hard at work. The Neighborhood
Housing Services (NHS) in Ithaca, New York, for example, has been able
to commit counseling and financing assistance to customers of a local
credit union who have been saving for their home purchase. These lower-
income potential homebuyers have saved carefully but, in many
instances, will be purchasing homes in need of repair. The Ithaca NHS
will be able to provide second mortgages for rehabilitation through its
revolving loan fund, thus ensuring the viability and safety of the
property, the first mortgage holder, the property-and-casualty insurer,
the city tax base, and the health of the neighborhood. In a host of
other cities such as Ithaca, these funds are providing
NeighborWorks organizations with an extraordinary opportunity
to assist potential homebuyers who have consistently fallen through the
cracks--families with incomes that are marginally too high to qualify
for most available public assistance and decidedly too low to go it on
their own. The flexible resources available through this pilot will
make both existing subsidy programs and conventional resources work in
our neighborhoods as never before.
Highlights of the first 12 months of the five-year (1998-2002)
NeighborWorks Campaign for Home Ownership 2002 follow. As of
December 31, 1998, the participating 107 NeighborWorks
organizations: Created 6,874 new homeowners, of which: 91 percent are
low- or moderate-income households; 55 percent are ethnic or minority
households; 63 percent are single heads of households; 44 percent are
women; 95 percent are first-time buyers; and for 31 percent of these,
owning is less costly or only marginally more costly than renting.
--Secured $585.6 million in private/public investment from outside
partners.
I'm concerned that I may be leaving the impression that the only
activity of NeighborWorks organizations is to increase home
ownership. Far from it! Consistent with the basic philosophy of the
network that home ownership and healthy neighborhoods are inextricably
bound together and mutually reinforcing, during fiscal year 1999
NeighborWorks organizations will add 2,850 units of
additional mutual and rental affordable housing, conduct hundreds of
volunteer projects ranging from new home construction, clean-up/fix up,
community gardens, alley sweeps, and similar efforts.
NeighborWorks organizations will also use their revolving
loan funds to assist business owners to establish and/or expand
businesses, work with local governments to create neighborhood parks,
conduct after-school programs, and initiate numerous other community-
building activities.
Part of the NeighborWorks system's success over the years
is due to Neighborhood Reinvestment's ability to monitor local
financial controls and provide technical assistance, training and
limited grants to support the wide variety of locally generated
strategies and approaches. In preparing for fiscal year 2000's
submission, I felt it was important to emphasize that our intent is to
support locally designed strategies rather than to create a series of
``programs'' which then force local organizations to contort their
efforts to ``fit'' the eligibility requirements for financial or
technical assistance.
looking ahead to fiscal year 2000
Thus, you'll see that our objectives for fiscal year 2000 seek to
balance our resources to meet the highly varied and diverse needs of
the communities served by the 184 NeighborWorks
organizations. We hope to slightly expand the number of communities
served and the number of charter members as well as continue to provide
high-quality training to the entire community development field. We
also hope to provide grants to augment local revolving loan funds,
which have been one of the most critical engines for community
revitalization.
Housing rehabilitation for existing homeowners has long been the
cornerstone of NeighborWorks revitalization efforts, and
remains key. Only when each responsible owner can borrow the necessary
capital to meet his or her needs will communities return to stability
and attractiveness to new homeowners.
A recent empirical study in Cleveland, by Cleveland State
University, shows that every $1 investment in home rehabilitation adds
13 cents to the value of homes located within 150 feet of the rehab
project. Thus, the average investment (in the Cleveland study) of
$31,000 in substantial rehab added $4,000 to the sale price of every
home located within 150 feet. The study also shows that above-average
rehab investment, or multiple rehabs in a block, have even a larger
effect on the value of nearby homes.
Our technical assistance will focus on specific local needs as well
as on strategic initiatives inspired by members of our network that
promise to benefit the network as a whole.
the neighborworks campaign for home ownership 2002
The NeighborWorks Campaign for Home Ownership 2002
focuses on expanding its impact in terms of the number of new
homeowners served and strengthening the capacity of local systems to
manage expanded productivity.
In order to meet this mission, over the next five years the
NeighborWorks Campaign for Home Ownership 2002 intends to:
--Create 35,000 new low- to moderate-income homeowners;
--Counsel an additional 270,000 potential owners; and
--Generate $2.5 billion of public/private investment in underserved
communities.
With the fiscal year 2000 appropriation of $90 million, we would
further expand the NeighborWorks Campaign for Home Ownership
2002. Grants would enable NeighborWorks organizations to
provide prepurchase as well as postpurchase counseling, first and
second mortgages, home-repair loans, and foreclosure-intervention
assistance. Neighborhood Reinvestment estimates that this assistance
will:
--Yield 7,000 additional new homeowners;
--Enable the NeighborWorks organizations to assist
thousands of families to maintain home ownership (through
rehabilitation, property repairs, postpurchase counseling and
foreclosure intervention);
--Leverage a total of $390 million in additional outside investment;
and
--Prevent millions in foreclosure losses.
The NeighborWorks Campaign for Home Ownership 2002, with
the proposed fiscal year 2000 appropriation, will create more than
42,000 new homeowners! This is nearly three times the number created in
the first five-year campaign from 1993 to 1997.
multifamily initiative
Affordable, quality multifamily housing is also essential to
helping distressed communities. Many NeighborWorks
organizations have approached community revitalization through
ownership and management of multifamily units within the mutual or
rental tenure mode. Several now own more than 1,000 units and provide--
in addition to affordable quality units for families--after-school
programs and day care and summer activities. In an effort to better
meet the requests for technical assistance a group of
NeighborWorks organizations launched in February of this year
a five-year initiative to:
--Strengthen asset management practices throughout the
NeighborWorks etwork to ensure that properties owned
and managed by NeighborWorks members are financially,
physically and socially secure and thus able to serve their
communities for the very long run;
--Develop strong resident leaders and services such as after-school
learning centers, tutoring, and adult learning opportunities so
that families can enjoy successful long-term tenure, thus
leaving energy and dollars to pursue other family goals;
--Attract $600 million in public- and private-sector investments; and
--Add 10,000 multifamily units to the 19,000 currently owned by
NeighborWorks organizations.
meeting the needs of rural communities
The work of the Rural NeighborWorks Alliance (a group of
25 NeighborWorks organizations which banded together in 1991)
is to find creative, proactive ways to address rural housing concerns
and increase the focus on organizational resources for rural
development. Rural NeighborWorks Alliance operates a
revolving loan fund and, with investments from Fannie Mae, the
MacArthur Foundation and Neighborhood Reinvestment, the total
capitalization has grown to more than $1 million in just four years.
The fund is used primarily for low-interest rate, short-term, deferred
construction loans, which provide needed gap financing for affordable
housing development in rural areas.
Recently, RNA joined with the Department of Agriculture's Rural
Housing Services' Rural Home Loan Partnership (RHLP) to partner with
financial institutions to leverage and maximize USDA's Section 502
programs and access the community facilities fund in order to provide
opportunities for very low-income households to become homeowners in
America's poorest rural communities. Twelve NeighborWorks
organizations were awarded over $4.2 million in Section 502 monies to
assist the building and renovation of 113 housing units.
At present, Neighborhood Reinvestment Corporation is also involved
with the Rural Housing Services to develop the first of a series of
training sessions to educate and connect interested community-based
organizations with financial institutions about the Section 502
programs. During the training sessions, there will also be opportunity
to learn about successful case studies of how these programs have made
a difference in rural communities. The first training session is
scheduled for April 28, 1999, in Memphis.
overview of the neighborworks system
In order to comprehend how we plan to meet the ambitious goals we
have set for fiscal year 2000, it is important that you understand how
the NeighborWorks system operates and what makes it
successful.
The NeighborWorks Network
At the heart of this system is the NeighborWorks network,
consisting of 184 locally directed partnerships composed of community
residents and the business and public sectors, serving more than 825
communities nationwide. Often known as Neighborhood Housing Services,
each NeighborWorks organization's local board of directors
establishes strategies for revitalization of their neighborhoods and
community. NeighborWorks organizations share common
characteristics:
--Led by a board of directors composed of local residents, financial
and business sector leaders, and public officials;
--Are state-chartered, not-for-profit organizations with 501(c)(3)
status;
--Operate a flexible revolving loan fund;
--Work with conventional lenders to develop flexible loan products;
--Promote physical, economic and social revitalization of designated
target areas;
--Create and sustain affordable housing;
--Meet Neighborhood Reinvestment chartering and ongoing performance
guidelines; and
--Develop and support strong resident leaders who work to enhance the
viability of their communities.
Our belief is that home ownership in strong, healthy neighborhoods
gives residents an equity stake in the economic mainstream of America,
building long-term assets for their families as well as their
communities. Home ownership also improves city tax bases, creates an
environment for reputable lending and insurance firms, stabilizes
school attendance and builds a positive social environment. However,
the full benefit of home ownership accrues to communities only when
these homes become secure investments that have at least a strong
potential for asset accumulation for the buyer. When they do, the
buyer, their neighbors on the block, and the overall neighborhood all
benefit. To make sure that revitalizing communities receive the full
benefits of home ownership, it is important to create a strong nucleus
of buyers as well as default-resistant owners.
Neighborhood Reinvestment Corporation
Created by Congress in 1978, Neighborhood Reinvestment's mission is
to encourage, support and facilitate these organizations' efforts to
revitalize distressed communities through the local public/private
partnerships. We do this through:
--Technical assistance--delivered by specialized practitioner experts
geographically placed around the country in nine district
offices;
--Flexible grants--to capitalize and operate revolving loan funds;
--Training--``how-to,'' nuts-and-bolts coursework for community-based
practitioners; and
--Our secondary market, Neighborhood Housing Services of America
(NHSA)--a unique secondary market backed by national investors.
This ensures the local liquidity of revolving loan funds.
We also manage the risks inherent in the NeighborWorks
system through a multifaceted risk management system. In essence the
risk assessment system backs up strong local board leadership that
monitors local financial controls, programmatic activities and program
changes.
Neighborhood Housing Services of America
The NeighborWorks system's unique secondary market,
Neighborhood Housing Services of America (NHSA), serves as a financial
backstop to local NeighborWorks organizations' loan funds.
Each NeighborWorks organization may sell loans to NHSA at
whatever rate and term is locally affordable. This kind of secondary
market outlet ensures a continuous source of capital through the local
revolving loan fund, which, in turn, enables local organizations to
utilize the plentiful private sources of capital that are available for
conventional lending. Last year $80 million in lending from revolving
loan funds sparked an additional $740 million in coordinated private
and public lending. NHSA enables us to continuously meet the capital
liquidity needs of the NeighborWorks network.
Together, Neighborhood Reinvestment and NHSA assist in the growth
and capacity development of local NeighborWorks organizations
to meet the capital, technical and organizational needs of their
communities.
revolving loan funds
The engines that drive this system are the flexible local revolving
loan funds. Neighborhood Reinvestment provides seed capital to attract
additional capital that may come from local banks, insurance companies,
local government, foundations and other investors. Each
NeighborWorks organization sets its own underwriting terms
and policies. The loans made from the revolving loan funds fill the
gaps in an otherwise-fragmented set of resources available to lower-
income borrowers. Local determination of best use and the flexibility
of these funds together comprise the critical resource for broader
community revitalization. For example, the revolving loan funds are
used for:
--Gap financing--used in conjunction with conventional loans to
assist families rehabilitate and purchase their homes ;
--Equity capital--to secure blighted properties for rehabilitation
and sale, secure mutual or rental units as well as purchase
property for future rehab or development.
--Major rehabilitation, minor repair and emergency loans--used to
help existing very low-income and frequently elderly homeowners
maintain their homes and avoid the predatory lending scams that
often target this population;
--First- and second-mortgage loans--for those buyers who cannot fully
qualify conventionally; these loans are tailored to the buyers'
ability to repay;
--Down-payment and closing costs for first-time homebuyers; and
--Economic development--for small business start-up or expansions.
The revolving loan funds serve both as a capital resource for the
community and as a way of attracting and securing private investment.
In fiscal year 1998, investment from NeighborWorks revolving
loan funds rose by 23 percent, from over $65 million in fiscal year
1997 to over $80 million in fiscal year 1998.
conclusion
The NeighborWorks system has proven to be an effective
mechanism over time to revitalize distressed communities nationwide. It
has improved its efficiency and effectiveness over its 20-year history
in leveraging limited public funds with private capital. In 1994, total
public- and private-sector investments totaled $268.4 million; in 1998,
total investments in distressed communities amounted to more than $820
million.
In fiscal year 2000 and beyond, Neighborhood Reinvestment and
Neighborhood Housing Services of America look forward to continuing our
mission to support NeighborWorks partnerships of residents
and private-sector and public-sector leaders as they work to revitalize
distressed neighborhoods and communities in rural, small town, suburban
and urban settings.
We are extremely grateful for the Committee's support and look
forward to a successful year and continued opportunities in fiscal year
2000.
______
Selective Service System
Prepared Statement of Gil Coronado, Director
introduction
As we approach the millennium, I am enthusiastic about the future
of the Selective Service System. Fiscal years 1998 and 1999 so far have
been banner years. The Agency's accomplishments reflect the
professionalism of our modest number of full-time and part-time
employees and the dedication of nearly 11,000 part-time civilian
volunteers. I am proud to say that the Selective Service System stands
ready to mobilize national manpower should the President and the
Congress decide a draft is needed for a crisis that may exceed the
capabilities of America's standing Armed Forces.
Although Selective Service is a compact Agency with a modest annual
budget, it continues to furnish America's only time-proven defense
insurance policy. Since World War II, every President, every Secretary
of Defense, all the Armed Services chiefs, key Members of Congress from
both sides of the aisle, national veterans and patriotic organizations,
and more importantly, the American people, have all agreed that the
Selective Service System must remain in place to underpin America's
role as a beacon of freedom and strength in a turbulent world.
But the Selective Service System is far more than just a defense
manpower insurance mechanism. For present and future generations of
America's young men, it represents a very critical link between
society-at-large and today's volunteer military. It is a reminder that,
as Americans, every young man is personally responsible for ``providing
for the common defense.'' Each and every day, Selective Service is a
reminder to the world that, if necessary, we will defend our Nation as
our fathers, grandfathers, and great grandfathers have so gallantly
done in the past.
The President's budget request for fiscal year 2000 proposes
funding the Selective Service System at $25,250,000. This is the third
increase since fiscal year 1995. Numerous tradeoffs and adjusted
priorities were implemented to accommodate constrained resources since
fiscal year 1995. Notwithstanding, at the current level the Agency
continues to perform its statutory missions.
agency purpose
The Selective Service System remains ready to furnish its primary
customer, the Department of Defense, with personnel for military
service in a national crisis. It also remains ready to implement an
Alternative Service Program for conscientious objectors. Consequently,
Selective Service is a vital component of national defense preparedness
for our Nation. Its missions, organizational structure, and programs
have been thoroughly and repeatedly reviewed since 1990. Each review
also embodied the principles and objectives of the ongoing National
Partnership for Reinventing Government. Most recently, the Agency's
missions and structure were analyzed and evaluated, leading to a
September 1997 General Accounting Office report which provided two
alternatives: suspending active registration and placing the Agency
into ``deep standby.'' Ultimately, any decision to change Selective
Service would require policy judgments that involve other
considerations, some of which cannot be quantified, in addition to cost
and time required to respond to a national emergency.
I am proud of the workforce's uninterrupted professional response
and its sustained national security contributions. The employees of the
Selective Service System continue to do the public's business with
demonstrated enthusiasm and focused commitment. And for my part, I
continue to manage the Agency austerely, looking for cost savings and
greater programmatic efficiencies through information technology and
staffing levels.
recent progress in customer service
Since I last testified before this committee, there have been a few
dramatic and dynamic changes with regard to serving our customers. Four
are most noteworthy because they provide the public with effective
service and satisfy the Congressional charge to Federal agencies to
evolve into performance-based organizations.
--Young men are able to register on-line, and anyone can verify a
registration at our web site. http://www.sss.gov. These new
options are major accomplishments in customer convenience,
speedy operations, and greater accuracy of data.
--We continue to streamline our authorized full-time and part-time
workforce, achieving a net reduction of over 19 percent in
civilians and over 13 percent in part time military staffing.
This continues in concert with the Government Performance and
Results Act objectives and mandated strategic and performance
measurement planning.
--Extensive registration improvement campaigns were conducted in 21
geographic areas across the Nation experiencing low
registration rates. Focused chiefly in America's inner cities,
efforts not only garnered registrations which add to the
fairness of any future draft, but they also protect Federal and
state benefits for young men, many of whom are minorities or
disadvantaged.
--Twenty-seven states now have laws which reinforce the Federal
requirement to register with Selective Service. In these
states, the laws vary, but they generally condition student
financial aid, public college enrollment, and government
employment upon a young man's compliance with the national
registration obligation. The new state laws and several similar
municipal ordinances increase a young man's awareness of the
registration requirement.
agency areas of emphasis
Program and Performance Measures.--In concert with the requirements
of the Government Performance and Results Act, as coordinated by OMB,
the Agency has identified numerous measurable performance goals that
define and qualify many expected program accomplishments for fiscal
year 2000. The goals reflect programmed levels of accomplishment which
are consistent with the funding and resource levels contained in the
President's Budget. Additionally, measures identified in the Selective
Service System's fiscal year 2000 Performance Measurement Plan, define
annual progress toward the achievement of particular goals and
objectives also delineated in the Agency's fiscal year 1997-2002
Strategic Plan. Measures of performance effectiveness are: qualitative
improvements over specific time frames; more accurate and faster
turnaround of data; lower levels of personnel staffing; improved
customer services; and the completion of all Y2K requirements.
Recently, the White House commended Selective Service on its excellent
progress in addressing Y2K issues. With the application of ever
evolving communications, software and hardware technologies, the Agency
continues its mandate to accomplish its missions smarter, better, and
more cost-effectively.
Registration Improvement & Public Awareness.--For some time we were
aware that our registration rate has been declining over the past
several years, but it is only in 1999 that we saw the first big drop.
For calendar year 1998, it appears that we are about 2 percent under
1997. Consequently, we are about 89 percent for ages 18 thru 25. This
concerns us because we believe that once you fall below 90 percent
compliance, the public would perceive our system as unfair. The public
would believe, rightly, that not everyone who should be in the pool is
there; and therefore those who are there, are disadvantaged because
they are more vulnerable to be called. This is why I have placed such a
priority on raising the registration rate.
Recognizing this trend, we implemented aggressive steps to correct
the situation, such as focused blitzes in low registration areas.
Naturally, the resources are traded off among other programs. However,
if additional resources became available, we would expand mass mailings
to targeted zip codes with low registrations. Further, we would develop
and distribute more public service broadcast messages to specific
markets, together with new focused printed materials. And finally we
would expand our efforts to maximize tape matching programs and
partnerships to identify potential nonregistrants. I estimate that the
cost would be about $1.00 additional per registration, or a total of
about $2 million. And any registration does triple duty: it documents
that a man complied with the law, it preserves a young man's
eligibility for Federal/State benefits, and it provides men with
information about military service. It would take SSS about $5.00 to
contact the same young man that DOD does for $13,000.
The Agency is strengthening its programs aimed at improving
registration rates. Already underway are advanced registration
improvement efforts. Again this year, Selective Service is making a
strong attempt to reach young men in selected states where
registrations appear to be low. Registration improvement ``blitzes''
are being scheduled to publicize the peacetime registration
requirement. We strive to reach the unregistered, not only to assure
fairness and equity if there needs to be a future draft, but because
the law requires a man to register with Selective Service to remain
eligible for student loans and grants, most Federal jobs, and training
under the Department of Labor's Job Training Partnership Act. No man
should unwittingly deny himself these opportunities. To support this
effort, additional radio and television public service announcements
(at no cost for airtime) in English and Spanish are being distributed
nationally to relevant communities. These high-quality products have
received laudatory comments from viewers around the country and are
receiving no cost annual air play commercially valued at over $2
million.
Selective Service maintains a home page on the World Wide Web
(http://www.sss.gov) where registration and other Agency information is
now available to anyone with access to the Internet. A convenient and
highly efficient method of registration is the recent provision for the
public to register through the Internet. Our fiscal year 1999 goal of
providing an on-line capability for a man to register and immediately
receive his Selective Service number was achieved on December 2, 1998.
This efficient method is averaging about 15,000 registrations per
month. That average will increase as more men become aware of the
capability to ``Save a stamp. Save time. Register on -line.'' Selective
Service continues to expand its Web Page with other Federal agencies to
enhance public education and customer responsiveness. Site content is
constantly being improved. On- line now is the capability to verify a
man's registration status. It can be used by anyone or any
organization, such as colleges, universities, state and Federal
agencies. The purpose of all these changes is to provide outstanding
service to our customers: service which is responsive, convenient, and
more timely.
Information Technology (IT).--We are also investing in IT as the
vehicle to improve customer services. Modernization of the Agency's
technology infrastructure began in fiscal year 1997 and is planned to
continue through fiscal year 2003. In accordance with the requirements
of the Information Technology Management Reform Act of 1996 (Clinger-
Cohen Act), the Agency is developing an IT architecture that describes
the work of the Selective Service System, the information it uses, and
the IT needed to carry out its missions. Aligned with these efforts is
the Agency's capital planning initiative which is also being developed
to satisfy the Act. Further, our Information Management Modernization
Plan focuses on adding new information technologies and Y2K mandates to
the Agency's infrastructure. This is mainly driven by changing customer
needs and revised government requirements. The goal of upgrading the
Agency's IT platforms is based on reengineering critical mainframe
computer systems while targeting other systems for use on small
computer platforms. Integrating the Selective Service mainframe
computer systems into more user-friendly client/server applications is
our strategy over the next several years with the potential to move off
of a large mainframe. Selective Service has modified its computer
application programs to be Y2K compliant. These programs have been
tested and validated by in-house staff. Independent validation and
verification is underway by a contractor. These are the type of
proactive efforts which the White House recently characterized as
``excellent progress.''
By embracing change and applying technology, Agency activities are
leading toward a paperless work environment and a more economic means
of doing business. We are exploring and implementing new methods of
sharing information with other government agencies to verify Selective
Service registrant data. This is necessary to verify that men are
eligible to participate in state and Federal benefits in accordance
with the Solomon Amendment to the Military Selective Service Act and
the Thurmond Amendment (5 U.S.C. 3328). As the Agency moves forward
with its IT improvements, updated and appropriate performance measures
are being employed to monitor progress toward the attainment of
objectives and milestones.
Revamping these systems will pay important dividends in end-user
productivity and better service to customers. The Selective Service
System is confident that its IT initiatives will improve customer
service and increase the productivity of the Agency's workforce.
summary
Today, Mr. Chairman, the Selective Service System stands prepared
to perform its crucial, time-tested responsibilities if directed to do
so. The missions of this small Agency are even more fundamental to our
National Military Strategy as the United States deploys its Armed
Forces in ever more scattered world trouble spots and as recruiting and
retention for our volunteer military become more challenging. The
Selective Service System remains resolute in its rightsizing and
streamlining of operations. The fiscal year 2000 appropriation request
of $25,250,000 will be invested very prudently in one of the Nation's
greatest security assets. Its rationale for existence and its
credentials are the same: a compact structure with the means to provide
manpower to our Armed Forces as required in a national emergency, and
to do it timely, fairly, and equitably.
I am especially proud to lead a dynamic and productive Selective
Service System. I can assure you, Mr. Chairman, that with the ambitious
efforts underway, America is maintaining a low-cost insurance policy
against underestimating the nature and size of future threats our Armed
Forces may face. Selective Service has accomplished much since I last
appeared before this committee. My pledge to you is that our
achievements this year and next shall be even greater.
Thank you, Mr. Chairman.
Community Development Financial Institutions
Prepared Statement of the Coalition of Community Development Financial
Institutions
Chairman Bond, Senator Mikulski, and distinguished members of the
Subcommittee, thank you for the opportunity to submit testimony on the
President's budget request for the Community Development Financial
Institutions (CDFI) Fund. The President has requested $125 million for
the CDFI Fund in fiscal year 2000. The CDFI Coalition, representing
more than 465 CDFIs working in all 50 states, urges you to support the
President's full request.
The CDFI Coalition formed in 1992 to respond to initiatives by the
Administration and Congress to support CDFIs. We served as a primary
resource in drafting the legislation that created the CDFI Fund. Since
that time we have devoted our efforts to building public and financial
support for the CDFI industry through advocacy, public education,
knowledge building, and outreach. The CDFI Coalition represents
community development loan funds, community development banks,
community development credit unions, microenterprise lenders, and
community development venture capital funds. Together our members have
loaned and invested some $4 billion in our nation's most distressed
communities.
what are cdfis?
CDFIs bring private sector capital to bear on problems that have
historically required public sector solutions. CDFIs emerged in
response to the credit and capital-related assistance needs of our
nation's most economically and socially distressed and disinvested
rural, urban, and tribal communities. Their purpose is to create
permanent solutions in these communities. They are bridge institutions
that link unconventional borrowers and conventional financial
institutions. They all have community development as their primary
mission and carry out that mission by financing businesses and
community facilities, job creation and development, and affordable
housing in low and moderate-income communities.
The government did not create CDFIs. Some CDFIs have histories
stretching back five decades. These organizations are the responses of
hundreds of local communities to fill market niches that banks and
other conventional financial institutions do not. They are based on
bipartisan principles of building private markets, creating
partnerships, and providing the tools to enable poor individuals and
communities to become self-sufficient and stakeholders in their own
future.
why is the cdfi fund important?
The CDFI Fund is a unique government effort created to capitalize
financial institutions committed to serving and improving low-income
and low-wealth communities. The Fund bolsters economic development by
investing in and assisting CDFIs. By investing in institutions, not
just projects, the Fund helps CDFIs better respond to their markets by
increasing their ability to manage risk, to enhance capacity, and to be
flexible in their financing. With capital from primarily private sector
sources, CDFIs excel in using sound business practices to leverage
conventional, private financing into poor communities.
Support of these organizations through the CDFI Fund makes the most
effective use of limited federal resources. It uses relatively small
amounts of federal money to leverage significant amounts of private and
non-federal dollars, promotes private entrepreneurship and encourages
self-help and self-sufficiency.
what has the cdfi fund accomplished?
The CDFI Fund has been innovative, investment-oriented, and
business-like in approaching its funding. Through its rigorous review
process, the Fund has made awards that have provided opportunity and
insisted on institutional viability. Recognizing that there are diverse
organizational levels, the Fund has established different windows for
participants. In addition to the ``Core CDFI Program,'' the Fund has
implemented an ``Intermediary Program'' through which organizations in
need of assistance can participate through CDFI intermediaries, and a
``Technical Assistance Program'' which offers financial support to
CDFIs working to build their organizational capacity.
The CDFI Fund has been productive and successful in issuing its
first three rounds of awards. Thus far, the Fund has awarded $122
million to 117 CDFIs through its Core Program Component, $3 million to
70 CDFIs with its Technical Assistance Program, and has reached more
than 200 CDFIs through its $7 million invested in CDFI Intermediaries.
The Fund has also awarded $58 million to more than 170 banks and
thrifts through the Bank Enterprise Awards Program resulting in more
than $700 million in direct financing services in distressed
communities as well as $271 million invested in CDFIs. Through these
awards the Fund has built a balanced national portfolio of urban and
rural and large and small CDFIs with geographic diversity.
why continue to support the cdfi fund?
CDFIs, their borrowers, and the communities in which they work need
the capital that the CDFI Fund offers. Support for the CDFI Fund is
essential to their vital work. Increased support will enable CDFIs to
continue to rebuild and revitalize our nation's communities. From its
survey of its First Round Core Program awardees, the Fund's initial
findings illustrate the significant impact of the Fund's assistance on
CDFIs. Collectively, this group of 30 CDFIs has taken a $34 million
investment and turned it into $565 million in loans and investments to
help create or expand 1,148 businesses and 1,895 microenterprises;
create or retain more than 12,000 jobs; and develop more than 8,600
affordable housing units and 285 community facilities.
The CDFI Fund offers the combination of increased access to capital
and the institutional capacity building that is vital to CDFIs and,
through them, to our nation's distressed communities. CDFI Fund's
programs are consistently oversubscribed. In the midst of its growth
the CDFI industry is experiencing substantial demand. In the first
three rounds of Core Component awards, over 560 CDFIs have requested
more than $662 million. The Fund has awarded a total of $119.5 million,
barely eighteen percent of the funds requested.
An increased appropriation to the CDFI Fund generates substantial
private dollars to distressed communities. In an analysis of its 1996
Core Program awardees, the Fund found that its First Round investment
resulted in CDFI asset growth of 122 percent, increasing from $473
million to $1.05 billion by 1998. CDFIs are very successful at
leveraging private dollars. They build bridges between conventional
financial services and unconventional borrowers and often work where
banks do not. The dollar for dollar match required by the CDFI Fund
represents only a fraction of the long term leveraging potential of
this program. Every dollar of CDFI equity investment can leverage up to
$50-$100 into low-income communities.
CDFIs will continue to benefit from the CDFI Fund's Training and
Technical Assistance Initiatives. A key part of the Fund's institution-
building mandate is its training and technical assistance initiative.
No issue is more critical to the viability of this much-needed industry
than building its human capacity. The CDFI Coalition, with a Ford
Foundation grant, conducted an extensive study of the human capacity
needs of the CDFI industry. Our findings stressed the need for training
and proposed efficient and economical approaches to enhance the
industry's performance.
With increased support the CDFI Fund can broaden its reach and
impact, enabling CDFIs to better reach poor communities. The CDFI Fund
can and should maintain a blend of emerging and mature CDFIs by
creating a Small and Emerging CDFI Access Program (SECAP) as part of
its core CDFI Program Component. SECAP would fill a gap between the
Core Program and the Technical Assistance Program. By providing access
to limited capital assistance with a streamlined business plan,
flexible matching requirements and training and technical assistance
funding, SECAP will greatly expand the Fund's potential customer base.
Given the demand and success we have described above it is
appropriate for the Congress to continue to invest in this program. We
are strongly urging you to provide increased support by appropriating
the full $125 million requested by the President. In this era of scarce
resources it is incumbent upon the government to use those resources
strategically and effectively and to maximize their impact. The CDFI
Fund can use its support to enable organizations with proven track
records to expand and diversify their services, grow responsibly, and
sustain themselves over time.
NONDEPARTMENTAL WITNESSES
[Clerk's note.--The following testimonies were received by
the Subcommittee on VA, HUD, and Independent Agencies for
inclusion in the record. The submitted materials relate to the
fiscal year 2000 budget request.
The subcommittee requested that public witnesses provide
written testimony because, given the Senate schedule and the
number of subcommittee hearings with Department witnesses,
there was not enough time to schedule hearings for
nondepartmental witnesses.
DEPARTMENT OF VETERANS AFFAIRS
Prepared Statement of the Joslin Diabetes Center
Mr. Chairman, thank you for this opportunity to submit a statement
for the hearing record for the VA concerning fiscal year 2000 funding.
The purposes of this statement are for Joslin Diabetes Center (1) to
provide the Committee a status report on the VA's participation in the
joint Joslin/DOD/VA Diabetes project funded through DOD appropriations
for the past two years; and (2) to request direct funding through this
bill of $2 million for fiscal year 2000 for the VA to expand the pilot
program into new VA regions and facilities.
Background
Attached are background fact sheets on Diabetes, Joslin Diabetes
Center, and the Joslin Vision Network (JVN).
By the end of fiscal year 1999, the Joslin/DOD/VA Diabetes
Detection, Prevention and Care Project will have accomplished the
following at selected VA sites:
In Hawaii, we have set up the Joslin Vision Network (JVN) at the
Honolulu VA Clinic and the Tripler Army Medical Center.
The Joslin Diabetes Outpatient Intensive Treatment (DO IT) program
has been deployed in Hawaii where the first DO IT implementation
practice program with patients was completed in December.
At New England VA (VISN-1), we have the JVN located at the West
Roxbury/Boston and Brockton VA Hospitals with Togus, Maine scheduled
for mid-summer deployment.
The JVN has been deployed at the West Roxbury/Boston VA Hospital.
Research protocols for the JVN and DO IT programs have been
cooperatively developed and are in the early stages of implementation.
From these pilot models, we will develop evidence based practice models
that can be implemented effectively in current and future additional
sites.
The clinical studies and trials that validate this treatment and
detection protocol for VA and DOD implementation for the JVN and DO IT
programs will commence in New England in May and in Hawaii in July.
Fiscal year 2000
DOD Funding
For the fiscal year 2000 project phase through requested DOD
funding, we have planned the following tasks, targets and activities:
--The three fully operational JVN sites in Hawaii will utilize
Tripler Army Medical Center as the Reading Center.
--Tripler will provide the DO IT program on a monthly basis for
military personnel, families and veterans.
--The three Image Acquisition Sites for the New England VA will
utilize Joslin as the Reading Center component.
--The VA Hospital in West Roxbury/Boston will provide one DO IT
program on a monthly basis for veterans and family members.
--All research protocol trials will be completed while new phases
will be developed for the program evaluation component.
VA Funding
With the support of VA policy and program officials, we propose to
enhance the VA component of the program. The VA and Joslin have
developed a plan to expand the research and clinical trial protocols
and to establish and implement Joslin Diabetes Detection, Prevention
and Treatment programs in an additional region to serve a new veterans
population group.
Fiscal Year 2000 Program Summary
Under current plans, and the pending request for a DOD funded
program, use of the JVN equipment and the expansion of screening
opportunities in three VA regions will be the focus for fiscal year
2000 activities. The advancements in VA and DOD capabilities to detect
and treat diabetes will result in health care benefits and cost savings
to patients. This also results in cost savings to the health care
systems of VA and DOD. The real thrust of the program's importance is
not the introduction of the new equipment and techniques--the real
importance is the use of the detection equipment and education in
treatment protocol that minimize the incidence and severity of the
impact of diabetes.
Following the expansion of the JVN and the incorporation of the DO
IT protocol within the three regions planned for fiscal year 2000,
Joslin will provide technical assistance in file management, patient
follow up and monitoring, and the design of long term studies to
measure the impact of the introduction of these two new elements (JVN
and DO IT) into the VA and DOD medical networks and infrastructure.
Joslin will also work with VA and DOD medical personnel on
developing documentation for use in other VA/DOD locations and with
their respective geographically adjacent civilian populations. The
promise of the pilot programs lies in their ability to reach the
civilian population outside the traditional medical systems and in
their expanding use within both the VA and DOD.
The VA enhancement funds we are seeking--$2 million through the VA-
HUD Appropriations Act--will permit the VA to treat more patients with
the improved methods, techniques and technology derived from the base
DOD funded pilot program. This enhancement will enable the VA to better
accomplish its health care mission, and result in reduced agency and
patient costs and improved patient treatment.
Fiscal Year 2000 Joslin Diabetes Center Funding Request--$2 Million
Joslin Funding Summary
VA Program Participation Costs (expanded).....................$1,000,000
Joslin Diabetes Center Program Technology Development......... 500,000
Joslin Diabetes Center Program Participation Expenses......... 500,000
--------------------------------------------------------------
____________________________________________________
Total, Joslin/VA Project Cost........................... 2,000,000
Summary
The proposed expansion of the Joslin/DOD/VA project with the VA
will provide for the continuing improvement of health and costs related
to diabetes for the Department of Veterans Affairs for a wider
population group. We are grateful that we have the policy and
programmatic support of the VA in our efforts. We understand that the
VA supports this request for an additional $2 million.
Conclusion
Mr. Chairman, expansion of this cooperative effort in fiscal year
2000 will cost $2 million for the expenses of both Veterans Affairs and
Joslin Diabetes Center. We respectfully request that you carefully
consider the potential program benefits and cost savings associated
with this modest investment for fiscal year 2000 funding. We are
pleased to be a part of this project with the Department of Veterans
Affairs and appreciate your Committee's support.
Thank you again for this opportunity to submit this statement for
the hearing record.
______
Statement of The Retired Enlisted Association
On behalf of The Retired Enlisted Association's (TREA) National
President Fred Athans and National Auxiliary President Ethel Hale as
well as over 100,000 members and auxiliary, we appreciate the
opportunity to testify before this subcommittee concerning fiscal year
2000 Department of Veterans Affairs Appropriations. TREA is a federally
chartered Veterans Service Organization (VSO) representing retired,
active, guard, reserve and family members who are serving or have
served in every component of the Armed Forces of the United States:
Army; Marine Corps, Navy, Air Force, and Coast Guard. There are several
issues which affect the members of this organization, and all veterans,
that will be impacted by the actions of this subcommittee. These issues
include:
va subvention
Increased access to health care for military retirees is TREA's
greatest concern. The majority (sixty-one percent) of our members are
over the age of 65 and have been disenfranchised from their ``earned''
military retiree health care benefit. That is why TREA supports
legislation authorizing the Department of Veterans Affairs to receive
payments from Medicare to serve Medicare-eligible veterans (including
military retirees). The Senate has already included a demonstration
program in S. 4, the Soldiers', Sailors', Airmen's, and Marines' Bill
of Rights. The VA Subvention program would be a good step in the
direction of improving retirees access to health care. Further, the VA
Subvention program would help all those veterans who are on Medicare,
not only military retirees. As we work with the Ways and Means
Committee on this issue, we are hopeful that the members of this
committee, the advocates for veterans in Congress, will support VA
Subvention when it is addressed in the House of Representatives.
Due to the fact that Medicare Part ``B'' would be a requirement of
VA Subvention, TREA supports legislation which would eliminate the
penalty for military retirees that did not elect Medicare Part ``B''
and now wish to enroll. Unfortunately, many military retirees were
counseled by active duty hospital representatives not to enroll in
Medicare Part ``B'' stating that their care at military health care
facilities would continue for the rest of their lives. Today, however,
we have seen several rounds of base closures which have left hundreds
of thousands of military retirees without quality health care. Waiver
of the Medicare Part ``B'' penalty and opening VA Hospitals to
Medicare-eligible retirees will help correct this situation. Again,
TREA recognizes that this issue falls under the jurisdiction of your
colleagues on another Committee but we need your support, as advocates
for veterans on this important issue.
long term health care
H.R. 1432, recently introduced in the House by Representative Kelly
of New York calls for public funding of long term health care for
veterans with a service connected disability rating of 50 percent or
higher. While the Department of Veterans Affairs has been providing
long-term care for veterans for many years out of its annual health
care appropriation, the increasing cost of health care makes it
imperative that Congress provide the funding to carry out this mission.
Congress can not allow this benefit to cease due to a lack of funding.
concurrent receipt
Presently, military retirees pay is being off-set based on the
percentage of VA disability they receive. As such, military retirees
are the only class of American citizen required to waive their earned
retired pay, dollar-for-dollar, to receive VA compensation for service
connected disability. There are numerous bills pending in the House of
Representatives to eliminate this off-set. TREA supports any
legislation which would address this disparity which exists. We support
the same treatment of military retirees as U.S. citizens with service
connected disabilities. The support of the members of this subcommittee
would be appreciated when your colleagues on the Defense Appropriations
Subcommittee address this issue.
veterans benefit administration
Following along with the issue of Concurrent Receipt is the
existing backlog in the processing of claims for a VA disability. The
current wait is, in a word, shameful. It is an understood fact among
veterans that if you do not have a Veterans Service Officer working for
you, your claim will not be acted upon by adjudicators for a
considerable period of time which may last for years. Veterans with
service connected disabilities should not be discouraged from applying
for their earned entitlement to disability compensation because they
know that the system will be working against them. TREA was pleased to
hear the Department of Veterans Affairs plans to hire more claims
processors in fiscal year 2000. However, we remain skeptical that these
additions will have enough of an impact to truly correct this problem.
The most recent figures on claims processing show that the existing
backlog makes the stated goal of 74 days for a rating-related action
unlikely. Further, the increasing complexity, both medically and
legally, will continue to have a significant impact on timeliness. The
Board of Veterans Appeals currently renders a decision within 120 days
of receiving an appeal. However, the total elapsed processing time for
an appeal in the first quarter of fiscal year 1999 was 968 days, and
this is an improvement from fiscal year 1998! A time-frame of nearly
two and one-half years is not satisfactory. TREA is pleased the VA is
working to correct this delay but the fact remains that it still
exists.
Outside the Department of Veterans Affairs Headquarters is a quote
from President Lincoln which reads, ``To care for him who shall have
borne the battle and his widow and his orphan.'' In reality, many who
have borne the battle do not receive what they earned for fighting in
that battle. The process of filing a claim needs to be reviewed to
ensure that veterans who deserve compensation receive it in a timely
and efficient manner. Please appropriate the necessary funding to
improve the claims process and the lives of deserving veterans.
commission on servicemembers and veterans transition assistance
Along with many other Veterans Service Organizations, and members
of Congress, TREA anxiously awaited the report of the Dole Commission.
There were numerous points made by the Commission which greatly affects
TREA's members. One point of particular concern is the following
statement:
``Although healthcare coverage for Medicare-eligible Service
retirees would be expensive, the central issue is fairness and equity,
not affordability. In 1997, the Federal Government spent $2.9 billion
to provide FEHBP coverage to 1.67 million federal civilian
beneficiaries aged 65 or older, and budgeted for immigrant healthcare.
Thus, in the interest of fairness and equity for those who have endured
the hardships and dangers of a service career, the cost of FEHBP-65
would be a small price to pay.''
Military retirees cannot understand why immigrants have more health
care options then themselves and their families. We believe that
eligibility reform at the Department of Veterans Affairs, an issue we
address later, and the previously addressed VA Subvention program would
help improve this situation.
One particular area of concern for those of us who spent twenty or
more years in the military is the recommendation concerning the
limiting of the VA Home Loan guarantee to one use. Certainly,
individuals who make the military a career may choose, at some point in
time, to buy a home that meets their needs. Perhaps this may come with
the arrival of a child or at a location where base housing may not be
available. These servicemembers should not be forced into having to
determine whether or not to buy a home while still on active duty or
wait until retirement. The VA Home Loan program has been a successful
program for decades. I do not doubt that a program created following
World War II can use some readjustment, but to limit the program to one
use will force career servicemembers into difficult decisions that
their predecessors did not have to make. Instead of being a transition
benefit, this could cause a difficulty veterans should not have to deal
with when separating from the Armed Forces. TREA urges Congress to
continue to provide full funding for the current VA Home Loan program.
The Commission has also recommended significant changes to the
Montgomery GI Bill. The GI Bill is certainly one of the best recruiting
tools the armed forces have today. Further, the impact it has had on
society has been profound as more and more Americans have had the
opportunity to earn college degrees. However, the education system in
this country has changed greatly over the years. College tuition
increases have nearly always doubled inflation over the past few years.
That has made the pursuing of a college degree much more difficult for
separating servicemembers as the value of the GI Bill has, therefore,
steadily decreased. Further, education itself has changed. No longer is
a four year degree the only form of higher education. Often, separating
servicemembers may take a course over six months which costs thousands
of dollars. The Commission's recommendation concerning the increase in
the amount payable for tuition and fees along with the speeding up of
payment for the GI Bill recognizes the fact that education has changed
over the years.
The Subcommittee's support of these improvements to the veterans
benefits package would be appreciated, not only by TREA's members, but
by current and future veterans nation-wide. Further, we recognize there
are numerous other proposals in the Commission's report such as merging
of DOD and VA purchasing programs as well as facilities. We understand
that Congress will need to study these recommendations and determine if
they work in the best interest of veterans and the country. However,
the recommendations we have addressed here, we believe, are those which
can be addressed immediately and will have a significant impact on
those who have served our nation.
va enrollment
TREA is very pleased with the current VA policy of enrolling all
veterans for health care. This is a positive step towards showing all
veterans that their nation is thankful for their service. We urge that
full funding be granted to ensure that the Department of Veterans
Affairs will be able to continue to enroll veterans in future years. We
do not want veterans who have enrolled in the VA to be told in one or
two years time that the health care they are being guaranteed today has
come to an end. We are concerned, however, that disabled veterans are
not receiving their guaranteed health care. TREA has been working on a
particular case where one of our members, who is rated at 70 percent
disabled, was told there was no space available to treat his service-
connected disability. This veteran, in fact, is a priority 1 veteran,
those rated 50 percent or higher. He should not have been told there is
no space available due to the large number of new enrollees into the VA
system. Just as it is important that all eligible veterans have access
to the VA, it is more important that veterans with service connected
disabilities can receive treatment and are not told there is no space
available. Promising veterans care is wonderful, but not at the expense
of the current patient priority system.
eligibility reform
The Retired Enlisted Association supports the efforts of Chairman
Stump to provide for eligibility reform concerning the enrollment
categories in the Department of Veterans Affairs. Presently, many
military retirees fall under Category 7, the lowest enrollment category
which means military retirees, who have often lost their access to
military treatment facilities, cannot access VA facilities either.
Chairman Stump's proposal to create a separate enrollment category for
retirees is greatly appreciated by the members of this organization and
will certainly go a long way towards increasing the health care options
for military retirees. Further, we believe it is a justifiable benefit
for those who have dedicated twenty or more years of service to this
nation. We urge members of this committee to provide adequate funding
to create this special category.
fiscal year 2000 budget
``Pay Go'' is an expression which TREA and the other military
associations have heard for years. If one program was going to be
funded, its cost would have to be offset by taking money away from
another program. Now, we have come to find that this is not always the
case. Last year, the infamous ``Highway Bill'' was offset by taking $10
billion from, among other agencies, the VA. Our members ask, why does
``Pay Go'' not apply to the Transportation Bill like it does to the VA
and DOD Appropriations Bills? In an effort to increase funding for the
Department of Veterans Affairs, TREA has supported VA Committee
Chairman Bob Stump in his efforts to add additional funding for
Veterans health care and other issues. The grossly under-funded budget
submitted by the Department of Veterans Affairs to Congress was
shameful. As the budget surplus was diced up into new programs and
securing old ones, the VA saw an increase in its budget that barely
kept up with inflation. That is why we must come before you today, to
fight for our earned benefits that have, over the years, been gradually
reduced due to a lack of sufficient funding. However, we recognize the
budget agreement of 1997 limits the increase in spending which is
possible. Further, as an association which represents military
retirees, we fear an off-set which takes funding from the Department of
Defense would have a severe impact not only to retirees and their
families but our active duty troops and their dependents as well. The
Budget Resolution passed by the Senate included an amendment which
increased VA funding without off-sets from other Defense and Veterans
programs. TREA urges this Committee to include funding levels equal to,
and with the protections guaranteed, in the Senate Budget Resolution.
gulf war illness
Health care and disability compensation for veterans of Operations
Desert Shield and Desert Storm are another area of concern for TREA.
The concept of service connected disability is relatively simple. If
you leave the military with an illness you did not have when you
entered, you are no longer a ``whole person'' as defined by the VA and
are, therefore, entitled to a disability rating and proportionate
compensation. Many veterans of the Persian Gulf returned with symptoms
of no particular illnesses or injury. In response, Congress passed
legislation allowing the VA to compensate these veterans with
undiagnosed illnesses.
Currently, the VA has extended the eligibility period to December
31, 2001 for compensation for undiagnosed illnesses in Gulf War
veterans. We are certainly pleased that the VA has done this. We are
also pleased that the GAO reported in 1998 that the VA has taken a
number of steps to improve its processing of Persian Gulf claims
(General Accounting Office, Veterans' Benefits, Improvements Made to
Persian Gulf Claims Processing). However, the work is not finished. Let
us not repeat the mistakes that were made over the issue of Agent
Orange twenty years ago, where many died while studies were trying to
determine the cause of their illness. We may never know what happened
to our men and women who served in the Gulf. But we do know that they
are sick and in need of our help. TREA would like to thank the many
members of Congress, from both sides of the aisle, who have introduced
legislation calling for increased research, expansion of the list of
illnesses which are service connected and other issues relating to
Persian Gulf illness. We sincerely hope these veterans will not be
forgotten as time goes by and memories of our nation's efforts in 1990-
1991 become part of history.
conclusion
Mr. Chairman, distinguished Subcommittee members, we are at an
interesting time in history. Through a balanced budget we have the
opportunity to correct nearly three decades worth of injustice on our
nation's veterans. We have been told in the past that once the budget
situation is resolved, our issues would be addressed. Today, the budget
issue is resolved and we are here asking that our needs be met.
Veterans realize there is a budget surplus which does not have a penny
directed to their programs. Why have those who put the nation before
themselves been put last by the nation? Now you, Congress, have the
opportunity to correct this by providing enough funding so veterans can
receive their earned benefits. The Department of Veterans Affairs must
receive full funding, be authorized to begin the VA Subvention program,
improve veterans educational benefits and continue to treat veterans
fairly and justly. By doing this, Congress can help ensure that
veterans once again become prophets of patriotism and service to the
nation as well as the best recruiters the Armed Forces had.
Mr. Chairman, I would like to thank you for giving The Retired
Enlisted Association the opportunity to present its views on these
important issues.
______
Prepared Statement of the American Heart Association
you are a target
Chances are heart attack or stroke will be the death or disabler of
you or someone you love. Heart attack, stroke and other cardiovascular
diseases are America's No. 1 killer and a main cause of disability.
Cardiovascular diseases account for nearly 1 of every 2 American
deaths.
The American Heart Association is pleased to provide
recommendations on fiscal year 2000 appropriations for the Department
of Veterans Affairs' Medical and Prosthetic Research program. This
program consists of four components: Cooperative Studies Program,
Health Services Research and Development Service, Medical Research
Service; and Rehabilitation Research and Development Service.
you can make a difference
The AHA, dedicated to reducing death and disability from heart
attack, stroke and other cardiovascular diseases commends this
Committee's support of the VA Medical and Prosthetic Research program.
The AHA is alarmed that the President's budget flat funds this vital
program. Enactment of this budget would severely jeopardize ongoing
studies and adversely impact planned innovative research. If a no-
growth budget is enacted, the VA would be negatively impacted by about
$10 million in out-year costs for previously approved research programs
and $10 million in expected biomedical research inflation. At a
minimum, VA research needs $336 million just to maintain its current
level of effort. The AHA is concerned that insufficient money is being
devoted to America's No. 1 cause of death--heart disease--and our No. 3
cause of death and a leading cause of permanent disability--stroke.
how you can make a difference
The AHA recommends an fiscal year 2000 appropriation of at least
$360 million for the VA Medical and Prosthetic Research program. Our
recommendation, consistent with that of the Friends of VA Medical Care
and Health Research, will allow maintenance of fiscal year 1999
initiatives and implementation of new initiatives for fiscal year 2000.
The AHA challenges our government to significantly increase funds for
heart and stroke research through the VA Medical and Prosthetic
Research program. We strongly urge the VA to establish heart and stroke
research centers to advance the battle against heart attack, stroke and
other cardiovascular diseases--America's No. 1 killer and a leading
cause of disability. Our government's response to this challenge will
help define the health and well-being of citizens in the next century.
still number one
Heart attack, stroke and other cardiovascular diseases have been
the leading cause of death since 1919. Nearly 60 million Americans--1
in 5--suffer from one or more of these diseases. Millions of Americans
have major risk factors for cardiovascular diseases--about 50 million
have high blood pressure, 39 million have high blood cholesterol (240
mg/dL) and 48 million smoke.
While heart disease and stroke occur at all ages, they are most
common in Americans over age 65--an age group that is now about 13
percent of the U.S. population and will be 20 percent by year 2020. By
the year 2020, the percentage of veterans over 65 years of age will be
about three times that of the general population or 51 percent of the
veteran population. The VA's planning models recognize that its aging
patient population demands more care. More than 4.49 million or 16.4
percent of the veteran population reported suffering from ``heart
trouble'' in the 1993 National Survey of Veterans. More than 990,000 or
3.6 percent of the veteran population are stroke survivors. As the
veteran population ages, the number of veterans afflicted by heart
disease and stroke will increase substantially.
Cardiovascular diseases put an enormous burden on our economy.
Americans will pay an estimated $287 billion for cardiovascular-related
medical costs and lost productivity in 1999. No other disease costs
this nation so much money and that amount is expected to increase
dramatically with the growth of the senior citizen population.
insufficient va resources devoted to heart and stroke research
The Department of Veterans Affairs Medical and Prosthetic Research
program plays an important role in heart and stroke research and
deserves the strong support of Congress. In fiscal year 1998, VA
support for research on heart disease was $20 million (a 24 percent
increase from fiscal year 1997), accounting for 7.4 percent of the
fiscal year 1998 VA's Medical and Prosthetic Research budget. In fiscal
year 1998, VA-supported stroke research represented $4.6 million or 1.7
percent of the VA's Medical and Prosthetic fiscal year 1998 budget. In
addition to its own program, the VA investigators spent an additional
$33.2 million on heart research and $6.9 million on stroke research
from outside sources.
va heart and stroke research benefits all americans
The mission of the VA Medical and Prosthetic Research program is to
``discover knowledge and create innovations to advance the health and
care of veterans and the nation.'' While the primary purpose of the VA
health care system is the provision of quality health care to eligible
veterans, VA-supported research contributes to the quality of care by
bringing talented and dedicated physicians into the VA system.
Discoveries from VA-supported research benefit veterans, science and
the world's health.
VA cardiovascular research represents an integral part of the
overall scientific effort in this field. VA researchers include many
nationally recognized, distinguished scientists and several Nobel
Laureates. Most recently, 1998 Nobel Prize winner Ferid Murad, M.D. for
research demonstrating the role of nitric oxide in regulating blood
pressure, had been supported by the VA. Several VA investigators have
been acknowledged for their work in cardiovascular research. For
example, American Heart Association volunteer Gerald F. DiBona, M.D.
was awarded the prestigious VA Middleton Award in 1995 for
internationally recognized research on kidney and cardiovascular
diseases. Also, VA investigators provide core faculty support at major
medical schools affiliated with VA institutions.
The Medical Research component of the VA Medical and Prosthetic
Research program supports both basic and clinical research, primarily
investigator-initiated peer reviewed studies. This component provides
funds for support of VA-based faculty members (M.D.s or Ph.D.s) at
various stages in their careers, multicenter cooperative studies--a
large portion of which are cardiovascular studies--and research
equipment. The presence of a VA research program aids the VA. This
small, but internationally recognized, highly competitive research
program in fiscal year 1999 supports 2,165 investigators at 107 VA
facilities nationwide.
VA cardiovascular research is largely clinical in nature. The VA is
a major contributor to this nation's clinical research, playing a
unique role in the research community because of its ability to
immediately translate research findings into clinical practice.
VA-supported research has produced landmark results and
revolutionized treatment in the cardiovascular area. You and your
family have benefited directly for VA heart and stroke research.
Several cutting-edge examples follow.
Inflamed Arteries.--Many heart attacks and strokes are the end
result of atherosclerosis, the disease process that causes obstructed
blood vessels. VA-supported research has shown a major way inflammation
causes atherosclerosis or hardening of the arteries. Scientists have
identified large numbers of a certain receptor on inflammatory cells in
heart blood vessels. If researchers can create a way to block that
receptor, progression of atherosclerosis might be prevented.
Heart Bypass Surgery.--In 1996, an estimated 598,000 heart bypass
surgery procedures were performed on 367,000 patients in the United
States at an average cost of $44,820 per procedure in 1995. Generally,
one year after surgery, 10 to 15 percent of the vein grafts used in
these procedures become blocked. VA research has found that reducing
the temperature of the solution used to harvest the vein grafts may
stop heart arteries from becoming clogged with atherosclerosis. The
study also discovered that while a daily aspirin stops artery vein
blockage for a year after surgery, long-term survival depends on the
extent of underlying disease before the procedure and the length of
time of the procedure. In a landmark study, VA researchers found that
heart medication works just as effectively as coronary artery bypass
surgery for certain groups of patients with blocked arteries.
Gene Therapy May Help Heart Failure.--About 4.6 million people in
the United States suffer from congestive heart failure, the leading
cause of hospitalization for Americans age 65 and older. VA researchers
have found in animal studies that inserting a gene in heart cells
affected by heart failure started an active increase in the chemical
that triggers the cells to beat more strongly. Additional research in
this area could provide a new lease on life for millions of Americans.
Also, VA scientists, using gene therapy in animals, increased the
number of blood vessels that transport oxygen to the heart.
Stroke Risk Reduction.--About 9 percent of older Americans suffer
from the most common type of an irregular heartbeat, atrial
fibrillation, a risk factor for stroke. Research has shown that low
doses of the blood thinner warfarin can lower the risk of stroke by
about 80 percent in patients suffering from atrial fibrillation.
Stroke Survivor Improvements.--Stroke is a leading cause of
permanent disability in the United States and the No. 3 killer. VA
studies have produced therapies to enhance quality of life for
survivors. VA researchers have created a software program to assess and
treat the stroke-related speech disorder aphasia, have shown that
strenuous exercise can benefit stroke survivors who are paralyzed on
one side of their body, and have developed a rehabilitation procedure
to restore arm movement. Researchers have identified seven pathways
associated with motor recovery from stroke, allowing more precise
predictions about functional recovery of stroke survivors.
Aspirin and Angina.--About 6.2 million Americans suffer from angina
(chest pain) due to insufficient blood supply to the heart. In another
landmark study, VA research found that aspirin cuts deaths and heart
attacks by 50 percent in patients suffering from unstable angina.
Angioplasty Benefits.--In 1996, an estimated 666,000 angioplasty
procedures were performed in the United States to restore blood flow to
the heart by widening narrowed arteries. VA research was the first to
evaluate this procedure. Results showed that after undergoing
angioplasty, patients suffered less pain and can exercise longer than
those taking only medication. Another study showed that clot-busting
drugs produced comparable results to those of angioplasty at cost
savings of $3,000 per patient. Each year more than 150,000 people are
candidates for clot-busting drugs, according to the VA.
Heart Failure Drugs.--About 4.6 million Americans suffer from
congestive heart failure, the often disabling inability of the heart to
pump sufficient blood throughout the body. A VA study showed that heart
medications can enhance the heart's pumping ability and keep sufferers
of congestive heart failure alive. These study results have
revolutionized heart failure treatment.
Non-Q-Wave Heart Attack.--Of the estimated 1.1 million Americans
who will suffer a heart attack this year, an estimated 750,000 will
experience the non-Q-wave--EKG classification--version. VA research
showed that noninvasive treatment of certain non-Q-wave heart attack
survivors saves money and is just as effective or in some cases better
than invasive procedures such as coronary angiography. Higher death
rates for victims were associated with invasive procedures.
High Blood Pressure.--An estimated 50 million Americans have high
blood pressure, the leading risk factor for stroke and a major cause of
heart attack. VA research showed that consistent with private sector
statistics, physicians increase antihypertensive medicine in only 25
percent of patients and that even those patients who had their blood
pressure monitored were poorly controlled. Better management of these
patients will reduce the number of heart attacks and strokes, America's
No. 1 and No. 3 killers, respectively. An inexpensive computerized
reminder system helps doctors manage patients and cut costs.
Cholesterol.--About 39 million Americans adults have elevated blood
cholesterol levels (240 mg/dL), a major risk factor for heart attack
and stroke. An estimated 11 million veterans are at increased risk of
heart disease due to high cholesterol levels, according to the VA. A
clinical trial showed that daily use drug gemfibrozil reduces coronary
heart disease risk by 22 percent with major reductions in coronary
heart disease, heart attack and stroke for individuals with low levels
of ``good'' cholesterol and normal levels of ``bad'' cholesterol.
Results could mean cost savings because gemfibrozil is more economical
than statin drugs. Also, VA research showed the effectiveness of
cholesterol screening, when broken down into HDL, the ``good''
cholesterol and LDL, the ``bad'' cholesterol, for adults--even those
over age 65. Another study found that the addition of soy protein to a
low-fat diet substantially lowers cholesterol with moderately high
cholesterol levels.
Wheelchair Aerobic Fitness Trainer.--This VA-developed trainer has
become an alternative to drug-induced stress testing for
cardiorespiratory fitness and coronary artery disease in people with
lower limb disabilities.
Heart and Stroke Research Challenges and Opportunities for VA
The research advances highlighted above and other progress have
been made possible by congressional support of the VA Medical and
Prosthetic Research program. Thanks to research, no longer does a heart
attack or a stroke necessarily mean immediate death. Now that more
people are surviving, heart attack and stroke can mean permanent
disability, costly medical attention, and loss of productivity and
quality of life.
Challenges and research opportunities to advance the battle against
heart disease and stroke abound. Examples of on-going VA research are
highlighted below.
Heart Failure Studies.--The growing number of sufferers from
congestive heart failure has earned this disease the title of ``the new
epidemic.'' VA research is examining whether the addition of beta-
blockers to standard treatment reduces deaths and enhances health and
quality of life of patients. If beta blockers prove to be effective
against heart failure, the drug could save the VA $9.4 million a year.
Another study is creating a large DNA bank of sufferers to examine the
genetic basis of heart failure. A third study, the first large scale,
international, randomized clinical trial is assessing the role of
digitalis in the treatment of congestive heart failure. It is
evaluating the effects of this 200-year old treatment in preventing
deaths from heart failure, the leading cause of hospitalization of
Americans age 65 and older. Heart failure represented more than 22,000
VA hospitalizations in 1990 at a cost of about $100 million. Results
will improve treatment of heart failure.
Heart Attack Research.--An estimated 1.1 million Americans will
suffer a heart attack this year. VA research is assessing the most
cost-effective way to diagnose and treat suspected heart attack victims
without the use of costly invasive procedures. One such procedure being
examined is a computer analysis of the heart's electrical signals
during exercise. Findings from this study could save money, improve
health care and reduce the number of surgical procedures.
Warfarin and Aspirin Study.--Heart attack remains America's single
largest killer. A VA-sponsored study is analyzing the effects of
warfarin, a blood thinner, plus aspirin versus aspirin alone in
reducing deaths from heart attacks. Results could save 20,000 lives
each year, according to the VA.
Atherosclerosis and Iron Research.--Atherosclerosis or hardening of
the arteries is a major risk factor for heart attack and stroke. VA
research is evaluating the concept that too much iron in the blood
stream contributes to atherosclerosis. Results of this research could
revolutionize the treatment of heart attack and stroke.
Irregular Heart Beat and Stroke Drug.--An estimated 1 million
Americans suffer from atrial fibrillation, the most common irregular
heart beat, which causes more than 75,000 strokes a year. A VA study is
evaluating the efficacy of two promising drugs in maintaining normal
heart beat. Research results will enhance treatment for atrial
fibrillation and reduce stroke risk.
Stroke Rehabilitation.--Stroke will strike about 600,000 Americans
this year; most survivors will remain permanently disabled. Studies to
enhance functional capacity and capabilities of stroke survivors are
underway.
The number of VA research applications has grown slightly over the
last five years, but funding cuts and/or inflationary increases
severely restrict support for approved applications. For the programs,
which were reviewed for fiscal year 1998 funding, more than 30 percent
of approved applications were funded. Ten years ago, 50 percent of the
approved applications were funded.
Through fiscal year 1999, total dollars appropriated for the
Department of Veterans Affairs Medical and Prosthetic Research program
have increased $123 million since 1985 at an average annual rate of
about 3 percent. However, there has been a decrease in terms of
constant ``1985 dollars'' of $7 million. The Medical Research programs
highlighted below are of interest to the AHA.
Investigator-Initiated Studies.--During fiscal year 1999 this
program will constitute 65 percent of the Medical and Prosthetic
Research appropriated budget. Under the President's 2000 budget, this
program would be level funded from the fiscal year 1999 appropriated
level. These investigators comprise the core of all VA research and
provide the preceptorship for career development awardees.
Cooperative Studies.--In fiscal year 1999 this program supports 41
clinical trials. The VA offers a unique opportunity for cooperative
studies due to close linkage among hospitals. These studies provide a
mechanism by which research on the effectiveness of diagnostic or
therapeutic techniques can achieve statistically significant results by
pooling data on patients from a number of VA hospitals. The Cooperative
Studies Evaluation Committee evaluates proposals developed by teams of
VA clinicians and biostatisticians. The VA under this mechanism has
supported many landmark clinical trials in the cardiovascular field
(e.g., studies in high blood pressure treatment and coronary artery
bypass surgery). Under the President's fiscal year 2000 budget, this
program would be level funded.
Career Development Awards.--Applications for these awards are
reviewed both locally and by the VA Central Office. This program
experienced a decrease in the number of awards by 58 percent from a
high in 1991 of 212 awards to a low of 88 awards in fiscal year 1997.
In response to the Research Realignment Advisory Committee suggested
rejuvenation of this program, a review began in fiscal year 1997 for
the VA's Medical Research Service, Health Services Research and
Development Service and, for the first time, Rehabilitation Research
and Development Service. This will result in an anticipated 187 Career
Development Awards in fiscal year 1999.
action needed
Today's investment in biomedical research will lead to future
returns. These returns include continued decreases in death rates from
heart attack, stroke and other cardiovascular diseases, reduced federal
outlays for hospital and long-term care expenses, a well-trained cadre
of biomedical researchers and a more healthy and productive society.
The American Heart Association recommends an fiscal year 2000
appropriation of at least $360 million for the VA Medical and
Prosthetic Research program. Our recommendation is consistent with that
of the Friends of VA Medical Care and Health Research. An appropriation
of this amount will allow maintenance of fiscal year 1999 initiatives
and implementation of new initiatives for fiscal year 2000. An fiscal
year 2000 appropriation of at least $360 million for this program would
continue current research momentum in cardiovascular diseases within
the VA and help to maintain the VA's vital role in the overall
scientific effort in this field. We strongly urge the VA to establish
heart and stroke centers to advance the battle against heart attack,
stroke and other cardiovascular diseases--America's No. 1 killer and a
leading cause of disability.
______
Prepared Statement of the National Association for Uniformed Services
introduction
The National Association for Uniformed Services (NAUS) appreciates
the opportunity to submit this statement concerning the association's
legislative agenda.
background
The National Association for Uniformed Services represents all
ranks, branches and components of uniformed services personnel, their
spouses and survivors. Our nationwide association includes all
personnel of the active, retired, reserve and National Guard, disabled
and other veterans of the seven uniformed services: Army, Marines,
Navy, Air Force, Coast Guard, Public Health Service, and the National
Oceanic and Atmospheric Administration.
naus veterans affairs goals--106th congress
The purpose of this association is to ensure a strong national
defense as provided by a highly trained volunteer force. To ensure that
high quality young people will be attracted to service in the armed
forces the nation must ensure that adequate recruitment and retention
incentives are available and that any promise of benefits to be earned
by military services are honored. Unfortunately, over the past years
many of the promises have been broken because of inadequate funding for
veteran programs. The ``breach of faith'' by the government and the
subsequent impact on retirees and veterans has been noticed and is
affecting the numbers and quality of those considering military
service--as shown by services missing their new member recruitment
goals.
Health care
NAUS recommends enactment and adequate funding for legislation to
authorize VA/Medicare subvention legislation on a fee-for-service
basis. NAUS also supports subvention on a managed care basis as well.
Both fee-for-service and a managed care component would provide for the
most efficient and cost-effective delivery care.
We also recommend that Congress eliminate all co-payments for
military retirees and TRICARE/CHAMPUS beneficiaries for care received
in VA medical facilities and return to system whereby VA would be
reimbursed by the military services for care provided to their
beneficiaries. This would be a major step towards honoring the lifetime
medical care promise and restore much of the faith lost in the
government to fulfill its promises.
With an aging veterans population it is important that we improve
the VA's ability to provide long-term care needs for disabled and poor
veterans through a combination of VA facilities for veterans requiring
specialized care and expansion of long-term care contracting.
Survivor's benefits
NAUS Strongly Urges the Principle of Replacement Income for
Survivor's Benefits Payable to Widows of Catastrophically Disabled
Veterans.
The DIC payable to widows of catastrophically disabled veteran's
needs to be restructured to more closely parallel the percentage of
replacement income provided by other Federal survivor's benefit plans
such as the Military's Survivor's Benefit Plan, or the Federal
Survivor's Annuity.
Catastrophically disabled veterans receive additional allowances
because of their service-connected multiple disabilities and the family
income may be $36,000 or more a year. While living, their wives are
their primary care givers and often provide skilled nursing care.
However, in performing this full-time duty they are not able to work
and earn retirement or Social Security benefits in their own right. In
these cases both the veteran and his family are dependent totally upon
income from the Department of Veterans Affairs (VA).
Consequently, after their husband's death, the income of these
widows drops to about $10,000 to $12,500 per year--depending upon the
number of years of their husband's total disability, and the over
lapping years of marriage. In the cited examples the percentages of
income replacement are 28 percent and 35 percent.
As an issue of fairness we believe the replacement income for these
widow's should parallel that of federal survivors, which is a about 50-
55 percent. This change would affect about 32,000 widows of
catastrophically disabled veterans.
NAUS also recommends that legislation be enacted to continue DIC
payments for widows who remarry after age 55.
Education
There is now near universal agreement that the veteran education
benefit is in need of sweeping reform. That statement in no way
diminishes the Association's appreciation for the improvements made to
the education benefit in the last two years, improvements that are a
credit to all members of this Committee. NAUS is sincerely grateful for
the enhancements enacted last year, particularly for the increase of 20
percent in the basic entitlement. We would like to see the following
improvements enacted in the current Congress:
--Pay eligible veterans full tuition, fees, books and supplies + $400
per month for up to 36 months. Provide indexes for inflation
and include non-institutional training.
--Eliminate the $1200 payroll reduction.
--Allow the services discretionary authority to transfer the benefit
to a family member.
--Allow service members 10-years from first enrollment to use the
benefit, not to exceed 15 years from separation.
--Exempt subsistence from counting as income for purposes of loan
eligibility.
--Allow accelerated lump sum payments
--Allow VEAP participants to elect MGIB if they were on active duty
on October 9, 1996 and pay $1200.
Employment and Reemployment
NAUS seeks the following improvements in veterans' employment
benefits and programs:
--Congressional oversight in efforts to determine the military
occupations for which it is feasible to meet civilian
licensure, certification, and apprenticeship requirements.
--Equity for military retired veterans regarding military service
creditable for civil service leave accrual and service
creditable during reduction's-in-force.
--Improvement in the programs and services of the Small Business
Administration that require special consideration for veterans.
--Establishment of programs to assist reserve and retiree
entrepreneurs to sustain their business or self-employment
during and to aid recovery following involuntary military
service in the Armed Forces for war and contingency operations.
This is especially needed in view of the immanent call up of
the reserve forces to support what will be the long term
operations and commitment required for peace in Kosovo.
--Repeal of the current law that inequitably imposes age restrictions
on the ``original appointment'' to certain occupations (i.e.,
law enforcement, fire fighters, air traffic controllers) or
amend current law to authorize a ``computed age'' for veterans
and military retirees that credits prior military training and
experience
--Repeal of the current law that prohibits civil service appointments
in the Department of Defense only after 180 days immediately
following military retirement.
Memorial affairs
NAUS seeks the following improvements in these final benefits
received by most veterans:
--Codification of the eligibility requirements for burial in
Arlington National Cemetery that includes elimination of all
waivers (HR-70)
--Legislation authorizing conveyance of government land adjacent to
Arlington National Cemetery for expansion of burial space
--Construction of a National Military Museum with sections for each
armed service.
Concurrent receipt
NAUS seek enactment of legislation authorizing the concurrent
receipt of VA disability compensation and military retired pay without
an offset of either.
closing
The National Association For Uniformed Services (NAUS) appreciates
the opportunity to submit this statement concerning our Legislative
Agenda for the 106th Congress.
______
Prepared Statement of the Fleet Reserve Association
introduction
Mr. Chairman. The membership is pleased that the Fleet Reserve
Association (FRA) has been invited by this distinguished Subcommittee
to present its request for funding the Department of Veterans Affairs
for fiscal year 2000. On behalf of nearly 155,000 shipmates, I extend
gratitude and a salute for the concern and active interest generated by
you, Mr. Chairman, and the Members of the Subcommittee in providing
funds for the protection, improvement, and enhancement of programs that
are made available to the Nation's veterans.
Mr. Chairman, there seems to be some confusion with the name of the
Fleet Reserve Association (FRA). Many believe that FRA is an
organization of Reservists. Although FRA does proudly lay claim to
Reservists among its membership, the majority are active duty and
retired members of the Navy, Marine Corps, and Coast Guard--
collectively known as the Sea Services. Its name is derived from the
Navy's program of transferring to the Fleet Reserve (Fleet Marine
Reserve for Marine Corps personnel) persons who leave the service after
20 years of active duty but do not have 30 years to fully retire.
During the required period of service in the Fleet Reserve, personnel
assigned earn ``Retainer Pay'' and are subject to recall by the
Secretary of the Navy.
This year FRA is commemorating its 75th Anniversary. It is the
oldest and largest professional military organization exclusively
serving and representing enlisted men and women of the Sea Services. It
continues to seek protection and equity for those who serve or have
served in the Sea Services, and those veterans requesting assistance.
Since 1924, FRA has been active in pursuing Congressional and the
Administration's support for enlisted quality of life and veterans'
programs. FRA is proud of its service to the Nation and its veterans.
dva fiscal year 2000 budget
FRA's major goal for fiscal year 2000 is to seek increased funding
for the Department of Veterans Affairs (DVA). Without additional funds,
the Nation's veterans will be short-changed if the Administration's
inadequate budget request is approved.
FRA's anxiety over the VA budget is well founded. In the chart
below, the Association has selected a Federal Cabinet level department
and several agencies whose programs may be compared somewhat to those
provided the Nation's veterans. It is noted that for comparability, VA
isn't getting its fair share of the Federal budget. From fiscal year
1995 through fiscal year 1998, for example, the Financial Management
Service, Department of the Treasury, reports that of the five federal
entities listed below, the lowest percentage increase following that of
DVA is 3.6 percent greater. If a 14.2 percent increase in funds would
have been provided DVA, an additional $1.3 billion could have been used
for sorely needed improvements in veterans' programs.
[Dollars in millions]
------------------------------------------------------------------------
Fiscal year
Dept./agency -------------------------- Percent of
1995 1998 increase
------------------------------------------------------------------------
DVA.............................. $37,769 $41,776 10.6
PHS.............................. 20,725 23,670 14.2
NIH.............................. 10,883 12,501 14.8
HCFA............................. 310,657 379,950 22.3
H&HS............................. 303,075 350,563 15.6
------------------------------------------------------------------------
Further testament to the inadequacy of DVA budgets can be found in
The Economic and Budget Outlook: fiscal years 2000-2009. It cited the
VA for having one of the smallest percentages in discretionary spending
in fiscal year 1999. Of the nine (9) categories (not including
``Other'') listed under ``Non-defense Discretionary Spending,''
veterans' benefits was seventh, 1.2 percent less than the sixth place
``Natural Resources and Environment.''
Additionally, the Administration on February 1, 1999 announced that
DVA's fiscal year 2000 budget is $200 million above last year's
funding. $124,141,000 of that ``increase'' is to be obtained through
the Medical Care Collection Fund (MCCF) from third party payers. To
show further disregard, the Administration included a total of $749
million in its proposal that the DVA must collect from third party
payers in order to fund improvements in veterans' health care.
In its belief that the VA budget continues to be grossly
underfunded, FRA lists below the programs that should be authorized or
expanded in the Department of Veterans Affairs (DVA) for fiscal year
2000. The Association urges the adoption of its recommendations and
their eventual funding to assure full recognition of America's veterans
and, if applicable, that they're compensated for the sacrifices made in
service to the Nation and its citizens.
fra recommendations in brief
The following recommendations are submitted for consideration from
the perspective of FRA's members whose average age is 67 years. Some
are veterans of as many as three wars and most are retired from the Sea
Services yet they are very concerned with the state of readiness of the
Nation's Armed Forces and the dwindling VA budgets.
1. Appropriate funds to expand health care for all veterans to
include the construction and leasing of additional nursing and long-
term care facilities.
2. Provide additional funds to improve educational programs and
provide voluntary open enrollment in MGIB for all current and past VEAP
participants.
3. Appropriate sufficient funds to maintain and modernize cemetery
facilities and equipment (including Arlington National Cemetery) and
expand the number of cemeteries and burial spaces.
4. Provide support for the adoption of concurrent receipt of
military retired pay with veterans' compensation without loss to
either.
5. Deny funding to DVA for the enforcement of civil court orders
directing the division of veterans' service-connected disability
compensation and encourage the adoption of laws that will repeal the
practice. And, further, to support amendments to the Uniformed Services
Former Spouses Protection Act (USFSP) as outlined in H.R. 72.
6. Support the repeal of the statute requiring the repayment of
separation pays or bonuses if the recipient enlists in the Reserve
components or becomes entitled to reserve retirement pay.
veterans health care
Expand Access to Veterans Health Care.--FRA seeks adequate funds
for the Department of Veterans' medical treatment and care centers. The
Association believes that VA health care should be open to all
veterans' regardless of their ability to pay. The Association quite
agrees that there must be a system granting priority access for certain
veterans; i.e.--service-connected disabled at 30 percent or more;
however, all veterans rated 20 percent or less, or non-rated, should be
granted access on an equal basis--first come, first served.
The latter group would include non-disabled military retired
veterans who were promised free medical care for life but do not now
have access to military treatment facilities (MTFs). These military
retirees are forced to seek treatment from other than MTF sources.
Congress, through the Base Closure and Realignment Acts (BRAC), voted
to close more than 50 percent of MTFs near which the retirees resided
for the purpose of obtaining the benefits promised to them and their
families. It is only fair that Congress allow them a higher priority
access to VA health care and direct the Department of Defense to
reimburse the VA for care tendered. Frankly, FRA further believes that
extending equal access to veterans as suggested above will improve
quality and the administration of care in veterans' health care
programs.
In making its recommendation, FRA is aware of the comments
attributed to Senate Report 105-216, page 14, that the ``VA has
underutilized capacity that will allow treatment of additional veterans
. . .'' For those requiring hospitalization, page 15 notes that there
are an ``increasing number of unused inpatient hospital beds since
outpatient care is on the rise.'' FRA knows that a major part of the
problem is the scarcity of employees. This, coupled with complaints
that the VA is either reducing, consolidating or eliminating health
care services, points directly to the need to increase funding for the
Veterans Health Administration (VHA).
Congress should shame President Clinton into standing by his
remarks of March 6, 1995 (when he stated that his Administration
``fought to fully fund [veterans] benefit programs'') and provide full
funding to strengthen and enhance the VA's health care system.
Subvention and MCCF.--Addressing the latter first, FRA recommends
that to aid in providing additional funding for the VA health care
system, DVA should continue to collect monetary receipts through the
Medical Care Collections Fund (MCCF). However, receipts or estimated
receipts from this program should not be included in the VA budget.
With an estimated 66 percent of the over-65 male population in the
year 2000 expected to be veterans, it should be cost-effective for the
VA and the Health Care Financing Administration (HCFA) to allow
Medicare-eligible veterans to voluntarily utilize VA facilities for
their health care. HCFA would reimburse the VA for care provided
Medicare-eligible veterans and at the same time collect from third
party insurers providing veterans Medigap or other commercial
healthcare policies. Instead of Medicare dollars going to a commercial
entity, authorizing Medicare subvention for the VA would then become
one of the major building blocks to encourage DVA to continue and
expand modernization of its health care program. Further, subvention
will help in the quest to ``fully utilize (the system's) capacity'' and
``increase the use of inpatient hospital beds.''
FRA recommends that a demonstration project for the VA be
authorized and funded to test the feasibility of establishing Medicare
subvention programs within its health care facilities.
Tobacco-related Illnesses.--FRA recommends that the DVA be
authorized and appropriated funds for the pursuit of monetary
retribution from the tobacco industry. The funds obtained, if any,
would be used for the purpose of establishing care and treatment for
tobacco-related illnesses attributed to smoking while veterans were
active members of the Nation's Uniformed Services.
The idea that tobacco-related illnesses for many veterans are not
service-connected is ludicrous, especially if it pertains to those who
served in combat environments. Cigarettes were once distributed free by
tobacco companies and the military services and made available
practically at cost in military stores. And, too, military seniors may
have encouraged the use of tobacco by simply announcing, ``The smoking
lamp is lit.''
Many service members may recall that cigarettes were a refreshing
respite from the ordeal of combat, they soothed the nerves, calmed
fears, comforted the wounded, eased distress in body and mind, and even
aided in the subsiding of hunger pangs. The VA has been treating
veterans for alcoholic and drug-related illnesses for years. Since the
use of drugs is illegal, and alcohol is a craving (as is tobacco use)
it's hypocritical not to treat tobacco-related illnesses and consider
tobacco-related claims. FRA believes DVA need not hesitate any longer
in initiating or joining negotiations against the tobacco industry for
payments to support its VHA in providing the required care and
treatment of affected veterans.
Nursing Homes, Long Term Care, and other Health Care Programs.--Our
veterans are aging. World War II and Korean veterans are in their 60s
and above. As noted above, by the year 2000 sixty-six percent of the
male population in the United States will be veterans. More and more of
them will become dependent upon the VA to provide the necessary care in
nursing homes, domicilaries, state home facilities, and its underused
hospital beds. The Nation can ill afford to wait for out-year
appropriations before it expands nursing or long-term care.
The Federal Advisory Committee on the Future of VA Long-Term Care
recently suggested that VA discontinue funding for the construction of
nursing homes and, instead, expand contracts with home health agencies
and nursing homes. FRA, however, has a problem with this approach.
In recent years there's been a rush of recommendations for Federal
entities to turn over many of their operations and programs to the
private sector. Some have merit, others do not. For our veterans, FRA
believes that only the VA should be responsible. By placing veterans in
private facilities, DVA could pass the blame to others. Still, the
Association is acutely aware that some contracting is necessary.
Consequently, FRA recommends the adoption of increased appropriations
in fiscal year 2000 for the construction and leasing of facilities.
Also included is an increase in grants to States for the purpose of
constructing and operating such facilities for the benefit of its
veterans.
Health Care Costs.--Recent reports by benefits consultant Towers
Perrin and Hewitt Associates estimate health care costs will increase 7
to 10 percent in 1999. On average, HMO costs are rising 8 percent for
enrollees without dependents. Medigap insurance premiums have soared to
greater costs beginning January 1 of this year. These facts and more
support the need for greater funds for the VA's health care system in
fiscal year 2000. If increased funding is not appropriated, less care
will be provided and quality will decline further.
Medical and Prosthetic Research.--FRA continues to support adequate
funding for medical research and for the needs of the disabled veteran.
The value of both programs within the veterans' community cannot be
overstated. The need is there.
education
Montgomery GI Bill (MGIB).--The MGIB is one of the major incentives
for enlisting in the United States Armed Forces. It is with gratitude
that FRA witnessed the fiscal year 1999 actions of the 105th Congress
in increasing educational benefits for veterans eligible to participate
in the program. But there are many others who should be authorized to
enroll in MGIB and, for those currently in receipt of benefits, to
receive increased funds that are commensurate with today's economy.
Since 1991 military operations and personnel tempo levels have
increased dramatically. For example, optempo soared 143 percent since
the Cold War ended. The Navy alone responded to orders to deploy 77
times during the past six years of the Clinton Administration but only
40 times during the eight years President Reagan was in office. All
this with less manpower following Congress' authorizations to cut
military personnel levels by more than 25 percent.
For these veterans and those who participated in the Veterans
Education Assistance Program (VEAP), whether they withdrew voluntarily
because it failed to offer satisfactory benefits or as a result of bad
advise from senior officials, FRA believes they should be provided an
opportunity to enroll in the MGIB. Further, benefits under the MGIB
should be revamped to offer benefits comparable to earlier GI Bills.
FRA continues to subscribe to (a)--the belief once offered by the
Treasury Department that veterans who take advantage of their GI bill
will return more money to the U.S. Treasury for every dollar spent by
the Federal government for their education, and (b)--as stated by the
Commission on Servicemembers and Veterans Transition Assistance
(CSVTA), ``a more financially attractive MGIB would enable our Nation
to fully capitalize on the unique national resource of veterans'
skills, training, experience, and character.''
In relation to the MGIB and VEAP, FRA concurs with the CSVTA
recommendation to improve and adequately fund the Military's Transition
Assistance Program. (See below.)
Education Benefits for Active Duty Personnel.--FRA proposes an
amendment to the current practice of not providing stipends to active
duty personnel pursuing education under the MGIB. If the service member
has two (2) or more years of honorable active service and the
inclination to enroll in a course of education after regular duty
hours, he or she should be authorized a partial stipend dependent on
the number of hours completed each month. Today, many Service members
find that they must seek employment after duty hours in order to
provide additional--sometimes every day--comforts for the family. If
the member receives a stipend for enhancing his or her level of
education instead of ``moonlighting,'' then additional strength is
added to the CSVTA statement that: ``America's leadership will include
veterans, only if veterans can obtain the best education for which they
quality.'' FRA recommends appropriations to fund such a program.
cemetery systems
National Cemetery System.--There's no question regarding the need
for expanding the VA's cemetery system. The new National Cemetery
Administration (NCA) and its predecessor have and are doing much to
meet the demand for burial spaces for aging veterans who are passing
away in greater numbers than ever. It could do more, but without the
necessary funds, the system will never meet the demand. Further, the
practice of not providing adequate funds for the system is placing many
of its facilities in jeopardy. The Nation cannot afford to allow these
cemeteries to deteriorate in the maintenance of its facilities and
grounds and the operation of burial services for the Nation's veterans.
FRA urges increased funding, fenced so that the NCA has exclusive
use for the purchase of land, preparation, construction and operation
of new cemeteries, the maintenance of existing cemeteries, and the
expansion of grants to States to construct and operate their own
cemeteries.
Additionally, to deter vandalism, FRA suggests funding
appropriations to hire local police or security companies to patrol
cemeteries during hours of closure.
Arlington National Cemetery.--FRA endorses the bill, H.R. 70,
recently passed by the House, that establishes new eligibility
requirements for burial in the Arlington National Cemetery. The
Association requests that funds provided for the operation and
maintenance of the cemetery be prohibited in their use for interments
of any person or persons not meeting the requirements of H.R. 70.
Additionally, FRA supports the appropriation of funds for the
future expansion of the cemetery to include portions of the property
now housing the Arlington Navy Annex and any available property
adjacent to the cemetery grounds.
concurrent receipt
FRA continues to advocate concurrent receipt of military retired
pay and veterans' service-connected disability payments without loss to
either.
Oft time actions proposed for military personnel are ignored by
Congress because Federal civilian employees aren't to be recipients of
like considerations. An example of this is currently being touted in
Congress following the Department of Defense's recommendation to
increase military pay in fiscal year 2000 above that for civil service
employees. Yet, when the shoe is on the other foot, it is rare when
military personnel are granted identical benefits proposed or provided
for Federal employees. These are many, but most retired military
veterans cite the law that authorizes their Federal civilian
counterparts to receive their government pension concurrently with
veterans' compensation for service-connected disability. Even more
difficult to comprehend is the statute permitting retired military
personnel, unauthorized to draw military retired pay concurrently with
veterans' compensation, may gain employment in the Federal
establishment, switch his or her military retired pay to a Federal
employee pension, and then be eligible for concurrent receipt of both
the pension and the veterans' compensation.
Some people argue that the reason concurrent receipt cannot be
authorized is the same period of service to the Nation cannot be
compensated twice. But, if this were true, why is a federal employee,
who is also a member of the National Guard or Reserve, paid by the
military for the annual 14 day training period and, at the same time,
be a recipient of payment for his or her federal employment--plus a
credit for both civilian and military retirement purposes? This is,
without a doubt, dual payment for the same period of service.
(Note: This is in no way to be construed as advocating a change to
the procedure of rewarding Guard and Reserve personnel who also are
Federal employees.)
Another argument favoring concurrent receipt is the military's way
of offering the military member little opportunity to choose non-
disability or service-connected disability retirement. For example, a
member of FRA had no choice but to retire under the military's non-
disability provisions; his disability was rated as zero. Subsequently,
within the year VA rated his disability at 60 percent. Others have
retired from the military services with zero to ten percent
disabilities only to have the VA grant them higher ratings. Since the
military failed to offer many service members an appropriate service-
connected disability rating, and the VA later gave them a much higher
one, concurrent receipt in the form of H.R. 44, H.R. 65 or H.R. 303
should be given strong consideration for passage.
FRA recommends that the distinguished members of this Subcommittee
actively support and encourage the repeal of 5304.(a)(1), 38 USC, and
the enactment of H.R. 44.
court-ordered divisions of veterans' compensation/retired pay
State Courts have been overly generous in awarding spouses and/or
former spouses a portion of veterans' service-connected disability
payments and military retirement pay. The former should be outlawed by
Congress. Service-connected disability payments are made for the
express purpose of compensating the veteran for physical sacrifices
made in the Nation's military service, not by the veteran's spouse.
Service-connected disability payments are to financially assist a
veteran whose disability may restrict his or her physical or mental
capacity to earn a greater income from employment.
FRA believes that this payment is exclusively that of the veteran
and should not be a concern of the States' civil courts. If a civil
court finds the veteran must contribute financially to the support of
his or her family, let the court set the amount allowing the veteran to
choose the method of contribution. If the veteran chooses to make
payments from the VA compensation award, then so be it. The Federal
government should not play the roll of the States' collector. FRA
recommends the adoption of stronger language offsetting the provisions
in 42 USC, now permitting Federal enforcement of State court-ordered
divisions of veterans' compensation payments. Otherwise, to recommend
that the appropriations process deny funds for the purpose of
processing state court orders that direct the division of payments from
the account of veterans who are authorized service-connected benefits.
FRA is truly grateful to the Chairman, House Committee on Veterans
Affairs, and 15 other Members of this Body who are concerned that a
Federal law allows the States to unjustly treat veterans with impunity.
Not only does this affect the veterans described immediately above, but
those entitled to military retired pay for their long and faithful
service to the Nation in the uniformed services. Last year, and again
early in the 106th Congress, Mr. Stump and his colleague, Mr. Norwood,
had the courage to sponsor legislation that provides sorely needed
equality in the treatment of military retired pay by State Civil Courts
but, most importantly, by the very government to which the veteran has
devoted years of honorable service.
Late last year, Chairman Stump held hearings on the Uniformed
Services Former Spouses Protection Act (USFSPA). It was clear that the
original law made its way through Congress under suspicious
circumstances and has become a one-way weapon used by many former
spouses and their attorneys to financially bleed their military spouses
of outrageous sums.
A significant number in Congress speak of returning the money and
power to the States, the very States that cry for more State-rights,
but continue to look the other way so that Federal statutes will void
the right and responsibility to enforce their own laws. FRA says;
``Give back to the States not only the right to decide who is what, but
the authority to enforce its own laws without using the Federal
government as their `bill collector'.''
FRA strongly endorses Messrs. Stump and Norwood's proposal, H.R.
72, and urges all members of this Subcommittee to support its proposed
amendments to the USFSPA which should be as fair to the military
retiree veteran as it is for his or her spouse.
separation pays
The dismissal from honorable service in the uniformed services as a
result of Congressionally-approved ``downsizing'' caused many mid-
career young men and women to seek opportunities in the civilian
sector. To ease their transition, Congress--at the urging of the FRA
and The Military Coalition--agreed to provide certain separation
payments for service members with six or more years of active service,
but less than 20. On departure from their uniformed service, they were
encouraged to join the Reserve or National Guard. However, few knew or
were aware that if they eventually retired and received retirement pay,
their separation pay, special separation benefit (SSB), or voluntary
separation incentive (VSI) payment would have to be repaid to the
Federal government. The same applies to those who later are awarded
service-connected disability payments from the VA.
FRA is totally opposed to the repayments. The Association believes
its shoddy treatment of the men and women who wanted a career in the
uniformed services but were unable to complete that career because
incumbent Administrations and Congresses did not authorize their
retention.
Under current law the service member who is released from active
duty and qualifies for certain pays or benefits never has to repay any
portion of that stipend if he or she doesn't qualify for veterans'
disability payments or is not accepted by the National Guard or Reserve
Forces. If qualified for either, however, it's time for pay-back. It is
difficult for FRA to understand why the individual willing to further
serve the Nation in uniform or is awarded service-connected disability
compensation should have to repay the Federal government for that
privilege. The Association recommends the repeal or the necessary
technical language to amend the applicable provisions in Chapters 51
and 53, 38 USC, to terminate the requirement to repay the subject
benefits. (Also requires an amendment to 1704(h)(2), 10 U.S.C.)
other recommendations
In the event some of the recommendations of the Commission on
Service Members and Veterans Transition Assistance (CSVTA) are adopted
in the authorization process, FRA submits the following comments for
the Subcommittee's consideration.
Veterans Health Care.--FRA has reviewed the recommendations of the
Commission on health care and believes that some have merit. It is
certainly agreeable that neither the VA nor DOD can meet the demand for
health care, but this is a matter of funding. FRA does not agree with
either the expansion of TRICARE or that VA beneficiaries should have
access to Military Treatment Facilities (MTFs). This thinking also
extends to the recommendation to provide transitional health care for
recently separated service members and their families.
FRA does not support HMO-style health care for military personnel.
However, TRICARE is all that is now available, but even it needs much
work to improve its system of delivery. Active duty personnel and their
families, for the most part, are not pleased with TRICARE. Neither are
retirees and their families. Further, there is little if any space
available for the latter group of beneficiaries in MTFs. Otherwise, FRA
would not have recommended authorizing non-disabled military retirees
to utilize VA facilities for their health care.
The current dissatisfaction with DOD's TRICARE system is adequate
reason to oppose the CSVTA recommendation to expand the program within
the VA Medical Services.
Transition Assistance Program (TAP).--FRA concurs with the
Commission's recommendation to improve and adequately fund TAP. In the
past few years FRA has opposed attempts by the Department of Defense to
reduce this critical program that offers assistance to service members
returning to civilian life when their periods of active service in the
Armed Forces are concluding.
FRA believes that if the Armed Forces had an effective program it
would encourage members enrolled in the MGIB to pursue their education
benefits upon separation. In this respect, the Association is pleased
that H.R. 4110 (Public Law 105-368) requires the VA and, in another
section, military service secretaries, to ``ensure separating service
members are well informed of the eligibility requirements for education
benefits.'' However, FRA is concerned that the law is limited to
service members released from active or reserve commitments at the
``convenience of the government.'' And, also, restricted to those
enrolled only in VEAP. FRA has recommended that the language be amended
to cover all departing service members whether enrolled in VEAP or
MGIB.
Transfer of Education Benefits to Spouses and Children.--FRA
advised the House and Senate Committees on Veterans Affairs that it was
opposed to this recommendation by the Commission. The Association
believes that the cost of providing education benefits to veterans'
family members will soar to new heights. It's difficult not to remember
the years 1975 and 1976 when the high cost of funding the Vietnam GI
bill caused the major veterans organizations and the Ford
Administration to call for its demise. Many Vietnam veterans lost out
on education benefits.
The MGIB, whose title: ``All Volunteer Force Educational Assistance
Program,'' was primarily adopted as a recruiting and retention
incentive and is not so much a rehabilitation program as the GI bills
designed for veterans of WW II, Korea, and Vietnam, most of whom were
draftees.
The very language of 3001(4), 38 U.S.C., which FRA fully endorses,
firmly establishes the MGIB exclusively for those who serve on active
or reserve duty in the All Volunteer Force (AVF).
However, in discussing the issue with the senior enlisted Master
Chiefs of the Navy and Coast Guard, their recommendation is to offer
the transfer proposal only to those service members who reenlist and
complete a minimum 20 years in the active components of the Armed
Forces. The provision could very well be an excellent re-enlistment
incentive.
Termination of the $1,200 contribution (Payroll Deduction) to the
MGIB.--In view of the probability that the MGIB will undergo further
improvement, FRA is on record as opposed to the CSVTA recommendation to
terminate the $1,200 contributions of service members electing to
receive MGIB benefits upon attaining eligibility. It believes the
contribution adds an incentive for the service member to further his or
her educational pursuits because of the investment made. However, in
lieu of $100 per month for 12 months, the Association recommends $50
monthly deductions over a 24 month period. At the end of the two-year
period, he or she is now eligible to begin receipt of MGIB benefits.
Also recommended is the reimbursement of contributions if, at the end
of the enlistment or period of honorable service, the member chooses
not to participate in the MGIB. Further, if the member fails to
complete the term of enlistment or service, or is in receipt of less
than an honorable separation, no refund of contributions would be
authorized.
Thrift Savings Plan.--FRA is also opposed to this recommendation
unless it provides Federal matching funds as offered civilian employees
for their participation in a similar program. Otherwise, the
Association is concerned that a Thrift Savings Plan for uniformed
personnel is not beneficial to most junior grades. Many have financial
problems or barely manage to live within their budgets. Others work a
second job after their regular duty requirements to provide day-by-day
needs or additional comforts for their families. Since there is no
incentive (matching funds) for junior personnel to participate, FRA
believes the program will be perceived as ``an officer benefit,'' not
conducive to enhancing the morale of the troops. Again, FRA will
subscribe to the program only if it has matching funds.
Refocus VA's Housing Program Toward Veterans in Transition.--FRA
disagrees with limiting the VA home loan guaranty to one use. This
restriction would place an undue hardship on the active duty service
member and family who may wish to possess their own residence wherever
assigned under military orders. To be able to do so, frees a housing
unit on the military installation for a service member unable to afford
a down payment to purchase a home or afford to rent a residence on the
civilian market. Further, the Association believes that the veteran who
becomes sufficiently affluent to upgrade his or her choice of residence
should have the opportunity to do so.
Deliver Cost-Effective Services to Homeless Veterans.--FRA has
concern that an inordinate amount of VA funds have been targeted to
serving homeless veterans. In many cases the same veterans are in
receipt of more than a fair share of existing benefits. FRA believes
that the availability of rehabilitation, education and vocation
programs, and the housing program established in H.R. 4110 (Public Law
105-368), are more than adequate to assist in turning homeless veterans
into responsible citizens, although admittedly so, there are those who
cannot be rehabilitated. Any further needs of affected veterans should
be made available in the same manner as prescribed for beneficiaries of
other veterans' programs.
Consolidate DOD and VA Disability Compensation Systems.--FRA isn't
certain that the two systems are or could be compatible. The
Association would support a study but withholds any recommendations
until FRA reviews the final report. At this time, the Commission's
recommendation to include ``necessary changes in legislation'' with the
proposed report should not be granted.
conclusion
Mr. Chairman. In closing allow me to again express the appreciation
of the Association's membership for all that the Subcommittee has done
for our Nation's veterans over these many years. FRA also is grateful
for the opportunity to address the distinguished members of this panel
on the issues so important to its members and the millions of other
veterans concerned that the DVA budget is inadequate. They look to this
Subcommittee for a satisfactory resolution.
______
Prepared Statement of the Vietnam Veterans of America, Inc.
Mr. Chairman, Vietnam Veterans of America (VVA) thanks you and your
distinguished colleagues for this opportunity to comment on the
appropriations process for the VA fiscal year 2000 budget. VVA strongly
believes that the Administration's budget request of $44 billion for
operation of the Department of Veterans Affairs (DVA) is woefully
inadequate, especially the $17.3 billion in actual appropriated dollars
suggested for the Veterans Health Administration (VHA). VVA
respectfully seeks your assistance in correcting a reckless budget
request, that if passed, will inflict damage on an already troubled
VHA.
VVA asks that you and your colleagues appropriate an additional
$3.2 billion to ensure that the VHA will deliver quality health care
and provide other needed services to our nation's ill and disabled
veterans. While reasonable people can and do disagree on exactly how
much is necessary to keep the current system operating at a reasonable
level, VVA believes that the bare minimum needed under any scenario is
the $1.7 billion recommended by your distinguished colleague, the
Honorable Arlen Specter, Chairman of the Senate Committee on Veterans
Affairs. Our analysis leads us to conclude that a more appropriate sum
to maintain basic VA operations without further damage to
organizational capacity to serve veterans properly is much closer to
the $3.2 billion recommended by the ``Independent Budget of the
Veterans Service Organizations'' (IBVSO). In any case, VVA believes
that we all agree that additional resources are needed.
The VHA is a large and complex health care system. It includes a
number of ``Specialized Services Programs'' that are at the core of the
VA's mission of ``Caring for he/she who hath borne the battle''. These
programs include such areas as Seriously Mentally Ill, neuro-
psychiatric wounds of war such as Post-Traumatic Stress Disorder
(PTSD), treatment for the Blind and Visually Impaired, Spinal Cord
Injury, and Prosthetics. Indeed, such a comprehensive and large system
is hard to manage. Unfortunately, a truncated budget will serve to only
exacerbate existing managerial problems-at the cost to the veteran-
patient.
VVA believes that if adequate resources are made available, VHA can
further develop its capability to do a much-improved job as long as the
Congress continues close oversight on outcomes. Such improvements to
reduce repeated preventable use of resources include, but are not
limited to such actions as taking a full and complete military/medical
history on every veteran who enters the system, testing for ALL
conditions that may be relevant to the branch./time/place/MOS/actual
experience of the individual's military service. Such a comprehensive
work up will lead to a more proper and complete diagnosis and a more
effective treatment plan that will actually lead to helping restore the
Veteran to the highest state of ``wellness'' and the greatest degree of
self-sufficiency possible. VVA believes that much of the ``churning''
of veterans back and forth through the system can be prevented. This is
better for the veterans who becomes well, and for the VA in that
precious resources are not spent in dealing with preventable visits.
VVA believes that the fiscal year 2000 budget request is a recipe
for implosion within VHA. The VA medical structure is set up to
allocate resources utilizing a prospective payment model. This
prospective payment model, however, is within a closed system where
there are too few resources. Increased competition for these resources
has already started to block needed resources to the smaller, more
specialized parts of the VHA system. We have observed this happening
for the last few years, and it is most evident right now in fiscal year
1999.
It is now commonly known that VHA does not have the finances to
maintain the current VHA system. Due to a significant shortfall in
operating resources in the current year, VHA has asked for authority to
proceed with cutbacks that include closing of facilities and a
reduction of staff, to begin immediately. It is now public knowledge
that VHA is seeking authority to implement planning to contend with
additional reductions due to a shortfall of at least $1.4 billion. This
is coming from a system that was already preparing for reduction before
the request. The announcement of an initial cut of 926 personnel at
eleven sites is only the first wave of such reductions in capacity. It
is VVA's understanding that at least another twenty-five sites have
been approved for significant reductions.
The most troubling aspect of the budget request is that the VA is
currently undertaking a series of ``new'' initiatives that will clearly
involve additional cost. The VA has committed to move swiftly to test,
treat, and compensate for the widespread problem of Hepatitis C among
veterans, especially Vietnam veterans, which was likely acquired as a
result of military service. VVA believes that this is a vital and
proper expenditure, desperately needed by affected veterans. Resources
are necessary in order to pay for this treatment, however.
The VA is planning to commit an additional $40 million toward
assisting homeless veterans and to increase long-term care by at least
$105 million. While we certainly applaud these long-overdue steps, we
are at a loss as to how the Office of Management and Budget (OMB) and
the White House thought that the VA will be able to afford these
vitally needed services without either providing additional funds or
significantly diluting other existing, already underfunded services.
VA's budget submittal simply does not ``add up.'' Again, we
respectfully request your committee to appropriate a VA budget that
does ``add up.''
There is ever the need for a VHA system to serve as the primary
means of delivering the highest possible quality of care to veterans.
The fiscal year 2000 budget request is an affront to the veteran
community, especially as millions of veterans are now of the age where
health care is most needed. The normal problems of aging are often
greatly exacerbated by injuries incurred in military service. Veterans
health care is not just important to the veterans community, it is
important to the future of this nation.
VVA is aware that an additional $2 billion for the VHA will not be
acquired through the ordinary process of creating a budget. We know
that the money must come from somewhere else. Mr. Chairman, a $20
billion budget for the VHA will be enough to simply preserve the
organizational capacity of VHA to deliver its current state of medical
care. If the Administration's budget request is approved, many veterans
will find the chances of obtaining medical care even more scarce.
Funding VHA at $20 billion would still constitute less of a percentage
increase than that which was provided to Medicare over the last decade,
and significantly less than medical inflation. We strongly urge you to
do the right thing and preserve the VA health care system at a time
when more and more veterans are counting on it. The offsets can be
found, given the creativity, experience, and intelligence of you and
your distinguished colleagues.
It is no secret that the Veterans' Benefits Administration (VBA) is
in dire need of reform. The recent ``Report of the Congressional
Commission on Service Members and Veterans Transition Assistance''
strongly recommends a modernization of VBA's benefits delivery and
infrastructure. The article in The Washington Post of April 10, 1999,
regarding the deplorable conditions of the Washington, D.C., Regional
Office is illustrative of the worst of the problems that veterans face
in attempting to get timely, fair, and accurate adjudication of claims.
The disability claims process is beset with an adjudication system
that is inconsistent in quality and accuracy, and extremely poor in
timeliness. Currently, according to VA officials, there are over
390,000 claims pending and another 100,000 claims on appeal. According
to VA Under Secretary for Benefits Joseph Thompson, VA data shows that
errors in the claims-adjudication process occur at a 36 percent rate
and that 42 percent of claimants are dissatisfied with compensation and
pension services. Vietnam Veterans of America believes that one of the
reasons the system is so clogged is that veterans have lost faith that
they will get a fair and accurate adjudication the first time around,
and they are all too often correct in this assumption. If VBA would
``get it right the first time'' then the incessant stream of appeals
would begin to diminish. However, at this point , VVA believes that we
just have too few people trying to accomplish too much work at the same
time that they are trying to modernize the system by which claims are
adjudicated. Simply put, VBA needs more funding in order to hire more
people to get the job done.
While VVA believes that the Veterans Benefits Administration (VBA)
needs more staff, we also believe that VBA is plagued with an
adjudication and appeals process that lacks a focus. There are no
precise, definitive rules that can be effectively and fairly applied to
the processing of most cases. To compound this legal problem, the VBA
has failed to properly update its information management system. While
trying to implement a more efficient system, VETSNET, the effort
resulted in a disparate system of information management that holds no
one clearly accountable for project performance and operational system
capability.
It is common criticism that VBA is not all that accessible to
veterans with many regional offices in areas of small population and a
telephone system that is cumbersome and buttressed with layers of
electronic ``shields.'' Other stations, as in the extreme case of the
Washington, D.C., VA Regional Office have virtually ceased to function.
In sum, the VBA is an organization that is not accessible enough to
veterans and is run on less-than-efficient databases. VBA is in real
need of an organizational overhaul. While it is not just money that is
needed, proper resources are certainly part of the solution.
In order for the jaded claims adjudication and processing system to
become truly efficient, new information-management systems and
technology must be acquired. A redesigning of both human and physical
resources must also take place. Veterans deserve the benefit system
that they were promised--one that provides seamless access to an
effective claims-processing system centered on an adjudication process
that is fair and timely.
Mr. Chairman, if these changes do not take place, we will have a
21st century VBA that is even more inept than it currently is. VVA
believes that prescience is in order here and asks that your committee
act now and provide a VA budget that can afford to make the necessary
changes in VBA before it manifests into an even larger and more
expensive problem. VVA seeks a VBA that puts veterans first and also is
not a drain on taxpayers' dollars.
Mr. Chairman, I would like to respectfully remind your committee
and all of Congress that we now stand on the threshold of yet another
ground war in Kosovo which has the potential to consume and harm many
young American men and women. Already three U.S. service members are
being held prisoner. Is under funding the VA, and most especially the
health care system, the right signal to send to these soldiers? VVA
thinks not, and asks that you ensure that there is a system in place to
truly care for these future veterans.
Again, I thank you for considering our views on this most critical
issue to veterans of every generation.
______
Prepared Statement of the American Gastroenterological Association
Summary of Recommendations
The American Gastroenterological Association (``AGA'') urges
Congress to increase funding for medical research on digestive diseases
and disorders through budgetary increases to the Department of Veterans
Affairs (``VA''). Specifically, the AGA encourages Congress to provide
at least a 14 percent increase over fiscal year 1999 raising the
funding for VA health research programs from $316 million to $360
million, as recommended by the Friends of VA Medical Care and Health
Research (``FOVA'').
medical research recommendations
The AGA appreciates the opportunity to present its views regarding
fiscal year 2000 appropriations for the VA. The AGA is the nation's
oldest, not-for-profit specialty medical society, consisting of over
10,000 gastroenterologic physicians and scientists who are involved in
research, clinical practice, and education on disorders of the
digestive system. As the nation's largest and leading voice of the
gastrointestinal research community, the AGA is uniquely qualified to
advise Congress on the current status of federally-supported digestive
disease research programs and the areas in need of further research.
Digestive tract disorders cost more than $115 billion annually.
Gastrointestinal cancer, foodborne illness, gastroesophageal reflux
disease (``GERD'') and ulcers, motility disorders, inflammatory bowel
disease, and hepatitis C account for the majority of digestive
illnesses, impacting the lives of millions of Americans. They affect
more than half of all Americans during their lifetime, ranking second
among all causes of disability due to illness in the United States.
Digestive disorders likewise strongly impact America's veteran
population.
For some digestive diseases, medical research has brought us close
to developing lifesaving treatments and cures. Yet, in others, we lack
even a basic understanding of the cause and transmission of the
disease. This testimony focuses on these serious health problems and
makes recommendations on how Congress should allocate this country's
precious medical research dollars.
gastrointestinal cancers
Approximately 226,300 new cases of gastrointestinal cancers will be
diagnosed this year. Sadly, 131,000 Americans will die from these
cancers. Certain veteran populations are especially at risk including
those exposed to ionizing radiation, such as atomic test participants
and Hiroshima/Nagasaki occupation forces. The most common cancers are
described below.
--Colorectal Cancer is the second leading cause of cancer-related
deaths in the United States. It is estimated that 129,400 new
cases will be diagnosed this year with approximately 56,000
Americans projected to die from this disease in 1999.
Colorectal cancer is linked to age with over 90 percent of
people diagnosed being over 50 years old. Further, African
Americans have higher prevalence and mortality rates.
--Lower esophageal and upper stomach cancers have experienced a
dramatic rise in incidence rates in the last 10 years.--In this
year alone, nearly 22,000 Americans will be diagnosed with
stomach or gastric cancer; 13,500 will die of it. A slightly
lower number of people, 12,500, will be diagnosed with
esophageal cancer this year. This cancer is more prevalent
among African Americans.
--Pancreatic cancer will be diagnosed in 28,600 Americans in 1999
with the same number of people projected to die from this
disease.
--Approximately 14,500 new cases of liver/intrahepatic bile duct
cancer will be diagnosed this year in the United States and
13,600 deaths due to this cancer will occur. The incidence of
liver cancer is increasingly dramatic due to the epidemic of
chronic hepatitis C, notably more common among veterans.
--An estimated 3,600 people will die of cancer of the gallbladder and
other biliary cancers this year with approximately 7,200 being
diagnosed with this cancer.
The good news is that biomedical research, basic and clinical, has
yielded increasingly positive cancer survival rates when patients'
conditions are detected early. For example, 90 percent of people who
develop colorectal cancer can be effectively treated if the disease is
caught sufficiently early. Improved screening alone, however, is not
sufficient. We need additional research to continue our understanding
of this disease.
One of the greatest breakthroughs in gastrointestinal cancer
research has been the discovery of a stepwise genetic progression in
the development of gastrointestinal cancer. Researchers have identified
a genetic link to gastrointestinal cancers in 20 percent to 30 percent
of cases. Research shows that a genetic mutation at one generational
level continues to mutate at succeeding generational levels, increasing
a person's likelihood of developing cancer.
The VA has made cancer a medical research priority, but has not
focused research on the following areas: (1) the genetic aspects of
gastrointestinal cancer including the potential identification of other
genes; (2) diagnostic tests for genetic abnormalities and prevention;
(3) nutritional and environmental factors relating to the development
of this disease, such as diet; and (4) the development and treatment of
Barrett's syndrome (a common precursor to lower esophageal/upper
stomach cancer) in patients with GERD. Research indicates that people
with long-standing and severe heartburn symptoms are 43.5 times more
likely to develop esophageal cancer. We urge the subcommittee to
include language in the report accompanying the fiscal year 2000 VA-HUD
Appropriations Bill which encourages the VA to intensify its research
efforts on the genetic and nutritional/environmental causes of
gastrointestinal cancers.
foodborne illness
Foodborne illness is estimated to cost annually $5 to $6 billion
dollars in medical costs and productivity losses. Some 6.5 to 33
million Americans suffer from foodborne illnesses each year, resulting
in 9,000 deaths. Among the more common pathogens are Salmonella,
Escherichia coli 0157:H7 (the pathological strain of the bacterium
E.coli), Shigella, Campylobacter, Cyclospora, Listeria monocytogenes,
and Cryptosporidium.
Not only does the VA population face the average risk of foodborne
illness but also an increased risk due to potential bioterrorist
attacks. As the goal of war turns from political concessions to mass
injuries and casualties, one expects to see more bioterrorist attacks
both against the military and the general population. Although people
fear the more deadly anthrax and cholera viruses, some anticipate that
actual attacks will involve foodborne and waterborne pathogens
especially for terrorists trying to create mass panic and high
morbidity costs with fewer deaths. This type of attack has already
occurred in the United States in 1984 when a religious cult sprayed
salad bars with Salmonella infecting over 750 people in an attempt to
influence voter turnout and election results.
Current congressional efforts, which largely focus on inspection
programs and on preventing the ingestion of contaminated food and
water, would not protect against a deliberate bioterrorist attack.
While these prevention-oriented initiatives certainly are important,
treatments for those who do get sick once tainted food is consumed is
essential. For some of these pathogens, we unfortunately lack even a
basic understanding. As such, we encourage Congress to channel
additional resources into research in the following areas: (1) the
pathogenesis of the disease to identify the pathogens, to understand
contamination and transmission patterns, to understand how pathogens
translate into disease in humans, and to determine the reason for
antibiotic resistance; (2) the reaction of the gut to infections. The
research currently being performed has focused on the kidney where few
people are affected but the mortality rate is high. Stopping the
disease when it is initially confined to the gut, however, would
prevent the kidney from even being affected; (3) the development of
animal models to understand how the pathogens cause disease and to
develop treatment; and (4) the invention of vaccines or substances that
bind with the toxins to prevent the illness.
The VA should join with the National Institutes of Health, the
United States Department of Agriculture, the Food and Drug
Administration, the Centers for Disease Control and Prevention, and the
Department of Defense in implementing the Administration's Food Safety
Initiative. The VA should emphasize research required to develop a
greater understanding of the pathogenesis of foodborne illness and to
discover effective treatments.
motility disorders
Motility disorders affect five million Americans accounting for
half of all gastroenterologic visits and ten percent of the visits to
primary care physicians. Eight to seventeen percent of Americans suffer
from functional gastrointestinal disorders, making it a major cause of
morbidity and mortality from digestive illnesses, particularly among
females. A higher prevalence of motility disorders was noted in Persian
Gulf veterans, suggesting a potential link between the disorder and
stress.
Research is needed due to the high prevalence of this disease and
the lack of knowledge on how to identify, diagnose, and cure the
disease. Irritable Bowel Syndrome (``IBS''), the most common motility
disorder, is especially troubling because a patient does not present
with any pathognomonic symptoms or laboratory findings of the disease,
making diagnosis and treatment extremely difficult. IBS research is
needed on: (1) understanding how the muscular and nervous system of the
gut; (2) clinical descriptions and epidemiological studies of patients
with IBS including family backgrounds; (3) genes that determine
susceptibility and resistance; (4) brain interactions with the gut; and
(5) virus foodborne infections that appear to initiate IBS in
previously unaffected individuals.
A lack of a basic understanding of IBS has made drug manufacturers
reluctant to fund research. If more federally funded research was
focused on IBS, it would stimulate more private-public partnerships,
and lead to advances in medical knowledge
inflammatory bowel disease (ulcerative colitis and crohn's disease)
Inflammatory bowel disease affects two to six percent of Americans
or 300,000 to 500,000 people. Unlike IBS, inflammatory bowel disease
(``IBD'') involves an inflammation of the bowel. One type of IBD is
Crohn's disease, which primarily involves the colon and small bowel.
The other is ulcerative colitis affecting the inner lining of the large
intestine. IBD usually begins in early adulthood and persists
throughout life with remissions. IBD affects people in the prime and
most productive years of their lives and results in substantial
morbidity and economic loss to them and society. People with IBD
experience abdominal pain, fever, bowel sores, intestinal bleeding,
anorexia, weight loss, fullness, diarrhea, constipation, and vomiting.
In severe cases, the patient can hemorrhage or contract sepsis/toxemia
resulting in death. The cause of IBD is unknown; it may be a virus or
bacteria that alters the body's immune response causing an inflammatory
reaction in the intestinal wall. Studies on the cause of IBD are
desperately needed to better understand the disease and work towards
more effective management and treatment.
hepatitis c
Viral hepatitis is caused by six different viruses (commonly
labeled A, B, C, D, E, and G). Hepatitis C accounts for 60 percent to
70 percent of all chronic cases of hepatitis. Approximately four
million Americans are chronically infected with the hepatitis C virus
(``HCV'') with an estimated 200,000 new cases diagnosed annually. HCV
is more prevalent among veterans than non-veterans with rates estimated
at between 10 percent to 20 percent of all inpatients in VA Medical
Centers. This higher prevalence may be linked to transfusions which are
more common among veterans, especially those who experienced combat.
Further, minority populations have a higher prevalence of HCV. This
disease is projected to cost $600 million a year in terms of medical
care and work loss, excluding transplantation costs. Between 8,000 to
10,000 people are expected to die from HCV this year with the death
rate expected to triple over the next decade. It ranks second only to
alcohol abuse as the cause of cirrhosis (i.e., liver cell damage and
scarring) and liver disease, and is the leading cause for liver
transplants in the United States. Further, 52 percent of all VA liver
transplant patients have HCV. Chronic alcoholism, a common concern
among veterans, may increase the likelihood of developing chronic liver
disease.
Acute hepatitis C results in a chronic infection in over 85 percent
of the cases with most contracting chronic liver disease. This chronic
infection is often asymptomatic, making detection extremely difficult.
In fact, many people are not aware that they are infected, despite easy
detection through a simple blood test. Twenty-five to thirty percent of
HCV infected people develop symptoms ranging from mild to moderate
problems of jaundice, fatigue, abdominal pain, loss of appetite,
intermittent nausea, and vomiting to more severe, life-threatening
conditions such as liver disease, cirrhosis, and end-stage liver
disease, including cancer. In fact, the three main risk factors
associated with developing liver cancer include HCV, the hepatitis B
virus (``HBV''), and alcoholic cirrhosis with the increase in liver
cancer being attributed to the rise in HCV and HBV.
Despite vigorous support by Congress and the VA, long-term
remission can only be attained in up to 40 percent of HCV patients
receiving anti-viral therapies. Further, no vaccines are currently
available to prevent hepatitis C. Accordingly, more research is needed.
The AGA urges Congress to support research in the following areas: (1)
the molecular biology of HCV; (2) longitudinal study on the normal
clinical course of hepatitis C and factors resulting in progression to
cirrhosis and liver cancer; (3) epidemiological studies on hepatitis C
and alcohol consumption; and (4) the interaction between HCV and other
diseases such as diabetes and acquired immunodeficiency syndrome
(``AIDS''). This research would enable the development of therapies to
stop the progression of the disease, a vaccine to prevent transmission
of HCV, and strategies for educating at-risk groups.
S. 71, introduced by Senator Olympia Snowe (R-ME), creates a
presumption of service connection for the occurrence of hepatitis C for
veterans who developed hepatitis C after experiencing the following
while serving: (1) transfusion of blood/blood products before December
31, 1992; (2) blood exposure on or through skin/mucous membranes; (3)
hemodialysis; (4) tattoo, body piercing or acupuncture; (5) unexplained
liver disease or abnormal liver function tests; and (6) working in a
health care occupation. S. 71 would raise the number of veterans
eligible for treatment of hepatitis C at VA Medical Centers, making
this research on a treatment even more pressing and cost-effective in
the long term.
funding recommendation
The diseases, illnesses, disorders, and syndromes described above
continue to take a huge toll on the American public and economy. The
AGA appreciates Congress' commitment to biomedical research and to
digestive diseases research in particular. However, more effort is
needed. Many of the illnesses described above are only now beginning to
emerge as the next epidemic. For others, like certain gastrointestinal
cancers, research advances have placed the hope of eradication within
our grasp. In either case, now is not the time to shortchange VA
research programs. As such, we encourage Congress to ensure that the VA
has adequate resources to appropriately pursue research opportunities
in the areas discussed above by increasing funding 14 percent, from
$316 in fiscal year 1999 to $360 in fiscal year 2000.
The AGA appreciates the opportunity to present its views on the
fiscal year 2000 appropriations. Please call Michael Roberts, Vice
President of Public and Government Relations at the AGA, at (301) 941-
2618 if you have further questions.
______
Prepared Statement of the Air Force Sergeants Association
Mr. Chairman and distinguished committee members, thank you for
this opportunity to present what we believe should be among this
committee's funding priorities for fiscal year 2000. As a nation, we
ask our servicemembers to turn their mortal beings over to the dictates
of their country. Their term of service is always arduous, and the job
they do for all of us is fantastic. This committee among all segments
of our national leadership holds the key to protecting and honoring our
nation's warriors. You, in a very real sense, are the conscience of a
nation in ensuring that our veterans are viewed as a vital national
resource--not a financial burden.
As you work toward your appropriations decisions, the Air Force
Sergeants Association and its 150,000 members urge you to ensure
sufficient funding to provide for the integrity of the entire VA
system. This funding and this nation's commitment to our veterans
should ensure, with no delay, the full benefits, entitlements and
medical treatment that those who have served have so rightfully earned.
AFSA members view all honorably discharged veterans as worthy of a
full range of benefits that they earned through sacrifice and voluntary
subjection to the unlimited liability clause: they formed a covenant
with the nation to sacrifice their lives, if necessary, to protect its
interests. This nation's reciprocal response should be based on certain
principles that this association urges you to use as a guide during
your deliberations.
guiding principles
1. First, this nation owes its veterans dignified, transitional,
recovery assistance . . . not based on rank or status, but simply
because they served in the most lethal of professions.
2. Any decisions on care for the member must factor in a
realization that most veterans are enlisted veterans. These veterans
served with lower pay, generally reentered the civilian populace with
non-transferrable military skills, probably had relatively little
civilian education, and served in skills that are less marketable.
3. This nation's commitment cannot waiver simply because of the
large number of veterans. Congress and (in turn) the VA must never make
determinations simply because ``the money is just not there.'' It is
more a situation of national will--not economic constraints.
4. Our enlisted guardsmen and reservists are full-time players.
They are part of the total force. Any differences between reserve
component members and the full-time force, in terms of VA programs or
availability of services, need to be systematically erased.
5. It is important that the commitment of our troops to combat or
high-risk situations also involves an absolute commitment to care for
any malady that results.
general issues
Many veterans are frustrated and disappointed because promises that
were made during their careers are simply not being kept. They feel
that the covenant between the nation and the veteran was one-sided,
with honor on the side of the veteran. We urge this committee to
support a written guarantee in writing of benefits to which veterans
are legally entitled by virtue of their service.
We applaud the Veterans Administration for progress made toward the
reduction in the time required to process claims and adjudicate
appeals. We urge you to do all that you can to facilitate the VA's
continued progress in this effort.
Despite military service draw downs and the resultant lack of the
availability of ``honor guard'' personnel, it is incumbent that this
government to ensure full military honors and burial rights for those
who have served.
Because of the ravages of war, the unique nature of military
service, and numerous other reasons, many veterans are homeless. These
people, by and large, paid a tremendous price by serving their nation.
We must expend an extra effort to assist our homeless veterans.
Over the last few years, there have been several efforts to make
``Veterans' Preference'' a reality. We urge this committee to support
any improvement that will put ``teeth'' into such programs to help
veterans transition back into the civilian workforce.
medical care
Without question, the health care system administered by the
veterans administration impacts, in one way or another, those who
served. Some issues that are reflected in the many phone calls we have
received follow.
1. All honorably discharged veterans must have the full continuum
of care--mandated by law.
2. VA-Medicare subvention is very promising, and we request full
support for this effort. Under this plan, Medicare would reimburse the
VA for care it provides to non- disabled Medicare-eligible veterans at
VA medical facilities. This is an opportunity to ensure that those who
served are not lumped in with all those who never chose to do so.
3. The enlisted force is pleased with the possibility of VA-DOD
sharing arrangements involving network inclusion in the DOD health care
program, and especially, the practice of consolidating physicals at the
time of separation. Theses decisions represent a good, common sense
approach that should eliminate problems of inconsistency, save time,
and take care of our veterans in a more timely manner; AFSA supports
these approaches so long as neither DOD or VA beneficiary access and
care are jeopardized
4. It is our contention that any limitation on the VA treatment of
tobacco-related illnesses must be eliminated. Just as we care for those
with other physical situations caused by their own lifestyle choices,
it is absolutely wrong to draw the line here. I and many of you in this
room can point out numerous situations from ``care packages'' with free
3-cigarette packs, to field duty and training punctuated by ``smoke'em
if you gottem,'' as indisputable facts that smoking was (until very
recent times) a very real part of the military lifestyle. Full VA
funding for tobacco-related illnesses needs to be reinstated.
5. While the VA's drive to save money by reducing its expenses is
commendable, we caution the VA that these reductions must not be the
overriding target. The only bottom line in this system should be the
welfare of the veteran.
6. The VA must be fully funded to provide for long-term care
including nursing home care; care for chronically mentally ill
veterans; and home care aid, support and services.
7. The number of veterans who are women has significantly increased
in recent years. The VA must be funded to provide the resources and
legal authority to care for women to include obstetric services and
after-birth care for the mother and child.
education
Many members join our Armed Forces to get an education. Those who
entered the service after December 31, 1976, and before July 1, 1985,
were offered the Veterans Educational Assistance Program (VEAP). Within
that program, the military member contributes up to $2,700 which the
government matches with up to $5,400. VEAP pays $300 a month for 27
months; however, there are approximately 55,000 members who came into
the service between 1977 and 1985 who chose not to participate in VEAP
because it was considered a relatively poor benefit in relation to the
actual cost of classes. These G.I.s are now retiring (20-plus years of
service) without any educational benefit.
Since 1985, the Montgomery G.I. Bill has been offered to new airmen
entering the Air Force. If an airman chooses to participate, this
program requires a $1,200 payroll deduction, $100 during each of the
member's first 12 months of service. For that $1,200, the member
receives an educational benefit of $528 per month for 36 months--
clearly a much more valuable benefit than VEAP. However, the airman's
enrollment decision must be made at basic military training; it is a
one-time, irrevocable decision. At that critical juncture, many choose
not to participate because they can't afford to do so due to their
already-relatively- low pay. We ought to eliminate the current $1,200
payroll reduction taken from each member who opts to enroll in the
MGIB. During the pressure of basic training (and at a time of lowest
pay) is not the appropriate time that airmen, many of whom have
families to support, should have to make such an important decision. We
should let them elect to enroll in the MGIB at any time during their
first enlistment.
The 1997 VA Authorization Act created an open window for some VEAP
participants to convert to the MGIB. However, 110,000 (DOD-wide) VEAP
participants were excluded from converting to the MGIB because
government counselors gave them faulty information. We have received
dozens of phone calls and letters decrying the fact that these airmen
followed the rules; but were excluded because the government decided to
change the rules at the last minute. Under VEAP, there is a 2-for-1
matching. If you have money in your VEAP account, it is non-interest
bearing. Accordingly, education counselors in all services advised VEAP
participants not to put money into their VEAP accounts until they were
ready to use the benefit. Unfortunately, when the 1997 VEAP-MGIB window
opened, the law allowed only those with money currently in their
accounts to convert to MGIB. Tens of thousands of VEAP participants
were excluded from the conversion because they followed the guidance of
government counselors. In basic fairness, we need to reopen that window
one more time and allow all currently serving military members to
convert to the MGIB.
Finally, while the MGIB is a good program relative to VEAP, it has
not kept up with inflation. While the cost of undergraduate education
has gone up 5 to 7 percent per year since 1985, the MGIB benefit has
not kept pace. If the MGIB was at the same relative value as at its
inception, the MGIB benefit would be approximately $800 a month. I urge
you to increased the value of the MGIB benefit and make it the same
value (relative to inflation) it held when the program began.
Because many enlisted members have no choice but to go to work
immediately after retirement, many never use their MGIB educational
benefit. Those that are unable to use the benefit (many of whom have
given the government $1,200 to invest for a significant long-term
return) don't receive a cent in return from the government. In fairness
to them, and in recognition of their unique sacrifices and risks,
participating members should be allowed to transfer their educational
benefit to family members--we ask your support in that regard.
With all of the national attention on educational programs, it is
important that we include military members in that dialogue.
home loans
The current VA home loan program primarily attracts only marginally
qualified veterans. Fees, closing costs, and down payment requirements
should be restructured to reduce the overall risk to the program. The
best way to attract new veterans is to eliminate fees and make the
program as attractive a possible.
For our reserve component members, the Selected Reserve Home Loan
Program was authorized as a temporary initiative and was, last year,
once again temporarily extended. Congress should permanently extend
this program. The concept of ``weekend warriors'' is certainly an
unfair, inaccurate misnomer. This nation owes our guardsmen and
reservists great deal, the least of which is provision of a full
benefits package for their service.
AFSA supports all programs that give veterans viable alternatives,
especially in the area of housing assistance. However, if other home
loan programs are made available, liberal qualification criteria and
the ``no down payment'' feature should be maintained for all sources.
Additionally, the reusability feature of the VA Home Loan program is
very important to military members and veterans who are required to
relocate several times during a career.
In conclusion, AFSA believes that the work your committee does is
among the most important done on the Hill. Your job is not only to
protect and reward those who served; it is to demonstrate to those
currently serving and who someday will serve that this nation is
committed to honor those who give a portion of their lives to their
nation. Today, we have touched upon just a few of the important issues
that you will wrestle with during the coming months.
In conclusion, Mr. Chairman, we thank you for this opportunity to
present the views of the Air Force enlisted community. As you ponder
and debate the proper focus of appropriations for future VA programs,
AFSA asks you to determine to capture a fair portion of the reported
$1.6 trillion budget surplus for those who made that surplus and this
nation's prosperity possible: America's veterans. On behalf of all AFSA
members, we appreciate your effort and, as always, are ready to support
you in matters of mutual concern.
______
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Prepared Statement of the American Association of Homes and Services
for the Aging
The American Association of Homes and Services for the Aging
(AAHSA) is pleased to take this opportunity to present our comments
regarding the fiscal year 2000 budget request for the U.S. Department
of Housing and Urban Development (HUD) from the Clinton Administration.
AAHSA is the nation's largest organization representing only nonprofit
sponsors of senior housing. Our members own and manage over 300,000
units of market rate and federally assisted housing--including the
largest number of nonprofit-sponsored HUD Section 202 elderly housing
facilities.
As we stated in the past, as nonprofit sponsors of elderly housing
we respond to entirely different motivations in developing housing for
the poor, the needy, and the frail elderly. Our motivation is born of
mission not profit. Ours is a mission of helping those whose needs are
the greatest and of striving to provide housing and supportive services
to all low-income elderly who need it.
Overview
As we begin the discussion of funding for elderly housing programs
in the fiscal year 2000 HUD budget, we ask you to keep in mind the
features that make elderly housing unique. Elderly housing provides a
sense of physical and emotional security, which is particularly crucial
for vulnerable older persons. It facilitates informal support among
residents--generally an older woman living alone--and prevents a sense
of isolation. It provides a cost effective means to link supportive
services with housing for older persons, particularly critical in
promoting independence and delaying more costly institutional care.
Elderly housing has special design features unique to older persons,
such as grab bars, pull-cords, lower cabinets, elevators, increased
lighting, and non-skid surfaces. And, elderly housing incorporates
programmatic features to encourage wellness, interaction with peers,
and promotes community volunteerism. It provides and/or links community
services, both formal and informal, through public and private
institutions, neighbors, families and friends. As we stated in last
year's testimony, housing for the elderly is more than a unit, it's
home and it's a community.
Last year, AAHSA was particularly critical of an administration
budget proposal that sought to fundamentally change the nature of the
Section 202 elderly housing program. We believed--and appreciated this
committee's leadership to get Congress to agree--that last year's
Administration-proposed changes were ill-conceived, ill-planned, and
ill-advised. Congress and elderly housing proponents believe strongly
in the success of Section 202, and rather than dismantling this
preeminent housing program for the elderly, were of the opinion that it
could form the foundation around which other successful housing
programs serving the elderly could be developed.
Last year, Congress roundly defeated each aspect of the
Administration's elderly housing budget proposal, and challenged HUD to
go back to the drawing board and craft a workable model for elderly
housing that focused on both the present and the future. During the
past year, HUD and the Administration worked closely with elderly
housing proponents in studying the state of elderly housing and sought
to meet that challenge.
Fiscal Year 2000 HUD Budget Proposal
The fiscal year 2000 HUD budget proposal that eventually emerged
from the Administration incorporated many of the ideas, approaches and
objectives that AAHSA and other elderly housing proponents have
advocated over the years. Central to the Administration's elderly
housing proposal is an historic multi-faceted housing initiative, a
``Continuum of Care for the Elderly'' program to ``enable low-income
and frail elderly to obtain decent housing and access the services that
aging requires.'' During the fiscal year 2000 budget briefing conducted
by Secretary Cuomo and HUD's various program Assistant Secretaries,
AAHSA praised the department for taking innovative steps in this new
direction to serve our nation's senior population. Specifically, the
continuum of care for the elderly builds on existing programs--
particularly Section 202--and was showcased as a comprehensive
``housing security'' approach for the elderly. The Administration's
continuum of care includes: $510 million for Section 202 new
construction; $50 million expansion of the service coordinator program;
$87 million for 15,000 rental assistance vouchers linked to low income
housing tax credits for new construction; rental assistance vouchers
linked to Medicaid for assisted living; $100 million to renovate and
retrofit existing elderly housing facilities for assisted living; use
of the reverse mortgage program for rehabilitation and property
improvement loans; and up to $5 million of Section 202 funds for
intergenerational learning centers.
The Administration proposal serves the purpose of opening a
positive debate over how best to serve elderly housing needs as we
enter the new millennium. While AAHSA has a few modifications for
further refinements, we believe the Administration's fiscal year 2000
budget proposal is a bold step positioning elderly housing as part of
long term care. Because AAHSA has long been an advocate of a continuum
of care approach utilizing elderly housing as part of the solution to
long-term care for the elderly, our testimony will predominantly focus
on that aspect of the Administration budget proposal. AAHSA's
commitment to, and vision for the continuum of care dates back to the
founding of the organization in 1961 and the earlier ``lifecare''
practices of some of our members. As we look to the future, AAHSA
encourages policymakers to see elderly housing as a key component of
this ``continuum for the millennium.''
Continuum of Care for the Elderly Proposal
Our comments below are designed to help the committee in its
deliberation on specific parts of the Administration's continuum of
care for the elderly proposal:
Section 202.--As Section 202 celebrates its fortieth anniversary in
1999, it is recognized as the nation's best and largest producer of
affordable housing for very-low income seniors. Over the years, Section
202 has earned strong bipartisan support as the primary government
program responding to the special housing needs of low-income elderly
Americans. The program has coupled the cost benefits of project-based
rental assistance with supportive services for frail elderly persons;
has maintained a long record of sound management; and, its nonprofit
sponsors have built a major portion of the nation's supply of quality,
affordable elderly housing while demonstrating long-term commitment to
their communities.
Although the Administration asserts that it has maintained full
funding of $660 million for the Section 202 program in fiscal year
2000, in actuality, there are set-asides in the proposed budget that
would reduce the funding level by $150 million to $510 million for
development of 5,790 new units and rental assistance activities in
fiscal year 2000. However, neither AAHSA nor the Administration should
be forced to make a Solomon-like decision of choosing between
supporting the continuum of care approach with its attendant parts, or
supporting ``full funding'' for Section 202 development. Both are
needed, and neither should be shortchanged. In recent housing
legislation, particularly in H.R. 202 and H.R. 1624, the Section 202
development program would be authorized at least at $700 million in
fiscal year 2000. And, H.R. 1624 would establish separate funding
streams, including mixed-financing, for the other elderly housing
continuum of care-type activities without ``robbing Peter'' or Section
202 to pay for those other activities.
Additionally, AAHSA has long advocated for flexibility in the
Section 202 program to enable mixed-financed, mixed-income, and mixed-
use facilities. AAHSA supports the flexibility in the program offered
by H.R. 202, which allows use of funds for acquisition, modifies income
limits in high vacancy areas, and allows Section 202 funds to be use in
conjunction with other federal and non-federal financing sources. The
``other sources of financing'' feature would be particularly useful in
coupling Section 202 with low income housing tax credits to develop and
increase the production of new housing units.
While we strongly support much in the Administration's continuum of
care proposal, we encourage you to prevent reduction in funding for
development activities under the Section 202 program and support $710
million in fiscal year 2000 funding for Section 202 development and
project rental assistance. We urge Congress to establish a continuum of
care for the elderly account and provide an additional $200 million for
the Section 202 program to be available for mixed-financing and
leveraging other development financing sources and enabling greater
program flexibility. Program flexibility should include a change in
statute to enable linkages between Section 202 and the low income
housing tax credit program.
Service Coordinators.--AAHSA testified last year that the use of
service coordinators in elderly housing facilities is an integral part
of the continuum of care, and our facilities have come to reflect the
vast support systems that enable the frail elderly to live
independently with dignity and respect. Under the continuum of care
concept, there are economies of scale benefits that accompany groups of
older persons living together who have access to services to help make
their life easier.
The Administration proposes $50 million for an expanded service
coordinator program to serve residents of HUD-assisted elderly housing
and other eligible elderly persons living in a project's neighborhood.
Funding for the expanded program would be instituted as a set-aside
under the Section 202 program. Over the years, AAHSA has advocated for
a more reliable and stable source of funding for service coordinators,
including funding service coordinators as a part of a facility's
routine operating expenses. Once again, we urge Congress to establish a
more routine funding mechanism for service coordinators. We suggest
that Congress provide new funding for service coordinators through the
current competitive grant process, and subsequently allow grant
recipients the option to build the cost of service coordinators into
their operating budget upon the expiration of the grant. In addition,
many elderly projects are constrained from providing a service
coordinator because HUD's 120 percent fair market rent cap prevents
them from building the cost of a service coordinator into their budget.
A waiver for nonprofit sponsors who specifically exceed the rent cap in
order to fund service coordinators would resolve this problem. While we
support the funding level proposed by the Administration--and it is
consistent with the level of funds originally provided when the service
coordinator program was first established--we oppose the notion that
service coordinators should be funded out of Section 202 development
funds as a set-aside in the Section 202 account. We urge Congress to
establish a continuum of care for the elderly account in fiscal year
2000 and provide at least $50 million in funding for (1) renewal of
expiring service coordinator and congregate housing contracts, (2) new
service coordinator contracts, and (3) expansion, to enable service
coordinators to serve other residents residing in the community.
Assisted Living Vouchers.--AAHSA continues to favor the project-
based approach over tenant-based vouchers as the preferable method of
providing rental assistance to low income elderly persons for many of
the reasons we outlined in last year's testimony, including the most
obvious reason that an older resident wants a place to age-in-place and
prevent or delay placement in other institutional care settings.
Vouchers make it more difficult for older persons, particularly more
frail elderly and persons who need the service enriched environment of
elderly housing, to find available and suitable housing in the
community. And, vouchers do not expand the supply of affordable housing
for the elderly. We continue to view vouchers as ``eating our seeds,''
we can live off our seeds for awhile, but it is short-sighted, and does
not build or grow the future.
However, HUD proposes a change in law to allow existing Section 8
tenant-based vouchers currently used by low income elderly to cover the
rent portion of assisted living costs. Given the fact that these
vouchers are currently in use by elderly residents, AAHSA would support
the expansion and use eligibility of these Section 8 vouchers. The
purpose is to both prevent the transitioning of the elderly resident to
more costly institutional care, and to provide greater options to
elderly residents in their choice of residential and care settings.
H.R. 1624 would also authorize an additional $87 million for 15,000
incremental Section 8 vouchers to be utilized by low income elderly to
help pay the rent cost of assisted living facilities on a 10 city/state
demonstration basis. Priority would be given to very low income seniors
who are Medicaid-eligible. The purpose of the demonstration is to gauge
the effectiveness of Section 8 rental assistance in assisted living
facilities, under controlled conditions, and report back to Congress
with findings, particularly on the savings realized by serving
Medicaid-eligible elderly persons in a non-nursing home environment.
These are objectives that AAHSA supports. We urge Congress to
extend to low income elderly persons currently using Section 8 rental
assistance vouchers the option to use their vouchers in assisted living
facilities. We additionally support $87 million in funding for 15,000
incremental vouchers to be used by frail elderly in assisted living
facilities.
Assisted Living Conversion.--Just as our residents are aging-in-
place, our housing is aging-in-place, and is in need of modernization
and retrofit. For years, AAHSA has urged Congress and the
Administration to establish a modernization and retrofit program to
address the problem of aging buildings, especially since the loss of
the Flexible Subsidy program and non-implementation of Project Retrofit
under the Congregate Housing Services Program in the 1990 National
Affordable Housing Act.
Under the continuum of care, the Administration proposes up to $100
million of Section 202 development funds to be available for an
innovative, competitive grant program to convert all or part of
existing Section 202 projects to assisted living facilities through
rehabilitation, modernization or retrofit. While AAHSA applauds the
Administration for taking this particular half step forward, we believe
that a full step is needed. This is a desirable objective, but we
believe that increased flexibility would be more beneficial. H.R. 202
would allow savings generated from financial conversion of Section 202
facilities to be used for modernization and retrofit of facilities.
H.R. 1624 establishes a $100 million capital grant program for the
rehabilitation, modernization, and repair of most project-based
federally assisted elderly housing, and allows for conversion of
elderly housing units to assisted living. We urge Congress to support a
continuum of care for the elderly account in fiscal year 2000 that
provides up to $100 million in funding for the rehabilitation,
modernization and retrofit of project-based federally assisted elderly
housing, and up to $100 million for conversion of elderly housing units
to assisted living.
Intergenerational Learning Centers.--AAHSA has long promoted the
concept of co-location, or locating services and service providers on
or in close proximity to elderly housing facilities. HUD proposes to
use up to five percent or $5 million of assisted living conversion
funds to provide space within elderly housing projects for
Intergenerational Learning Centers where ``the skills and experience of
seniors will be harnessed to meet the need for affordable child care
and allow seniors and children to learn new skills together.'' While
AAHSA supports this co-location approach, we would expand the eligible
use of funds to other co-location activities, including adult day care,
senior centers, home health care centers, and other types of services
and service providers. We urge Congress to support a continuum of care
for the elderly account in fiscal year 2000 that provides up to $5
million in funds for co-location activities; and to provide language
that encourages the use of funds from the CDBG account for co-location.
Other Issues
Financial Restructuring.--Last year, AAHSA outlined the arguments
for the financial conversion of the existing debt-laden Section 202
inventory with Section 8 assistance to the capital advance program with
project based rental assistance (PRAC), and urged this committee and
Congress to consider changing existing budget rules to permit debt
conversion while minimizing the budgetary impact. Since then, progress
has been made in considering other ways of minimizing the up-front
budgetary costs, including year-by-year debt abatement, prepayment and
refinancing proposals. Once again, AAHSA urges the committee and
Congress to allow for a range or menu of options in financial
restructuring of the Section 202 inventory including debt conversion,
prepayment and refinancing.
Program Funding.--AAHSA is additionally concerned with full funding
for expiring Section 8 contracts; adequate funding at the
Administration-requested level for the Section 811 and HOME programs;
and prevention of resident displacement caused by owners opting out of
the Section 8 program. We particularly urge Congress to proactively
pursue ways to help stem the loss of affordable housing caused by owner
prepayment and opting-out. Congress could help prevent resident
displacement by reducing the opt-out incentive by ensuring market
returns to owners; by providing a right-of-first-refusal and other
incentives to encourage the transfer or sale of opt-out properties to
nonprofit organizations; by removing barriers to sales; and by
facilitating acquisitions among sponsors with a long-term commitment to
providing affordable housing. We also urge Congress to provide funding
for ``enhanced vouchers'' to elderly residents in cases where expiring
Section 8 contracts may cause rent levels to increase.
Conclusion
AAHSA is thankful for the leadership this committee has provided
for elderly housing and for this opportunity to provide testimony. We
are pleased to be able to contribute to the committee's deliberation on
these critical issues, and we urge your support for the recommendations
outlined in these comments. We hope that our comments will assist in
helping you formulate a budget that is responsive to the increasing
needs of very-low-income elderly. If you desire additional information,
please contact Gerard Holder, Associate Director for Housing Policy at
202-508-9476 or [email protected].
______
Letter From the National Association For Equal Opportunity In Higher
Education
Silver Spring, MD, April 28, 1999.
The Honorable Christopher S. Bond,
Chairman, Subcommittee on VA-HUD-Independent Agencies, Committee on
Appropriations, United States Senate, 274 Russell Senate Office
Building, Washington, DC.
Dear Chairman Bond: As President and Chief Executive Officer of the
National Association for Equal Opportunity in Higher Education (NAFEO),
I am writing to respectfully request your support and assistance with
efforts to secure funding for minority programs in the fiscal year 2000
VA-HUD-Independent Agencies Appropriations bill. Specifically, on
behalf of the 118 HBCUs represented by NAFEO, we ask that $20 million
be provided to support the HBCU-UP program.
NAFEO is the national umbrella organization representing the
nation's 118 Historically Black Colleges and Universities (HBCUs). Of
this number, over 100 of the NAFEO/HBCUs were founded prior to the
Civil Rights Act of 1964 with the primary mission of educating African
Americans. In fact, many of these schools were established during the
Reconstruction Era as a means of educating persons who had been slaves.
The other 14 institutions that belong to NAFEO, known as ``NAFEO's
Other Equal Opportunity Educational Institutions (EOEIs)'' were
established after 1964 and serve significant numbers of African
Americans and other minorities.
Underrepresentation of minorities in science, engineering and
mathematics (SEM) fields is a serious problem that threatens our
nation's ability to effectively address the scientific and
technological challenges of the next century. As the nation prepares
for these challenges, it is essential that available resources be
focused on improving the ability of young people from underrepresented
groups to acquire the skills needed for meaningful employment in the
high technology enterprise. Given the strong track record of HBCUs in
producing a disproportionately large number of minority undergraduates
with degrees in these fields, additional resources are needed to assist
these initiatives.
Currently, the National Science Foundation (NSF) Directorate for
Education and Human Resources (HER) provides $6 million to three HBCUs
($2 million per institution) with the expressed purpose of
strengthening their SEM education and research infrastructure,
including support for faculty, research experiences for undergraduates
and scientific instrumentation. Another $2 million is provided by the
research and related activities account. While a 6 percent increase has
been proposed for NSF generally, no increase is recommended for HBCU-
UP, or the other minority programs administered by HER.
With respect to the fiscal year 2000 VA-HUD-Independent Agencies
Appropriations bill, NAFEO is seeking increased funding for the NSF
Education and Human Resources account. The request provides an
additional $12 million above the fiscal year 1999 level, and will
support an additional six institutions. This would ensure that the
current centers would continue to receive support at the fiscal year
1999 level of $8 million while allowing for additional program
participants.
A chart listing NAFEO's specific priority requests and the
organization's general request is attached for your review. Thank you
for your attention to this request. I look forward to meeting with you
to discuss this and other initiatives in more detail. The National
Association for Equal Opportunity in Higher Education thanks you for
all you do in ``keeping the doors of opportunity open.''TM
Sincerely,
Henry Ponder,
CEO & President.
______
Prepared Statement of the County of Sutter, California
Thank you, Mr. Chairman, and members of the committee for this
opportunity to speak before you today on behalf of the County of
Sutter, California in support of two project requests for fiscal year
2000. The County of Sutter appreciates this committee's support, and we
look forward to working with the committee to continue to improve our
economy.
Emergency Operations Center.--The County of Sutter, California
requests a $3.6 million earmark in the fiscal year 2000 VA-HUD
Appropriations bill under Economic Development Initiative to construct
a new Emergency Operations Center in Sutter County.
The County of Sutter has experienced four presidentially declared
flood disasters in the last four years alone. In January 1997, Sutter
County was part of the third largest evacuation in U.S. history when
nearly 50 square miles were inundated. Given Sutter County location in
the Sacramento River watershed, it is likely that additional emergency
events will occur in the future.
The existing Emergency Operations Center (EOC) is wholly inadequate
to meet the needs of the County and the region. It is located in a
rural fire station pre-dating World War II that was actually dismantled
and moved from San Francisco to its present location. It is small,
noisy, poorly heated, and badly lit. Further, sanitary facilities are
inadequate when the facility is in full operation. Perhaps most
critical is the fact that modern communications devices--essential to
emergency operations--do not operate in the existing EOC. And perhaps
most ironically, the fire department must be relocated to a remote
facility when the fire station is taken over for EOC purposes, thus
placing the community at an even higher level of risk at the very time
the risk level needs to be reduced.
The new facility will be located on high ground. The 10,000 square
foot facility will include space for disaster operations, operational
branch offices/meetings, media briefing facilities, restrooms, briefing
areas, kitchen and dining areas, and off-shift rest facilities. Site
improvements will include security gates, driveways, parking, a secure
water source, an on-site wastewater disposal system, and security
lighting.
The focus of the project is to upgrade the County's and region's
disaster response capabilities by increasing usable area, centralizing
vital communications and situation monitoring equipment, and adding
modern support systems, such as networked computers and satellite
communications.
The County is committed to constructing this facility and is
willing to commit significant resources to capital facilities. However,
federal assistance is needed if the County is to construct a facility
capable of meeting the proven needs of the County and region. The
assistance of this committee is greatly needed and appreciated.
Sutter County Industrial Development Projects.--Mr. Chairman,
Sutter County also requests an earmark of $300,000 in the fiscal year
2000 VA-HUD Appropriations bill under the Economic Development
Initiative to provide critical assistance in the County's efforts to
improve its economy by way of developing two industrial areas in Sutter
County.
Sutter County, located north of the City of Sacramento, is an
economically depressed rural region which relies heavily on agriculture
for economic stimulus. Sutter County has relatively high unemployment
rates and relatively low per capita income levels, and needs to
diversify its economy in order to improve the lives of its citizens.
Two areas in Sutter County are well-positioned geographically to
provide economic development opportunities in the form of an
industrial/commercial reserve and an industrial park. The South Sutter
County Industrial/Commercial Reserve provides an opportunity to develop
approximately 3,500 acres of land near the Sacramento International
Airport and major transportation corridors. The Sutter Industrial Park
is located five miles west of Yuba City. While these two areas provide
real economic development and diversification opportunities, the County
lacks the financial resources to stimulate significant interest and
development in these areas.
Mr. Chairman, the County of Sutter appreciates the committee's
continuing assistance related to improving our region's economy. Thank
you for the opportunity to appear before your committee. I would be
happy to answer any questions.
______
Prepared Statement of the City of Gainesville, Florida
Mr. Chairman and Members of the Subcommittee, my name is Pegeen
Hanrahan and I am the City Commissioner of Gainesville, Florida. I
would like to submit the following testimony for the record and ask for
your assistance with regard to two important initiatives on which the
City is currently working.
Sweetwater Branch/Payne's Prairie Stormwater Protection Project
Background
The Sweetwater Branch basin contains approximately 1,710 acres and
is located in the southeast central portion of the City of Gainesville.
The outfall from this basin discharges into Payne's Prairie, a state
owned preserve and park system, which eventually flows into the Alachua
Sink, a natural sinkhole that drains directly into the Floridan
Aquifer. This Aquifer provides the majority of drinking water to
Florida's residents.
The Sweetwater Branch drainage basin contains urban, commercial,
industrial and residential area stormwater runoff. Because the branch
runs through some of the oldest portions of Gainesville, most
stormwater runoff is directly discharged into the Branch with very
little flooding attenuation or pollution loading reduction. The runoff
has the potential to affect threatened and endangered wildlife such as
the Bald Eagle, the Woodstork, the Sandhill Crane, and the Southeastern
American Kestrel. In addition, many domestic wells are used to obtain
water from surficial and intermediate aquifers in the area.
Water monitoring sites along Sweetwater Branch indicate that
inorganic constituents and nutrients are elevated. These compounds
adversely impact water quality and, potentially, vegetation in Payne's
Prairie and degrade water recharging the Floridan aquifer system
through Alachua Sink. Specific conductance has been increasing over
time, with averages ranging from 305 to 945 umhos/cm during 1997. The
average total nitrogen concentrations range from 0.25 to 1.08 mg/L.
Average total phosphorus concentrations are found to be 1.16 mg/L, with
many values exceeding 3.00 mg/L. There is a presence of relatively high
levels of total and fecal coliform, with total coliform bacteria found
to exceed 1,600 MPN/100mL. Aquatic macroinvertebrate sampling and
analyses performed in 1996 indicate an overall poor health of
Sweetwater Branch. In summary, the situation has created concern
amongst environmentalists, business leaders, and concerned citizens
throughout the region that Paynes Prairie and the Floridan Aquifer are
being compromised.
Project Description
The City of Gainesville intends to conduct surveying and
engineering analysis to determine the most beneficial and appropriate
means of providing treatment of the stormwater being transported
through the Sweetwater Branch prior to discharge to Paynes Prairie.
Conceptual studies have been conducted previously to identify optional
locations for such treatment facilities. Based on these studies, a
tentative location has been selected for further analysis.
Project Benefits
The primary goal for the proposed project is to provide a
comprehensive ecosystem management solution to the problem of
stormwater runoff from downtown entering Sweetwater Branch, Paynes
Prairie and the Alachua Sink. The project will reduce or eliminate the
sediment, debris, nutrients and general pollutants currently being
discharged.
SUMMARY OF FUNDING NEEDS
------------------------------------------------------------------------
Project Phase Funding Need Year
------------------------------------------------------------------------
Engineering/Surveying................... $200,000 1st
Property Acquisition.................... 800,000 2nd
Construction............................ 1,000,000 3rd
----------------
Total............................. 2,000,000
------------------------------------------------------------------------
It will be the City's intent to utilize $500,000 appropriated last
year for this project through USEPA to fund the engineering phase and
assist in the property acquisition phase.
Stormwater Treatment
The City of Gainesville has been developing a multi-faceted
approach to addressing stormwater runoff problems within the highly
urbanized 1,700 acre Sweetwater Branch watershed.
At the upper most limit of the watershed, there is a Duck Pond
Wetlands Restoration project under design. This section of Sweetwater
flows through the Northeast Historic District. The Restoration project
includes restoring a channelized section of the creek to a more natural
flowing creek.
Sweetwater then flows through the Central City District adjacent
and through the Matheson Historic Park. The City recently completed the
installation of a Bafflebox treatment structure and has permitted the
installation of another type of treatment structure called a Vortex
Box. These structures efficiently remove sediments and floatables that
are generally carried to and through the creek.
The City obtained a Brownfields designation for property located on
the southern perimeter of the Central City District for purposes of
designing a stormwater and groundwater wetlands treatment and flood
attenuation facility that will be developed and integrated into a city
park. In addition, the facility will serve as the master stormwater
detention facility for the Downtown Redevelopment District.
This site is located adjacent to the Historic Train Depot that the
City has recently acquired and plans to renovate. The park will provide
interconnections to several major rail/trail facilities that connect
Downtown Gainesville to the City of Hawthorne and the University of
Florida campus. There is an intermodal transportation center under
design as well to be located on property adjacent to the proposed
stormwater park site.
The City's Electric Utility is in the process of designing a
repowering plan for the historic Kelly Power Plant located adjacent to
this site. There is consideration of utilizing the reuse water from a
nearby wastewater treatment plant. This water is currently being
discharged to the Sweetwater Branch downstream of the proposed
stormwater park site.
The final proposed treatment facility is located towards the
southern terminus of the creek as it enters into the State owned Paynes
Prairie Preserve. This treatment facility will provide final treatment
of the runoff prior to discharging into the preserve and ultimately
into the Floridan Aquifer through the Alachua Sink.
The City of Gainesville intends to utilize the $500,000 from USEPA
to fund engineering phase and assist with property acquisition.
Additional funding up to $1.3 million is needed to provide total
property acquisition and construction. The City of Gainesville is
providing funding from the Stormwater Utility Program for portions of
this overall master plan as well.
The Depot Avenue Project
The Depot Project includes the reconstruction of approximately two
(2) miles of Depot Avenue from SR 331 to US 441 and the development of
the Depot Wetlands Park. The Depot Avenue portion of the project is
intended to address current safety and capacity issues and includes the
construction of two travel lanes, turn lanes, curbs, sidewalks and
landscaped medians. Depot Avenue traverses Gainesville from west to
east, approximately one-half mile south of, and parallel to, SR 26
(University Avenue). Its western terminus is at the eastern edge of the
campus of the University of Florida and its associated student housing
development, and its eastern terminus is at SR 331 in Southeast
Gainesville. It skirts the southern edge of downtown Gainesville at its
mid-point, and its intersection with SR 329 (Main Street) is considered
to be the southern ``gateway'' to Downtown.
Depot Avenue is located adjacent to the existing Depot Avenue Rail-
Trail, which is an 8 foot wide asphalt bike trail. It alternately
connects an existing recreational park and the proposed Depot Wetlands
Park, residential areas, commercial areas, and industrial land uses
along its length. The redesign of the road will address these varying
conditions and will also provide for the involvement of the
neighborhood residents it serves.
The enhancement of Depot Avenue will encourage increased
utilization of mass transit, bicycle and pedestrian modes of travel and
increase accessibility to a major public heritage and recreation
destination for the community. The City of Gainesville's RTS
Transportation Center is located on the north side of Depot Avenue
directly south of the core of Downtown Gainesville. The Transportation
Center is a multi-modal transportation hub for the Regional Transit
System, Greyhound, Amtrak and the Bicycle Commuter Facility.
The enhancement of Depot Avenue will also provide infrastructure
and improved safety while accessing from downtown and the University of
Florida area to the Porters Community, just west of SR 329 (South Main
Street) and Southeast Gainesville. The Porters Community lies within
Census Tract 2, which extends north of University Avenue, and Southeast
Gainesville lies within Census Tract 7. Census Tract 2 is approximately
37.7 percent African American and Census Tract 7 is approximately 75.6
percent African American (Census, 1990). Approximately 35.1 percent of
all families in Census Tract 2 are in poverty and approximately 31.6
percent of all families in Census Tract 7 are in poverty (Census,
1990). The socio-economic conditions of these areas include high crime
rates, sub-standard housing, and lack of services and investment. The
enhancement of Depot Avenue provides for safer access to the higher
employment areas of Gainesville, including downtown and the University
of Florida, improving physical infrastructure, including drainage
improvements, lighting and streetscaping, and providing safe bicycle
and pedestrian facilities that connect both east and west Gainesville
to Downtown.
The Depot Avenue Project will provide for beautification, and
encourage redevelopment and infill in the urban core of Gainesville and
its adjacent areas. This enhancement will provide a region-based
incentive for reducing sprawl development in the Gainesville
Metropolitan Area by providing an alternative east-west corridor to SR
26 that allows for maximum use of alternative transportation. As a
consequence, this project will increase mobility while minimizing
pollution and congestion associated with the use of single occupant
vehicles.
The Depot Wetlands Park is a proposed 22-acre Stormwater Wetlands
Restoration Park that will serve as the stormwater management facility
and developed urban recreational park that will serve many adjacent and
nearby residential neighborhoods.
As part of the stormwater management component of the project, the
facility is intended to provide water treatment for the Depot Avenue
Project as well as the Central City District portion of the watershed
that is located upstream of the facility. This project is in the
planning stages as the centerpiece of a USEPA and Florida DEP funded
Brownfields pilot project.
Once constructed the Park will serve as a hub for several existing
and planned rail trail bikeways. The Depot Project provides linkages to
the Depot Avenue Rail-Trail that links with the Waldo Road Rail-Trail,
the proposed Downtown Connector Rail-Trail that links with the
Gainesville Hawthorne Rail-Trail, and the proposed 6th Street Rail-
Trail. This trail system provides connections between the Downtown
area, the University of Florida campus, many residential neighborhoods,
and other municipalities. The trail system serves not only recreational
users but also serves as an alternative transportation facility.
The Depot Park is home to the Historic Train Depot Building that
was recently purchased by the City of Gainesville for purposes of
rehabilitation. The Old Gainesville Depot was built in 1907, and was
placed on the National Register of Historic Places in 1996. The City of
Gainesville was founded as a rail hub linking Fernandina Beach on the
east coast of Florida to Cedar Key on the west coast in the mid-1800's
and uses a train symbol as its official seal. The Old Gainesville
Depot's under-roof, otherwise open loading docks will provide open
vistas to the adjacent Stormwater Park. The Depot building will house a
unique mix of destination-oriented cultural and commercial uses
supportive of redevelopment in the Depot Area, the Depot Park, the
rail-trail system, and the RTS Transportation Center. The historic
Depot building's unique character and location will serve to make it
both a lively destination hub for the neighborhood and a catalyst for
further redevelopment of the area south of downtown. The building is a
standing testament to and a significant visual emblem of Gainesville's
rich history. It is also an historic symbol of transportation choice
that is particularly appropriate to its envisioned new uses, the
Stormwater Park, the adjoining rail-trail and its nearby connections
that are being developed, and to the RTS Transportation Center that
will be built across the street. The restoration of this building in
conjunction with the restoration of the 22-acre Depot Park is expected
to provide a major community destination and regional ``eco-tourism''
attraction for the community.
The City's Electric Utility is in the process of designing a
repowering plan for the historic Kelly Power Plant located adjacent to
the Transportation Center, Depot Historic Structure and the Stormwater
Wetlands Restoration Park. The planning firm of Dover, Kohl and
Partners has recently completed a community-planning process held in
conjunction with the repowering project. This community-planning
process included the entire Depot Avenue area adjacent to Downtown. The
City encourages citizen participation in the community-planning process
and actively provides opportunities for participation in the planning
of public infrastructure such as the Depot Avenue Project.
The Depot Avenue Project will include property and right-of-way
acquisition, design and construction activities at a cost of
approximately $18.8 million. The Depot Wetlands Park includes property
acquisition, design, remediation and construction activities at a cost
of approximately $10.0 million.
______
Prepared Statement of City of Dayton, Ohio
Chairman Bond, Ranking Member Mikulski, and Members of the
Subcommittee, thank you for the opportunity to submit the following
testimony which briefly details a concept that we call `` Tool Town''
for which we are seeking your partnership and support in the amount of
$2 million.
Tool Town is an idea that was created by a tooling community and
machining task force during the development of the comprehensive plan
for the city of Dayton. Tool Town will be a precision metalworking park
for the tooling and machining industry located on underutilized
industrial property in downtown Dayton. Tool Town will concentrate
tooling and machining companies, support services, and educational
opportunities in a unique campus-like environment. It will provide the
opportunity for companies to share equipment, staff, and resources and
to cooperate in new ways to meet a variety of customer needs. This
unique approach will not only support the region, but also help the
tooling and machining industry compete globally and retain these high-
paying jobs in the United States.
In the short term, Tool Town would provide a home for 23 businesses
employing over 1,500 people, and through its growth over the next 20
years, would house over 80 tooling and machining businesses and still
have the capacity for additional growth. Just within the city of
Dayton, this industry would be the direct supplier of 5,600 new jobs
and the generator of an equal number of new, spin-off jobs.
Ensuring the success of the tooling and machining industry will
help accomplish goals established in our comprehensive plan, including
increased per capita income, poverty reduction, revenue generation, and
job creation. These goals are relevant to the entire region, especially
in areas that formerly were centers of manufacturing and distribution
and whose citizens have suffered the most from the loss of those
industries and the impacts of urban sprawl. The creation of Tool Town
will support the long-term viability of the tooling and machining
industry and provide jobs for people who need them.
Tooling and machining businesses can provide secure, well-paying
jobs with benefits and the potential for advancement. The jobs are
available to a high school graduate after a nine-month training program
at Sinclair Community College, located in downtown Dayton. Sinclair has
a tooling and machining certification program that is recognized as the
best in the United States.
The average graduate has a minimum of three job offers and all
graduates get jobs. They are also designing a new curriculum to provide
advanced training which will produce ``top gun'' machinists.
The development of the Tool Town campus will also demonstrate the
feasibility of reusing brownfields. We have already received an U.S.
EPA Brownfield Pilot Program grant to complete an environmental
assessment and develop a reuse strategy for this site. A successful
brownfield project in our region will stimulate similar activities on
other underutilized and abandoned industrial sites. Its location in the
urban core permits economic development without additional major
investments in public infrastructure by reusing the existing roadways
and utilities that are already adequate to support full development of
this site.
regional strengths
The Miami Valley region has tremendous strengths in tooling and
machining. We are the fourth largest concentration of tooling and
machining industries in the United States. A recent survey of 11
counties in this region \1\ indicates that there are currently over 825
tooling and machining companies employing approximately 26,000 people.
This represents a $1 billion yearly payroll and $2.2 billion annual
sales revenue.
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\1\ Survey completed by the Center for Business and Economic
Research, the University of Dayton, Survey area includes Butler
(northern portion), Champaign, Clark, Clinton, (northern portion),
Darke, Greene, Miami, Montgomery, Preble, Shelby, and Warren (northern
portion) counties.
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The industry is growing in our region. In the last five years, the
number of jobs in tooling and machining has increased by 22.7 percent.
This is compared to a total employment growth rate of 5.3 percent in
the Dayton-Springfield area and 7.1 percent in the state of Ohio.
We have a wide breadth of capabilities in the industry, including
precision machining; molds; and special machines, processes, and
services. We have the ability to meet a variety of customer needs
through cooperating among area firms.
Educational opportunities are also a regional strength. As
mentioned above, Sinclair Community College is located near Tool Town
and is currently providing training for this industry. They are also
working with Dayton Public Schools on a possible joint venture to be
located at the Tool Town campus.
partners
There is a network of partners already involved in and committed to
this project. Partners at the local level include public and private
organizations such as the Dayton Tooling and Machining Association,
whose members have contributed $250,000 to provide two years operating
capital for the Tool Town Foundation; Montgomery County; Sinclair
Community College; the Brownfield Redevelopment Authority; and the
Miami Valley Economic Development Coalition. Local funding
contributions toward tooling and machining initiatives represent over
$1.7 million, including the construction of the Dayton/Miami Valley
Entrepreneurs Center, an Edison technology incubator to be located in
tool Town. Local in-kind contributions represent $835,000 worth of
staff time dedicated over the next three years to implement these
initiatives.
At the state level, the Ohio Department of Development has pledged
operating funds for the Entrepreneurs Center of up to $200,000 a year
and the Ohio Department of Transportation is supporting our application
for a Transportation and Community and System Preservation Pilot
Program (TCSP) planning grant for the Tool Town campus.
As previously mentioned, the federal government is also partnering
on this project, including awarding Dayton a U.S. EPA Brownfield Pilot
Program grant and the U.S. Economic Development Administration
contributing $1.1 million toward the Entrepreneurs Center. We were also
selected to participate in the final round of the TCSP grant program
and hope to receive a $300,000 planning grant for the Tool Town campus.
In addition, the city of Dayton has allocated $670,000 of our HUD funds
toward acquisition of a former foundry that comprises 11 acres of Tool
Town.
conclusion
The tooling and machining industry is globally significant. It has
a bright future. It is the core technology of every kind of
manufacturing and is essential to research and development, not to
mention our country's infrastructure, space program, and defense
readiness. It is essential, that as a nation, we maintain our ability
to engineer, build, and maintain tools.
While the global market presents opportunities there are those who
are working hard to take this lucrative business away from the United
States. The Pacific Rim countries already have 40 percent of the world
market in this industry, equivalent to the United State's share, and
their stated plan is to acquire 80 percent of it. Tool Town will be a
national demonstration project of a new way for businesses to work
together to meet this challenge. It will help ensure that the United
States will increase its share of this industry in the new century.
______
Prepared Statement of the Habitat for Humanity International
Mr. Chairman, Ms. Ranking Member, Distinguished Members of the
Committee, colleagues, and guests: It is a privilege to testify on
behalf of legislation which advances the opportunity for low-income
people to achieve the American Dream of homeownership. Habitat for
Humanity has two basic goals: To build houses with--not for--persons
who in no other way could own their homes; and to make it a matter of
conscience that everyone deserves a simple, decent place to live. The
SHOP and Capacity Building programs support and advance both of these
goals in important ways.
Before I illustrate just how much of an impact these programs make,
allow me to describe Habitat for Humanity International and its role in
the process. Habitat for Humanity is an ecumenical Christian
organization; for 23 years, we've been building houses with people in
need throughout the United States and much of the rest of the world.
Last fall, Habitat dedicated its 70,000th house. In little more than a
year, we expect to complete our 100,000th house. The families who move
into these houses make monthly payments on no-profit, no-interest
mortgages; they also contribute as much as 500 hours of ``sweat
equity.'' Habitat for Humanity offers these families--chosen without
regard to race, religion, sex, or national origin--a ``hand up,'' not a
handout. Habitat's nearly 1,500 affiliates in the United States select
homeowners on the basis of need, their ability to pay the no-interest
mortgage and their willingness to partner with us (invest sweat
equity). Each of these affiliates carries 501(c)(3) non-profit status
and is directed by its own locally elected volunteer board of
directors. Only about one of every four affiliates has any paid staff;
the rest are operated entirely by volunteers.
Habitat uses two federal programs to help ``set the stage'' for its
homebuilding: the Self-Help Housing Opportunity program (SHOP) and
Capacity Building. These programs make grants to Habitat for Humanity
International, which, in turn, makes grants to its affiliates in all
parts of the country. Habitat is strictly accountable to the Congress
for use of program funds. We make regular reports to the Secretary of
HUD.
The Congress last year re-authorized SHOP and Capacity Building for
fiscal year 1999 and fiscal year 2000; now the programs await
appropriations for which national and regional non-profit groups will
compete. SHOP and Capacity Building merit appropriation of funds,
because they work. At Habitat, for example, we're on track to build
more than 4,000 houses with the SHOP 1996 and SHOP 1998 awards we've
received--in fact, when the building is done, we'll have built about
400 more homes with the assistance of the two SHOP grants than our
agreement with HUD calls for. SHOP funds are used only for land and
infrastructure. Organizations awarded funds must average one house
built for every $10,000 included in the two-year grants (we're
averaging $9,071 for each SHOP 1996 house and $8,086 for each SHOP 1998
house). At Habitat, our affiliates are responsible for raising the rest
of the funds to build each house, which, on average, costs at total of
$43,251.
In the three years since the inception of SHOP, Habitat for
Humanity and Housing Assistance Council have been the primary users of
the funds. SHOP has made a significant impact on housebuilding among
Habitat's affiliates in the U.S.; affiliates participating in the
program built 60 percent more units in 1998 than they did in 1996.
Every day, we see SHOP do exactly what it's meant to do--give Americans
in need the chance to move into their own homes and slip the bonds of
poverty. We respectively request that $20 million be appropriated for
SHOP for fiscal year 2000.
The Capacity Building program allows Habitat for Humanity
International to fund affiliates' initiatives to increase the number of
houses they build. Affiliates are required to show us how Capacity
Building funding can help them increase home-building volume by at
least a 15 percent increase. With Capacity Building funds from the
Supplemental 1997 budget, 62 Habitat affiliates plan to increase
homebuilding volume by 169 percent in the next three years!
Capacity Building funds are used in two ways. Approximately one-
third of the funds helps provide technical assistance to affiliates
through the support of affiliate managers (each affiliate manager
advises 30 affiliates). Affiliate managers provide a variety of
training to local volunteers, resulting in increased production of
Habitat homes. Approximately two-thirds of Capacity Building funds are
made available to local Habitat affiliates to provide equipment and
persons to develop capacity to increase house numbers. Since no more
than one-fourth of Habitat affiliates have any staff and since
Habitat's experience is that even one staff person raises the numbers
of houses almost exponentially, affiliates may apply for funds for
staff positions on a three-year diminishing basis (100 percent funding
the first year, 75 percent the second year, 50 percent the third year).
This method motivates affiliates to take full responsibility for
staffing by the fourth year. Many more affiliates seek these funds than
can be accommodated. It is important to note that each affiliate must
first raise $3 for each $1 in Capacity Building funds it receives. We
respectively seek $10 million to be appropriated in fiscal year 2000
for Capacity Building.
SHOP and Capacity Building are not about statistics or processes;
they're about building hope for Americans who have so little. I could
not describe these programs adequately if I didn't offer at least a few
examples of the lives they have touched.
Minnie Burgess, a new Habitat homeowner in Miami, Fla., only
dreamed of homeownership before she heard of S.H.O.P. and Habitat. She
spent much of her time keeping eight grandchildren from the drug
dealers milling about her former apartment complex. Today, thanks to
Habitat and S.H.O.P. funds, she and her family live in a safe
neighborhood.
``I can't even explain what Habitat has done for me and my
grandkids,'' Burgess said. ``We're all prouder now and have room to get
around a little more.''
Carol Seumptewa, a Habitat homeowner in Arizona, couldn't afford a
decent house for her 21-year-old quadriplegic daughter and herself on
her receptionist's salary. But because of S.H.O.P., they will soon move
into a brand new handicapped-accessible home equipped with a roll-in
shower, lower sinks and handrails.
SHOP also helps improve lives by fighting crime. A Habitat-
developed subdivision in Lynchburg, Va., deters wrongdoing through
design features incorporated in its street layout, landscaping and
lighting. The 88-home development--Jubilee Heights--can be traced to
S.H.O.P. money that ``set the stage'' for housebuilding.
Capacity Building is also building a repertoire of success stories
at Habitat. One of the best examples is that of four affiliates in the
Mississippi Delta area of northwest Mississippi that are putting
Capacity Building funds to work to hire a resource developer who will
target other sources of funding. The new fund-raising impetus is
expected to result in about 20 houses in less than three years. It's
just one instance of how Capacity Building provides the seed money for
even more resources that accelerate housebuilding.
There is a story behind every new house. SHOP and Capacity Building
are changing lives one family at a time and thousands with each grant.
Let's keep the momentum going. Appropriations of the SHOP fiscal year
2000 and Capacity Building fiscal year 2000 programs will see to it
that more Americans build better futures.
______
Prepared Statement of St. Joseph's Hospital Health Center
Mr. Chairman, thank you for the opportunity to submit this
testimony and for the support that this Subcommittee gave to St.
Joseph's Hospital Health Center last year. St. Joseph's, located in
downtown Syracuse, New York, is a non-profit 431-bed hospital and
health care network providing services to Onondaga County and to
patients from 15 surrounding counties. St. Joseph's is best known for
its ranking as the #1 hospital in New York State for open-heart surgery
in terms of lowest overall mortality rate. We are very proud of this
ranking, which we have held for three consecutive years. What many
people do not know is that we are also the largest hemodialysis center
outside metropolitan New York. My statement is focused on these two
areas of expertise at St. Joseph's and how we plan to initiate a
chronic disease management model that will benefit our current patients
with heart and kidney disease and enhance the quality of life for at-
risk patients in the region. We see this initiative as one with not
only health enhancement benefits but also with significant positive
economic implications for the community and the region.
St. Joseph's provides over $7 million in bad debt and charity care
to our service region. This comes to about 4 percent of our operating
budget. This number has steadily risen over the years and we feel it
will continue to do so unless some dramatic steps are taken. In order
to increase access to patients who are underserved and at-risk for
disease, we have implemented a program of ``patient-centered care.'' We
believe we achieved our #1 ranking for cardiac care through this
process, which employs a secondary prevention model for disease
management. By applying a multidisciplinary team approach to heart
disease and preparing patients before surgery and rehabilitating them
after, we have reduced mortality rates as well as the number of second
hospitalizations. We have done this to improve the overall health of an
underserved and underinsured patient base, but also for practical
financial reasons. While our rehabilitation and education programs for
our cardiac patients are largely unreimbursed, we are rewarded by
having to perform less expensive charity care on patients who would
typically end up back in the hospital without disease management.
Recognizing that early assessment is important to reducing the
number of expensive treatments required later in life, St. Joseph's
instituted a Wellness Place at a local mall so that people could stop
in at their convenience. The Wellness Place provides free, general
health screenings such as blood pressure readings, cardiac and diabetes
risk assessment, counseling and patient education and seminars. Last
year, approximately 15,000 people used the Wellness Place. Nearly 1000
of these people were determined to be at risk for heart disease,
diabetes, or vascular problems. These individuals were offered follow-
up services intended to change lifestyle, such as nutritional
counseling, smoking cessation, exercise programs and other similar
regimens. They were also offered a choice of primary care physician if
none was identified. This is all done at considerable unreimbursed
expense to St. Joseph's but with the knowledge that a great deal of
money will be saved in the long run--for the patient, the Medicare
system and the hospital. The most dramatic economic implications I
mentioned are encompassed within this concept--but not all. At risk
patients are working people who may lose jobs if their disease
progresses. It is important to realize, however, that patients with
diagnosed diseases or who have congestive heart failure, may still work
and lead productive lives if an effective disease management program is
initiated at the earliest stage possible. The other economic benefits
come in the form of the support required for this program. I will
detail those later in this statement.
Assessment is the first line of defense in chronic disease
management; but, there are many other factors involved after this step
is taken. A program for management of disease must adequately educate
patients and then foster a sense of individual responsibility for the
importance of following prescribed regimens. This takes a great deal of
initial monitoring and time spent with patients by telephone, at
community health centers, and in the home. This also requires
coordinated community participation by physicians, nurses, pharmacists,
physical therapists, educators, behavioral specialists and even
employers.
Diabetes, leading to kidney disease and kidney failure, is the most
expensive disease in the country. The second most expensive, and #1
admitting diagnosis for Medicare, is congestive heart failure. The U.S.
spends more than $7 billion annually in Medicare dollars for these
diseases. The clinical relationship between chronic kidney failure and
heart disease (e.g., high blood pressure) requires similar early
intervention techniques as well as later management, treatment, and
rehabilitation. Utilizing resources already developed and in place for
our cardiac rehabilitation program, St. Joseph's is proposing to
further develop a chronic disease management program focused on
hemodialysis. Combining resources in this way will be cost effective
and has the potential to radically change the management of kidney
disease.
The specific objectives of the program will begin with early
identification. Timely referrals to a nephrologist can be improved so
that more aggressive treatment can be initiated to prolong kidney
function and allow better preparation of the patient for dialysis.
Second, we will identify, investigate, evaluate, and implement
technology that will promote in-center self care and home hemodialysis
modalities. The Aksys Corporation has developed a product that has the
potential of achieving this objective. Third, we will utilize the St.
Joseph's Cardiac Rehabilitation Model for the renal patient. This model
will emphasize education and exercise with the goal of improving the
percentage of patients that stay employed, reduce frequency and length
of hospitalizations, and improve patient acceptance of and control over
disease processes. Finally, we will apply our disease management
techniques to our overall goal of reducing the percentage of candidates
for kidney transplantation. The ultimate goal of the renal patient and
the health care industry is to have renal patients lead a ``normal''
life. Currently, kidney transplantation is the modality that is most
associated with that goal.
Our history of service and specialization in the areas of cardiac
and kidney disease has proven that there is a demonstrable need for a
chronic disease demonstration in these areas for the Central New York
region. The demonstration will involve relationships and initiatives in
Dialysis, Cardiac Care, Home Care, and Wellness. What we lack at this
point, is a facility that can be shared by both cardiac and dialysis
patients. Our current dialysis facility, the largest outside the New
York Metropolitan area, is woefully inadequate in every way. The
facility was originally built as a modular, temporary, unit over 20
years ago. We now treat our overload of patients in the hallways and
have legitimate safety concerns that come with overcrowding and
questions as to the future structural integrity of the plant itself. We
have not replaced this facility for financial reasons but, fortunately,
have been able to treat patients satisfactorily. We have three
satellite clinics in the region that are also operating at capacity.
Our goal is to implement our demonstration program in an on-campus
facility that will provide the space needed for dialysis, exercise
facilities, classrooms, meeting rooms, examination rooms, and nurse and
allied professional training space. Training of personnel is an
important aspect of implementing an innovative chronic disease model.
In terms of economic development for the region, we believe that
keeping our patients healthy and productive will have the most dramatic
impact on the economy albeit in the long term. For the shorter term, we
believe the training programs that we currently provide and will expand
in areas such as home care, nursing, rehabilitation specialists, and
counseling, to name a few, will bring employment opportunities to
people in and around Syracuse. As we expand our efforts, we will likely
train people outside the immediate area to be able to serve the
outlying areas where our satellite clinics are and in homes in more
remote locations. The facility we envision will also provide many
construction jobs over the next couple of years. The two-story
facility, equipment and program operation will cost approximately $12.5
million. St. Joseph's has requesting Federal partnership grant funding
of $5.1 million that will also cover start-up operating costs. We
estimate, based on our current services, that our operating budget will
exceed $5.5 million per year.
As you know, St. Joseph's received $750,000 last year to begin the
planning and site preparation necessary for the new Center. We are very
grateful for this support and urge you to complete this investment with
an additional $2 million in fiscal year 2000 toward our total requested
federal share for the intiative. Having made this request, which we
realize is considerable, we would like to assure the Subcommittee that
St. Joseph's will provide, through private sources, the remainder of
the estimated total for this effort or $7.4 million.
We recognize the magnitude of this request but believe
wholeheartedly that this facility, and the implementation of our
chronic disease management model will repay this initial investment
many times over in terms of Medicare savings and in terms of providing
a national model for replication across the country.
Thank you.
______
Prepared Statement of the Village of Freeport, Long Island
Chairman Bond and members of the Subcommittee, I am Mayor William
F. Glacken of the Village of Freeport, Long Island.
I appreciate your receiving this testimony from me about the
revitalization of the Freeport Nautical Mile, a critical project
affecting our Village and Region. Representative Peter King is fully
aware of the importance of this project to our community, and has
written to you in support of our project.
The Village of Freeport is the largest Village on Long Island's
South Shore. It is located approximately 25 miles east of Manhattan. We
have a population of approximately 50,000, making us the second largest
Village in the State of New York.
Freeport is one of Long Island's historic commercial, residential
and recreational centers, with a history of settlement stretching back
over 300 years. We have welcomed successive waves of immigrants
throughout our history. Large percentage increases in our population
occurred at the turn of the century, in the 1920's, and particularly in
the rush to the suburbs which followed World War II. Our identity as a
multiracial, ethnically diverse community goes back for decades. I am
particularly proud that in our community black, white and hispanic
residents are almost equally represented in our total population. These
residents are also equally committed to building their futures in our
Village. I know they represent a tremendous asset in making Freeport a
model for 21st century growth and cooperation.
As an older suburb, we share many of the problems and challenges
that face urban areas and small cities. Our central business district
has been ``hollowed out'' by competition from regional shopping malls.
We have a high property tax burden in relation to other areas of the
County and region, due in large part to a growing school system with a
higher than average population of children at risk and new immigrants
with limited English language capability.
When I came into office two years ago, the Village faced a looming
deficit and a true financial crisis. In addition, Freeport had not made
necessary infrastructure improvements needed in our waterfront and
central commercial areas to retain small businesses and attract
visitors. With hard work and tough decisions, we have stabilized that
situation, but this is the situation and the context in which we face
the project I want to talk about with you today: the Revitalization of
one of the Freeport's priceless assets, our working waterfront, ``The
Nautical Mile.''
Freeport is one of New York State's Historic Maritime Centers, the
largest one within Long Island's South Shore Estuary. It is the only
large, diverse working waterfront in Nassau County, home to commercial
fishing vessels, fish markets, boat sales, seafood restaurants, charter
boats and marine-related businesses and shops. Although it has been a
vital engine of economic and recreational activity for more than a
century, a number of factors including the economic downturn of the
early 90's, changes in the region's commercial fishing industry, the
closing of several marinas which had been long time anchors on
Woodcleft Avenue, and a deteriorating infrastructure caused by
recurrent flooding and postponed rehabilitation contributed to decline
along The Nautical Mile.
We needed to act to save the Nautical Mile from irreversible
decline. We have acted. We have begun to implement one of the most
ambitious revitalization projects now underway in Nassau County. In the
coming months, the entire one mile length of Woodcleft Avenue will be
raised by as much as 2 feet as necessary to finally end the recurrent
flooding that has hit our businesses so hard. Magnificent water views
and public access to the water along boardwalks and bike paths will be
opened, as the Village develops the Little Swift Creek Recreational
Facility at the water gateway to Woodcleft Canal. A new 11 foot wide
brick-paved Promenade will replace existing narrow walkways. Utility
lines will be relocated underground and decorative lighting installed
to further enhance the Nautical Mile. A new pier and Esplanade will be
built at the center of the Nautical Mile on the grounds of the Long
Island Maritime Education Center, a unique museum and educational
facility also known as ``The Seaport at Freeport'' and the only
satellite program managed by the South Street Seaport Museum.
We are also working to consolidate some of our wholesale and retail
fish marketing to a ``mini-Fulton Fish Market'' to help retain and
strengthen the Nautical Mile's remaining commercial fishing ventures.
And finally, working with Nassau County we hope to reconstruct the road
which Freeport named for one of its celebrity citizens, Guy Lombardo
Avenue, to provide a thematically designed link between the Nautical
Mile and our currently economically distressed central business
district.
This ambitious project has stretched our resources to the maximum.
Protecting and revitalizing Freeport's waterfront has been recognized
as a regionally significant project, and we have received critical
support through competitive proposals that have won support from FEMA,
federal ISTEA funds, Empire State Development and other State agencies,
and from private industry. I am requesting $4.2 million today from your
Committee to provide vitally needed assistance that will ensure the
momentum we need to make the Nautical Mile Program a success. I thank
you on behalf of all of Freeport's citizens for your consideration and
help in working with us to build Freeport's future on high ground.
______
Prepared Statement of the University of the Sciences in Philadelphia
Mr. Chairman and Members of the Subcommittee, thank you for the
opportunity to submit this testimony to your hearing record. As
President of the University of the Sciences in Philadelphia (USIP), I
make an appeal on behalf of both campus and community. The University
of the Sciences in Philadelphia, formerly known as the Philadelphia
College of Pharmacy and Science, has been a member of the Philadelphia
community since 1821. USIP is the oldest institution of higher
education in the field of pharmacy in the country and holds the very
special distinction of having most past and current pharmaceutical
founders and/or CEOs in the country as alumni. The specific purpose of
my statement is to make a case for federal assistance to develop a
highly visible, 11.2-acre tract of land donated to the University by
the Unilever Corporation, parent company to Breyer's Ice Cream. This
piece of land is adjacent to the University and actually doubles the
size of our city campus and provides USIP an unprecedented opportunity
to significantly change the face of our West Philadelphia community.
The University of the Sciences in Philadelphia has developed a $100
million campus development plan that will take 20 years to complete.
This would include off-street parking facilities for students, a new
academic building to showcase the University's science programs, a new
field house to address the long-standing and critical need for
recreational facilities, a new laboratory building and/or a new
dormitory. All of these will be built around a central quadrangle of
open space, which will enhance the University's unique green, urban
environment, and provide a link for an existing community park, The
Woodlands, and a proposed Botanic Trail. A new 650-space parking lot
will help ease congestion and parking issues in the community, freeing
up space for commuters who use the trolley, residents, and consumers at
local businesses.
Presently, the University campus is somewhat fragmented. A major
thoroughfare into downtown Philadelphia runs through the center of the
campus and currently contains pedestrian, vehicular, and trolley
traffic. On the southwest side, the campus backs up to the historic
Woodlands Estate now located in a 55-acre cemetery. While this is being
promoted as a tourist attraction as part of a West Philadelphia revival
effort, very few tourists would venture beyond this point. On the other
side of the campus, the 11+ acre tract containing the abandoned Breyers
Ice Cream plant abuts a newer part of the campus.
The first phase of this plan addresses current safety and
appearance issues. It involves the demolition of the ice cream plant
that covers more than half of the total acreage of this new plot. This
structure, parts of which are 75 years old, has fallen into a state of
severe disrepair. Since Breyer's Ice Cream left the Philadelphia
region, this dilapidated, abandoned structure has been an eyesore for
the community as well as a reminder of lost jobs. In addition to the
removal of the Breyer's Ice Cream plant, the first phase of the
development plans calls for improving the safety of the campus,
beautification of the area and creating a more integrated campus. To
address these concerns, the University of the Sciences in Philadelphia
plans to make several improvements to the roads bordering or running
through the campus. These include redesigning traffic patterns and
parking around the campus to be safer and more efficient for
pedestrians and commuters; and developing a clearly delineated,
geometrically-organized system of pedestrian pathways and open spaces
linking the southern and northern campuses.
Philadelphia is a federally designated Enterprise Zone, but the
University's neighborhood is just beyond the boundaries of this Center
City-focused initiative. The University of the Sciences in
Philadelphia, however, is located in West Philadelphia, an area
recognized by the Economic Development Administration as an area
eligible for federal assistance. The average income for West
Philadelphia residents is half of those living in Center City and
Chestnut Hill/Mount Airy. The news stories, highlighting crime
activity, and general appearance of pockets of West Philadelphia, has
been a major concern for prospective students from outside the area.
Unlike other area universities and colleges where the safety of
students has forced many institutions to become contained communities,
students at the University of the Sciences are active participants in
the Philadelphia community. Our students gain valuable training and
professional experience from the local community and feed this
experience into Philadelphia's growing health care, pharmaceutical and
biotechnology economies. These include 160 hospitals, 150 research
labs, five medical schools, schools of dentistry, podiatry, optometry
and veterinary medicine as well as seventy-five percent of the United
States pharmaceutical firms, all located within a two-hour drive of
Philadelphia.
The University of the Sciences in Philadelphia is scheduled to
receive $369,000 in earmarked funds through the recently enacted TEA-21
legislation. These funds will be requested as reimbursement in the
costs of the beautification of streets surrounding the campus, the
development of open green space, and the relocation and diversion of
certain side street traffic.
These efforts will contribute significantly to redevelopment
efforts currently underway just to the north with very positive
implications for the residents of the immediate community in terms of
safety and beautification. Recognized by the federal government as an
area eligible for federal assistance, the University of the Sciences in
Philadelphia is seeking a $3 million HUD Economic Development
Initiative (EDI) grant in the fiscal year 2000 VA, HUD and Independent
Agencies Appropriations bill. This Federal help will allow
revitalization in West Philadelphia to happen more quickly and lessen
hazards associated with abandoned property and mixed traffic
thoroughfares.
The proposed campus expansion plan will provide numerous benefits
to the University, the community and the City of Philadelphia,
including increased job opportunities, a safer community and reduced
traffic congestion. The University of the Sciences will be better
positioned to continue its long-standing tradition of educating health
care professionals. Unfortunately, this will not be possible without
the development of this donated land. Regardless of the development
plans of the University, the Breyers Ice Cream plant is a hazard, not
to mention an eye-sore to the community, that is in desperate need of
removal.
On behalf of the students at the University of the Sciences and the
community of West Philadelphia, I thank you for your time.
______
Prepared Statement of the Tubman African American Museum
Mr. Chairman and Members of the Subcommittee, as Director of the
Tubman African American Museum I appreciate the opportunity to submit
testimony for the record addressing the economic development initiative
developed for the Tubman African American Museum.
The Tubman African American Museum is located in Macon, Georgia and
is Georgia's largest African American Museum. Founded in 1981, the
Museum is dedicated to educating all people on aspects of African-
American art, history, and culture. In addition to its permanent and
visiting art exhibits, the Tubman hosts concerts, plays, celebrity
storytelling and frequent lectures by well-known authors. Through
workshops, festivals, publications, youth camps, special events, and
community and school outreach programs, the Tubman offers school
children and the residents of Macon, Georgia a forum for social and
cultural understanding in an accurate and historical perspective.
Mr. Chairman, the Tubman African American Museum is clearly a
leader in educating people about African-American art, history, and
culture. Numerous articles in national publications attest to the fact
that the Museum is already having a large impact on many lives. Recent
articles in the Washington Post and the Wall Street Journal and
segments on NPR, PBS, and CNN highlight the positive influence the
Tubman is making in the Macon community. The Tubman not only provides
resources to the local community, the Georgia Council for the Arts also
recognizes the Museum as the 38th out of 184 art organizations in the
State of Georgia.
The Tubman's popularity and public visitation continues to grow at
a rapid rate. In the last five years, the Tubman has grown from less
than 5,000 visitors in 1992 to more than 65,000 in 1997. We have
documented that visitors come from around Georgia and from all fifty
states to visit the Tubman African American Museum. As audiences grow,
it is apparent that the Museum's current facility is no longer adequate
to accommodate the dynamic and popular educational and community
programming.
The Tubman African American Museum is literally bursting at the
seams. Large school groups are often turned away due to the lack of
Museum space. The lack of physical space also makes it difficult to
meet the public's demand for public lectures, workshops, and summer
camp, forcing the Tubman to rent space ``off-campus'' for these
activities.
The turn-of-the-century building that currently houses the Tubman
is substandard in many ways. The ceilings throughout the building are
eight feet tall, making the facility inadequate for many exhibitions.
In addition, the current facility does not have a loading dock or
elevator, limiting the Museum to a variety of exhibits. Limited space
at the Tubman also confines the Museum to only display 5 percent of its
permanent and prized collection, ``The Noel Collection.'' The Noel
Collection represents thirty years of Lynn and Michael Noel's
acquisition of thousands of pieces of African-American art. As a
contribution to understanding African-American art and culture, the
Noels have honored the Tubman with pieces of their collection to
display at the Museum. Unfortunately, about ninety-five percent (95
percent) of the collection is in storage in Houston.
In 1997, as a result of the Tubman's facility restraints, the
Museum's Board of Directors and Executive Director undertook a long-
range planning study to determine ways in which the Museum can
appropriately expand its services to state and regional suffices and to
position itself as a primary tourist attraction. After carefully
planned research and feasibility studies, the decision was made to
build a new Tubman African American Museum seven times the current
size. The new Tubman African American Museum will be located in the
heart of downtown Macon. Positioned downtown near the Georgia Music
Hall of Fame and the Georgia Sports Hall of Fame, the new Tubman
African American Museum will be another added attraction to bring
tourists to vibrant downtown Macon.
The development of a new Tubman African American Museum promises
great economic growth for downtown Macon, Georgia. In fact, this
initiative is one of the top priorities for the ``New Town Macon,''
Macon's downtown revitalization organization. The Mayor of Macon, City
Council, County Commissioners, and a wide range of community
organizations have endorsed this project as an important component of
downtown's economic development efforts. To this end, the City and the
County have pledged funds in support of the new Tubman. In addition to
public funds, the Tubman has initiated a private capital campaign to
raise funds for the $15 million project.
Mr. Chairman and Members of the Subcommittee, I urge your careful
consideration in awarding the Tubman African American Museum with an
Economic Development Initiative (EDI) grant in the amount of $5.2
million. An Economic Development Initiative grant would complement our
community, state, private, and local support and funds for the Tubman's
program growth and facility expansion.
With the Tubman's history of contributing to Macon's social,
economic, and educational growth, we hope that the Senate
Appropriations Subcommittee on Veterans, Housing and Urban Development,
and Independent Agencies will take careful consideration in awarding
the Tubman a grant for fiscal year 2000.
Mr. Chairman, I would like to take this opportunity to thank our
Georgia Senators, Senators Paul Coverdell and Max Cleland, and their
staffs for their leadership and efforts in supporting this project. The
Tubman African American Museum and the citizens of Macon appreciate
their commitment and hard work.
Mr. Chairman, thank you for this opportunity.
______
Prepared Statement of the City of Newark, New Jersey
Mr. Chairman and members of the Subcommittee, thank you for giving
us the opportunity to submit testimony about projects under your
jurisdiction that are critical to the people of Newark, New Jersey.
Newark is truly at a crossroads: we are a City with all of the problems
of many major urban centers, but we are also a City with vast
potential. We have begun to turn the corner--there is a renewed
vitality and sense of optimism in Newark.
Our downtown is undergoing vibrant revitalization. The acclaimed
New Jersey Performing Arts Center (NJPAC), which includes a new public
plaza open space, opened in 1997. An adjacent waterfront park and
historic area along the Passaic River is scheduled to begin
construction by the U.S. Army Corps of Engineers later this year, and a
minor league baseball stadium where the Newark Bears will begin to play
this summer is almost completed. Renovated office buildings, and new
retail spaces add to the mix of activities which are all changing the
face of Newark. But we know that the renaissance of our City cannot
just happen in the downtown business and arts center; it must also
include the residents and their neighborhoods in meaningful,
substantive ways. The proposals for economic development activities
outlined herein may be disparate, but they all relate to improvements
in the quality of life for residents of and visitors to Newark.
Newark is the largest City in New Jersey, with 275,221 residents in
1990, and ranks sixty-third in the nation in population. Newark's
twenty-four square miles of land makes it the smallest of the country's
top one hundred cities, with the fifth highest population density in
the nation. Much of our land is taken up by Newark International
Airport, higher education and medical facilities, and other
institutional uses, increasing the density of our actual ``livable''
space. The median family income, according to the 1990 Census, was only
$25,816--as opposed to $47,589 for the State--and our population is
five years younger than the State average. Twenty-nine percent of our
population was under the age of 18, and twenty-six percent lived below
the poverty line. For people living in these conditions, there are
basic needs which must be met: the availability of open space and
recreation areas, the availability of jobs, and the availability of an
infrastructure which is conducive to the development of business and
industry.
Fundamental to the goal of bringing Newark back is the
revitalization of its neighborhoods. Key to this improvement is the
revitalization of municipal parks in some of our poorest and most
densely populated areas, in full partnership with neighborhood
residents and community based organizations. Toward this end, the City
of Newark seeks the assistance of this Subcommittee in securing funding
to execute a plan to revitalize neighborhood municipal parks. Projects
have been selected in each of the City's five wards, with specific
strategies developed for each. The City of Newark will make every
effort to match dollar for dollar federal support through its operating
and capital budgets, staffing and in-kind services. Support is also
expected from the private sector, including foundations, corporations
and individuals.
The City's Department of Neighborhood and Recreational Services
will embark on a community partnership for parks strategy, currently
being tested in the largest municipal park, Jesse Allen Park. A local
grassroots campaign with advertising will be coordinated to invite all
neighborhoods surrounding each of the thirty-five small city parks to
collaborate and make theirs a community park according to the
established process. In each of the cases described below, a ``Friends
Of'' park association is being formed of citizens who live around the
park, and anchoring community institutions, such as schools, the faith-
based community, community development groups, and local agencies. Each
association will be helped by the City to form a board and become a
501c3 non-profit organization. Each group will be expected to get at
least 10 percent of the surrounding neighborhood residents to join the
association and donate at least one dollar, and will participate in
joint orientation and training with peers from similar groups city-
wide. The City will award additional funds for that particular park,
which the ``Friends Of'' group will help to administer to execute
improvements and create programming. It is anticipated that funding
will be in the amount of $1,000 per acre of park, plus matching with
various foundation and corporate partners.
Federal support will be utilized to match municipal capital
investment in improvements. The City administration will maintain its
current efforts and services, such as lawn mowing, trash removal and
basic landscaping. In addition, our comprehensive strategy will include
support from other municipal departments. The Engineering Department
will address capital needs, develop comprehensive physical plans and
drawings for each park, compiled in consultation with the community
group. The Police Department has pledged to create walk-ride units of
officers who patrol in and between specific parks, train watch groups
who undergo association training, and organize police youth and adult
athletic leagues to compete in the parks. The Newark Public Information
Office will coordinate the communications and media strategy, both for
initial outreach and with each association in determining its own
campaign direction and format.
The specific municipal parks that have been identified for
participation in the demonstration project and the unique strategies
for each are briefly described below.
Riverbank and Independence Park in the East Ward.--These parks are
in the crowded Ironbound section, where the neighborhood has very
little open space. The City is working with local groups to develop the
designated park area near the Passaic River with jogging trails, soccer
fields, and new open space.
Jesse Allen Park in the Central Ward.--This park is adjacent to one
school and near several others. It was recently the focus of several
discussions and meetings with community groups. It is in the heart of
the City's poorest area, and has been subject to repeated vandalism.
The City and the newly formed Jesse Allen Park Association are working
jointly to develop and execute a plan that includes the refurbishment
of ballfields, a revitalized playground, a new concert area, and
security measures.
Kasberger Field in the North Ward.--These playing fields and
recreation area are virtually hidden in the neighborhood in North
Newark. It has attracted the attention and interest of many little
league groups who want to help fix up the facility for ongoing use. A
security fence, lighting and better drainage have been identified as
vital needs.
Boylan Center and West End Park in the West Ward.--Boylan is the
only City recreation Center in the West Ward, and West End is the only
municipal park. Both need landscaping, furniture and signage to better
serve their local area populations.
Mildred Helms Park and St. Peter's Recreation Center in the South
Ward..--Mildred Helms is a long narrow park in the heart of a dense
residential neighborhood. It adjoins an elementary school, but is
littered with crack vials, debris and broken glass, and has broken
playground equipment. Yet the area children play there daily, as it is
the only open space in the immediate area. This is a site where
neighborhood organizing will potentially enable substantial change in
the environment. St. Peter's is a complex including basketball courts,
a pool and a center building on the other side of the ward. This
facility, too, is in need of community support to overcome chronic
vandalism and return it to full utilization.
The City of Newark is seeking the support of this Subcommittee for
a $5 million allocation to help to implement the City's overall
strategy for park and neighborhood revitalization. Based on community
partnerships and a sense of pride and ownership, the children of Newark
will truly have the opportunity to be a part of the City's renaissance.
The second project is one that will have a tremendous impact on the
redevelopment of industrial property close to Newark International
Airport, known as the Airport Support Zone. In order to accommodate the
expanding businesses which must be close to the airport and Port
Newark/Elizabeth, adequate drainage and unflooded roadways are
necessary. Simply put, the roadways in this area are prone to flooding,
making access to local firms and homes impossible. Motorists are often
stranded during severe rain, and the ground floors of some area
businesses become waterlogged.
The South Side Interceptor/Queens Ditch are the principal
stormwater conveyances draining the southern part of the City of
Newark. The South Side Interceptor picks up stormwater in the vicinity
of Weequahic Park and carries it to the Queens Ditch in the vicinity of
Newark Airport. Queens Ditch empties into the Airport perimeter ditch,
before discharging into the Newark Channel at Port Newark. Both
conveyances suffer from collapsed sections, heavy sedimentation due to
relatively flat gradients, and other blockages. The result is
insufficient capacity, leading to flooding on several key traffic
arteries. Major rehabilitation is required to restore flow and
capacity.
The project is critical to support expansion of Newark Airport. The
redevelopment of Frelinghuysen Avenue--the heart of the Airport Support
Zone--and the Waverly Yards property--an old railroad facility directly
across Rte. 1 from the Airport--are vital. This area is located
immediately adjacent to the Northeast Corridor, the Airport Monorail
Extension, and a proposed conference center and hotel complex.
Reconstruction of the South Side Interceptor will eliminate the
flooding problems on Frelinghuysen Avenue, especially in the vicinity
of the critical connections with Route 22 and I-78. The removal of
standing water will enhance the connections of this area to Newark
Airport and further its development as an Airport Support Zone. The
rehabilitation of the Queens Ditch will reduce flooding in the vicinity
of International Way and Waverly Yards. The combined project cost is
estimated at $10,000,000.
The Newark Museum's New Science Initiative is another project which
ties together economic development, community outreach and educational
opportunities. The Museum is recognized as one of the nation's leading
cultural institutions, and serves almost a half million adults and
children each year. Science-related programs draw more visitors than
any other offerings.
Realizing the opportunity to attract larger audiences and better
serve Newark and New Jersey residents, the Museum has embarked on a new
science initiative. In planning the program, the Museum staff has been
guided by the principles contained in Goals 2000 and by New Jersey's
recently adopted Core Curriculum Content Standards. Critical thinking,
mathematical and scientific understanding will be fostered as visitors
question, experiment, compare, and analyze real specimens from the
Museum's science collections, and participate in planetarium and Mini
Zoo programs developed to effectively communicate complicated and
abstract science concepts.
The Newark Museum seeks $2.0 million to support the Science
Initiative. The City of Newark has committed $1.7 million to date
toward the preparatory collections care necessary to make this
initiative possible. Additionally, The Museum plans a $5 million
operating endowment fund based upon a public/private partnership to
assure adequate on-going support, of which $1.2 million has been raised
to date.
The final project brought to the Subcommittee for consideration is
a major economic development initiative that will create a professional
sports and entertainment complex in downtown Newark. It is being
planned by a consortium of private businesses, nonprofit
representatives and the City administration. As this new economic
development initiative is evolving from preliminary to concrete plans,
there is a unique opportunity for an important downtown facility linked
to a key transit hub.
This project will use the attraction of a major league sports
franchise to locate a state-of-the-art arena as a key cornerstone for
development. The mission of this project is to harness the momentum
initiated by the successful opening of NJPAC, and create a vibrant,
state of the art sports and entertainment district in downtown Newark.
It will be a catalyst to the evolving creation of a vibrant downtown
corridor--as development continues based on strong anchors elements.
These include NJPAC, the Gateway complex of modern office buildings,
the Newark Museum and Main Library, the refurbished Newark Penn
Station, the new Joseph G. Minish Waterfront Park, and the Newark Bears
baseball stadium. A new light rail system, the Newark Elizabeth Rail
Link, is in final design, and will ultimately be the spine along which
these projects are arrayed.
The preliminary plan for the Newark Sports and Entertainment Center
master plan consists of a covered multi-purpose sports arena with
19,000 seats, ancillary parking, a new television production and
broadcast complex, up to 2 million square feet of new commercial and
retail space, including hospitality facilities. The sports and
entertainment center will provide superior access to a broad customer
base, create sizable, measurable, bankable fiscal benefits for the
taxpayers of New Jersey, and will, consistent with the commitment of
the New Jersey State Plan, ``steer development from environmentally
sensitive zones and back into urban areas.'' As the project creates a
destination location--which will create new incremental spending--it
will help to revitalize New Jersey's oldest and largest city and
establish a new sports paradigm linking professional athletes to the
youth of the state.
The Newark Sports and Entertainment Center is expected to draw
nearly two million people to the city each year. The estimate includes
those attending sporting events, family entertainment shows like the
circus, concerts and other attractions. In addition, the development of
the Newark Sports and Entertainment Center will act as a catalyst to
the increased demand for and opening of restaurants, shops, hotels and
small service businesses that meet the needs of patrons. Local
corporations, small businesses, city residents, and local employees are
expected to benefit from the Newark Sports and Entertainment Center
through improved quality of life, better entertainment and retail
options for is current workforce, and improved job opportunities. At
least 5,000 jobs in construction, ancillary services and direct
employment are anticipated.
A unique aspect and public benefit of this project is the
establishment of a foundation to benefit inner-city youth in New
Jersey. Community Youth Organization (CYO) has been formed by the
largest investor in the ownership group of the NJ Nets. CYO will be a
partner in the profits of the team, and is committed to investing its
profits in children, people and businesses in Newark.
The total population of the region in a 25-mile radius of Newark--
excluding New York--is 5,088,656, and includes New Jersey's five most
populous cities. In an approximate 10 mile radius of Newark, the
population is 2.1 million with a median family income of $54,683. This
contrasts with Newark's population of 265,000 and median income of half
that of residents in the 10 mile radius. A recent survey of Newark's
mid-day population found 266,000 local residents, 52,000 non-resident
workers and 24,000 non-resident students. The six colleges and
universities in the city have over 45,000 students and faculty. Newark
is also home to major corporations, including Prudential Insurance,
Continental Airlines, Blue Cross/Blue Shield of NJ and Public Service
Electric and Gas. Newark's Penn Station, a stop on the Northeast
Corridor for Amtrak as well as New Jersey Transit trains and buses from
throughout the State, is only a short walk from the proposed sports and
entertainment complex. This concentration of people with discretionary
income for entertainment and dining, and easy access to public
transportation, will be encouraged to use this significant purchasing
power in the City of Newark.
The ownership group for a major league sports franchise has
indicated the ability to contribute approximately $200 million of
private funds toward the anticipated $300 million project cost. The gap
in financing will be filled with a combination of tax-exempt revenue
bonds (subject to debt limits), user fees and grants related to the job
generating abilities and economic development potential of the project.
The City plans to use proceeds from parking and hotel taxes to
subsidize the project. The city will immediately benefit by the
presence of the Newark Sports and Entertainment Center, as it will pay
property taxes on land that is currently city-owned or underutilized.
Public funds are expected to be utilized for site acquisition and
off-site infrastructure improvements. The project area includes a large
tract of vacant land and underutilized buildings which has been
declared an ``Area in need of Redevelopment'' under the Redevelopment
statutes of the State of New Jersey. This Committee's endorsement of an
allocation of $15 million in funding through the Economic Development
Administration for site acquisition and project construction is
respectfully requested.
______
Prepared Statement of the Department of Neighborhood and Community
Services, City of Tallahassee, Florida
Mr. Chairman, I would like to thank you and the Members of the
Subcommittee for this opportunity to submit testimony to discuss the
commitment and the partnership between the City of Tallahassee and
Florida State University for the comprehensive revitalization of the
oldest historically African American community in the capital of the
State of Florida. We are requesting your support for an Economic
Development Initiative grant for $3.5 million to assist us in our
efforts to develop an $80 million arts and entertainment district that
would rebuild the economic and employment base of this community.
Frenchtown, established in 1841 by French settlers who created a
small enclave of homes and businesses is one of the first neighborhoods
established in Tallahassee. After suffering many hardships the French
gave up on this area, which after the Civil War was then claimed by
freed slaves. The Frenchtown neighborhood grew as a community and for
over 100 years became the economic and cultural center of Tallahassee's
Black Community.
In the late 1950's and early 1960's with the onset of integration,
the closing of the historically Black high school, and the urban flight
that occurred continued into the 1970's and 1980's the Frenchtown
community began its downward spiral of social and economic decline.
The deterioration of the Frenchtown community can be traced to a
breakdown in the basic cycle of community regeneration. People who
raised their families in Frenchtown have aged and remained. Their
offspring faced with the increase in urban decay, coupled with the
phenomena of expanded choices brought on by integration, chose not to
develop their lives in Frenchtown. The children who were raised in the
Frenchtown community, opting for the expanded choices brought on by
integration accelerated the trend of decline in the social, cultural,
economic and home-ownership base of Frenchtown.
The City of Tallahassee has joined with the citizens who have
remained and have undertaken the implementation of a long standing
commitment for the comprehensive revitalization of this community
strategically located in the center of the urban core of Tallahassee.
Frenchtown has the potential to become one of the most desired and
diversified neighborhoods in the City. The Frenchtown community is
within a one mile radius of two major state universities, Florida A&M
University and Florida State University. Florida State University is
located directly across the street from the Frenchtown community. The
State Capitol, the Tallahassee-Leon County Civic Center and the City's
downtown, which accounts for over 15,000 jobs and the hub of the City's
public transportation system are all located on the southern boundary
within a four block radius of Frenchtown. The City's plan for
redevelopment of this community is all encompassing. It consists of a
concentrated effort to rebuild the home-ownership base of the
community, to revitalize the main commercial thoroughfare of the
community, to preserve the historic and cultural institutions of the
community and through the development of the Frenchtown Arts and
Entertainment District to recapture the legacy of Frenchtown as a
center for commerce and entertainment for the Tallahassee community and
provide a major infusion into the employment base of Frenchtown.
A comprehensive neighborhood revitalization strategy, in order to
be successful must seek to create partnerships among federal, state and
local governments, the private sector, community organizations and
neighborhood residents. In this pursuit, the City of Tallahassee and
the Florida State University (FSU) have formed a partnership, coming
together and combining key aspects of their major development and
redevelopment activities to develop a $85,000,000 Economic Development
Initiative, the Frenchtown Arts and Entertainment District. This
partnership will result in the linking of the University's proposed $40
million new performing arts center with the City's proposed $45,000,000
Frenchtown Arts and Entertainment Complex. This City/University
partnership will encompass the following activities:
--A joining of the University's and the City's respective development
and redevelopment efforts, which are on either side of US
highway 90 (Tennessee Street), through an attractive and
convenient pedestrian promenade. The promenade would link the
exit of the Arts and Entertainment Complex's 1,000 space garage
in Frenchtown with the entry of Florida State University's Fine
Arts Complex which is anchored by a 1,200-seat Performing Arts
Center.
--The development of a 261,000 square foot Arts and Entertainment
Complex constructed around an 1,000 space parking garage. The
Complex includes a 75,000 square foot museum of African-
American History Science and Technology, a 60,000 square foot
100 unit suites hotel, 30,000 square feet of retail shops,
20,000 square feet of restaurants and night clubs, a six-plex
movie theater and 76,000 square feet of apartments and
condominiums.
The Economic Development Initiative grant is a critical element of
this project. The funds will be used to cover the finance charges for
the first ten years of a $8,000,000 108 loan. The 108 loan proceeds
will be used for property acquisition and for the installation of
infrastructure for the Frenchtown Arts and Entertainment Complex.
This development of this complex will create approximately 300
temporary jobs and 500 permanent employment and training opportunities
for very low income individuals who are transitioning from welfare to
work and for other low- and moderate-income persons from the Frenchtown
community specifically, and from other low income neighborhoods of
Tallahassee. The development of this Complex on this site will complete
the revitalization of the Frenchtown commercial district, returning it
once again into a viable commercial, cultural, residential and
employment center.
The acquisition of the site for the Arts and Entertainment Complex
with the 108 loan proceeds will remove from this community slum and
blighted conditions. These conditions that exist on the site stem from
vacant dilapidated abandoned buildings and vacant lots that foster
illegal drug traffic, vagrancy, illegal dumping and other crimes.
The development of this project will satisfy all of the
requirements associated with the Economic Development Initiative Grant
and the Community Development Block Grant Programs.
Mr. Chairman, granting this request will position us to complete
the comprehensive revitalization of this community. It will enable us
to return the Frenchtown community to the time when it was a center of
employment opportunity, business ownership, home-ownership,
entertainment and a thriving cultural life.
Again, I thank you for this opportunity to request your support of
our efforts to rebuild this neighborhood.
______
Prepared Statement of Hampton University
Mr. Chairman and members of the Subcommittee, I am Dr. William R.
Harvey, President of Hampton University in Hampton, Virginia. I would
like to thank you for allowing me the opportunity to testify in front
of the Senate Appropriations Subcommittee on Veterans Affairs, HUD, and
Independent Agencies to discuss the development of the Technology
Implementation Initiative, an important effort currently underway at
Hampton University. Hampton University is requesting a $3 million
Economic Development Initiative (EDI) grant in your fiscal year 2000
Veterans Affairs, HUD, and Independent Agencies Appropriations Bill to
help implement the Technology Implementation Initiative.
About Hampton University
Hampton University is a comprehensive institution of higher
education, dedicated to the promotion of learning, building of
character and preparation of promising students for positions of
leadership and service. Its curriculum emphasis is scientific and
professional with a strong liberal arts undergirding. An historically
black institution, Hampton University is committed to multiculturalism.
The University serves students from diverse national, cultural and
economic backgrounds. From its beginnings to the present, the
institution has enrolled students from five continents: North America,
South America, Africa, Asia and Europe and many countries including
Gabon, Kenya, Ghana, Japan, China, Armenia, Great Britain and Russia,
as well as the Hawaiian and Caribbean Islands and numerous American
Indian nations.
Research and public service are integral parts of Hampton's
mission. In order to enhance scholarship and discovery, faculty are
engaged in writing, research, and grantsmanship. Faculty, staff and
students provide leadership and service to the University as well as
the global community. In achieving its mission, Hampton University
offers exemplary programs and opportunities that enable students,
faculty and staff to grow, develop and contribute to our society in a
productive, useful manner.
The Technology Implementation Initiative at Hampton University
According to the Institute for Higher Education Policy, the top
information technology challenges confronting colleges and universities
include helping faculty integrate technology into instruction,
providing adequate user support, and providing the appropriate
financial planning for information technology. More college courses are
using technology then ever before. The percentage of classes using e-
mail increased to 44 percent in 1998, up from 33 percent in 1997, 25
percent in 1995, and only 8 percent in 1994. Today, one-third of all
classes are using Internet resources as part of the syllabus, compared
with 25 percent in 1997, and 15 percent in 1996. Further, almost one-
fourth of all college courses are using World Wide Web (WWW) pages for
class materials and resources, compared with 8 percent in 1996 and only
4 percent in 1994.\1\
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\1\ Institute for Higher Education Policy. February 1999. Distance
Learning in Higher Education. Data available from .
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Hampton University recognizes that the quality of undergraduate
education must keep pace with the needs of students who will take their
place in an information intensive workplace. The University also
recognizes that its teaching faculty should be sensitized to the
potential benefits and trained in these new and emerging technologies.
In order to address the needs of our students and faculty, the
Technology Implementation Initiative concept has been initiated as a
university-wide project that plans to integrate educational technology
with the teaching and learning environment.
The Technology Implementation Initiative is designed to enhance
Hampton University's ability to provide cutting-edge technological
services in order to create an interactive web that will link the
entire Hampton University community all over the globe, including
learners, faculty, staff, and the community. The Technology
Implementation Initiative will fully integrate the Hampton University
campus infrastructure in a unified secure network. The administrative
and academic buildings and dormitories will be wired for the delivery
of the Internet and the University's Intranet system. The Initiative
will also expand the University's uplink/downlink capabilities to
develop distance learning relationships through on-site programs in the
Caribbean, Africa, Europe, and other settings.
A key to the success of the Technology Implementation Initiative
will be the development of our faculty's technological skills.
Workshops and programs will be offered to our faculty and staff that
will focus on the integration of technology in the classrooms and in
the community.
The Technology Enhancement Initiative will incorporate the
development of the Academic Technology Mall (ATM), a comprehensive
service center designed to support information literacy and promote the
application of new and emerging educational technologies that enhance
the teaching-learning process. The ATM currently serves as the hub of a
campus-wide network that distributes voice, video, and data throughout
key instructional and administrative buildings. The ATM facility is
composed of a public access laboratory, faculty development laboratory,
computer classroom, electronic classroom, and the media productions
department.
The Technology Implementation Initiative will provide for a
student-focused entity that offers an array of computer and multimedia
services and resources. It will foster a creative work environment
where students utilize self-directed and self-paced technologies in
identifying, accessing, and generating data and documentation needed
for their courses and research applications. The student laboratory
will consist of Pentium and PowerMac computers, Internet access, and a
wide variety of software, printers, and other peripheral equipment that
are fully networked.
Mr. Chairman, Hampton University's goal is to become the preeminent
minority research institution capable of competing with majority
institutions. The creation of the Technology Implementation Initiative
will greatly enhance Hampton University's position as a leading
minority research institution. It will spur further business and
scientific investment in the Tidewater region, and will create an ideal
atmosphere for coordinated, interdisciplinary research at the
University. The Initiative will enable Hampton University to be better
positioned to attract collaborative research between the University and
national laboratories and industry, and thus enhance the academic,
scientific, and economic climate of the University and the entire
Tidewater region.
I thank you for this opportunity to testify.
______
Prepared Statement of the College of Agriculture and Technology at
Morrisville, New York
Mr. Chairman and members of the Subcommittee, I am Dr. Ray Cross,
President of the College of Agriculture and Technology at Morrisville,
New York. I would like to thank you for allowing me the opportunity to
testify in front of the Senate Appropriations Subcommittee on Veterans
Affairs, HUD, and Independent Agencies to discuss the development of
the Telecommunications Center for Education, a vital initiative
currently being developed by the SUNY Colleges of Technology (UCT)
Alliance. The UCT Alliance is requesting a $3 million Economic
Development Initiative (EDI) grant in your fiscal year 2000 Veterans
Affairs, HUD, and Independent Agencies Appropriations Bill to help
develop the Telecommunications Center for Education.
The UCT Alliance is a strategic partnership of the State University
of New York's five colleges of Agriculture and Technology that has been
created to better serve the educational and economic needs of the
people of rural New York. The UCT Alliance colleges, located in Alfred,
Canton, Cobleskill, Delhi, and Morrisville, have historically shared a
common emphasis on experiential and ``practical'' learning through
extended laboratory and internship experiences. The UCT Alliance has
established relationships with business and industry across New York,
and sponsors partnerships with high schools in their region. Through
local Advisory Committees, the Alliance Colleges maintain close contact
not only with local businesses and industry, but also with both the
public and private sectors throughout the state. The Alliance Colleges
are thus uniquely situated to assist in the economic development of the
region.
In order to effectively transform the five Colleges of Agriculture
and Technology into more collaborative institutions and assist the
Alliance's students and local communities, each campus must upgrade
their respective distance learning technologies and facilities. To
obtain this goal, the UCT Alliance is developing the Telecommunications
Center for Education. The Telecommunications Center for Education will
create a virtual campus that will fully connect and integrate the more
than 14,000 students currently enrolled in the five colleges. We know
from recent semesters that the current and future demands for these
types of services far exceeds our current ability to provide these
needed resources.
The Telecommunications Center for Education will house a variety of
cutting-edge telecommunications equipment designed to enhance
instruction and learning. The centers will contain ``classrooms of the
future,'' which will be equipped with videoconferencing/distance
learning equipment, computer ports and cabling for networking, and
technology that will provide access to satellite downlinks and uplinks.
These high-tech conferencing and instructional facilities will make it
possible for each campus to fully develop its capacity as a workforce
training center for its students and the region's business community.
A mainstay of the economy throughout New York State, agriculture
and technology training is highly specialized and critical to the
nation's economy. Training for these careers, however, is not widely
available in New York. In addition, employers in such fields as
manufacturing, construction, physical therapy, and telecommunications
continue to clamor to hire skilled employees. Students in the rural
areas of upstate New York, though, do not have the exposure and
resources to properly train to be competitive for the industries.
Through the Telecommunications Center for Education, The UCT
Alliance will step fully into its role of providing training centers
for the skilled technical workforce. The Telecommunications Center for
Education will provide benefits to the agricultural community by
creating linkages to agriculture-related businesses and institutions.
These linkages will spur the development of a more skilled workforce,
enhance competitiveness in national and international markets, and
stimulate many of the diverse facets of the rural economy.
The Alliance has a responsibility to not only generate new
knowledge, but to deliver that knowledge to businesses and citizens in
our area. Business and industry located near each of the alliance
colleges are interested in providing continuing education for their
employees. On each of the campuses, the Alliance will also make the
distance learning centers available to these businesses as centralized,
off-site training centers. In other cases, the video-conferencing/
distance learning capabilities will make it possible to deliver
instructions and training directly to the worksite. In the future, the
Alliance Colleges will work to develop training contracts with national
companies based in New York State and other neighboring states to
deliver specialized coursework over video networks to train employees
on the new technologies and techniques needed to remain competitive in
the global marketplace.
Rural communities are faced with the very real need to provide a
better and more highly trained employment base. The Alliance Colleges
have accepted this mission and are creating the Telecommunications
Center for Education as a model demonstration that can be replicated in
numerous other states whose rural communities are facing similar
challenges. For these reasons, the UCT Alliance is seeking initial
federal funding of $3 million in the fiscal year 2000 Veterans Affairs,
HUD, and Independent Agencies to help develop the Telecommunication
Center for Education. This is part of a two-year federal request of $6
million, out of a total project budget of over $14 million. This
federal partnership, in conjunction with the over $8 million to be
provided by the State of New York and from private sector resources,
can help make the mission of a more highly trained and technologically
competitive rural America a reality in the years to come.
I thank you for this opportunity to testify.
______
Prepared Statement of the Information Technology Center at Fairfield
University
Mr. Chairman, thank you for providing the opportunity to submit
testimony concerning an important initiative Fairfield University is
undertaking to ensure the progress of information technology education
and training in two educationally underserved cities in the State of
Connecticut. In particular, my testimony addresses the need to
establish an Information Technology Center, and the importance of such
a resource as a logical step in advancing the knowledge of information
technology among primary and secondary school students and adults in
and around the cities of Bridgeport and Norwalk. As President of
Fairfield University, I would like to provide the Subcommittee with a
brief overview of the state-of-the-art resources that the University
can bring to address the educational and workplace challenges brought
about technology.
As you are aware, constant advances in technology have resulted in
an ever-changing workplace environment. This is especially true for the
computer industry, where the Labor Department estimates that an average
of 95,000 new computer scientists, systems analysts and programmers
will be needed every year from now until 2005. As a result, studies
have indicated that to ensure national economic growth into the
millennium we must prepare our school systems to meet the demands of
the technological era by providing cutting-edge skills at the primary
and secondary level. In addition, educational programs must also be
developed at the collegiate level for university students, as well as
for returning adult students who need to modernize or enhance their
skills.
Fairfield University, a leading university in Connecticut, has
proposed a solution to meet the occupational needs in its State for the
twenty-first century. The proposal involves the utilization of an
existing state-of-the art telecommunication infrastructure that will
provide educational programs and training to children at local primary
and secondary schools, to returning students through satellite learning
programs, as well as to students throughout the University.
The proposed Fairfield program is unique for a number of reasons.
First, it will provide technical education and training for primary and
secondary school students studying in local urban public schools. A
recent study published by the National Assessment of Educational
Progress indicated that more than half of urban public school students,
many from areas similar to those surrounding Fairfield, scored far
below national averages in reading, math, and science. The Fairfield
programs will reach students who have historically not received extra
support for basic and advanced technical skills and training. While
school funding at the local level remains scarce, this program will
assist public schools to advance the skills of its children without
tampering with its budget. Second, similar to the federally funded
School-to-Work movements, these newly founded programs will help
students to improve and excel in basic and advanced educational areas,
while simultaneously preparing them to enter a modern-day workforce. As
a result, the programs offered by Fairfield will prove beneficial to
securing economic growth for the State.
Another feature that makes the Fairfield telecommunication
infrastructure unique is its ability to provide technical training
through the creation of its convenient satellite learning programs.
This is especially important for returning adult students who need to
modernize their skills in order to be competitive in the contemporary
workplace. Recent State of Connecticut employment cutbacks in the
banking, insurance, and manufacturing industries have produced alarming
unemployment rates among its highly trained workers. Fairfield
University is prepared to meet the challenges posed by this problem
through satellite learning programs that will train these workers so
they can re-enter the workforce. In addition, the satellite learning
programs will target members of the community who have little or no
technical skills, so they also can obtain work in the technical field.
The benefits of satellite learning programs from Fairfield University
are then twofold: The programs will decrease recent State unemployment
rates among highly-skilled workers, and concurrently provide better job
security for the low-skilled and low-income wage earner.
As Connecticut seeks to address the educational needs of its
citizens and meet the workforce needs of employers it must develop
strategies for capitalizing on the resources and strengths of its
higher education system.
Technology uses at Fairfield University: A Career Preparation Model for
the State of Connecticut
There is a need in the State of Connecticut and across the country
to create partnerships between institutions of higher learning and the
community. The primary focus of these collaborations should be with
secondary education and business/industry. The proposed relationships
can reduce high school dropout rates by infusing added resources and
expertise into the school system, and can increase the caliber and
breadth of job-training opportunities for local industry.
The computer industry has initiated outreach efforts, putting
equipment and software into schools to train students in information
technology, helping to increase skills and combat the shortage of high
tech employees. For example, it has been estimated that currently there
are approximately 350,000 computer programmer and system analyst jobs
vacant in the U.S. These companies cannot sell products without a
skilled workforce to install and service systems. Unfortunately,
privately funded pilot programs cannot be set up in every U.S. city.
Institutions of higher education in partnership with industry can fill
this gap for training in information technology.
Telecommunications technology is the vehicle through which
institutions of higher education can provide broader educational access
to the community. Students, educators, parents, senior citizens, and
the unemployed are just a small sampling of the potential recipients of
on-line training sites throughout the community.
Connecticut's Fairfield University possesses a singular, award-
winning resource that can bridge the gap and help accomplish these
goals. An already established state-of-the-art telecommunications
infrastructure consists of a fiber system that reaches every computer
in every classroom, faculty office and student residence hall. In
total, 23 campus buildings share voice, video, and data services. The
backbone portion of this system was recently upgraded to 155 Mbits from
10 Mbits. In addition, the University operates satellite dishes for
program downlinking and teleconferencing and a campus television
network with 50 channels, eight of which are programmed exclusively by
the University.
Cablevision Head End is a facility on campus providing a high-speed
networking hub for Cablevision in Connecticut. Through this resource,
voice, video, and telecommunications are made available to
Cablevision's residential and commercial customers. This facility has
the potential of providing the University with access to Cablevision's
entire customer base with national outreach potential. Cablevision Head
End is also fiber optic and reaches a broad audience inclusive of local
schools, private homes, work places, and community centers.
The academic and administrative staff at Fairfield possesses
extensive expertise in working with the local community, as witnessed
by the multitude of community outreach projects that complement current
programs. These efforts can be greatly enhanced, reaching broader
audiences through the development of a comprehensive distance learning
curriculum. What is required to take this step is modest when compared
to what can be accomplished in a very short time. The establishment of
an Information Technology Center will provide the central location for
all departments and disciplines to meet, develop, and transmit
curricula via television or computer to classrooms, workplaces,
community centers, or homes. It will also provide easy access to
digital library resources for the students and the business community
regionally and potentially statewide.
Establishing an Information Technology Center (Academic Computing,
Media, and Technology Training): A Bridge between Fairfield
University and the Community.
Building upon the existing telecommunications infrastructure,
Fairfield University can provide expanded services to the community.
Utilizing a distance learning model, training opportunities can be
developed serving the school systems, State agencies, and businesses.
Proposed training opportunities can be designed to increase skills,
improving workforce readiness for emerging employment in the State.
Fairfield University plans to upgrade, expand, and renovate a large
portion of its library structure and establish a Center dedicated to
utilizing the telecommunications infrastructure to improve community
outreach efforts from all of the various departments of the University.
The Center will have state-of-the-art facilities for distance learning
including: Satellite up-link and redistribution; Electronic classrooms;
Multimedia rooms; Conference center auditorium; Computing and
projection equipment; Electronic information databases; Research in
collaborative teaching and learning; and A digital library collection
for community and business use.
The Center will be used by the University faculty and staff for
internal instruction, and will be available to residents of the
surrounding communities on an as needed basis and, through various
partnership relationships, designed collaboratively to meet the
emerging needs of the community.
Fairfield University has comprehensive career preparation resources
that can be utilized and shared with the community. These include: The
School of Continuing Education; the Graduate School of Education and
Allied Professions; the School of Engineering; the School of Business;
the School of Nursing; and the College of Arts and Sciences.
Fairfield University's telecommunication capability is one of the
best in the country. The construction of an Information Technology
Center will help to coordinate and expand existing outreach as well as
provide the foundation for new collaborations. Using expanded
technology resources, faculty will be able to design and develop new
curricula. The current technology resources at Fairfield, combined with
the existing expertise of faculty and administrators, represents a
strong foundation upon which this Information Technology Center will
flourish.
The specific programmatic components of this Center, in brief, will
include information technology and computer training (including
Internet-2) as well as a Global Information Resource Center for
Fairfield County's corporations. This proposal seeks a federal
partnership grant from HUD in the amount of $3 million to assist in the
establishment of the Information Technology Center at Fairfield
University to foster the essential dialogue required to ensure that the
University's curricula is aligned with the ever-changing needs of
society and the workplace.
For these reasons, we believe a Federal partnership demonstration
at Fairfield University has the potential to meet the economic
development needs of Connecticut's schools and businesses as well as
the broader community throughout the State. We appreciate the
Subcommittee's attention and consideration of our proposal for such a
partnership opportunity.
Thank you.
______
Prepared Statement of the University of Medicine and Dentistry of New
Jersey
Mr. Chairman and members of the committee, I am Dr. Stuart Cook and
I am the president of the University of Medicine and Dentistry of New
Jersey (UMDNJ), the largest public health sciences university in the
country. The UMDNJ statewide system is located on five academic
campuses and consists of 3 medical schools, and schools of dentistry,
nursing, health related professions, graduate biomedical sciences and a
school of public health. 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.
I appreciate this opportunity to appear before you to testify on
behalf of two priority projects of UMDNJ which we believe are
consistent with the mission of this committee; namely, the Child Health
Institute of New Jersey and the Neurological Institute of New Jersey.
The Child Health Institute of New Jersey is located at the UMDNJ-
Robert Wood Johnson Medical School (RWJMS) in New Brunswick, New
Jersey. Nationally, RWJMS ranks among the top ten medical schools in
the percentage of minority student enrollment. The school ranks in the
top one-third in the nation in terms of grant support per faculty
member. RWJMS is 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.
Disorders of health affecting infants and children exact a terrible
toll in both human suffering and economic impact on families and the
community. State and Federal public policy places a priority on efforts
to prevent and treat childhood disorders. The prevention of conditions
such as mental retardation, muscular dystrophy, sickle cell disease or
cystic fibrosis has nearly incalculable benefits to society. Although
such centers are common in some parts of the country, the metropolitan
New York/New Jersey region does not have a research center designed
specifically to address issues of child health.
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 cognitively.
The Institute will be linked physically and programmatically with
both the medical school and the Children's Hospital at Robert Wood
Johnson University Hospital, the core teaching hospital of Robert Wood
Johnson Medical School. Locating the Institute in New Brunswick will
promote the development of new partnerships among the Institute, the
medical school, the teaching hospitals affiliated with UMDNJ and with
the multinational pharmaceutical, biotechnology and chemical interests
throughout New Jersey.
The Child Health Institute will act as a magnet for additional
growth in research and health care program development in the region.
New Brunswick has emerged as the premier ``Health Care City'' in New
Jersey through the efforts of UMDNJ, its schools and affiliated
hospital network, and the ongoing support of Johnson and Johnson, the
largest manufacturer of health care products, and the Robert Wood
Johnson Foundation, one of the largest philanthropic foundations in the
world.
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 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.
The Child Health Institute has already received $11.8 million in
private funding from the Robert Wood Johnson Foundation and from
Johnson & Johnson. The Institute has also applied for a $1 million NIH
Research Facilities Construction Grant, and we anticipate some state
funds to be available for our research facilities. We respectfully
request $10 million for infrastructure development and program
assistance for the Child Health Institute of New Jersey. This
combination of state, federal and private resources will enhance
UMDNJ's commitment to children, health care and the economic
development of our communities.
The Neurological Institute of New Jersey has been established by
the UMDNJ-New Jersey Medical School and UMDNJ-University Hospital as a
center of excellence in the neurosciences in recognition of the
expertise that exists in this discipline on our Newark campus. No other
entity in New Jersey approaches the depth of human expertise,
technological advancements and research achievements that exist in the
variety of services at the medical school and the hospital.
University Hospital is the core teaching hospital of the medical
school. It 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 about $4 million
annually. NJMS offers the only fully accredited neurosurgical residency
program in the state.
The Neurological Institute would serve as an umbrella under which
clinical, research and educational efforts would be focused. The
delivery of clinical care would be provided through University
Hospital, its clinics, physician offices and affiliates. Education
would be provided by multi-disciplinary teams focused on neurological
disease including prevention, early diagnosis, treatment and
rehabilitation. The Institute would collaborate with its regional
academic affiliates, the New Jersey Institute of Technology and Rutgers
University in promoting research.
Neurological disorders including stroke, epilepsy, multiple
sclerosis and Alzheimer's disease are common and debilitating.
Neurological diseases are a leading cause of death and disability in
the United States, affecting some 50 million Americans. Five million
new cases of neurological disorders are diagnosed every year, which is
five times the number of new cancer cases diagnosed.
An estimated 4 million Americans suffer from Alzheimer's disease.
With the baby-boom generation approaching retirement age, that number
could triple in a few short years. Experts say that Alzheimer's is the
fastest growing disease of the new millennium and America is ill-
prepared to deal with it. New Jersey could be particularly affected.
Despite our small size, New Jersey ranks ninth in all states in its
number of senior citizens.
Veterans are another group particularly at risk for neurological
diseases because of post traumatic syndrome and exposure to chemical
agents. More than 500,000 veterans live in New Jersey with some 150,000
residing in UMDNJ's catchment areas.
Neurological diseases and disorders account for about $400 billion
in health care costs and lost productivity.
While the devastation of neurological disease and injury can be
horrific, amazing breakthroughs in treatment and new drugs or surgical
techniques are occurring. These breakthroughs require painstaking
research and testing, significant financial support, and a
concentration of clinical expertise and potential research subjects in
a controlled environment. Unfortunately, the lack of such a statewide
focus in the neurosciences has limited New Jersey's participation in
and access to leading edge research, clinical trials and beta-site
technology. The Neurological Institute will allow New Jersey to
establish the credentials and clinical material necessary to compete
for the advanced basic science and clinical research projects that
currently are out of reach. Also, the critical mass of expertise
provided by the Institute will hasten the pace at which theories become
therapies in New Jersey through its educational opportunities and
sponsorship of new technology at its clinical sites.
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. The Institute would focus
the attention of pharmaceutical companies on the concentration of
patients and availability of physicians and research nurses experienced
in drug trials. The Institute will provide direction and coordination
to physician referral efforts. Targeted community-based primary care
and neurological specialty physicians will be invited to join the UH
medical staff and will be conferred member status in the Institute. An
ambitious program of continuing medical education in all fields related
to neurosciences will be established to provide referring physicians as
well as patients with a positive exposure to the academic and clinical
proficiency of the Institute.
The Institute 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. This MRI, with a rated field strength of 3-4
Tesla, would place New Jersey in the forefront of neuroimaging groups.
Imaging instruments with this field strength are 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. Applications will also extend to fibromyalgia, chronic
fatigue syndrome and post traumatic stress syndrome, where neurological
origins are not yet established.
UMDNJ already has established programs in neurosciences at the
medical school and at the Veterans Administration Medical Center in
East Orange. We are well positioned to conduct research of direct
relevance to veterans. We would collaborate with the VAMC and with our
research partners, Rutgers University and the New Jersey Institute of
Technology, in the development of a neuroimaging lab.
Before assuming the presidency of UMDNJ, I served as Chair of the
Department of Neurosciences at the New Jersey Medical School for 25
years. I also served as chair of the East Orange VA Medical Center's
Neurology Services for 10 years. I am well aware of the strong, dynamic
link between UMDNJ and the Veterans Administration Medical Center. The
VA was there for me when I was starting my medical career and I want to
be there for the VA to continue providing the very best health
education, research and patient care to the men and women who risk
their lives in service to our country.
We respectfully request $1.5 million toward the capital and
instrumentation costs from the Department of VA/HUD for the
Neurological Institute of New Jersey.
Thank you for the opportunity to appear before you today. We thank
the members of this Subcommittee for your leadership in supporting
national and international research and development initiatives. This
committee has been a strong supporter of the universities and research
institutions in this country. Your leadership on many biomedical
initiatives is especially appreciated.
______
ENVIRONMENTAL PROTECTION AGENCY
Prepared Statement of the National Association of Conservation
Districts
The National Association of Conservation Districts is a
nongovernment association that represents the nation's 3,000
conservation districts and more than 16,000 men and women who serve on
their governing boards. Established under state law, conservation
districts are local subdivisions of state government charged with
carrying out community-based programs for the protection and management
of natural resources. Conservation districts work with nearly two-and-
half million cooperating landowners and operators and provide
assistance in managing and protecting nearly 70 percent of the private
lands in the contiguous United States.
Conservation districts work with a number of local, state and
federal natural resource agencies in carrying out a wide variety of
conservation and environmental protection programs. Partnering with
state water quality agencies, state conservation agencies and the U.S.
Environmental Protection Agency, districts are key players in
implementing federal and state water quality protection and enhancement
programs.
Since the passage of the 1972 Federal Water Pollution Control Act
(Clean Water Act), tremendous strides have been made in cleaning up
point sources of water pollution such as industrial and municipal
wastewater discharges. The progress in treating point sources has been
made possible, in large part, by an investment of nearly $100 billion
in federal funds for the construction of municipal wastewater treatment
plants. Nonpoint sources of pollution--runoff from cropland,
construction sites, mining activities, lawns and city streets--are much
more elusive targets and pose a significant obstacle to achieving the
nation's water quality goals. Pollution prevention remains the key to
effectively dealing with nonpoint source pollution.
When Congress enacted Section 319 in the 1987 amendments to the
Act, it recognized that nonpoint source pollution control is best
addressed through state and locally driven cooperative, incentive-based
management programs. With federal assistance and state matching
efforts, Section 319 state management programs have resulted in
considerable progress in controlling nonpoint source pollution. Some 38
states have also established companion agricultural nonpoint programs
that provide technical and financial assistance to farmers and ranchers
to help them implement conservation practices that stem runoff.
Although progress has been made, lack of adequate funding is still
the primary obstacle to addressing the nation's nonpoint source
pollution control problems. After 25 years and a near $100 billion
federal investment in wastewater and industrial waste treatment, the
most pressing water quality challenges today revolve around nonpoint
source pollution and runoff from animal feeding operations.
Section 319 of the Clean Water, which provides grants to states for
nonpoint source pollution control, has proven to be a popular and
successful tool for addressing nonpoint source water quality concerns.
Conservation districts manage nearly 40 percent of Section 319 funds
and have a proven track record of success in providing technical
assistance to landowners to install practices to stem runoff. However,
the workload facing us is considerable and this level of funding--about
$80 million in fiscal year 1999--falls far short of the federal
commitment needed to address local needs. The federal dollars invested
in Section 319 also leverage considerable state and local resources.
Last year alone, state and local governments invested more than $1
billion in conservation efforts with much of that directed toward water
quality concerns. An increase in federal funding will bring even more
state and local resources to bear. Conservation districts believe that
$300 million is the minimum needed for EPA's Section 319 grants-to-
states program in fiscal year 2000.
Clean Water Act Section 106 State Program Grants are another
important tool to help states develop and implement effective water
quality protection programs. Matching these funds with their own
resources, states are able to better plan and set priorities that more
effectively address those needs. Conservation districts recommend a
funding level of $120 million for Section 106 in fiscal year 2000.
In addition to the already pressing need for conservation
assistance, EPA and USDA's recently released Unified National Strategy
for Animal Feeding Operations (the AFO Strategy) calls for the
voluntary development of comprehensive nutrient management plans
(CNMPs) for some 450,000 agricultural operations that are not subject
to the National Pollution Discharge Elimination System permit program.
Although voluntary, the AFO Strategy will create a tremendous new
workload for states to provide assistance to producers in developing
the CNMPs. Estimates in the number of staff years needed at the field
level to assist farmers and ranchers in this initiative range as high
as 8,000 FTEs. The President's budget request recognizes some of this
need by requesting $651 million in funding for its Clean Water Action
Plan. However, that funding level still does meet the on-the-ground
needs.
Further, since EPA is moving forward with plans to increase its
regulatory oversight of animal feeding operations, we urge the
subcommittee to include in its report direction that any additional
funds should be used to increase technical and financial assistance to
farmers and ranchers to implement the AFO Strategy. Specifically, more
assistance should support the development and implementation of
integrated pest and crop management systems, nutrient and animal waste
management plans, and installation of additional conservation measures
to reduce erosion and the resulting polluted runoff.
The Great Lakes National Program (GLNP) has been instrumental in
protecting the water quality of the largest freshwater ecosystem on
Earth. EPA works with 187 conservation districts in the Great Lakes
Basin in carrying out erosion and sediment control programs, developing
remedial action plans for areas of concern and helping landowners
install needed conservation practices to protect water quality. While
the Great Lakes Basin is home to some 40 million people, the impact of
the Great Lakes National Program echoes throughout much of North
America. To protect and enhance this important investment, conservation
districts recommend funding the Great Lakes National Program at $16
million and Great Lakes Erosion and Sediment Control at $600,000 in
fiscal year 2000.
The Clean Water State Revolving Fund (CWSRF) is a significant
financial tool for achieving clean and safe water, and for helping meet
the significant needs for the nation's wastewater infrastructure over
the next 20 years. Conservation districts applaud the President's
initiative to allow states to reserve up to 20 percent of their CWSRF
for use as grants for nonpoint source pollution control and estuary
management. We strongly encourage you to direct that a substantial part
of the funding under a nonpoint source SRF set-aside be made available
for agricultural landowners. Because of the difficulty many
agricultural producers have in recouping the costs of implementing
water quality management practices, loans from the SRFs have been
little-utilized. However, grants to defray the costs of best management
practices will be much more popular to landowners and effective in
obtaining the water quality improvements we all seek. However, we
oppose the President's proposal to cut funding for the CWSRF program by
$500 million. At the very least, funding for the CWSRF program should
be maintained at the fiscal year 1999 level of $1.350 billion.
In addition to EPA's water quality and other programs, the
President in his budget request proposes a new undertaking called the
Better America Bond (BAB) program. The BAB provides $1.9 billion in
bonding authority in fiscal year 2000 and $9.5 billion over the next
five years to help communities preserve green-space, protect water
quality and redevelop brownfields. Much of the program is aimed at
obtaining easements for those purposes. Conservation districts support
the Better America Bond program as long as easements are obtained on a
willing-seller basis.
In recent years, both the public and private sectors have
recognized the valuable role wetlands play in proving both water
quality benefits and valuable fish and wildlife habitat. Nonetheless,
we still lose roughly 100,000 acres of wetlands annually to various
types of development. Conservation districts strongly support efforts
to reverse this trend and increase the inventory of wetlands
nationwide. While we recognize some wetlands conversions will always be
necessary, there are many innovative ways to restore lost wetlands and
even create new ones. We believe that protecting and enhancing the
nation's wetlands can be achieved through education and by providing
landowners the technical and financial assistance they need protect
these valuable resources. The nation's conservation districts support
fully funding EPA's ``wetlands protection grants'' program in fiscal
year 2000.
We appreciate the opportunity to provide our recommendations to the
Subcommittee. In addition to the above, other detailed program
recommendations are outlined below.
FISCAL YEAR 2000 RECOMMENDED APPROPRIATIONS FOR SELECT PROGRAMS OF THE U.S. ENVIRONMENTAL PROTECTION AGENCY
[Millions of dollars]
----------------------------------------------------------------------------------------------------------------
Fiscal year--
Programs ----------------------------------------------------------------
1999 Admin. 1999 NACD 1999 Final 2000 Admin. 2000 NACD
----------------------------------------------------------------------------------------------------------------
State Programs Grants (Sect. 106).............. 115.000 120.000 115.000 115.500 120.000
Nonpoint Source Pollution Control Grants to 200.000 200.000 200.000 200.000 300.000
States (Sect. 319)............................
Water Infrastructure (CWSRFs).................. 1,253.000 1,350.000 1,350.000 800.000 1,350.000
Drinking Water Infrastructure.................. 775.000 1.250.000 775.000 825.000 825.000
Great Lakes National Program................... 13.441 16.000 14.700 13.367 16.000
Great Lakes Erosion & Sediment Control......... 0.350 N/A 0.500 ........... 0.600
Gulf of Mexico Program......................... 4.283 7.300 6.897 4.300 7.300
----------------------------------------------------------------------------------------------------------------
______
Prepared Statement of the National Association of Convenience Stores
and the Society of Independent Gasoline Marketers of America
The National Association of Convenience Stores (``NACS'') and the
Society of Independent Gasoline Marketers of America (``SIGMA'') submit
this statement regarding the fiscal year 2000 appropriation from the
Leaking Underground Storage Tank (``LUST'') Trust Fund that is part of
the spending bill for the Environmental Protection Agency (``EPA'').
SIGMA and NACS urge: (1) that the LUST Trust Fund statute be modified
to allow the States to use some portion of the appropriations they
receive under cooperative agreements with EPA for enforcement of the
underground storage tank (``UST'') regulations; and (2) that the LUST
Trust Fund appropriation be increased.
Introduction of SIGMA and NACS
SIGMA represents over 260 independent gasoline marketers operating
in all 50 States. Last year, SIGMA members sold over $33 billion of
motor fuel, representing over 22 percent of all motor fuels sold in the
United States. SIGMA members supply over 26,000 retail outlets across
the nation and employ over 195,000 workers nationwide.
NACS is a trade association representing more than 2,200 retail
members operating convenience stores, many with motor fuel dispensing
operations, in the United States and around the world. NACS member
companies operate more than 72,000 convenience stores across the nation
and employ over 750,000 workers nationwide.
Background
Under EPA's UST regulations (40 C.F.R. Part 280), all USTs that
were in the ground on December 22, 1988, had to be upgraded to new tank
standards, replaced with new tanks, or closed by December 22, 1998. EPA
provided a 10-year compliance period largely due to the diverse nature
of the regulated community and the number of USTs owned or operated by
small businesses.
As the December 22, 1998 deadline approached, there were widely
varying estimates of compliance rates. Based upon these estimates, EPA
predicted that non-compliance on December 23, 1998 was going to be
approximately 35 percent, largely from USTs owned by State and local
governments and small businesses. NACS and SIGMA, based upon member-
supplied information, believe that their members' USTS are better than
96 percent compliant.
In August 1998, EPA published its post-1998 UST enforcement
strategy, relying primarily on the states to be the lead UST enforcers.
The Agency, in response to an inquiry from the House Commerce
Committee, indicates that it has approximately 33 full-time equivalents
(largely borrowed from other Office of Solid Waste programs) available
for UST enforcement at the regional level. Further, the August strategy
document stated that non-compliance after December 22, 1998 was not an
option and that temporary closure of out-of-compliance USTs was the
appropriate response.
On December 9, 1998, EPA issued supplemental guidance on its UST
enforcement strategy. The Agency decided to prioritize its enforcement,
essentially giving a six-month enforcement delay to ``low priority''
UST owners and operators--that is, State and local governments and
small businesses with four or fewer USTs. SIGMA and NACS have been very
critical of EPA's December 9, 1998 guidance.
During the past two Congresses, the House has passed amendments to
the LUST Trust Fund, expanding the allowable uses by the States of the
Trust Fund's appropriations they receive under cooperative agreements
with EPA. One of these expanded, allowable uses is enforcement of the
UST regulations. EPA supported State use of LUST Trust Fund monies by
the States.
Amend the LUST Trust Fund to Allow State Use for Enforcement
NACS and SIGMA urge the Subcommittee, working with the Environment
and Public Works Committee, to include in the fiscal year 2000
appropriations from the LUST Trust Fund a statutory modification that
allows the States to use some portion of the LUST Trust Fund monies
they receive from EPA for enforcement of the UST Regulations.
There is a substantial environmental benefit from allowing State
use of LUST Trust Fund monies for enforcement. Older tanks that have
not been upgraded, replaced or closed are the ones most likely to leak
and threaten human health and the environment. Increased enforcement
will uncover sooner these non-compliant USTs, abating the potential
environmental harm earlier.
State use of LUST Trust Fund monies for enforcement provides an
equitable benefit to the regulated community. SIGMA and NACS support
fair and even-handed UST enforcement. UST owners and operators,
including NACS and SIGMA members, have spent considerable sums in
complying with the tank regulations over an unprecedented 10-year
compliance ``window.'' EPA and the States also have had a decade to
figure out fair and even-handed UST enforcement. It is a slap in the
face to those UST owners and operators who have spent hundreds of
millions of dollars in complying with EPA and State UST mandates if the
law is not appropriately enforced. With few enforcers and little UST
enforcement leadership by EPA, increased State enforcement sends
appropriate signals to the regulated community that non-compliance with
the law will not be tolerated.
At the recent House Appropriations subcommittee hearing on EPA's
fiscal year 2000 spending, the Agency Administrator responded to LUST
Trust Fund questions, expressing concern that stepped-up enforcement
would put small businesses, especially ``moms-and-pops,'' out of
business. NACS and SIGMA believe Ms. Browner's concern is misplaced for
at least three reasons.
First, in response to a question from the House Commerce Committee,
EPA stated that State-supplied information suggested minimal
dislocations, particularly in rural areas, if retail gasoline outlets
were forced to close because of the December 22, 1998 deadline. SIGMA
an NACS are not aware of any change in this information. EPA's UST
regulations are not designed to protect competitors, especially when
they have chosen for a decade not to comply with the law. At the same
time, EPA ignores the moms-and-pops who have mortgaged their homes or
their children's educations to comply with the UST regulations or who
have gone out-of-business because UST upgrades or replacements were
uneconomic.
Second, as part of its December 9, 1998 supplemental guidance, EPA
provided an opportunity for UST owners and operators to self-disclose
their UST non-compliance in return for an abatement or elimination of
civil penalties. According to the Agency, fewer than 200 self-
disclosures were received and most were from New York companies where
EPA is the lead UST enforcer. EPA's self-disclosure policy was broadly
disseminated last December. Small businesses, including mons-and-pops,
had a fair opportunity to enter into reasonable consent agreement with
the Agency.
Third, in a recent letter to Senator Chafee, EPA said that
currently ``low Priority'' UST owners and operators, including moms-
and-pops, will lose their enforcement status on June 22, 1998--that is,
there will be no further ``grace period'' after this initial six
months. If this truly is EPA's policy and position, then the
Administrator should not be upset if the States use some of the LUST
Trust Fund monies for enforcement after October 1, 1999.
Based upon the foregoing, NACS and SIGMA believe a sufficient
record exists for statutory modification to the LUST Trust Fund to
allow the States to use some Trust Fund monies for enforcement of the
UST regulations.
LUST Trust Fund Appropriations Should Be Increased
SIGMA and NACS support increased funding over the Administration's
request from the LUST Trust Fund, especially if State use of the monies
for UST enforcement is approved by the Congress. Because of the
December 22, 1998 compliance deadline, it is expected that there will
be a ``blip'' in reported UST Releases and resulting cleanups.
Increased funding from the LUST Trust Fund will help to ensure that the
pace of corrective actions are not retarded.
At the same time, NACS and SIGMA are concerned that the LUST Trust
Fund has a substantial unobligated balance which is being used to
reduce the Federal deficit. LUST Trust Fund monies should go to the use
for which the tax is levied and collected, especially when the tax
often cannot be passed through in the per-gallon selling price of motor
fuels.
______
Prepared Statement of the Center for the Engineered Conservation of
Energy at Alfred University
Mr. Chairman and Members of the Subcommittee, I submit this
statement to encourage your support for the Center for the Engineered
Conservation (EnCo) at Alfred University. The mission of this Center is
to validate cutting-edge environmental technology and foster the
conservation of energy and environmental resources. Alfred
University's, record of accomplishments in these areas is well known in
the research community, the private sector and with those federal
agencies focused on Global Climate Change. To enhance EnCo's ability to
assist with research, development and technology transfer in resource
conservation, we request a $2.5 million federal partnership grant from
the Environmental Protection Agency through your fiscal year 2000
legislation to help establish the $24.7 million Center.
EnCo was designed as a platform to develop, test and deploy
environmentally-sound energy efficient technologies. It will oversee a
consortial research effort involving industrial partners, state and
local agencies, and the Federal Government. The EnCo Center which will
function as a ``living laboratory''--the facility will be used by the
consortium to deploy and validate next generation building, industrial
manufacturing, and transportation technologies. The living laboratory
concept involves the use of a ``smart,'' self-powered building where
promising technologies can be tested and demonstrated full-scale. The
laboratory will be flexible to allow it to continuously adapt emerging
technologies.
EnCo will bring together a multidisciplinary group of scientists
and engineers from across the University, from industry and from other
universities as appropriate and will interact closely with start-up
companies currently located in twin incubator facilities constructed in
Corning and Alfred, NY. These incubators have established a strong
record in technology transfer, and will play a critical role in
bringing the products and processes developed at EnCo to the
marketplace. The research and development that will be undertaken by
EnCo takes advantage of Alfred University's internationally-recognized
expertise in ceramic engineering and materials science and its location
in the ``ceramics corridor'' which is comprised of industry and
academic talent in these areas of research. In this way, EnCo's
programs will have a very substantial influence on national energy
conservation research and product development.
Given the link between energy efficiency, environmental impact, and
developments in engineering and materials science, EnCo will provide
numerous opportunities for interdisciplinary research in the areas of
resource conservation and improved energy efficiency, the EnCo facility
has been designed to meet and surpass the highest Environmental
Protection Agency building codes and standards. The facility will
greatly enhance technologies relating to indoor air quality while
utilizing environmentally preferable materials. EnCo will also develop
and incorporate into the building, cutting-edge technologies for water
and wastewater usage. Further, this innovative facility will maintain
low VOC content and incorporate recycled content materials into the
structural framework.
Following are examples of how EnCo's research activities complement
and enhance the priorities of the Environmental Protection Agency:
--Indoor Air Quality research conducted at EnCo will focus on:
--Source control measures designed to control, reduce or eliminate
harmful air contaminants that originate from the site, and
from building materials, furnishings, equipment, mechanical
systems and maintenance products.
--Ventilation control measures designed to ensure that adequate,
clean, outside air is delivered to inhabitants and entails
the utilization of exhausting mechanisms, air filtration
measures and monitoring for air contaminants.
--Environmentally-Preferable Material Selection research at EnCo will
focus on:
--Emphasis will be placed on the validation of environmentally-
preferable materials which offer multiple benefits, such as
reduced emissions, increased durability and environmental
advantages (such as recycled content).
--Water Use research conducted at EnCo will focus on:
--Reducing water use through low flow equipment, water efficient
appliances and automatic cut-off valves.
--Processing waste water via a Solar Aquatic wastewater treatment
system couple with a constructed ``wetlands'' area.
--Storm water reduction through the use of advanced roofing
systems, pervious paving systems and other landscape
architecture systems.
--Waste Management research will take place during both the
construction and operational phases of the EnCo facility,
including:
--Construction waste management designed to minimize the generation
of waste material during the construction period, pre-
identification of a recycling master plan for construction
debris and the protection of existing trees, soils and
other significant site features affected by the
construction process.
--Waste management programs deployed during the operational phase
of EnCo will include the design of facility space to
separate, sort and store the various waste streams
(including hazardous waste) from the building and its
laboratories.
The EnCo initiative will benefit significantly from the New York
State Energy and Research Development Authority (NYSERDA), which--has
completed a building pre-design study for EnCo focusing on the building
design process NYSERDA and will provide technical assistance for
consideration of whole building approaches to energy conservation,
cost-sharing for building modeling and design commissioning, as well as
incentives for the purchase of energy efficient equipment. NYSERDA will
continue to provide design assistance related to the sustainability
issues cited earlier. In addition, EnCo has been selected by NYSERDA to
partner with the National Environmental Technology for Waste Prevention
Institute (NETI) at the University of Massachusetts to identify ``high
impact'' industries in the Northeast Region (New York/New England.)
Close attention will be paid to cross-linkages in energy, pollution and
economic characteristics and to common processes that impact on energy
usage and the environment.
Through EnCo, new products can be brought to bear in the reduction
of energy consumption in dramatic ways. To facilitate the introduction
of these products into the marketplace, there must be a mechanism
whereby the economic benefits of the products are validated by real
world working experience. Private sector investments in advanced
energy-efficient products and processes have a demonstrated positive
economic return. What is required in order to do this is a coordinated
research agenda based in a high impact, ``smart building'' or flexible
laboratory. This research requires access to a facility which can be
easily fitted with the latest technologies to test how different
systems work alone or in tandem with other newly developed
technologies. Effective technologies will then be transferred to our
highly successful business incubators for development as products for
market.
Alfred University's accomplishments in the areas of renewable
energy, energy conservation and efficiency, and its commitment to
interdisciplinary research with industry and federal laboratories--all
justify a strong federal partnership in the full implementation of
EnCo. The institution and its non-federal partners have already
committed significant resources towards the establishment of EnCo, and
are now requesting that the Federal Government provide a reasonable
match for this effort. The creation of the Center for the Engineered
Conservation of Energy will serve as a model in the advancement of
energy-efficient and environmentally sound technologies and research
while producing economic benefits both regionally and nationally.
Alfred University has already invested considerable resources in
the establishment of EnCo, which will cost a total of $24.7 million to
build, equip and operate. The EPA, through its Science and Technology
and Environmental Programs and Management programs, is at the forefront
of promoting and supporting initiatives aimed at preventing,
regulating, and abating environmental pollution. EnCo has been designed
to serve as a model facility that will incorporate the most advanced
environmental standards and designs into its structural concept and
research programs. For these reasons, and those outlined previously, I
urge your consideration of Alfred's proposal for $2.5 million as a wise
investment in our national search for ways in which to enhance our
productivity and quality of life while protecting our energy and
environmental resources.
Thank you.
______
Prepared Statement of the Committee for the National Institute for the
Environment
Chairman Bond, members of the Subcommittee, thank you for providing
us an opportunity to present written testimony.
The Committee for the National Institute for the Environment has
been working since 1989 to improve the scientific basis for
environmental decisionmaking. The CNIE is nonpartisan organization that
takes no position on particular environmental issues other than the
need for better connection between science and the decisionmaking
process. We do not receive any federal money and we are not here today
to seek any funding that will go to our organization.
We have submitted testimony before this Committee for several years
on the need for a trusted source of scientific information on
environmental issues that is separate from the regulatory agencies of
the federal government. This source should provide objective peer-
reviewed science that answers the key questions of decision makers and
affected parties inside and outside of the government. We believe that
an opportunity to create such a trusted source now exists in the
context of the National Science Foundation. Our testimony today
encourages the Committee to take advantage of this opportunity and to
fund NSF at a level above the President's budget for the purpose of
improving the scientific basis for environmental decisionmaking--a need
I know you recognize.
The core principles that we advocate are:
A non-regulatory science body with a mission to improve the
scientific basis for environmental decisionmaking;
Integration of:
--Assessments of the state of scientific knowledge on environmental
issues
--Competitively awarded support for peer-reviewed research organized
around environmental topics
--Distribution of credible non-partisan information using modern
technologies, and
--Support for science-based environmental education and training.
Involvement of all stakeholders in its activities equally, inside
and outside the federal government.
the need for a trusted source of scientific information on the
environmental issues
No one seeks to perpetuate environmental problems that threaten our
health, economy, and quality of life. Yet, we are often in a situation
of making decisions without a strong scientific understanding of the
issues. The impacts of those decisions can be very costly in terms of
money spent without accomplishing real progress or in lives that are
adversely affected by real problems that go un-addressed. Without
sufficient investment in science, decision makers often lack the
reliable information they need to make informed choices.
Much of the environmental research supported by the federal
government is conducted by regulatory or management agencies on short-
term topics of direct importance to the agency. Because these agencies
often act as an environmental police force, they and their science is
viewed by many with mistrust or seen as tainted with a political
agenda. This is not a criticism of regulatory and resource management
agencies, simply an observation of an avoidable consequence of their
missions.
On the other-hand non-regulatory agencies like the National Science
Foundation have a great deal of public trust and support. In the case
of the National Science Foundation this trust and support is well
deserved. The science supported by the non-regulatory Foundation have
served this nation so well that we might well call it the National
``Success'' Foundation.
Yet, many of the most important and controversial environmental
issues such as urban air quality, potential effects of endocrine
disrupters, ecological relationships related to collapsing fisheries
stocks and possible relationships between ethnicity and exposure to
toxicants are poorly addressed by the federal science agencies. They
are tackled first within regulatory agendas and later, if at all,
within science agendas. They become embroiled in controversy and make
lawyers rich. This needs to change.
The National Science Foundation is beginning to recognize that it
has a role to provide the science to understand, resolve, and even
prevent these environmental problems. Spurred, in part by the interest
of this Committee as well as by our efforts, the NSF is beginning to
recognize that this new role can be taken on in a way that complements
its traditional role as the nation's source of fundamental science, but
that it will take some institutional changes as well as additional
funding to fulfill both its traditional role and this new role as a
leading provider of science to improve environmental decisionmaking.
support for the nie initiative
Our effort to create a source of credible scientific information on
the environment has been developed in partnership and has been endorsed
by more than 440 organizations, including:
--State and local government groups such as the National Association
of Counties, U.S. Conference of Mayors, Council of State
Governments, National Association of Attorneys General and
National Conference of State Legislatures,
--Most national and many local environmental groups,
--The U.S. Chamber of Commerce and more than 30 state and local
chambers of commerce and business associations,
--255 colleges and universities,
--85 scientific societies,
--Three former administrators of the Environmental Protection Agency
and six of seven former EPA Directors of Research and
Development.
Our Board of Directors reflects this diverse support; I am one of
three elected state and local governmental officials on the CNIE Board.
As an environmental engineer and as the recently retired Majority
Leader of the Utah State Senate, I have seen far too many examples of
legislators and administrators needing to make a decision when the
science was not sufficient. Many decisions can not and should not be
deferred, but we also need a process to ensure the adequacy, quality
and the independence of the science that we need. This nation needs to
increase its investment in environmental science and engineering.
However, it needs to do it in a way that involves decision makers and
other stakeholders in helping scientists and engineers to determine
priorities. The proposal to implement the principles of a National
Institute for the Environment under the National Science Foundation
offers this opportunity.
this committee's support for the nie initiative
We greatly appreciate the past support of your committee for the
proposal is known as the National Institute for the Environment or the
NIE. As part of the House-Senate Conference Report 105-297 to accompany
the fiscal year 1998 appropriation to the National Science Foundation,
you stated, ``Finally, the conferees encourage the National Science
Foundation to study how it would establish and operate a National
Institute for the Environment.''
response of the national science foundation
Last April, the National Science Foundation reported to this
Committee that it was ``committed to environmental research and
education in all areas of science and engineering, and is eager to
expand its role in a manner consistent with overall national goals and
with its mission and strategic plan.'' But the NSF did not have a plan
of action at that time.
Last summer, the National Science Board (NSB) created a Task Force
on the Environment ``for the purpose of assisting NSF in defining the
scope of its role in environmental research, education, and assessment,
and in determining the best means of implementing activities related to
this area.'' The findings of the Task Force will be presented to the
NSB at its meeting on May 7, 1999.
Although we are not aware of the details of the Task Force report,
we are very encouraged by the workings of the Task Force. We have been
given considerable opportunity to work with the Task Force and have
been impressed by it significant efforts to go beyond the status quo
and provide genuine leadership for the nation on this issue. We
understand that they will propose an ambitious initiative for NSF,
which we hope will be consistent with the NIE principles and goals that
we have outlined previously.
The Task Force plan seems likely to provide mechanisms for making
environmental science supported by the NSF more relevant and helpful to
the nation's need for more scientific environmental decisionmaking.
This is something that this Committee and Congress has urged for a long
time. I hope that we can all look at the NSF plan as a real victory.
However, the greatest plan will come to naught if this Committee does
not provide support--both intellectual and funding.
In addition to the work of the Foundation's Task Force on
Environment, new NSF Director Rita Colwell, is making science for
understanding the environment one of her top priorities. The NSF budget
request for fiscal year 2000 includes a new $50 million initiative for
integrated environmental science, under the theme ``biocomplexity''--a
term coined by Dr. Colwell to describe the complex interrelationships
between living beings and the environmental systems in which they live.
This would boost NSF's environmental portfolio to $670 million, with
the vast majority being managed through NSF's disciplinary
directorates.
Today, we wish to make the following points:
--Congress should take advantage of this excellent opportunity to
place environmental decisionmaking on a more scientific basis
by giving a clear sign of its support for the NSF's efforts to
connect its environmental science funding to the decisionmaking
needs of the nation. We encourage this Subcommittee to give the
same kind of priority to NSF that the subcommittee of
jurisdiction has given to the National Institutes of Health.
Investment in environmental science is essential to the health
of our citizens and our economic strength. Only by investing in
a new approach to science will we be able to achieve one
without compromising the other.
--We encourage the Committee to fully fund the NSF's biocomplexity
and environmental initiatives.
--We encourage the Committee to add additional funding above
President's request for NSF to implement the principles of a
National Institute for the Environment through the Foundation.
We support the proposal of the Coalition for National Science
Funding (CNSF), of which we are a member, for a $562 million,
15 percent increase over fiscal year 1999 funding for NSF. This
would help to maintain America's preeminence in science upon
which so much of our economic well being depends. Such a level
of funding would also allow the Foundation to take immediate
steps to implement the principles of the NIE without adversely
impacting other scientific endeavors.
--We recommend that in the context of providing funding over the
President's request, that this Committee give special attention
to an increase in environmental science funding to implement
the recommendations of the Task Force, consistent with the
principles of the NIE. Since we do not yet know the details of
these recommendations, we would like to keep the option open of
coming back to this Committee with suggestions for ensuring
that NSF's proposal is consistent with the desires of this
Committee as expressed in the fiscal year 1998 report language.
I, the Board and the staff of the CNIE, and the many supporters of
this effort are ready to meet with Subcommittee members and their staff
to provide further details and work with you to accomplish a goal that
I know we all share--improving the scientific basis for making
decisions on environmental issues.
Again, we thank this Committee for its commitment to ensuring
scientific excellence with respect to environmental decisionmaking and
for its time and consideration.
National Institute for the Environment endorsers
environmental organizations (50)
Alliance for Environmental Education
Alliance of Veterinarians for the Environment
American Chestnut Foundation
American Forests
American Rivers
Audubon Naturalist Society
Audubon Council of Texas
California Trout
Center for Marine Conservation
Chesapeake Bay Foundation
Climate Institute
The Coastal Society
The Conservation Agency
Conservation International
Cosanti Foundation
Defenders of Wildlife
Environmental Defense Fund
Environmental Law Institute
Environment and Energy Study Institute
Friends of the Earth
The Georgia Conservancy
Georgia Environmental Organization
Georgia Wildlife Federation
Global Environment and Technology Fdn.
The Gorilla Foundation
The Izaak Walton League of America
Louisville Resource Conservation Council
Massachusetts Audubon Society
Michigan Environmental Council
Minnesota Center for Environmental Advocacy
Minnesota Conservation Federation
National Audubon Society
National Parks and Conservation Association
National Wildflower Research Center
Oregon Trout
Pennsylvanian Environment Council
Planning and Conservation League
Population Action International
Rails-to-Trails Conservancy
Rainforest Alliance
Save The Bay (RI)
Save The Harbor /Save The Bay (MA)
Seatuck Environmental Association
Sierra Club
Silicon Valley Toxics Coalition
Trout Unlimited
The Wilderness Society
Wildlife Conservation Society
World Wildlife Fund
Zero Population Growth
state and local governments (17)
Governor of Alaska
American Public Works Association
Mayor of Bellingham, Washington
City of Baltimore, Maryland
City of Chicago, Illinois
City of Monterey Park, California
City of Redlands, California
County of Santa Cruz, California
Council of State Governments
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National Association of Attorneys General
National Association of Counties
National Black Caucus of State Legislators
National Conference of State Legislatures
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U.S. Conference of Mayors
religious and other groups (3)
National Council of Negro Women
National Religious Partnership for the Environment
Unitarian Universalist Seventh Principle Project
business (35)
Albuquerque Chamber of Commerce
American Recreational Coalition
Arizona Chamber of Commerce
Arkansas State Chamber of Commerce/Associated Industries of Arkansas
Association of Engineering Firms Practicing in the Geosciences
Association of Washington Business
Business & Industry Association of New Hampshire
Business Council of Alabama
California Chamber of Commerce
East West Corporate Corridor Association
Florida Chamber of Commerce
Greater Boston Area Chamber of Commerce
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Illinois Chamber of Commerce
Kansas Chamber of Commerce
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Louisiana Assn. of Business and Industry
Maryland Chamber of Commerce
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National Association of Minority Contractors
National Multihousing Council
Nebraska Chamber of Commerce
New Jersey Chamber of Commerce
Newport County (RI) Chamber of Commerce
Ohio Chamber of Commerce
Oregon Biotechnology Association
Regulatory Environmental Group of Missouri
Salem Area Chamber of Commerce
Texas Association of Business and Chambers of Commerce
The State Chamber--Oklahoma's Association of Business & Industry
U.S. Chamber of Commerce
Virginia Chamber of Commerce
academic & scientific organizations (86)
Academy of Natural Sciences (Philadelphia)
Air and Waste Management Association
American Academy of Veterinary and Comparative Toxicology
American Agricultural Economics Association
American Anthropological Association
American Association for the Advancement of Science (Biological Science
Section)
American Board of Veterinary Toxicology
American Fisheries Society
American Geographical Society
American Institute of Biological Sciences
American Malacological Union
American Ornithologists' Union
American Phytopathological Society
American Society of Agricultural Engineers
American Society of Agronomy
American Society for Horticultural Science
Am. Soc. of Ichthyologists and Herpetologists
American Society of Landscape Architects
American Society of Mammalogists
American Society of Naturalists
American Society for Neurochemistry
American Society of Parasitologists
American Society of Pharmacognosy
American Society of Plant Taxonomists
American Society of Safety Engineers
American Sociological Association (Environment and Technology Section)
American Solar Energy Society
American Zoo and Aquarium Association
American Veterinary Medical Association
Animal Behavior Society
Assn. of Environmental Engineering Professors
Association of Field Ornithologists
Association of Southeastern Biologists
Botanical Society of America
California Academy of Sciences
Center for Conservation Biology (Stanford U.)
Chicago Academy of Sciences
Cooper Ornithological Society
Council of Systematic Malacologists
Crop Science Society
Desert Fishes Council
Ecological Society of America
Field Museum of Natural History
Foundation for Microbiology
Georgia Academy of Science
Herpetologists' League
Institute for Marine and Coastal Sciences (Rutgers University)
International Association for Hydrogen Energy
International Association for Impact Assessment
International Oceanographic Foundation
Iowa Academy of Sciences
Louisiana Academy of Science
Marine Conservation Biology Institute
Minnesota Academy of Science
Mississippi Academy of Sciences
Mississippi State University Research Center
Monterey Bay Aquarium Research Institute
Mycological Society of America
National Assn. of Environmental Professionals
Nat. Asn. of Professional Forestry Schools & Coll.
National Association of University Fisheries and Wildlife Programs
New Jersey Marine Science Consortium
New Mexico Academy of Sciences
New York Botanical Garden
New York Zoological Society
The Ohio Academy of Science
Organization for Flora Neotropica
Pacific Institute for Studies in Development, Environment and Security
Pennsylvania Academy of Science
Rhode Island Natural History Survey
Rural Sociological Society
Society for Conservation Biology
Society for Ecological Restoration
Society for Economic Botany
Society for Industrial Microbiology
Society for Integrative and Comparative Biology
Society for the Study of Amphibians and Reptiles
Society for the Study of Evolution
Soil Science Society
Soil and Water Conservation Society
Special Libraries Association
Union of Concerned Scientists
US Federation for Culture Collections T
he Wildlife Society
Wilson Ornithological Society
Washington Academy of Science
universities (255)
The University of Akron
The University of Alabama System
Alabama A&M University
University of Alaska Southeast
Alfred University
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The American University
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University of California--Santa Cruz
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University of Central Florida
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University of Charleston
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Claflin College
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Clark Atlanta University
Clemson University
Cleveland State University
Colby College
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University of Colorado--Boulder
University of Colorado--Denver
Colorado College
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University of Connecticut
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Connecticut State University System
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Dickinson College
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Eckerd College
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State University System of Florida
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Franklin & Marshall College
Frostberg State University
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University of Georgia
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Grinnell College
Hamilton College
Hampden-Sydney College
Hampshire College
University of Hartford
Hartnell College
Hartwick College
Haverford College
University of Hawaii
Hobart and William Smith Colleges
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Howard University
University of Idaho
University of Illinois (system)
Indiana University
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Iowa State University
Jackson State University
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University of Louisville
Loyola College in Maryland
Loyola University New Orleans
Macalester College
University of Maine
Mankato State University
Marquette University
University of Maryland (system)
University of Massachusetts (system)
University of Memphis
University of Miami
Miami University (of Ohio)
Michigan State University
Michigan Technological University
Millersville University
University of Minnesota--Duluth
University of Minnesota--Twin Cities
University of Missouri--Columbia
University of Missouri--Kansas City
University of Missouri--Rolla
University of Missouri--St. Louis
University of Montana
Montclair State University
Morris College
Mount Holyoke College
Mount Union College
Muhlenberg College
University of Nebraska--Lincoln
University of Nevada--Las Vegas
University of Nevada--Reno
University of New England
University of New Hampshire
New Jersey Institute of Technology
University of New Mexico
New Mexico Institute of Mining and Technology
New Mexico State University
State University of New York--Binghamton
State University of New York--Buffalo
State University of New York--Plattsburgh
State University of New York--Stony Brook
Nicholls State University
University of North Carolina--Chapel Hill
University of North Carolina--Charlotte
University of North Carolina--Greensboro
North Carolina A&T State University
North Carolina State University
North Dakota State University
Northeastern University
Northern Arizona University
Northern Kentucky University
University of North Texas
NOVA Southeastern University
Oakwood College
Ohio University
Ohio State University
University of Oklahoma
Oklahoma State University
University of Oregon
Oregon State University
Oregon State System of Higher Education
Pace University
Paine College
Pennsylvania State University
University of Pittsburgh
University of Portland
Portland State University
Prescott College
Purdue University
Radford University
University of Rhode Island
Rice University
University of Richmond
Ripon College
Rochester Institute of Technology
Rust College
Rutgers University
Saint Augustine College
Saint Mary's College--Notre Dame, Indiana
Salem-Teikyo University
Salish Kootenai College
University of San Diego
San Diego State University
University of San Francisco
San Francisco State University
Santa Clara University
The School for Field Studies
Smith College
University of the South
University of South Carolina--Aiken
University of South Carolina--Columbia
South Carolina State University
University of South Dakota
South Dakota School of Mines and Technology
South Dakota State University
University of South Florida
University of Southern California
University of Southern Mississippi
Southern Illinois University
Southern University--Baton Rouge
Southwest Missouri State University
Southwestern University
Spelman College
Stillman College
Swarthmore College
Syracuse University
University of Tennessee--Knoxville
Tennessee State University
Texas College
Texas A&M University System
Texas Southern University
Texas Tech University
Texas Woman's University
University of Toledo
Towson University
Tufts University
University of Tulsa
Tuskegee University
University of Utah
Valparaiso University
Vassar College
University of Vermont
Virginia Commonwealth University
Virginia Polytechnic Institute and State University
Washburn University
Washington State University
State University of West Georgia
West Virginia University
Western Kentucky University
Western Michigan University
Western Washington University
Wichita State University
Wilberforce University
Wiley College
Willamette University
College of William & Mary
Williams College
University of Wisconsin--Green Bay
University of Wisconsin--Madison
University of Wisconsin--Milwaukee
University of Wisconsin--Stevens Point
University of Wyoming
Yale University
______
Prepared Statement of the Lovelace Respiratory Research Institute
It is requested that the U.S. Environmental Protection Agency (EPA)
continue to support the National Environmental Respiratory Center for
the purpose of conducting research, providing information and research
resources, and facilitating interdisciplinary communication concerning
the respiratory health risks of combined exposures to multiple air
pollutants and pollutant mixtures. Funds for continuation of the Center
are requested in the fiscal year 2000 EPA appropriation.
what is the national environmental respiratory center?
The National Environmental Respiratory Center (NERC) was
established through the fiscal year 1998 EPA appropriation to improve
our understanding of the relationship between complex mixtures of
environmental (outdoor) air pollutants and human health. Continuation
funding was provided in the fiscal year 1999 EPA appropriation. The
Center is operated by the independent, non-profit Lovelace Respiratory
Research Institute (LRRI) in Albuquerque, New Mexico, and its research
is conducted in the government-owned, now privatized, Inhalation
Toxicology Research Institute facility, which is leased by Lovelace.
The Center's principal activity is the conduct of research aimed at
understanding the contributions of the many individual pollution
mixture constituents to the respiratory health effects of real-world,
complex pollutant mixtures. The Center's work is leveraged by making
its unique studies and associated research resources available to
investigators in other organizations for collaborations. The Center
also maintains an internet site containing information on the Centers
activities, bibliographic databases, and other information pertaining
to air pollution mixtures issues and the mixtures currently under
study.
why was the center established?
Environmental air pollution research and regulations have focused
largely on single pollutants and sources, one at a time, in a
``revolving door'' manner. People do not breathe only one pollutant, or
pollutants from only one source, at a time. Congress, researchers,
regulators, industry, and the public are increasingly aware that the
``single pollutant'' approach has reached the point of diminishing
returns. Paradoxically, as levels of regulated pollutants fall due to
existing controls, the uncertainty EPA faces in estimating and
controlling the remaining health effects of environmental air pollution
is growing. As exemplified by the current quandary concerning
particulate matter, it is becoming increasingly difficult to assign
causality to single pollutants or pollutant classes independent of the
effects of co-pollutants. The nation faces a difficult dilemma in
judging whether or not health impacts are attributed to the correct air
contaminants, or combinations of contaminants, and the appropriateness
and cost-effectiveness of further reductions in specific man-made
pollutant emissions. Until NERC was established, there was no
substantive, coherent research program aimed specifically at developing
a foundation of information that could serve as a basis for considering
alternate approaches to understanding and managing the relationship
between air quality and health. NERC was created to complement other
efforts by meeting key unmet research needs critical to placing the
contributions of individual air contaminants in their proper
perspective.
NERC is one of two current initiatives directly exploring the roles
of the myriad pollutant species in the health effects of the mixtures
which people actually breathe. The expansion of EPA's air monitoring
program driven by concerns for fine particulate matter (PM2.5) includes
establishing a limited number of ``super sites'' which will provide
research-grade data on both particles and co-pollutants. This
information will provide much more detail on the types and amounts of
the various particles, vapors, and gases to which populations are
exposed. The intent is that new population studies will be conducted in
the vicinity of the super sites to take advantage of the more detailed
air pollution data. Although this will provide important new
information, it will still be difficult to assess (and impossible to
control) the personal exposures of specific individuals. Also, the
measurements that can be made in population studies can not provide the
level of detailed information on health responses that can be obtained
in laboratory studies. NERC provides key components of the
complementary laboratory effort that are not provided by any other
center or research program.
what does the center do?
The operating strategy for NERC and the specific research being
conducted were recommended by the Center's External Scientific Advisory
Committee (ESAC). The members of this broad-based Committee have
diverse backgrounds and views, and are both veterans and experts in the
air pollution research, regulatory, compliance, and advocacy arenas.
LRRI has vested a large measure of the responsibility for developing
the Center's agenda in this Committee.
external scientific advisory committee
Morton Lippmann, PhD, Chair, New York University
Jonathan Samet, MD, MS, Johns Hopkins University
Michael Bird, MSc, PhD, DABT, C.Chem, FRSC, Exxon Biomedical Sciences,
Inc.
John Vandenberg, PhD, U.S. Environmental Protection Agency
Bill Bunn, MD, JD, MPH, Navistar
Ron White, MST, American Lung Association
Glen Cass, PhD, California Institute of Technology
Ron Wyzga, MS, ScD, Electric Power Research Institute
The center's research program
The NERC research strategy is focused on conducting a multi-year
series of integrated studies planned in advance with the aim of filling
specific information gaps. This strategy differs from the common
research center approach of providing core resources and conducting an
annual internal competition for investigator-initiated studies. The
more structured strategy recommended by the Center's External
Scientific Advisory Committee allows the resources provided by multiple
sponsors to be focused in a goal-directed manner to resolve key
portions of the very complex issues surrounding the health effects of
pollution mixtures.
The initial multi-year set of studies will employ a consistent set
of respiratory health assays to determine the effects of several
complex, real-world, man-made air pollution mixtures. The exposure
atmospheres were selected so that their similarities and differences
can be used as tools to determine the roles of individual constituents,
families of constituents, and combinations of constituents in driving
the various health effects of the total mixture. As shown in the table
below, the 11 mixtures will include diesel (old and new technology) and
gasoline (on-road catalyst and off-road non-catalyst) engine exhaust,
wood smoke (hardwood and softwood), cooking fumes (meat and vegetable),
tobacco smoke, paved road dust, and coal-fired power plant emissions.
These atmospheres will be analyzed in much greater detail than has been
typical of toxicology studies, in order to relate health responses to
their hundreds of individual constituents and dozens of classes of
constituents.
Laboratory health response assays comprising five general
categories of respiratory effects will be evaluated for each
atmosphere, including irritation/inflammation, allergic responses/
asthma, respiratory defenses, lung and heart function, and cancer.
Several different laboratory health models and assays will be used to
encompass these effects which, in turn, encompass the key types of
health responses attributed to environmental air pollution.
INITIAL MULTI-YEAR RESEARCH MATRIX
----------------------------------------------------------------------------------------------------------------
Irritation Allergies Heart
and and Defenses and Lung Cancer
inflammation asthma Function
----------------------------------------------------------------------------------------------------------------
Diesel exhaust (old, new)............................. + + + + +
Gasoline exh. (catalyst, non-cat.).................... + + + + +
Paved road dust....................................... + + + + +
Wood smoke (hardwood, soft)........................... + + + + +
Tobacco smoke......................................... + + + + +
Cooking fumes (veg,, meat)............................ + + + + +
Coal power plant (secondary).......................... + + + + +
----------------------------------------------------------------------------------------------------------------
The matrix of data on health response vs. atmosphere composition
across the different pollution atmospheres will have considerable value
of three general types. First, and most importantly, the data will
allow taking advantage of the similarities and differences among the
compositions of the atmospheres to determine the individual
constituents, classes of constituents, and combinations of different
constituents that bear the strongest association with the different
health outcomes. This is the fundamental goal of the Center.
Second, an integrated, contemporary set of health data will be
generated for each atmosphere. For some of the atmospheres, no such
data exist, and for others, no data using contemporary assays exist.
Third, generating the data using identical study designs will provide
direct, head-to-head inter-comparisons among the man-made pollutant
atmospheres, which current data to not provide.
This initial series of studies will provide a foundation of
information on which studies of the causal roles of other air
contaminants can be designed. There are innumerable atmospheric
reaction products, pollens, molds, endotoxins, infectious agents and
other natural and man-made environmental air contaminants whose
potential effects, or interactions with other pollutants, need to be
understood and placed in context. In addition, there are many possible
adverse interactions between environmental air pollutants and other
exposures in the workplace and home that may contribute to the health
effects associated with outdoor air pollution. As results from the
initial series of studies are obtained and evaluated, issues to the
addressed by following research will be identified and prioritized.
Other center functions
An explicit goal of the Center is to leverage its resources to
serve broadly as a research resource to university investigators.
Collaborative participation in Center research is encouraged and
facilitated. NERC resources are made available to other investigators
for the conduct of complementary studies in a cost-effective manner on
a non-interference basis. This way, many hypotheses can be tested in
addition to those addressed directly by Center investigators. Special
emphasis is placed on providing collaborative opportunities to EPA
intramural scientists to complement the Agency's in-house capabilities
and studies. It is expected that NERC will also provide many
collaborative opportunities and information resources to the newly-
established EPA academic particle research centers; indeed, NERC
scientists were asked to participate in collaborative and advisory
roles by three of the five successful center applicants.
The development of an internet-based resource of information
relevant to Center activities and air pollution mixtures issues is an
important component of the Center's strategy. This resource is accessed
via the Center's web site (www.nercenter.org), and consists of
information on the goals and activities of the Center, opportunities
for collaboration and other research resources, and bibliographic
databases on the composition and health effects of the pollutant
mixtures used in Center studies.
what are the center's accomplishments to date and current status?
Accomplishments during fiscal year 1998 included: (1) establishing
the external advisory committee; (2) submitting an application to EPA;
(3) internal and external review of the application by EPA and approval
of the Center as proposed; (4) meeting with the committee and
developing the Center's strategy; selection by the committee and
initiation of five pilot projects necessary to finalize design of the
core research protocols; (5) developing budgets for the first and
second years; (6) submitting a detailed work plan to EPA; (7)
contacting and briefing a wide range of non-EPA federal, state, and
non-government potential sponsors; and (8) establishing the internet
site and beginning work on the information database.
With funding in the fiscal year 1999 EPA appropriation, work on
five pilot studies is well underway. These projects are address issues
of current concern and are thus valuable as individual studies, but
they are also producing information on experimental techniques that
will be useful for designing the protocols for the core Center research
program. The studies are examining: (1) airway and lung irritation from
wood smoke; (2) the role of fine particles in the development of
asthma; (3) toxic interactions between ozone and fine particles; (4)
the effects of particle-borne metals on the heart; and (5) the
development of statistical approaches to estimating risks from multiple
pollutants.
The Center's internet site has already been developed into a
considerable resource. Approximately 22,000 citations from the
scientific literature, Federal Register, and technical reports have
been entered into the information database. Several other research
organizations have been briefed on collaborative opportunities.
A major task to be completed by the end of CY 1999 will be planning
the details of the experimental design for the core research. This is
being done together with external experts. Workshops are being
organized in which Lovelace scientists and external scientists and
technical experts will discuss alternatives and resolve many of the
details of the core research protocols, including the generation of
atmospheres, analyses of the atmospheres, exposure concentrations,
health assays, statistical design, etc.
what support is being sought for the center?
The funds appropriated for fiscal year 1998 and 1999 are spent or
committed for ongoing work. A preliminary multi-year budget has been
developed for the work recommended by the External Scientific
Committee, and the results indicate that approximately $24 million over
a six-year period will be required to accomplish the Center's work plan
for the initial matrix of studies and analysis of the results. Thus,
the planned activity will require approximately twice the level of
annual funding provided in the EPA appropriations for fiscal years
1998-1999.
A strong effort is underway to obtain non-EPA funds for the Center.
Since the Center's long-term strategy was developed nine months ago,
significant discussions (multiple telephone conversations, transmittal
of written materials, scheduling of briefings) have been held with a
continuously-expanding list of organizations. To date, 58 companies,
trade associations, and state and federal agencies concerning their
potential support of the Center.
Although non-EPA financial support is beginning to develop, it is
too early to estimate the level of non-federal funding that is likely
to be raised. Recommendations have been made internally within numerous
organizations in several industry sectors, and five organizations have
already made contributions.
Lovelace respectfully requests that a minimum of $2 million be
designated for the NERC in the fiscal year 2000 EPA appropriation, to
be used as core support for the Center's third year of operation. This
funding is essential to ensure continuation of the Center and
maintenance of its progress while complementary support other
stakeholders is developed and EPA considers incorporation of the Center
as an integral component of its air pollution research portfolio.
______
Prepared Statement of the Center for Cognition, Learning, Emotion, and
Memory at New York University
Thank you, Mr. Chairman. My name is Peter Lennie, and I am speaking
on behalf of New York University as its Dean for Science. I appreciate
the opportunity to submit testimony to the Subcommittee today to
discuss a scientific research project which is not only an important
priority for New York University, but which we believe will advance the
national interest through enhanced scientific understanding of brain
function and development.
Our project addresses the programmatic priorities of this
subcommittee in supporting fundamental, university-based scientific
research and enlisting that research to serve the national welfare. We
thank the Subcommittee for taking the time to consider and give its
support to the important research being conducted in the brain
sciences--an area of great strength at New York University. We are
proud to report that New York University was previously approved for
funding by the Environmental Protection Agency (1992), and that its
performance in using the funds to strengthen the infrastructure for
neural science was reviewed highly. EPA funds were used to renovate
training and research facilities, modernize mechanical infrastructure
systems, and purchase multi-use equipment, thereby accelerating
scientific advances and new applications and preparing the next
generation of scientists. We at NYU firmly believe that a federal
investment in mind and brain studies repays itself many times over.
In line with the Subcommittee's interests, New York University is
undertaking to establish a Center for Cognition, Learning, Emotion and
Memory (CLEM). This Center will draw on the University's strengths in
the fields of neural science, biology, chemistry, psychology, computer
science, and linguistics to push the frontiers of our understanding of
how the brain develops, functions and malfunctions. In addition, as a
major training institute, the Center will help prepare the next
generation of interdisciplinary brain scientists.
A major thrust of the work to be carried out in the Center is
research on the learning process, including the underlying cognitive
processes that affect attention, memory, information processing, skills
acquisition, and retention, as well as their implications for
strategies that can rationalize and optimize training, learning and
performance. Of special interest to those studying learning and memory
systems is neural ``plasticity,'' the change in the nervous system that
occurs when we remember new things or learn new skills. Understanding
neural plasticity is essential to understanding and improving the
flexibility of human behavior. The fundamental biomedical and
behavioral research in this area will advance basic science and have
important practical implications in many sectors, including education,
job training, and technology development.
To establish this Center, New York University is seeking $10.5
million over five years to support and expand the research programs of
existing faculty, attract additional faculty and graduate and
postgraduate trainees, and provide the technical resources and
personnel support that will allow us to create a premier, world class
scientific enterprise. Individual researchers in the science programs
at NYU compete for investigational support through traditional routes,
very successfully. However, these traditional funding sources do not
address the specific need for establishment of a new cross-disciplinary
area of scientific study, particularly one that transcends biomedicine,
psychology, education, computer science, cognitive science, and
linguistics. Nor do they provide the extensive funding necessary for
faculty and student support and personnel and technical resources.
Support from the Subcommittee on VA-HUD and Independent Agencies would
enable us to meet these needs, and to build on the potential New York
University has to develop a new understanding of the brain and new ways
of using that knowledge for improving the national welfare.
research advances and applications
Advances in Biomedical Research.--Research conducted in our Center
will by its nature address neural disorders, including disorders of
emotional systems and the loss of memory through aging or disease. At
NYU, pioneering research into the neurobiology of fear is generating
important information about the brain systems that malfunction in, for
example, anxiety, phobias, panic attacks, and post-traumatic stress
disorders. The brain's fear system is involved in many human emotional
disorders, and malfunctions in emotional systems commonly characterize
serious psychiatric disorders. Research into the neural mechanisms of
fear will help us understand the source of emotions, how they are
triggered by circumstance, why these emotional conditions are so hard
to control, and how they can undermine our capacity to learn.
Ultimately, our research will generate clues for prevention and
treatment of emotional disorders, focusing perhaps on the ways in which
unconscious neural circuitry can, in effect, be altered or inhibited.
Job Training.--Research into the fundamental processes of cognition
and learning, emotion and memory will help address the persisting
challenge the nation faces in training veterans and other new recruits
to the labor force and in retraining workers dislocated from downsized
industries. Understanding how the brain functions and how we learn is
crucial to vocational rehabilitation, a primary concern for veterans.
The more we know about how people acquire, process, and retain
information, the better training programs can be designed and targeted
for specific skills and for workers with diverse backgrounds. For
example, CLEM research can clarify how adult learners use different
learning styles, how training personnel can accommodate those styles,
and how educational technology and simulated learning environments can
be harnessed to improve motivation and increase retention.
Education.--Research into the learning process as it relates to
attention and retention holds important implications for early
childhood development. Understanding how, when and under what
conditions learning proceeds can have practical applications for
parents, caregivers and educators. In the midst of a national debate on
education reform, thousands of educational innovations are being
considered without the advantage of a fundamental understanding of the
learning process. CLEM researchers, coupled with educational
psychologists and their expertise in normal childhood development, can
contribute substantially to national efforts to enhance early childhood
education, and improve teaching and learning in elementary and
secondary schools. At NYU, one locus for the development of these
practical applications is the Center for Digital Multimedia (a New York
State Center for Advanced Technology). The Center brings together
teaching experts, laboratory scientists, and software designers to
explore how interactive multimedia technologies enhance training,
develop prototype teaching models, and facilitate computer-human
communication through graphics, speech and vision.
Technology.--The fundamental research being conducted at NYU in
learning, intelligence, and information processing in biological
systems can contribute significant new understanding of computer and
communication technologies for the future. Research at the interface
between computer science, vision science, and learning research builds
on the recognition that vision impacts all areas of cognition, and that
computer vision studies the processing of images and thus, in its own
way, addresses cognitive issues. At NYU, vision psychologists and
computer vision researchers are working together to investigate the
neural bases of object and pattern recognition, depth perception, and
motion perception, and their computer analogs in data imaging,
processing, and retrieval.
Environment.--Improved understanding of the structure, function,
and development of the nervous system is the first link in the chain
leading from scientific discovery to a better understanding of human
health to effective regulatory and management actions in the realm of
environmental protection. At NYU, research into neural development and
function can help to explain how environmental factors alter or
influence these processes.
feasibility: institutional strengths
New York University is well positioned to create and operate a
major multidisciplinary research and training center. There is
commitment to the CLEM project at the highest level of the University
administration, established frameworks for interdisciplinary
collaboration, strengths in neurobiological, psychological and
computational sciences, and international standing in the scientific
community. The nation's largest private university, with 13 schools and
over 49,000 students, NYU is a leading center of scholarship, teaching
and research. It is one of 29 private institutions constituting the
distinguished Association of American Universities, and is consistently
among the top U.S. universities in funds received from foundations and
federal sources.
As the core of a decade-long multi-million dollar science
development plan, NYU created a premier neuroscience and cognitive
psychology program that encompasses a pre-eminent faculty and generates
substantial external funding from federal and state agencies as well as
the private sector. These investigations have attracted millions of
federal dollars from the NIH, the NSF and the EPA. In addition, NYU has
received major funding from the most prestigious private foundations
supporting the sciences. This includes the Howard Hughes Medical
Institute (HHMI)--the foundation most active in support of the life
sciences. (NYU is now home to no fewer than six HHMI Investigators,
with corresponding funding from the Institute.) The HHMI also has
awarded NYU two major grants, each exceeding $1 million, from its
Undergraduate Biological Science Initiative Program, as well as a major
facility improvement grant. The W. M. Keck Foundation also awarded two
grants, each exceeding $1 million, for facility and program development
in the neural and cognitive sciences; one grant funded the renovation
of a major new laboratory in emotional memory studies. The Alfred M.
Sloan Foundation similarly awarded two major grants totaling $2 million
to found the Sloan Center for Theoretical Visual Neuroscience--one of
five institutions chosen to implement the Foundation's national
initiative in theoretical neurobiology. Neural science faculty have, as
individuals, won prestigious awards, including HHMI Investigator, NSF
Presidential Faculty Fellow, NIH Merit Awardee, McKnight Foundation
Scholar in Neuroscience, and MacArthur ``Genius'' Fellow.
Neural science at NYU is particularly well known for its
fundamental studies of neural systems, particularly vision (including
studies of visual processing pathways, perception, and information
processing) and audition (including studies of auditory regions of the
nervous system). These various studies of mind and brain employ a full
range of techniques; they coordinate anatomical, neurophysiological,
biochemical, and behavioral experiments; and they are conducted in
various model systems up through humans, and computer modeling and
simulations.
With these strengths, NYU is particularly well placed to create a
distinctive center that will capitalize on expertise in physiology,
neuroanatomy, and behavioral studies and build on active studies that
range from the molecular foundations of development and learning to the
mental coding and representations of memory.
While other academic institutions are also studying the brain, NYU
has special strengths in important emerging research directions. NYU is
at the frontier of studies in the neuroanatomy and physiology of
emotion, a new area of exploration that complements studies of how
thoughts, and memories emerge from brain processes. Work recently
conducted at NYU and elsewhere has established the biological basis of
emotions and the patterns by which they are expressed within the neural
circuits of the brain and by the actions of the body. The new studies
have found that there are multiple systems in the brain, each having
evolved for different functional purposes, and each producing different
emotions. Work being conducted at NYU also suggests that the neural
circuits supporting the expression of emotions are highly conserved
through evolution. They persist, unconsciously, in our daily behavior,
and shape our reactions to events well before we rationally and
consciously process the event. Scientists at NYU are using behavioral
testing, physiological recording of neural activity, and
neuroanatomical tract tracing to ask, what are the neuroanatomical
pathways for the formation of emotions and emotional memories? How do
we learn and remember emotions? These studies have crucial applications
for personnel training, job performance and mental health, and address
such questions as: How can emotions, such as fear, facilitate or
undermine learning and performance? Do emotionally stressful situations
affect our ability to remember facts, retrieve information, perceive
events and objects? How can we better diagnose and treat emotional
disorders?
In a second area, NYU is internationally know for its vision
studies. At NYU, these follow an integrated systems approach that has
been shown to be highly successful in unraveling this complex system.
The interest in vision, a key input to learning, is associated with
focused studies of the learning process, particularly, the interaction
with memory and behavior. NYU vision scientists are studying form,
color and depth perception; visual identification; the varieties of
visual memory; and the relationship of vision and perception to
decision and action. Studies ask: How does vision develop? How does the
brain encode and analyze visual scenes? What are the neural mechanisms
that lead to the visual perception of objects and patterns? How do we
perceive spaces, depth, and color? How does the brain move from vision
and perception to planning and action?
NYU's special strengths also lie in the infrastructure it has
established to promote multidisciplinary brain research that
incorporates experimental, theoretical, and computational components.
As an example, the Sloan Center for Theoretical Visual Neuroscience
fosters joint research that harnesses the tremendous recent advances in
computational speed, size and memory to effectively revolutionize the
power of quantitative analysis to address fundamental problems in
neurobiological systems. The Center houses faculty with joint
appointments in neural science (Arts and Science) and mathematics
(Courant Institute of Mathematical Sciences), supports neural science
trainees with backgrounds in the physical and mathematical sciences,
and fosters a range of multidisciplinary projects which include:
analysis of neural and network dynamics of the visual cortex; the
nonlinear dynamics of the thalamus and other neural structures;
analysis of the visual perception of occluding objects; brain imaging
and adult brain plasticity.
CLEM will bring the University's many strengths in these areas more
fully to bear on the challenges and opportunities that
multidisciplinary studies present. The Center will provide an
organizational identity, core resources, and common focus for the
university's efforts. For students, it will provide an educational
forum to apply knowledge gained in one discipline to problems in other
disciplines. For researchers, the Center's synergistic linkages between
basic science departments, mathematical and computational units, and
biomedical departments will encourage intellectual cross fertilization
and will permit the consolidation of individual efforts in
multidisciplinary but conceptually coordinated efforts. For colleagues
in the fields of technology, education, and medicine, the Center will
facilitate connections with life scientists and enhance the translation
of research knowledge into commercial and educational applications and
health care.
CLEM will be an interdisciplinary unit linking faculty, students,
programs and resources from several schools of New York University.
These are the Faculty of Arts and Science, the Courant Institute,
School of Education, and School of Medicine, including its Skirball
Institute of Biomolecular Medicine and the associated Kline Institute
Center for Advanced Brain Imaging. To be housed at the University's
Washington Square campus within the Faculty of Arts and Science, CLEM
will coordinate laboratory research and training in fundamental
neurobiological, psychological, and computational studies of the
nervous system. The enhanced research and training that will be
possible will attract public and private funding above and beyond the
substantial funds, honors and recognition already awarded to the
University's researchers, and will support the center's continued
growth and development.
Mr. Chairman, I thank you for the opportunity to submit this
testimony.
______
Prepared Statement of the Integrated Petroleum Environmental Consortium
(IPEC)
It is proposed that the U.S. Environmental Protection Agency
continue to support a focused, university-based program, the Integrated
Petroleum Environmental Consortium (IPEC), with the goal of increasing
the competitiveness of the domestic petroleum industry through a
reduction in the cost of compliance with U.S. environmental
regulations. Continued Federal support of $2 million is specifically
requested as part of the fiscal year 2000 appropriation for the
Environmental Protection Agency through the Science and Technology
account or other source the Subcommittee may determine to be
appropriate.
Mr. Chairman, on behalf of the Integrated Petroleum Environmental
Consortium (IPEC), I would like to take this opportunity to thank you
for providing $1.5 million in funding for IPEC in the fiscal year 1998
and fiscal year 1999 appropriations bills for the Environmental
Protection Agency (EPA). Under your leadership both houses of Congress
and the final appropriations bills included initial funding for this
Consortium. Specifically this funding was provided for the development
of cost-effective environmental technology and technology transfer for
the domestic petroleum industry. With initial funding under the Science
and Technology account of EPA, IPEC is implementing a comprehensive
mechanism (Center) to advance the consortium's research expertise in
environmental technology. IPEC's operating practices and linkages to
the independent sector are ensuring that real problems in the domestic
petroleum industry are addressed with real, workable solutions. The
consortium includes the University of Tulsa, the University of
Oklahoma, Oklahoma State University, and the University of Arkansas.
We are pleased to report that, as envisioned and proposed by the
Consortium, State-level matching funds have been obtained to support
IPEC, creating a true Federal-State partnership in this critical area.
In fiscal year 1998 and fiscal year 1999, IPEC received $375,000 in
matching funds from the Oklahoma State Reagents for Higher Education. A
similar amount has been pledged by the Reagents as matching funds for a
fiscal year 2000 appropriation.
Since December, 1997 IPEC has worked closely with the EPA to meet
all internal requirements for funding of research centers. These
efforts have resulted in an excellent working relationship with the
Environmental Engineering Division of the EPA National Center for
Environmental Research and Quality Assurance with IPEC's grant from EPA
(fiscal year 1998 appropriation) finalized September 2, 1998.
IPEC proceeded with its proposal solicitation and review process
while final arrangements were made with the EPA. As a result we were
ready to fund projects as soon as the grant was made. I am happy to
report that IPEC has thus far funded eight research projects that
promise to help ease the regulatory burden on the domestic petroleum
industry. These funded projects include: the use of plants to clean
contaminated soils; the natural biodegradation of gasoline by
microorganisms in the absence of oxygen; the beneficial use of
petroleum wastes as road materials; the control of the formation of
toxic hydrogen sulfide in oil wells; the development of simple sampling
devices to replace expensive live organisms to assess toxicity in
contaminated soils; the treatment and disposal of naturally occurring
radioactive material (NORM) in oil production equipment; and the
remediation of brine-impacted soils. These projects were first reviewed
and approved by our industrial advisory board (dominated by independent
producers) as relevant to our mission of increasing the competitiveness
of the domestic petroleum industry and finally reviewed and approved by
our science advisory committee on the basis of scientific quality.
IPEC has provided $761,685 in funding for these projects. However,
another $631,480 in funding for these projects have been secured by the
investigators as matching funds from industry and industry
organizations such as the Gas Research Institute, the American
Petroleum Institute and the Petroleum Environmental Research Forum.
This is over and above the matching funds provided by the Oklahoma
State Reagents for Higher Education. IPEC has pledged to Congress to
work for a 1:1 match of federal dollars. As you can see IPEC is living
up to that promise! IPEC is well on its way to becoming a true public/
private partnership.
the continuing crisis in the domestic petroleum industry
The crisis in the domestic petroleum 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. The independent producers are
producing from mature fields left behind by the majors. Although there
is a significant resource base in these 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 formed an emergency task force to determine
what the state can do to help Oklahoma producers survive the current
decline in prices. Based on recommendations from this task force the
Oklahoma legislature passed new legislation in a special session to
link the gross production tax to the price of oil. However, legislators
and independent producers alike know that this measure only delays the
inevitable if the price of oil remains depressed at current levels. 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 is well on its way to fulfilling its pledge to you of
responsiveness to the needs of domestic petroleum industry and fiscal
responsibility. IPEC is continually probing our industrial advisory
board for new ways to assist the industry and continually seeking out
cost-effective technical solutions to these problems through an
aggressive solicitation and review process. With the current price of
oil these solutions are all the more critical.
IPEC will continue to work with the domestic petroleum 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
that provide services to the domestic petroleum industry. IPEC is
working 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.
Since 1994 IPEC has organized and conducted the International
Petroleum Environmental Conference. Dr. Kerry Sublette, Director of
IPEC, has served as chair of these conferences. This conference is
quickly becoming the premier conference of its kind in the U.S. and
represents the flagship of technology transfer for IPEC. The annual
International Petroleum Environmental conference serves as IPEC's
technology transfer flagship. In October, 1998 IPEC held the 5th
International Petroleum Environmental Conference in Albuquerque, NM.
There were over 350 in attendance from all facets of the oil and gas
industry including independent and major producers, service industry
representatives, and state and federal regulators. The program for the
5th conference featured several plenary lectures, over 150 technical
presentations, exhibits, a poster session and a special symposium on
the fate of oxygenates from gasoline in the environment. Co-sponsors of
the conference included the Interstate Oil and Gas Compact Commission,
the Railroad Commission of Texas, the Texas Independent Producers and
Royalty Owners Association, the Gas Research Institute, the Oklahoma
Independent Petroleum Association, the Oklahoma Energy Resources Board,
the EPA Office of Research & Development, and the National Petroleum
Technology Office of the U.S. Dept. of Energy. At the request of the
IPEC Industrial Advisory Board, IPEC sponsored the participation of ten
state regulators from Oklahoma and Arkansas in the conference. The IPEC
Science Advisory Committee also held its first formal meeting in
conjunction with the conference. The next conference is planned for
November, 1999 in Houston, TX.
funding of ipec
IPEC is seeking appropriations of $2 million for fiscal year 2000
and the succeeding fiscal years 2001 and 2002 through the Environmental
Protection Agency. The consortium will be responsible for at least a 50
percent match of federal appropriations with private sector and state
support over a five-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 the Rochester Institute of Technology
Mr. Chairman, and members of the Subcommittee, on behalf of the
Rochester Institute of Technology, in Rochester, New York, thank you
for this opportunity to share with you some information about RIT's
National Center for Remanufacturing and Resource Recovery. This Center,
which is located in our Center for Integrated Manufacturing Studies, is
doing important research and technology transfer in a field that is of
critical interest to our national economy from the standpoint of
environmental protection, energy conservation and global
competitiveness. I would like to provide the Subcommittee with some
background on the technology of remanufacturing, and explain why we
believe it will be of interest to you, and in particular to the
Environmental Protection Agency, which is within this Subcommittee's
jurisdiction.
As you know, millions of consumer and industrial products are
produced and disposed of every year, comprising a large part of the
over 160 million tons of municipal solid waste Americans generate per
year. Many of these products end up in overburdened landfills.
Recycling offers an opportunity to recover the raw material contained
in these discarded goods. But, even if goods are recycled, the energy,
labor, scrap material, and money put into making the component parts
are lost. There exists another, better alternative for many products--
Remanufacturing. Remanufacturing is the process of restoring retired or
dysfunctional durable goods to a ``like new'' condition. By restoring
end-of-life durable products for reuse, remanufacturing prevents waste
generation and the pollution, energy and raw material consumption that
would be required to make a new product from scratch. For example,
sixty percent of the energy required to manufacture a new automotive
part can be saved by remanufacturing an old one, and in the process,
greenhouse gas emissions are significantly reduced.
Remanufacturing makes good sense for the nation's economy too.
Purchasing a remanufactured product can cost consumers 50 to 70 percent
less than a new product. Companies benefit from avoiding hefty solid
waste disposal costs. As a labor-intensive industry, remanufacturing
also provides opportunities for employment and training. A survey of
remanufacturing companies found that there are over 73,000 independent
remanufacturing companies in the U.S. These companies employ nearly
500,000 people and have annual sales of over $53 billion per year. Many
remanufacturing firms hire unskilled workers or workers with
disabilities, providing these individuals with job experience and
skills.
Remanufacturing is a powerful example of how the goals of
environmental protection and economic growth can go hand-in-hand.
Remanufacturing is the process of recovering the component parts of
end-of-life products, restoring them to a ``like-new'' condition, and
returning those parts or products to service. Remanufactured products
may be completely refurbished and returned to service as the same type
of product, broken into components and utilized as after-market items,
or dismantled into components and sold as parts in new and different
applications.
Remanufacturing is pollution prevention and resource conservation
in action. It is well known that preventing--rather than controlling--
pollution is a cost-effective way to eliminate or minimize risks to
humans and the environment. By restoring end-of-life durable products
for reuse, remanufacturing prevents pollution and energy consumption
from raw material extraction and manufacturing processes that would be
required to make a new product from scratch.
Studies have shown that remanufactured engines require 50 percent
of the energy and only 67 percent of the labor necessary to produce new
engines. These savings for the manufacturer translate to savings for
the consumer--rebuilt equipment is on average 40-60 percent less
expensive than new equipment. Thus, consumers can have superior quality
products at a low price and be ``green'' at the same time. More
importantly, remanufacturing shows that the ability to produce a
product at a substantial profit and the ability to produce
environmentally sound products are not mutually exclusive.
New product manufacturing creates 87 percent of the waste produced
in the U.S. Because remanufacturing recovers the value added during the
initial manufacture of a product, it vastly reduces the energy
consumption and waste associated with the manufacturing process. For
example, the original manufacture of a product may require 6 times as
much energy as the remanufacture of the same product. The recovery of
natural resources is equally impressive. Remanufactured products
usually consist of 80-90 percent used components which means that
between eight to nine pounds of old material is recovered for every
pound of new material employed in the remanufacturing process. In a
specific illustration, remanufactured automobile starters annually save
about 8 million gallons of crude oil, 52,000 tons of iron ore, and
6,000 tons of copper. Energy saved annually by remanufacturing
worldwide equals the electricity generated by 5 nuclear power plants or
10.7 million barrels of oil.
On the consumer side, Kodak's single-use camera remanufacturing
initiative salvaged parts and materials from 100 million single-use
cameras as of May 1996, resulting in the diversion of 14 million pounds
of waste from entering the waste stream. Of the total new cameras
shipped in any given month,77 percent are now returned for
remanufacturing and Kodak is able to reuse about 85 percent of the
parts.
Climate change and solid waste prevention are two environmental
issues with an important underlying link. When products are reused,
less energy is needed to extract, transport, and process raw materials.
Using end-of-life products to make new products generally requires less
energy than manufacturing from virgin materials. Consuming less energy
leads to less greenhouse gas emissions being released into the
atmosphere. By reducing the quantity of products that are thrown away,
there is a reduction in greenhouse gas emissions associated with
material decomposition in landfills and in incineration.
The U.S. Environmental Protection Agency has been encouraging waste
reduction as one of many ways to mitigate global climate change.
Expanding the agency's activities in this area by supporting research
and development in remanufacturing would add significantly to the
impact of the agencies' efforts.
Pollution prevention has become the guiding principle of EPA's
efforts to protect the environment. The passage of the Pollution
Prevention Act established the new policy ``that pollution should be
prevented or reduced at the source whenever possible.'' Past
environmental protection policies emphasized the treatment of waste
products rather than improving the manufacturing processes that
produced them. The cost of complying with federally mandated pollution-
control and clean-up programs has grown from $26 billion in the 1970's
to $115 billion in 1990's. Despite the fact that more and more of our
GNP is expended on environmental remediation, our landfills are filling
rapidly and solid waste management is becoming a central concern of
state and local governments.
Efforts to regulate the amount of solid waste associated with
manufacturing are quickly becoming a reality for businesses seeking to
do business in Europe. The European Community has adopted legislation
dictating that no more than 15 percent of a scrap automobile may go to
a landfill by the year 2002. This ratio is to drop to 5 percent by the
year 2015. They will also soon require that manufacturers and
distributors of consumer electronics products take back and recycle or
dispose of used electronic equipment. Canada has expressed interest in
similar legislation and in 1991 MITI, Japan's international trade
ministry, issued regulations promoting the use of recycled materials
and the recycling of durable goods themselves. Currently recycling
techniques are only capable of reducing disposable waste to about 25
percent and, will be unable to meet the new stricter international
standards. American industry will have to comply with these regulations
if it wishes to sell products in these markets. Remanufacturing is more
energy efficient than recycling and offers American industry a
potential competitive advantage in serving these markets.
Notwithstanding all of its advantages, there are some obstacles to
remanufacturing. Traditionally manufacturers have only taken into
account the stages of product life cycle dealing with product design,
manufacture, and service. Now that the retirement phase of a product
has become a major area of interest in protecting the environment and
increasing economic growth, the life-cycle has been expanded to include
processes such as reuse, remanufacture and material recycle. Most
products have been designed with disposal rather than remanufacturing
as the end of the product life-cycle. Where design specifications are
not available, these products must be ``reverse engineered''. These
products are more difficult to remanufacture than those which were
designed and produced with remanufacture in mind.
On one level remanufacturing is not a new phenomenon. Remanufacture
of automotive parts has been around for more than 60 years and more
recently the copier and printer industry has offered the consumer the
environmentally sound alternative of purchasing Remanufactured toner
cartridges. Today, without accounting for the activities of original
equipment manufacturers (OEMS) and the Department of Defense, there are
more than 73,000 remanufacturing establishments in the U.S. with annual
gross sales in excess of $53 billion. Despite the importance of this
sector of the economy, it has gained little recognition. One reason for
this invisibility is the diversity of its product sectors. The second
reason is that nearly all of the firms are small to medium-sized
independent companies. Only a few of the major OEMs have
remanufacturing divisions. Eastman Kodak and Xerox are notable in the
photographic and xerographic fields, Caterpillar, Detroit Diesel, and
Cummins in diesel engines, and Copeland in refrigeration compressors.
With the exception of the Department of Defense and the original
equipment manufacturers noted previously, the majority of small or
medium size remanufacturers do not have, nor can they afford to
support, an internal engineering and applied research capability. Much
research, education, and support for industry will be required to make
designing new products for remanufacture a standard practice in
industry.
Remanufacturing is in many cases the most economically and
environmentally sound method of dealing with end-of-life products. The
remanufacture of goods promotes the avoidance of waste and prevents
needless use of energy. Remanufacture prevents the loss of non-
renewable resources due to disposal and avoids the use of further non-
renewable resources to replace discarded products. Remanufacturing can
help to bring this society one step closer to a sustainable, closed-
loop relationship between industry and the environment.
Funding Request for Fiscal Year 2000
For these reasons, RIT is proposing that the EPA provide support
for the National Center for Remanufacturing and Resource Recovery. The
EPA funding support, which will complement and leverage financial
support from the State of New York and industry, will allow the
National Center to develop and implement a host of remanufacturing
research programs geared toward helping U.S. manufacturers both large
and small learn how to make environmentally conscious products. The
National Center will help EPA take the nation's efforts to recycle to a
new and higher level--Remanufacturing.
The National Center's programs will help EPA's Science and
Technology programs address one of the most pressing areas--
environmental pollution at the source--by working directly with U.S.
manufacturers on using remanufacturing techniques and processes to make
needed environmental strides in manufacturing. EPA's Science and
Technology program mission is to promote long-term basic and short-term
applied research in a wide range of environmental and health concerns
and to provide the scientific knowledge and technologies to prevent
pollution. RIT's National Center for Remanufacturing will help EPA
accomplish its short-term applied research mission and have a dramatic
effect over time in reducing the pollution caused by U.S. manufacturers
and their products.
The Rochester Institute of Technology is requesting EPA support of
$3,000,000 in fiscal year 2000 for support of activities of the
National Center for Remanufacturing & Resource Recovery. These funds
would be used in the manner described in Attachment ``A.'' Part of the
funding would be used for one-time costs to purchase major equipment
items in support of the research plan. It is anticipated that the
ongoing program costs of the Center will be approximately $3,000,000
per year. RIT will seek $3,000,000 per year for 4 additional years for
environmental remanufacturing program costs from the federal
government. Attachment ``B'' is an outline of the goals of the National
Center for Remanufacturing and Resource Recovery.
RIT believes that by funding the National Center for
Remanufacturing and Resource Recovery (NCRRR), EPA will further its
mission. The National Center for Remanufacturing and Resource Recovery
(NCRRR) is nationally recognized as having leading expertise in a
variety of technical aspects of remanufacturing. This environmental
remanufacturing research program is needed to raise the visibility of
this emerging area of manufacturing and provide a place for industry,
academia and government agencies such as EPA to come together to
research and apply current and new Remanufacturing processes to real
manufacturing situations.
The center is housed in a completed 157,000 square foot
manufacturing laboratory--the Center for Integrated Manufacturing
Studies--which is the perfect home for a national remanufacturing
effort. This one of a kind facility, with its five large flexible
research bays, is expressly designed to have the capability to provide
industry and academic researchers with the ability to conduct full-
scale testing of remanufacturing processes using state-of-the-art
equipment.
The center is part of a technological university--RIT--which has a
long and distinguished history of service to large, medium and small
manufacturers through applied manufacturing research. In addition to
this strong capabilities in Industrial, Manufacturing, and Mechanical
Engineering, Packaging Science, Economics and Business, RIT has, in
recent years, brought to bear on manufacturing problems, pragmatic
solutions to meeting the technological and workforce needs in
industries related to microelectronics engineering, imaging
technologies and software engineering. RIT's Center for Integrated
Manufacturing Studies (CIMS) brings to the National Center for
Remanufacturing support labs in: simulation, reverse engineering,
design for manufacturing and assembly, computer aided design and
manufacturing, and ergonomics. CIMS also has state-of-the-art
capabilities in technology transfer and distance learning.
NCRRR has established itself as a leading R&D center for the
remanufacturing industry. The university created a Remanufacturing
Database System for the nation, which will serve as a base for sharing
findings with industry nationally and assisting individual companies in
keeping abreast of advances in remanufacturing, government programs and
regulations. RIT has also set up an Internet site for remanufacturing
research.
By supporting the critical R&D needs of this economically and
environmentally important industry, the EPA will enhance the industry's
competitive posture; quality of goods; energy, natural resource, and
environmental profile; save and, perhaps, create jobs in what has been
a declining U.S. manufacturing sector.
Mr. Chairman, we have developed a multi-phase research program for
the work that the National Center for Remanufacturing and Resource
Recovery would like to initiate with the Environmental Protection
Agency. Appendix A provides a summary description of this program, and
the timeline and funding that would be needed to implement this plan.
Our request for fiscal year 1999-2000 is $3,000,000 to begin the first
phase of this research program.
Thank you again, Mr. Chairman, for the opportunity to provide this
testimony to the Subcommittee. If you or your colleagues have any
questions about this project, please feel free to call and we will
respond promptly to your requests.
Attachment A.--National Center for Remanufacturing & Resource Recovery
research plan, timeline and budget
The National Center for Remanufacturing and Resource Recovery
(NCRRR) is focused on leading the remanufacturing industry into the
21st Century. The five-year goal of the center is to become a self-
sustaining national resource for applied research that will provide
technical solutions to real-life problems for remanufacturers.
Phase I Development and dissemination of life-cycle and design for
remanufacturing tools to promote sustainable remanufacturing
Currently, there is not a good method for transferring knowledge
obtained through the remanufacturing process back to the product
designers so that new products are designed for remanufacturability.
There is also limited availability of design tools for the evaluation
of the life cycle costs of remanufacturing.
In this phase of the project, NCRRR will develop guidelines,
metrics, and tools to promote design for remanufacturing and
incorporation of life-cycle considerations into remanufacturing.
Specifically, activities will include development and dissemination of:
Product assessment methods and tools; Life cycle costing methods and
tools; Economic recovery analysis techniques; Technology assessment
techniques; and Disassembly and teardown analysis methods and tools.
Phase II Remanufacturing Technology Advancement
In a recent vision document crafted by the remanufacturing industry
(``Remanufacturing Industry, Vision for 2020''), strong emphasis was
placed on the need for targeted research and development to enable the
remanufacturing industry to keep up with rapid technology changes and
demands for quality products. NCRRR proposes to develop and conduct a
focused R&D program to meet the technological needs of the industry.
Research areas will include: design for remanufacturing; reverse
logistics; structural and material analysis; intelligent testing and
diagnostics; reverse engineering; design capture; life cycle costing;
failure mode analysis; and cleaning technologies. The goal of this
research is to develop and disseminate tools and techniques that will
lead to improved design and manufacturing processes.
Signature analysis, a technique for intelligent testing and
diagnostics, was singled out in the vision document as a critical area
in need of development. NCRRR has an established program in this area
and will utilize funding under this grant to expand its activities to
create and transfer practical industry-specific tools for predicting
the useful life of electrical and electronic components.
Phase III Assessment of Pollution Prevention Opportunities in the
Remanufacturing Industry
Over a year ago, NCRRR established a Clean Technology Team to
develop and promote remanufacturing technologies and methods that use
little or no hazardous material, generate little or no waste, and are
safe for workers, the public and the environment. To date, the team has
been very active in providing direct assistance, technology
demonstrations, and R&D in environmentally preferable surface cleaning
technologies. With funds under this grant, the team will expand its
activities in the following areas: Reduced specification of hazardous
materials in product and process design; Paint stripping; Processes to
restore the physical attributes of components; Painting or other
surface refinishing operations; Packaging; and Disposition of wastes.
In this phase NCRRR will identify pollution prevention
opportunities in these areas for the remanufacturing industry. In
particular, NCRRR will focus its work on identifying operations in the
industry that tend to utilize persistent, bioaccumlative, and toxic
chemicals (PBT chemicals) and opportunities for substituting non-
hazardous processes. These opportunities will be documented in a
handbook for remanufacturers and will form the basis of subsequent work
under this grant.
Phase IV Direct Assistance to Remanufacturers
In this phase, NCRRR will develop a program of direct assistance to
remanufacturers aimed at implementing pollution prevention techniques
and, in particular, reducing the use of PBT chemicals. Direct
assistance will take several forms, including: site visits to
remanufacturers to conduct pollution prevention assessments, with a
focus on PBT use; development of recommendations on alternatives to
PBTs; assistance with implementation of alternative technologies and
methods; and assessments in NCRRR's Surface Cleaning Testing and
Demonstration Facility to assist companies in finding alternatives to
PBTs used in surface cleaning.
Phase V Technology Transfer
NCRRR will develop and carry out a technology transfer program
aimed at disseminating information to remanufacturers on state-of-the-
art clean manufacturing techniques, equipment, and chemistries that can
be used as alternatives to those processes using PBT chemicals.
Emphasis will be placed on those technologies that are both effective
and are environmentally conscious, i.e., non-toxic, non-hazardous and
resource-conserving.
Information will be disseminated in a number of ways, including:
Developing and disseminating reports, case studies, fact sheets, and
other printed informational materials; Providing up-to-date information
on PBT alternatives on NCRRR's internet web-site; Conducting hands-on
technology demonstration workshops; and Referring companies exploring
new, non-PBT environmentally conscious cleaning technologies to
companies already employing them.
NCRRR would conduct this work in close collaboration with key
industry trade associations representing the remanufacturing industry,
including the Remanufacturing Industries Council International (RICI);
Automotive Parts Rebuilders Association (APRA); and the Engine
Rebuilders Association (AERA).
At the conclusion of this project, NCRRR will have a database and a
set of information products that it can use to continue its work on
pollution prevention/PBT-use reduction. In addition, this information
would be made available to other organizations, such as industry trade
associations, state and federal agencies, and pollution prevention
technical assistance organizations.
[GRAPHIC] [TIFF OMITTED] TNOND.000
______
Prepared Statement of the Northwest Indian Fisheries Commission
Mr. Chairman, and Honorable Members of the Committee, I am Billy
Frank, Jr., Chairman of the Northwest Indian Fisheries Commission
(NWIFC) and on behalf of the tribes in Washington State I would like to
thank you for the opportunity to offer written testimony concerning the
Environmental Protection Agency's (EPA) fiscal year 2000
appropriations.
We are specifically requesting that programmatic funding levels to
the Northwest tribes be included in EPA's budget under Section
104(b)(3) of the Clean Water Act. The purpose of our request is to
continue implementation of the model Coordinated Tribal Water Quality
Program for twenty-six participating tribes and tribal organizations in
Washington State for fiscal year 2000. Strong congressional support for
the implementation of this tribal initiative began in 1990 and is
present today.
However, we are losing ground in the implementation of these
efforts. Erosion of base level funding is jeopardizing the federal
government's long-term investment of this efficient and effective
tribal water quality protection program. Support for this model tribal
initiative is timely in as much as it implements the goals and
objectives of the President's Clean Water Action Plan. It is an
existing program that centers around watershed-based water quality
protection by building partnerships and fostering inter-jurisdictional
cooperation. All are critical components to protecting and restoring
our Northwest salmon.
We respectfully request Congress to either:
(1) Appropriate $3.10 million into the EPA's funding base
Under Section 104(b)(3) of the Clean Water Act, Section 319 of the
Clean Water Act, or within EPA's Assessment and Watershed Program,
appropriate $3.10 million into EPA's funding base for twenty-six (26)
participating tribes and tribal organizations in Washington State to
fully implement the model cooperative tribal water resource program for
environmental protection; or,
(2) Direct the Agency to utilize $3.10 million in existing agency
funding
From existing Section 104(b)(3) of the Clean Water Act, Section 319
of the Clean Water Act, or EPA's Assessment and Watershed Program
funds, provide $3.10 million for twenty-six (26) tribes and tribal
organizations in Washington State to continue implementation of the
model cooperative tribal water resource program for environmental
protection.
Justification for this funding request is based on:
1. legal rights and obligations for the federal government to
protect the treaty-reserved rights of the tribes,
2. the United State's trust responsibility to protect the health
and environment of the tribes on a government-to-government basis;
3. cost effectiveness by utilizing a cooperative intergovernmental
strategy to accomplish National clean water goals; and,
4. minimize conflict between multiple jurisdictions who manage
water quality.
To assist the Committee members, I would like to summarize
background relevant to our request.
background
The NWIFC request is on behalf of our nineteen (19) member treaty
fishing tribes and the Hoh, Chehalis and Shoalwater Bay Tribes in
western Washington, and the Yakama Indian Nation, Colville
Confederated, Spokane, and Kalispel Tribes in eastern Washington. This
request is to continue implementing the model Coordinated Tribal Water
Quality Program that began in 1990.
Washington State has been blessed with bountiful rivers and
streams. Five species of Pacific salmon and three species of anadromous
trout utilize Washington State's streams during the fresh water stages
of their life cycles. Historically, there were ample supplies of fish
for ceremonial, subsistence, commercial and recreation purposes. Old
growth conifer removal, riparian zone impacts, farming activities, and
channelization of the streams has reduced the productive capacity of
these streams to extremely low levels. Currently, there are Puget Sound
salmon stocks listed under the Endangered Species Act.
In 1979, the United States Supreme Court re-affirmed the treaty
tribes' right to harvest half of the harvestable number of anadromous
fish passing through tribal usual and accustomed areas. In 1980, the
Federal District Court held that the United States and the State of
Washington must not permit degradation of fish habitat which would
diminish the treaty harvest right, including point and non-point
pollution sources. The Federal courts have recognized that protection
of water quality and other attributes of fish habitat are necessary to
secure the Constitutionally protected rights of the tribes to harvest
fish.
The sovereign authorities of the Tribes and the legal principles
enunciated in United States v. Washington along with other Federal
court decisions support the basis upon which the tribes are involved
with on and off-reservation environmental issues. As a result of
Federal court decisions, the State of Washington has recognized the
tribes as ``co-managers'' of the fish resource and water quality in our
state. As co-managers in Washington, the tribes must have the resources
to adequately participate in environmental protection programs.
The Environmental Protection Agency's (EPA) Indian policy (1984) of
working with Federally recognized tribes on a government-to-government
basis concerns more than 375 Indian tribes in the lower 48 states
controlling over 52 million acres of land base. In our state, tribal
reservations make up approximately six percent (6 percent) of the State
of Washington. Our tribes also have retained treaty rights not ceded to
the United States. These usual and accustomed fishing grounds include
most of the State of Washington. The combined area of Indian
reservations nationally is larger than all of New England, yet EPA now
devotes only a tiny fraction of its personnel and funds to
environmental protection for the tribes.
This is clearly a discriminatory prioritization of Federal funds.
On a national level, tribal reservations represent three percent (3
percent) of the land base of this nation. Although the EPA has worked
closely with the states to implement adequate environmental programs,
until recently, little had been done to accomplish the same for the
tribal governments. Indian tribes are over two decades behind the
states both in resources received from the EPA and in technical
assistance provided by the EPA in developing tribal water program
offices. A ``front end'' investment will promote cooperation and
increased tribal involvement in environmental protection as has been
the case between the EPA and state governments for the past 20 years.
The Coordinated Tribal Water Quality Program is already enabling
cooperative inter-jurisdictional partnerships.
We recognize, support and appreciate the successful efforts that
have been made to improve EPA Indian Programs and tribal funding. Our
request for Section 104(b)(3) funding is intended to stabilize existing
program implementation activities. Another possibility may be within
Section 319 of the Clean Water Act. However because of the legislated
formula, the doubling of Section 319 monies proposed nationally for
water quality protection efforts in fiscal year 2000, translates into
only $600,000 (one-third of 1 percent restriction) for tribal programs.
This means 535 tribal governments must compete for a very small pool of
tribal nonpoint source pollution management program funds. Clearly, a
means must be found to support the long-term funding of tribal programs
that seek to protect tribal treaty rights such as ours, or the efforts
being made by EPA will not be successful.
tribal/state roles
Beginning in 1990, the State of Washington has supported tribal
involvement in environmental protection both off and on-reservation.
The state is committed to work with the tribes on a government-to-
government basis as ``co-managers'' of the water resource in the
implementation of this program. The Federally recognized Indian tribes
in Washington have developed a process with state, local government
officials, and representatives of agriculture, industry, and
environmental communities to address water resource issues on a
government-to-government basis. The results of these discussions have
outlined a cooperative process between the tribes, state agencies and
programs, and local units of governments in areas of environmental
protection. This process was highlighted as a case study example to
countries around the world at the 1992 United Nations Conference on
Environment and Economic Development in South America.
The Coordinated Tribal Water Quality Program, an EPA/Tribal
partnership, has generated successful models of state/tribal inter-
jurisdictional cooperation. Examples of these models are: the Tribal
Water Quality Standards Template encouraging inter-governmental
uniformity and coordination of water quality management; and, the
Cooperative Management of the Clean Water Act Sec. 303(d) Program,
enabling state/tribal government-to-government process throughout the
CWA Sec. 303(d) listing and implementation processes.
The tribes must be part of the solutions to prevent and control
water pollution in Washington State. The tribes must participate in
these activities to protect their governmental interests and treaty
fishing rights. In this time of existing and pending listings of salmon
stocks under the Endangered Species Act, neither we, nor the resources,
can afford to lose programs integral to our inter-governmental
cooperative watershed program. The Coordinated Tribal Water Quality
Program is part of protecting our nation's environmental heritage.
conclusion
For seven years, Congress has recognized and supported the
Coordinated Tribal Water Quality Program by appropriating funding to
maintain its operations. Last year, Congress recognized the program
without specifying monies. Our understanding of this change in
Congressional action was due to the increased General Assistance
Program/Indian Set aside and the expectation that the Coordinated
Tribal Water Quality Program would be maintained with a portion of
those monies. This has not occurred. The General Assistance Program
monies are designated for capacity building--the Coordinated Tribal
Water Quality Program is an existing and successful tribal initiative
requiring stabilized implementation funding. This model program
demonstrates how tribes can participate in environmental programs
working with EPA to realize its long-range objective of including
tribal governments as partners in decision-making and program
management of tribal lands and resources.
We appreciate the difficulty Congress is facing in making decisions
for this next fiscal year. In the case of the EPA, Congress and the
Administration will probably direct EPA resources to address those
areas of highest risk to human health and the environment. Therefore,
we want to reiterate that tribal reservations and protection of their
treaty resources have not been adequately addressed for the past twenty
(20) years and this, also, represents the highest of risks to this
nation. To do otherwise would represent environmental genocide to
Native Americans.
Sufficient and permanent funding is necessary to continue the
tribal cooperative program. Certainty of funding is necessary for the
tribes to hire permanent and professional staff to implement this
program. Without an ongoing investment by Congress much of the good
that has been accomplished to date will be lost.
Please consider our request for $3.10 million for the Washington
State Coordinated Tribal Water Quality Program. Once again, thank you
for the opportunity to provide written testimony. Thank you also for
your assistance in helping to develop a national model program of how
tribal governments can address environmental protection in a
cooperative watershed approach with state and local governments.
Thanks to this committee, we are making significant progress. This
initiative is being supported at all levels of our governments. We hope
you and the Committee will continue to look favorably on our request.
______
Prepared Statement of the National Grain and Feed Association
Mr. Chairman, members of the Subcommittee, the National Grain and
Feed Association (NGFA) appreciates the opportunity to present its
views on a very important issue to U.S. agriculture. Specifically, the
U.S. Environmental Protection Agency (EPA) has proposed new safety
measures for aluminum and magnesium phosphide that threaten the
competitive position and economic vitality of many U.S. producers,
grain handlers, exporters, millers and processors. This is a critical
issue because aluminum and magnesium phosphides are the last remaining
cost-effective fumigants available to U.S. agriculture. As such, these
products play a vital role in U.S. agriculture's ability to provide a
high quality, nutritious and affordable food and feed supply to
domestic and foreign customers.
While this EPA proposal remains subject to revisions, the industry
is alarmed by the total impracticality and extensiveness of the
proposed regulations, which we believe have no scientific
justification. We will work through the rulemaking process with EPA.
However, we have been having dialogue with EPA since the fall of 1998--
well before the Agency announced its formal proposals on aluminum and
magnesium phosphide--and, thus far, EPA has not budged from its
original unjustified position. It is for this reason that our industry
has grave concerns about EPA's intentions and direction in the
regulation of these highly important fumigants, and seeks with this
testimony to raise concerns with members of Congress.
The NGFA consists of 1,000 grain, feed and processing companies
that operate 5,000 facilities that store, handle, merchandise, mill,
process and export more than two-thirds of all U.S. grains and
oilseeds. About 70 percent of NGFA member firms are small businesses--
country elevators and feed mills. Also affiliated with the NGFA are 36
state and regional grain and feed associations.
background
Aluminum and magnesium phosphides are used for indoor fumigation of
raw agricultural commodities, animal feeds, and processed food
commodities to control insects, and outdoor fumigation of burrows to
control rodent and moles. Aluminum and magnesium phosphides react with
atmospheric moisture to produce phosphine gas.
Once an infestation begins, fumigation is the only viable and cost-
effective treatment of large amounts of stored agricultural products.
Fumigation is particularly important in many Southern areas and during
periods of warm weather because warmer temperatures favor increased
insect activity. These fumigants are also used to meet domestic milling
and regulatory requirements for insect control. Furthermore, aluminum
and magnesium phosphides are often required to meet contract
specifications of foreign customers.
Thus, loss of aluminum and magnesium phosphide could jeopardize the
production and maintenance of high quality agricultural products in
some regions and during storage in warmer times of the year.
Furthermore, loss of aluminum and magnesium phosphide could undermine a
large percentage of U.S. exports of agricultural products, including
wheat, corn and many processed products.
Importantly, methyl bromide, the only other remaining agricultural
fumigant now in commercial use, is scheduled for cancellation in a few
years under provisions of the Clean Air Act. Other types of
insecticides, although useful in a total pest control program, are not
effective substitutes for fumigants. In addition, many insecticides are
being reviewed under provisions of the Food Quality Protection Act. If
use of these chemicals is restricted or canceled, the importance of
aluminum and magnesium phosphides will intensify.
overview of epa's rmms
On December 23, 1999, the EPA proposed a series of new safety
measures called Risk Mitigation Measures (RMMs)--which must be used
when fumigating products with aluminum and magnesium phosphide--as part
of the re-registration of these fumigants. Specifically, the 1988
amendments to the Federal Insecticide, Fungicide and Rodenticide Act
(FIFRA) required EPA to accelerate re-registration of all products with
active ingredients registered prior to November 1, 1984. Aluminum
phosphide was first registered in the United States in 1958. Magnesium
phosphide was first registered in the United States in 1976.
During the re-registration process, EPA concluded that aluminum and
magnesium phosphide do not present any food safety or ecological
concerns. On the other hand, EPA found that there might be health
concerns from acute exposure to aluminum and magnesium phosphide.
The NGFA has carefully evaluated EPA's proposed RMMs to determine
what, if any, changes are warranted in current label safety
requirements. To assist in this evaluation, a survey of NGFA members
was conducted to obtain information on their utilization of aluminum
and magnesium phosphide and the potential impact of EPA's proposed
RMMs. Based upon this analysis, we believe that the overall impact of
EPA's proposed RMMs would be to effectively preclude the future use of
the last remaining fumigants available to protect the quality of U.S.
agricultural commodities, processed products and finished products
during storage and transit. Specifically, the NGFA believes that EPA's
RMMs are unworkable, too restrictive and will not provide any
meaningful safety or health benefits. We are particularly concerned
with the following proposed RMMs:
Lower the Maximum Exposure Limit to 0.03 ppm
The EPA proposes to lower the maximum exposure limit to 0.03 ppm.
This level is significantly more protective than the permissible
exposure limit set by the Occupational Safety and Health Administration
(OSHA) and the current limits approved by EPA for aluminum and
magnesium phosphide.
We believe EPA's proposed 0.03 ppm exposure limit is overly
restrictive and will not provide any meaningful health or safety
benefits. EPA's proposed 0.03-ppm limit could significantly increase
costs and the burden placed on applicators when fumigating with
aluminum and magnesium phosphide. For example, lowering the exposure
standard to 0.03 ppm will dramatically increase the chances that the
exposure limit will be violated during routine fumigation operations
and significantly increase the time needed to properly aerate a
fumigated commodity.
In addition, questions remain over the ability of current
technology to accurately measure or consistently verify that phosphine
gas concentrations are at or below the proposed 0.03-ppm exposure
limit. Without access to reliable and cost-effective measuring
technology, fumigation with aluminum and magnesium phosphide would
become more difficult and aeration could be unnecessarily prolonged.
Prohibit fumigation within 500 feet of a residential area. Require
notification of residents and businesses within 750 feet of a
fumigated structure
The EPA is proposing to prohibit fumigation with aluminum and
magnesium phosphide within 500 feet of a residential area. The Agency
is also proposing to require notification of residents and businesses
with 750 feet of a fumigated structure so that they ``can make
decisions regarding temporarily leaving their property during
fumigation.''
We do not believe either proposal is based upon sound science. EPA
has not shown that fumigation with aluminum and magnesium phosphide
following current label directions will expose the public to harmful
levels of phosphine gas. Furthermore, the 500-foot ban could eliminate
fumigation in nearly 70 percent of current storage structures and
fumigation of rail cars, barges, and ocean-going vessels. In addition,
the 750-foot notification proposal could unnecessarily generate undue
public alarm with the safe application of aluminum and magnesium
phosphide.
EPA points to a series of phosphine poisoning incidents to justify
their public health concerns when fumigating with aluminum and
magnesium phosphide. However, an analysis of these incidents reveals
that most alleged poisoning incidents resulted from failure to follow
current label directions or illegal use of these chemicals. Even the
Agency admits that evidence of an alleged death from exposure to
phosphine is weak and unlikely to support a definite or even probable
cause-and-effect relationship.
The NGFA supports RMMs that adequately protect the safety and
health of applicators, nearby workers and the public. In this regard,
the safety record of aluminum and magnesium phosphide has been
excellent with current label directions providing an appropriate level
of safety. We also believe that RMMs must be based upon clear and
convincing evidence of risk. RMMs should avoid raising undue public
alarm over unsubstantiated or negligible risks and limit the use of
anecdotal information in which the cause-and-effect relationship is not
well established. Misuse should be addressed through label warnings.
Provide 24-hour pre-notification of local emergency responders
The EPA proposes that applicators notify local emergency responders
at least 24 hours in advance of fumigation. Under current label
directions, those applying aluminum and magnesium phosphide already
annually provide comprehensive safety and health information on these
fumigants to local officials. We believe that current requirements are
adequate because aluminum and magnesium phosphide's excellent safety
record when following label directions make it highly unlikely that
local emergency responders will be required to respond to a poisoning
incident. The 24-hour pre-notification would also be infeasible when
loading rail cars.
Require additional monitoring and leak testing of fumigated structures
The EPA would require monitoring throughout fumigated structures,
vessels and vehicles prior to unloading or disturbing fumigated
products and leak testing of fumigated areas. We believe EPA's
monitoring proposal is virtually impossible to achieve in most grain
storage structures and vessels. We also believe EPA's leak testing
procedures are unrealistic and not needed. Both situations are
adequately addressed in current label directions.
conclusion
The NGFA supports re-registration of aluminum and magnesium
phosphide with general re-affirmation of current label directions. We
believe that EPA's concerns would be better served by focusing on
training and education of applicators and effective enforcement of
current label directions.
We also believe that RMMs for aluminum and magnesium phosphide must
be based upon sound science and reliable information; be clearly
demonstrated as necessary to protect human health; be economically and
operationally reasonable, and permit the continued routine use of these
cost-effective and safe fumigants.
Thank you for allowing us to present our views on this important
issue to U.S. agriculture. We will be contacting you in a few weeks to
determine how we may work together to ensure that EPAs' final RMMs for
aluminum and magnesium phosphide are reasonable, necessary and
appropriate to the actual risks posed by these fumigants when following
current label directions.
______
Prepared Statement of the State and Territorial Air Pollution Program
Administrators and the Association of Local Air Pollution Control
Officials
The State and Territorial Air Pollution Program Administrators
(STAPPA) and the Association of Local Air Pollution Control Officials
(ALAPCO) appreciate this opportunity to provide testimony regarding the
fiscal year 2000 proposed budget for the U.S. Environmental Protection
Agency, particularly regarding grants to state and local air pollution
control agencies under Sections 103 and 105 of the Clean Air Act. The
President's request for fiscal year 2000 includes an increase of $3.2
million for state and local air grants, under both Sections 103 and
105, for a total of approximately $198.7 million. While STAPPA and
ALAPCO are pleased that the President's budget acknowledges the need
for additional funds, we believe this proposed budget leaves state and
local air agencies with serious funding gaps that will make it
difficult for us to continue to fulfill our responsibilities under the
Clean Air Act. Accordingly, STAPPA and ALAPCO request an increase of
$30 million above the President's request for fiscal year 2000, which
we will discuss in greater detail below.
STAPPA and ALAPCO are the national associations of state and local
air pollution control agencies in the 54 states and territories and
over 150 major metropolitan areas across the nation. Under the Clean
Air Act, state and local air quality officials have the primary
responsibility for ensuring healthful air quality for our citizens.
These agencies must carry out numerous activities to implement federal,
state and local clean air requirements. These include programs to
address particulate matter, ground-level ozone, toxic air pollution,
acid rain and other types of air pollutants, many of which cause
significant adverse health effects, including cancer, severe
respiratory ailments and premature death. Air agencies must address new
initiatives that focus on emerging problems, as well as carry out the
core elements of our programs, which serve as the backbone of our
nation's clean air effort.
state and local air grants should be increased
The President's budget request for fiscal year 2000 calls for an
increase of $3.2 million in grants for state and local air pollution
control agencies, bringing the total amount requested to $198.7
million. While we are grateful for the proposed additional funds and,
perhaps even more so, for the recognition implicit in the increase that
state and local air grants ought to be augmented, we believe the
proposal is not nearly adequate to address our nation's environmental
needs.
State and local air pollution control agencies face a serious
shortfall in federal grants. This deficit is due to the fact that
federal funding under Section 105 of the Clean Air Act has declined by
over $36 million since fiscal year 1995, while our responsibilities and
the cost of state and local programs under the Clean Air Act have
increased dramatically. These responsibilities include both new
initiatives to address emerging issues, as well as ongoing activities
to preserve the gains and improvements in air quality that we have
already made.
As we reported to you last year, in the spring of 1997, the U.S.
Environmental Protection Agency (EPA) and members of STAPPA and ALAPCO
undertook a four-month, intensive study to identify and estimate the
costs related to activities that should be funded with state and local
air grants under Section 105 of the Clean Air Act. The calculations of
additional need addressed both the deficiencies in existing programs
and the support needed for new initiatives. The EPA/STAPPA/ALAPCO
analysis determined that to operate a good, but not perfect, program, a
total increase of $98 million in federal grants to state and local air
agencies under Section 105 of the Clean Air Act would be necessary
(this amount did not address grants for the fine particulate matter
monitoring effort under Section 103).
Among the many activities the study identified as being in need of
additional funds were compliance assistance programs, especially for
small businesses; development, replacement and/or upgrading of monitors
(apart from fine particulate matter monitoring); collection of emission
and pollutant data, especially related to emissions of toxic air
pollutants; minor source inspections and permits; training;
implementation of ozone strategies; implementation of strategies to
address toxic air emissions in urban areas; and multi-state approaches
to regional air quality problems. Last year we provided you and your
staff with more detailed data about this study. We would be happy to
provide you with this information again, if you wish.
In spite of the fact that EPA participated in this study and
recognized the need for additional funding, to date the agency has not
requested the grant increases that this study indicates are necessary.
State and local air agencies would very much appreciate receiving
the entire $98 million increase in fiscal year 2000. However, we
recognize that this is unlikely, especially in view of the very
difficult task facing Congress in distributing finite resources to many
worthy programs. We believe, therefore, that it is reasonable for the
increase to be phased in over a three-year period. Since the
President's proposed budget calls for a $3 million increase, we request
that you appropriate an additional $30 million above the
Administration's request, increasing the total amount for state and
local air grants to $228.7 million in fiscal year 2000. The balance of
the increase--$66 million--could then be added in fiscal year 2001 and
fiscal year 2002.
clean air partnership fund
The President's budget request includes $200 million for the Clean
Air Partnership Fund, which will provide grants to form partnerships
among the private sector, the federal government and state or local
agencies for a variety of activities that will improve air quality. The
fund is intended to promote multi-pollutant strategies, demonstration
projects, innovative initiatives, technological advances and locally
managed and self-supporting activities, among other things, that will
integrate control strategies to reduce multiple pollutants most
efficiently. The Clean Air Partnership is designed to leverage state,
local and private funds, which will enhance its ability to accomplish
its goal of improving air quality.
STAPPA and ALAPCO are pleased that the Administration's request
includes these additional funds for the Clean Air Partnership. The
proposal will provide state and local agencies with excellent
opportunities to develop multi-pollutant control strategies aimed at
reducing air pollution in a cost-effective manner. We believe that the
harmonization of various clean air goals, such as the reduction of
greenhouse gases through criteria pollutant control programs, for
example, is critical and we applaud EPA for promoting such activities.
We plan to work closely with EPA as it develops this program more
fully.
In light of our support for the Clean Air Partnership, we urge
Congress to include in its appropriation to EPA the $200 million that
the President requested for the program. These funds should be in
addition to those federal grants (discussed earlier) that assist state
and local air pollution control agencies in fulfilling their
responsibilities. While the partnership is a laudable new program,
there are still many other critical activities that we can carry out
only through federal grants provided under Section 105 and other
authorities of the Clean Air Act. The partnership program is not
intended to be a substitute for those ongoing grant programs, nor does
it address the enormous budget shortfall we discussed earlier in this
testimony.
epa's budget
In order for state and local agencies to successfully obtain and
maintain healthful air quality for our citizens, we need adequate
federal funding. In addition to that, however, it is also critical that
EPA's own budget be sufficient to allow the agency to meet all of its
responsibilities. Without the tools, programs and rules the agency is
charged with developing, state and local agencies will be unable to
implement important federal air quality requirements. Therefore, we
request that you provide EPA with sufficient funding to meet its
obligations, even increasing funding above the President's budget
request, where necessary.
For example, EPA for several years has been inappropriately
earmarking state and local air grants for activities that the agency
should be carrying out with its own budget. One such activity is
training. Funding training activities is clearly a federal
responsibility, yet EPA has been using state and local grant funds for
these purposes for many years. Another example is the Emission
Inventory Improvement Program, which will develop essential tools for
collecting and reporting emissions data. EPA has used Section 105
grants, rather than its own budget, to fund this program. While these
programs are critical, EPA should be supporting them with its own
budget, rather than shifting the financial burden to state and local
agencies. If EPA's own budget were increased in these areas, the agency
would not feel compelled to commandeer state and local funds for these
programs.
Another example of the inadequacy of the President's request is the
reduction of $1 million within EPA's own budget from air toxics rule
development projects. These funds are being diverted to support
characterization of the air toxics problem. While we agree it is
critical to have a better understanding of toxic air pollution, this
activity should not come at the expense of toxics rule development. We
maintain that both these activities warrant adequate funding. In fact,
underfunding rule development will actually cause funds to be wasted.
If EPA does not meet the deadline for development of Maximum Achievable
Control Technology standards, which is very possible, particularly if
the agency does not have sufficient funding, state and local agencies
will be required to develop the rules themselves on a case-by-case
basis (pursuant to Section 112[j] of the Clean Air Act). Such a
scenario would be inefficient and overly burdensome and costly for
state and local agencies. Therefore, providing EPA with adequate funds
will save resources in the long run.
In other similar examples, EPA's budget calls for a reduction of
$10 million for characterizing the composition of PM2.5
particles using chemical speciation studies, a reduction of $1.3
million from emissions characterization for mobile sources modeling,
and $8.9 million from visibility-related programs, including regional
approaches to haze. We are concerned that these large reductions will
not allow the agency to develop all the necessary programs and tools
that state and local agencies require to fulfill their responsibilities
and hope that EPA's budget can be made adequate to allow the agency to
do its best work.
conclusion
Although we are pleased that the President's request calls for an
additional $3 million for state and local air grants, we believe the
increase should be much higher. Specifically, we request an increase of
$30 million above the President's request for fiscal year 2000, raising
the total for state and local air agency grants to $228.7 million.
We support the Clean Air Partnership Fund and urge Congress to
include funding for this program in the fiscal year 2000 appropriation.
We do not believe this program is a substitute for state and local
operational air grants under the Clean Air Act, however, and the
adoption of the partnership should not adversely affect appropriations
for our current activities.
Finally, if state and local air agencies are to succeed in
protecting air quality, we believe EPA must be adequately funded so it
can fulfill its responsibilities.
Thank you very much for this opportunity to provide you with our
testimony. Please contact us if you have questions or require any
additional information.
______
Prepared Statement of the American Water Works Association
introduction
AWWA appreciates the opportunity to present its view on the
Environmental Protection Agency (EPA) budget for fiscal year 2000. AWWA
and its members are dedicated to providing safe, reliable drinking
water to the American people.
Founded in 1881, AWWA is the world's largest and oldest scientific
and educational association representing drinking water supply
professionals. The association's 56,000 plus members are comprised of
administrators, utility operators, professional engineers, contractors,
manufacturers, scientists, professors and health professionals. The
association's membership includes over 3,800 utilities which provides
over 80 percent of the nation's drinking water.
AWWA utility members are regulated under the Safe Drinking Water
Act (SDWA) and other statutes. AWWA believes few environmental
activities are more important to the health of this country than
assuring the protection of water supply sources, and the treatment,
distribution and consumption of a safe and healthful adequate supply of
drinking water. We strongly support adequate levels of funding for
EPA's drinking water, ground water protection and clean water pollution
prevention programs.
request overview
Adequate funding for drinking water research and for capitalization
of the Drinking Water State Revolving Fund (DWSRF) are the two major
areas of concern to AWWA in the EPA fiscal year 2000 budget request.
AWWA believes that the fiscal year 2000 EPA budget request for
capitalizing the drinking water state revolving fund and for drinking
water research may not be adequate to meet the needs of the drinking
water program. It should be noted that these programs, particularly
drinking water health effects research, involve areas where relatively
small funding increases offer significantly great public health,
environmental and economic benefits to the nation's population. In the
fiscal year 2000 EPA budget, AWWA recommends that the following funding
be specifically appropriated for the indicated purpose:
--For the drinking water state revolving fund: $1,000,000,000 (as
authorized in the SDWA).
--For drinking water research: $41,400,000 (as requested in the
President's fiscal year 2000 Budget). Specifically designate
funding for drinking water research and health effects research
in the appropriation.
--For the AWWA Research Foundation (AWWARF) drinking water research:
$4,000,000 including $1,000,000 for arsenic in drinking water
research.
--For research on treatment technologies relating to perchlorate, to
be conducted through the East Valley Water District,
California: $2,000,000.
--For public water system supervision (PWSS) grants to states:
$100,000,000 (as authorized in the SDWA).
--For the EPA drinking water program as indicated below:
--Drinking Water Regulatory Development: $43.9 million (as
requested in The President's fiscal year 2000 Budget).
--Drinking Water Implementation Initiatives: $31.8 million (as
requested in The President's fiscal year 2000 Budget).
--Drinking Water Consumer Awareness: $1.5 million (as requested in
The President's fiscal year 2000 Budget).
--For the EPA Clean Water Action Plan: Appropriate the additional
$25.8 million in support of this plan as requested in The
President's fiscal year 2000 Budget.
drinking water state revolving fund (dwsrf)
AWWA believes that the fiscal year 2000 EPA budget request for
capitalizing the newly authorized DWSRF may not be adequate to meet the
nation's drinking water needs. The SDWA Amendments of 1996 authorized
for the DWSRF $599,000,000 for fiscal year 1994 and $1,000,000,000 for
fiscal years 1995 through 2003. The SDWA further authorizes that
authorized funds not appropriated in a fiscal year may be appropriated
in subsequent fiscal years until fiscal year 2004. Through fiscal year
1999, Congress has appropriated approximately $2.4 billion--a shortfall
of $3.2 billion from funds authorized for the DWSRF.
According to the EPA Drinking Water Infrastructure Needs Survey
released on January 31, 1997, $12.1 billion is needed in the immediate
future to protect drinking water supplies. Of this amount, $10.2
billion, or 84 percent, is needed to protect water from microbial
contaminants which can produce immediate illness or death. Over the
next 20 years EPA reports that $138.4 billion will be needed to upgrade
the infrastructure of the nation's water utilities and we believe that
the figure in the next needs survey will be much greater.
AWWA appreciates that the Administration's DWSRF budget request is
$50 million above the fiscal year 1999 appropriation and that both
Congress and EPA have been incrementally increasing the appropriation
each year; however, given the enormous need and that funding for the
DWSRF is already behind a continued strong commitment to appropriate
the authorized funding level is necessary. We urge Congress to
appropriate at least the $1 billion authorized for the DWSRF in fiscal
year 2000.
Although it represents only a fraction of the need, the amount
recommended by AWWA for the DWSRF will be a start and provide a source
of much needed loans for financial disadvantaged communities which
cannot obtain financing through other means. The federal funds will
leverage state resources by ultimately becoming a revolving fund that
would no longer require federal funding. The DWSRF would partially fund
the unfunded mandates of the SDWA.
Recommended Action in the Fiscal Year 2000 Budget.--Appropriate at
least $1,000,000,000 for capitalization grants for the drinking water
state revolving fund as authorized in the SDWA.
drinking water research funding
AWWA does not believe that the fiscal year 2000 EPA budget request
for drinking water research is clear and it may not be adequate to meet
the needs of the drinking water program. The EPA budget request is
displayed by goals rather than program elements so it is difficult to
determine how the program elements will be funded. The budget display
shows an apparent overall decrease in research spending by the EPA
Office of Research and Development. In testimony before the Senate
Environment and Public Works Committee in March 1999, EPA testified
that there was no funding gap for drinking water research for fiscal
year 2000. Yet the research for regulations which are scheduled to be
promulgated within the next few years does not appear to be completed
and little or no research has been initiated on the contaminants for
the next scheduled group of contaminants on the contaminate candidate
list (CCL) which could mean that research will not be completed in time
to affect the decisions on those regulations. We are prepared to work
closely with EPA and other stakeholders to resolve any future research
resourcing gaps beginning with the fiscal year 2001 budget process but
this year's budget cycle process has past.
Over the past several years, public water suppliers have worked
together with EPA and the Congress to secure increased research funding
for the nation's drinking water program. We believe that through this
cooperative effort needed increases in research dollars have been
obtained for drinking water over the past few years after several years
of steady decline. However, we are now uncertain how EPA is allocating
the appropriation for drinking water related research. We are uncertain
as to what portion of the agency's appropriations will be allocated for
conducting health effects research on drinking water contaminants such
as cryptosporidium, disinfection byproducts and arsenic. AWWA supports
spending at least $10 million for health effects research on these and
other contaminants on an annual basis. Because the fiscal year 2000 EPA
budget request and future research plans are unclear, we believe that
EPA should provide a research plan (with full stakeholder involvement)
on how the agency intends to do the necessary research in a timely
manner to affect the key regulatory decisions involved in promulgating
drinking water regulations for not only for the existing listed
contaminants but also for new contaminant candidates. It is time for
research strategic planning and execution within the drinking water
program to become a public process subject to public scrutiny.
The use of good science as the foundation of the new drinking water
standard-setting process under the SDWA amendments of 1996 will require
extensive drinking water research--particularly health effects
research. Funding for drinking water research is becoming more of a
critical issue. The 1996 SDWA Amendments require EPA to develop
comprehensive research plans for Microbial/Disinfection By-Products (M/
DBP) and arsenic as well as other contaminants. An estimated total of
over $100 million is needed for the combined arsenic and M/DBP
regulatory research plans alone and this figure does not include other
needed drinking water research on radon, a whole array of other
radionuclides, groundwater contamination, children's health issues,
endocrine disruptors, and other new contaminants that will require
additional occurrence, treatment, and health effects research based on
EPA's Contaminant Identification Method.
In August 2001--just 27 months from now--EPA will select at least
five contaminants from the Contaminant Candidate List (CCL) and
determine whether to regulate them. This process will be repeated every
five years. To determine whether to regulate a contaminant and
establish a maximum contaminate level (MCL) or another regulatory
approach, EPA will need good health effects research. Recognizing the
serious burden this regulatory mandate presents, the drinking water
community has offered its time, resources and expertise to work with
EPA to develop a research plan for the contaminants on the CCL. We have
volunteered to cooperatively sponsor a workshop to produce a
coordinated report and research strategy. If EPA agrees to our offer,
and all indications are that they will, we anticipate returning to this
Subcommittee with EPA to jointly recommend appropriate drinking water
research funding levels for the next fiscal year.
Given that drinking water research has long been underfunded and
the enormous need for immediate research to meet the deadlines of the
SDWA amendments of 1996, AWWA urges Congress to appropriate at least
$41,400,000 for drinking water research and specifically ``earmark'' it
in the appropriation. Continued underfunding drinking water research
will result in either delayed regulations or regulations promulgated
without the necessary research.
Recommended Action in the Fiscal Year 2000 Budget.--Appropriate at
least $41,400,000 for drinking water research (as requested in the
President's fiscal year 2000 Budget). Specifically designate funding
for drinking water research and health effects research in the
appropriation.
awwa research foundation
In a separate statement, the AWWA Research Foundation (AWWARF), (an
organization independent of AWWA), requested that $6 million in
drinking water research funds be designated specifically for AWWARF for
drinking water research which includes $1 million for arsenic research
and $2,000,000 for perchlorate treatment research. AWWARF and public
water suppliers will match the unallocated $3,000,000 portion of the
grant dollar-for-dollar. AWWA strongly believes that this kind of
local/federal research partnership is a wise and cost effective use of
public funds and the only way to secure science based drinking water
regulations in these difficult budgetary times. The AWWARF funds are
being used to support priority drinking water research needs including
disinfection by-products and cryptosporidium as well as arsenic.
The regulation of arsenic, which occurs naturally at low levels in
some drinking water supplies, presents a unique regulatory situation.
While the effects of arsenic at levels in excess of those typically
found naturally in the nation's water supplies are well studied, there
is a lack of data and serious scientific debate on the effects of the
naturally occurring low levels of arsenic in drinking water.
Recommended Action in the Fiscal Year 2000 Budget.--Appropriate
$4,000,000 specifically designated for the American Water Works
Association Research Foundation, including $1,000,000 for arsenic
research.
perchlorate treatment research
In separate statements, AWWARF and others requested $2,000,000 for
research technologies to remove perchlorate (a rocket fuel component)
from drinking water supplies. The research is to be conducted through
the East Valley Water District in San Bernadino, California. AWWARF is
managing the previous research funds provided by the subcommittee for
the East Valley Water District. AWWA believes that perchlorate
contamination of drinking water may be of concern in other parts of the
country and that this research will allow early corrective action.
There is no known treatment to remove perchlorate from drinking water
so this research is crucial for public water systems, especially those
communities which have lost their entire drinking water supply because
of the presence of perchlorate contamination in the water.
Recommended Action in the Fiscal Year 2000 Budget.--Appropriate
$2,000,000 for research on treatment technologies relating to
perchlorate within the Crafton-Redlands Plume, to be conducted through
the East Valley Water District, California.
public water system supervision grants
To comply with the SDWA, Congress intended that EPA develop
drinking water regulations and that the states implement and administer
the program to ensure compliance with and enforcement of its
provisions. Implementation, administration, compliance and enforcement
activities are collectively known as ``primacy'' requirements and
federal grants to the states are known as Public Water System
Supervision (PWSS) grants. The massive demands on states arising from
the SDWA have become increasingly apparent because of the dramatic
increase in the number of regulated contaminants over the past few
years.
As each regulation is added, state resource shortfalls become more
acute. Additional regulations are scheduled to be promulgated over the
next few years and the SDWA Amendments of 1996 added new
responsibilities for the states such as source water assessments, a
consumer confidence report program and alternative monitoring programs.
The SDWA authorizes a federal share of up to 75 percent, but federal
funding has approximated only 35 percent. The difference between state
and federal shares of the program has become so great that, according
to the Association of State Drinking Water Administrators (ASDWA),
states are concerned that without the infusion of additional resources,
they may be unable to successfully meet these requirements and will be
forced to prioritize future workload efforts. ASDWA has stated that
even with he infusion of funds from the Drinking Water State Revolving
fund set-asides, the current PWSS funding level is inadequate to
accomplish Congressional goals for comprehensive national public
drinking water system oversight. Should this occur, public health
protection will suffer a major setback.
EPA's budget request for fiscal year 2000 would not raise PWSS
funding for states from its present level of $90,000,000. We strongly
urge Congress to appropriate the $100,000,000 authorized for PWSS
grants to states as the minimum necessary.
Recommended Action in the Fiscal Year 2000 Budget.--Appropriate
$100,000,000 for Public Water System Supervision (PWSS) grants to
states.
epa drinking water program
EPA's drinking water program took on greatly increased
responsibilities in the 1996 SDWA amendments. These responsibilities
included developing a new regulatory process requiring additional
science and risk analysis for regulations, create a contaminant
occurrence data base and methodology to select contaminants for
regulation, promulgate microbial and disinfectant/disinfection by-
products regulations, identify new treatment technologies for small
systems, administer the newly created drinking water state revolving
fund, and develop regulations and guidelines for consumer confidence
reports, operator certification programs, source water assessment and
monitoring relief.
In satisfying these requirements, EPA has involved the public in
the regulatory process to an extent not equalled by another federal
agency and stands as a model for federal rule making. EPA has involved
private citizens, scientists, drinking water professionals, medical
professionals, public health officials, economists, and environmental
and consumer advocacy representatives, as well as other experts in
providing recommendations and how to carry out these new regulatory
responsibilities. EPA and the Office of Drinking Water and Ground Water
are to be commended for taking this new approach which should result in
better regulations that protect public health.
The President's fiscal year 2000 Budget requested the following
funding for the EPA drinking water program: $43.9 million for Drinking
Water Regulatory Development; $31.8 million for Drinking Water
Implementation Initiatives; and $1.5 million for Drinking Water
Consumer Awareness. Because of its exemplary approach to reforming the
regulatory process, the EPA drinking water program budget request
should not be cut to meet overall federal budget constraints. AWWA
believes that funding the EPA drinking water program is vital to
continue this new regulatory approach and urges Congress to appropriate
the funds requested in The President's fiscal year 2000 for the
drinking water program to continue to implement the new provisions of
the SDWA.
Recommended Action in the Fiscal Year 2000 Budget.--Appropriate
funding for the EPA drinking water program as requested in The
President's fiscal year 2000 Budget including:
--Drinking Water Regulatory Development: $43,900,000.
--Drinking Water Implementation Initiatives: $31,800,000.
--Drinking Water Consumer Awareness: $1,500,000.
clean water action plan
The protection of drinking water source supplies is one of the key
elements in providing safe drinking water to the American people. It is
safer and cheaper to prevent the contamination of drinking water
supplies than to undertake expensive efforts to treat it after it has
become contaminated. The Clean Water Action plan focuses on source
water protection for safe drinking water, preventing polluted runoff,
promoting a state-led watershed approach to restore and sustain
watershed health and assisting states with reducing nonpoint source
pollution by expanding state grant assistance. The agency is requesting
an additional $25.8 million to build on the foundation of last year's
appropriation and the existing clean water program. AWWA urges the
Congress to fund to the maximum extent possible, EPA initiatives to
address source water protection for safe drinking water. However, AWWA
does not support the reduction in other clean water programs such as
the Clean Water Act State Revolving Fund to fund this initiative and
hopes that funding for this action plan in other agencies will be
supported by members of this subcommittee when considering other
appropriations in full committee deliberations.
Recommended Action in the Fiscal Year 2000 Budget.--Appropriate the
additional $25.8 million in support of the EPA Clean Water Action Plan
as requested in The President's fiscal year 2000 Budget without
decreasing support to other clean water or drinking water programs.
This concludes the AWWA statement on the fiscal year 2000 EPA
budget. We would be pleased to answer any questions or provide
additional material for the subcommittee.
______
Prepared Statement of Texas A&M University
Mr. Chairman and members of the Committee, I am Ed Hiler, Vice
Chancellor for Agriculture and Life Sciences in the Texas A&M
University System. I appreciate the opportunity to appear before you
today, to describe a few exciting research projects we have underway,
and to ask for your support for continued federal funding. New
technology is the life blood of American agriculture. With the 1996
Farm Bill and resulting phase down in federal farm programs, it is
imperative that research continues providing a technological
underpinning for agriculture. Today, I will describe several examples
of how we can provide this underpinning.
environmental services of rice lands in arkansas, louisiana, and texas
Privately-held rice lands provide a variety of ecological services,
but they can also have adverse environmental impacts. Public benefits
include wildlife habitat, water filtration through wetlands, and flood
protection. Adverse impacts can include degradation of soil organic
matter, salinization, sedimentation, agricultural chemical losses, and
groundwater depletion. Elimination of Federal agricultural commodity
price support programs is reducing acreage in some parts of the Rice
Belt and increasing it in others--with the unintended result of
decreasing ecological services in some regions and increasing adverse
environmental impacts in others. Scientists from the Texas A&M
University System, the University of Arkansas, Louisiana State
University, and USDA-ARS will examine environmental benefits and costs
of alternative rice production technologies and how we might strengthen
communities and increase the environmental and economic benefits of
rice culture. We are requesting funding of $1,000,000 for this project
for fiscal year 2000.
consortium for agricultural soils mitigation of greenhouse gases
(casmgs)
American farmers can benefit from international agreements to
reduce greenhouse gas emissions, but only if reductions produced by
agriculture can be counted toward national goals. For American
agriculture to benefit a scientifically defensible method is needed to
calculate reductions in greenhouse gas emissions that result from
improved conservation practices. A consortium (including Colorado State
University, Iowa State University, Pacific Northwest National
Laboratory, Montana State University, The Ohio State University, and
the University of Nebraska) seeks funds to assess the economic and
environmental consequences of agricultural and environmental programs
and technologies designed to reduce greenhouse gas emissions.
Assessments in fiscal year 2000 will include the impacts of possible
government programs and conservation technologies on carbon dioxide and
nitrous oxide emissions and/or absorption in agricultural soils. We are
requesting $10,000,000 for support of this program in fiscal year 2000.
protecting our land and water resources in the 21st century
Droughts, floods, environmental concerns and ever-tighter
agricultural profit margins make it imperative that we manage our land
and water resources in the best possible way. High quality information
about both environmental and economic impacts is needed to inform
decision makers. Environmental issues that need to be considered
include the risks of water and air quality degradation, soil erosion,
and emission of greenhouse gases. For over a decade, researchers in The
Texas A&M University System Agriculture Program, in cooperation with
scientists from USDA, EPA, and other federal and state agencies and
private industry, have developed several computer-based decision aids
to help assess the environmental and economic impacts of land
management decisions throughout the nation. The objectives of this
initiative are to: (1) combine these decision tools into an integrated,
easily used, computer-based package; (2) implement a program to train
and transfer the package to agency personnel and other land managers;
and (3) improve the package based on feedback from the private sector
and governmental agencies. We are requesting $2,000,000 for support of
this program in fiscal year 2000.
centers for excellence in environmental operations
Dramatic growth in the Border Zone, between Texas and California,
has stressed the existing water supply, irrigation, and waste water
infrastructure to the limit. The most critical resource for continued
growth in trade and manufacturing within the zone is plentiful, good
quality water. The objective of this four-state (Texas, New Mexico,
Arizona, and California) initiative is to provide effective training
programs to increase water plant efficiency, protect public health from
biological hazards, reduce water pollution, improve irrigation
efficiency, eliminate waste and demonstrate new technology for water
and waste water treatment. We are requesting $5,000,000 for the Texas
Engineering Extension Service to support of this project in fiscal year
2000.
texas institute for applied environmental research (tiaer) at tarleton
state university
The TIAER is assisting the agriculture and environmental
communities and agencies nationwide to resolve environmental concerns
associated with agriculture. It is currently working with EPA, USDA,
state agencies, and other universities to develop conceptual
approaches, including the planned intervention! micro-watershed
approach'' to deal with the impacts of agriculture on water quality. It
is also developing modeling tools to analyze the economic and
environmental impacts of policy alternatives for several watersheds in
Texas and Iowa. We are requesting $750,000 for Tarleton State
University to continue support for this program in fiscal year 2000.
______
Prepared Statement of the County Sanitation Districts of Los Angeles
County
We would like to thank you for the opportunity to submit testimony
to the Subcommittee in support of federal funding in fiscal year 2000
for an exciting research program focused on strengthening scientific
understanding of the efficiency and sustainability of Soil Aquifer
Treatment (SAT) for indirect potable reuse of highly treated recycled
water. This research, which is taking place in California and Arizona,
has national implications for enhancing sustainable development of
communities by augmenting and protecting valuable groundwater supplies
with recycled water. Over $5 million in cash and in-kind services has
already been committed to the investigation by various research
sponsors and participants. In addition, Congress has appropriated $1.9
million over the last two fiscal years to support the project. We are
seeking an additional $1 million in fiscal year 2000 to continue this
important research.
The Soil Aquifer Treatment Project is designed to provide the data
necessary to support the rational design and operation of SAT systems,
to predict water quality improvements provided by SAT, and to answer
important public health questions. The County Sanitation Districts of
Los Angeles County, which serves over five million people in 78 cities
in Los Angeles County, California, and Arizona State University are the
project managers for the research in cooperation with the University of
Arizona, the University of Colorado, Stanford University and the U.S.
Geological Survey. We are joined in support of this funding by the
Cities of Phoenix, Glendale, Mesa, Scottsdale, Tempe, and Tucson,
Arizona; the Water Reclamation District of Southern California; the Los
Angeles Department of Water and Power; the City of Riverside,
California; the Bureau of Reclamation; and the American Water Works
Association Research Foundation.
As the arid West continues to develop and as sources for additional
water supplies become more and more scarce, an increasingly important
source of water for agricultural and urban use is recycled water. This
water has the potential to alleviate water shortages and to provide
important augmentation to existing sources. Soil Aquifer Treatment,
which is currently in use in California and Arizona, is one technology
that has the potential to economically supplement traditional treatment
and storage systems for existing and future potable water supplies.
This study will be of value not only in the West but in a number of
other areas around the country where groundwater recharge is used to
supplement potable water supplies, to control sea water intrusion in
coastal groundwater aquifers, to control land subsidence caused by
declining groundwater levels, to raise groundwater levels to reduce the
cost of groundwater pumping, and to provide a means of treating
wastewater prior to discharge. Most notably, the states of Florida,
Massachusetts, Nebraska, Michigan, New Hampshire, New Jersey, New York,
South Dakota, Texas, and Wisconsin, who already operate groundwater
recharge facilities, will benefit from this research. This research
will also benefit aquifer storage and recovery systems located in
eleven other states.
Further, our investigations of SAT will help address the public
health issues that all water suppliers in the nation face, such as
source water protection and disinfection practices. The questions that
will be answered by our study will be instrumental to the
identification, characterization, and treatment of compounds in our
nation's water supply so that we may better protect the health of our
citizens.
the need for the study
While groundwater recharge using recycled water has been used in
the United States for several decades and has been the subject of a
number of studies, the scientific and technical community's ability to
fully address a number of complex public health questions has been
limited by the nature of existing testing and study methodologies. The
funds approved by Congress in fiscal year 1998 and fiscal year 1999
have enabled a higher standard of research on SAT by expanding the
project's monitoring and analytical capabilities and will thus help
enhance scientific understanding of the various biological, physical,
and chemical processes in SAT that modify and improve the
characteristics of recycled water. Funds have been used in part to
follow up on research recommendations from the National Research
Council's (NRC) Water Science and Technology Board study on the
viability of augmenting potable supplies with recycled water. This work
addresses critical areas of research identified by NRC as necessary to
address the myriad of unknowns concerning SAT and the indirect use of
recycled water for potable water supply including the fate and
significance of disinfection byproducts, organics, and microbial
pathogens.
Currently the SAT Project is in its second year of study, and
valuable information has been developed to better understand the impact
of SAT on water quality in terms of chemical and microbial pollutants,
identifying monitoring criteria for viruses and other pathogens, and
increasing public knowledge and awareness of SAT. Fiscal year 2000
funds will be used to address key drinking water quality issues related
to the importance of the municipal wastewater source in determining
water quality, the use of tiered chemistry testing and toxicity tests,
including endocrine disruptor assays, to further characterize organic
pollutants in water before and after SAT, and expanded microbiological
assessments for viruses and emerging pathogens.
The results of our investigation will help us to better understand
the complex nature of recycled water and SAT so that we may take
advantage of the benefits offered by indirect potable reuse based on
groundwater recharge such as: Additional water quality improvements;
seasonal or longer-term storage without evaporative losses; protection
of water resources against recontamination (with coliforms and
parasites) by birds, mammals, and even humans; and prevention of algae
growth and associated water-quality problems such as algae-derived
taste and odor.
sat defined
Soil Aquifer Treatment can best be described as a groundwater
recharge method using recycled water. SAT relies on percolation of the
recycled water through soil and groundwater transport to further
improve water quality prior to reuse.
--Soil percolation encompasses several processes that occur as water
seeps downward through the soil under the influence of gravity
to enter the groundwater system. The soil acts as a filter to
improve the characteristics of the recycled water through
physical, chemical, and microbiological processes.
--Groundwater transport: After reaching the underlying aquifer,
groundwater moves slowly to extraction wells. During transport,
further water quality benefits are realized through a number of
physical, chemical, and biological processes.
purpose and goal of the study
The SAT Project is the first research program to focus broadly on
SAT as a system. Its goals are to provide the data necessary to support
the engineered design and operation of SAT systems, and to address
factors that are of interest to health regulators for the development
of regulations governing groundwater recharge projects.
Specific objectives of the project are to:
--characterize processes that contribute to organic chemical,
nitrogen and pathogen removal and transformation during
transport through the soil percolation zone and underlying
groundwater aquifer;
--investigate and model relationships among above-ground treatment,
wetlands polishing, and SAT;
--identify monitoring criteria that will provide proper assurances
regarding the elimination of viruses and other pathogens;
--produce a framework or model within which SAT systems can be
designed and operated to meet regulatory criteria.
--compare the effectiveness of SAT to other technologies; and
--increase public knowledge and awareness of SAT.
The effectiveness of SAT will be investigated and systematically
analyzed to determine the efficacy of the protective barriers inherent
in SAT systems: the interface at the soil-water boundary of the
infiltration surface; soil percolation; and groundwater transport. The
water quality benefits derived from the treatment in each barrier will
be evaluated based on the reductions achieved in levels of organic
carbon, nitrogen, and pathogens.
Field investigations and data gathering are being performed at six
full- or pilot-scale recharge sites in California and Arizona. These
sites offer a range of different effluent qualities and physical
conditions such as depth to groundwater, soil and sediment type, etc.
Laboratory work is also being conducted to analyze the data and develop
the applicable models. These facilities are located in Phoenix, Mesa,
and Tucson, Arizona; and Riverside, Los Angeles, and Los Angeles
County. Some of the more unique research elements include use of
genetic techniques to isolate and identify viruses; analytical
methodologies capable of identifying over 90 percent of the materials
comprising the organic makeup of groundwater and recycled water; unique
tracers to track the movement of recycled water as it infiltrates the
groundwater; and a public education/outreach component to disseminate
the results of the study.
On behalf of the many public agencies, cities, and universities
that are participating in this exciting and promising research project,
we would like to thank the Subcommittee once again for the opportunity
to submit this statement and for your previous support for this
project. Soil Aquifer Treatment has great potential to alleviate the
coming critical water shortages in the arid western United States and
provide valuable information on a national level for source water
protection and supply. We thank you again for your commitment to this
project over the last two fiscal years and ask you for your renewed
support to continue the research on this important project.
______
Prepared Statement of the North American Lake Management Society.
On Behalf of the North American Lake Management Society I
respectfully ask the Senate VA-HUD Appropriations Sub-Committee to
provide $20 million in funding for the Clean Lakes Program, Section 314
of the Clean Water Act. This program was a uniquely effective, cost
efficient federal program that provided seed money to state lake
programs and to local communities for lake protection and improvement
projects on public lakes.
Our nation's lakes need serious attention. The National Water
Quality Inventory 1996 Report to Congress indicates that 16 percent of
assessed rivers and streams and 35 percent of assessed lake acres are
not safe for fish consumption; 20 percent of assessed rivers and
streams and 25 percent of lake acres are not safe for recreational
activities (e.g. swimming); and 16 percent of assessed rivers and
streams and 8 percent of lake acres are not meeting drinking water
uses.
Last year, funds for the Nonpoint Pollution Program (Section 319)
were doubled, and a Senate Colloquy was added to the budget language
establishing congressional intent that Clean Lakes Program elements be
adequately funded through 319. THIS HAS NOT WORKED.
The 314 program, as now combined with the 319 program, has been
dwarfed by, and its priorities lost in, the much larger 319 program.
The EPA has not taken action to assure that states have financial
assistance targeted to support their lake management programs. Lake
projects have faired poorly in the competition for Section 319 funding
because 319 Program guidelines have tended to weed out 314 program
priorities that they were not designed to cover. Also, funding
decisions at the state level are made by the 319 program coordinators,
who for the most part have chosen not to share their program money with
another state agency. The two programs worked well in partnership, but
the marriage has been a failure.
Here is what we have lost:
--Water Quality Assessment Grants, which states used to assess the
condition of their lakes and reservoirs. These grants also
supported volunteer monitoring programs that foster long term
community interest and involvement in the health and well being
of both lakes and lake watersheds.
--Diagnostic and Feasibility Studies were designed to identify the
causes of problems found by the assessment grants, and look for
innovative, cost effective ways to repair the damage done to
lakes , their ecosystems, and their watersheds.
--Demonstration and Restoration Projects.--These greatly furthered
the science of lake rehabilitation. Often, the kinds of
research done in lakes, such as the use of aquatic weevils to
control nuisance exotic plant growth, do not fit well under
Nonpoint (Section 319) Program guidance. The Nonpoint program
worked in partnership with the Clean Lakes Program at this
stage of a project to address problems coming from the
watershed.
--Post Restoration Monitoring.--To evaluate the effectiveness of the
program, and guide the improvement of future projects.
As the only organization dedicated to building citizen/professional
partnerships for applied lake management, NALMS is uniquely positioned
to have our ear to the ground on this matter. Last year we provided you
with a survey of state lake program managers and professionals that
indicated a severe cutback in funding for Section 314 Clean Lakes
Program elements under the umbrella of the 319 program. 37 of 49 state
lake program managers responded that their state lake programs were
severely cut, and they strongly recommended a return to separate Clean
Lakes Program funding. A complete copy of these comments is available
on our web site, www.nalms.org, under the Government Affairs Committee
homepage. A quick update survey conducted this January indicates the
situation is no better in most states, and has even deteriorated since
last year.
Support is now building to pump new life into the Clean Lakes
Program:
--The Sport Fishing and Boating Partnership Council has recommended
that the EPA fund the Section 314 Clean Lakes Program. Agencies
and organization that contributed to this recommendation are:
B.A.S.S, Inc., National Marine Manufacturers Association,
Outdoor Technologies Group, U.S. Fish and Wildlife Service,
State Fish and Wildlife Agencies, International Association of
Fish and Wildlife Agencies, American Sportfishing Association,
BOAT/U.S., American Fisheries Society, American Rivers Trout
Unlimited, Penzoil Products Company, Grady-White Boats.
--The Congressional Great Lakes Task Force has recognized this
problem and has sent a letter to the OMB and the EPA asking
that they request separate funding for the Section 314 Clean
Lakes Program.
--The Council of State Governments' newsletter, ECOS, recently ran a
front page article titled: ``States to EPA: Bring Back Clean
Lakes!'' The last paragraph reads: ``Will EPA respond to these
concerns by reinstating a special-focus approach for lakes? The
precedent is certainly there--a review of discrete programs
managed by the agency runs the gamut from brownfields to print
shops. The decision to lump lakes with other water resources
apparently needs another look.''
--The National Recreation Lakes Study Commission, in their March 1999
Draft Recommendations includes the following language: ``The
Environmental Protection Agency's (EPA) current watershed-based
approach to protecting and enhancing our Nation's waters places
inadequate emphasis on lakes. EPA has not provided funding for
Section 314 (the Clean Lakes Program) of the Clean Water Act in
the past five years. EPA's recently issued ``Guidance on Use of
Clean Water Act and Safe Drinking Water Act Authorities to
Address Management Needs for Lakes and Reservoirs'' encourages
EPA Regional authorities and the States to ``recognize the
importance of lakes and reservoirs as key elements of the
aquatic ecosystem. However, this guidance does not provide
resources for the full range of activities that were formerly
authorized under the Clean Lakes Program''.
Lakes and reservoirs are the jewels of a watershed. They are the
focus of public perceptions of water quality. They are also the
settling basins for pollutants from the rest of the watershed. Because
people love lakes, communities are willing to look upstream and to the
watershed for ways to protect or clean up their lakes. But beyond the
watershed, the Clean Lakes Program focused on the whole lake ecosystem.
Degraded lake habitats, wetland loss, nuisance exotic species, and
fishery imbalances are problems the Clean Lakes Program helped
communities address. These problems are not traditionally covered under
319 project guidelines.
We believe that lakes are certainly as deserving of special program
focus as are our wetland, estuaries, and coastal zones. Clean Lakes
Program projects have been very cost effective and have been
particularly successful in leveraging federal dollars with state and
local funds. The program has been a model of partnership building
between federal, state, and local levels; and between water quality,
fish and wildlife managers.
NALMS believes that we need a separate Clean Lakes Program to
refocus attention on the special needs of our lakes and reservoirs. We
need to provide separate, adequate and consistent funding and guidance,
which will allow the Clean Lakes Program to grow to better meet the
needs of the states and their lake communities.
On behalf of the North American Lake Management Society, we
respectfully ask that Congress make a commitment to bringing the Clean
Lakes Program back to life with a $20 million dollar appropriation for
the coming fiscal year.
______
Prepared Statement of the Western Coalition of Arid States
The Western Coalition of Arid States (WESTCAS) is pleased to submit
comments for the record, regarding programs contained in the U.S.
Environmental Protection Agency's (EPA) fiscal year 2000 budget for
your Subcommittee's hearing record.
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 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.
state revolving funds
WESTCAS urges you to provide the $1 billion per year authorized
under the Safe Drinking Water Act for the Drinking Water State
Revolving Fund for fiscal year 2000. Many surface and ground waters do
not meet water quality standards. Communities face greater challenges
in trying to provide their citizens safe potable water meeting all of
the regulatory requirements. As more research is completed in the
treatment of microbes and disinfectant and disinfection byproducts,
communities will be faced with even greater costs to meet requirements.
We also would urge you not to fund the Operator Certification Program
for the Drinking Water State Revolving Fund which reduces funds
available for loans to communities by $30 million. We join with the
Association of State Drinking Water Administrators in expressing
concern that EPA has not asked for new funding for state primacy
programs and that the Drinking Water State Revolving Fund ``may become
the primary funding mechanism of `convenience' with the serious risk of
eroding the corpus of an already limited fund.''
WESTCAS urges a higher level of funding than proposed by the
administration for the Clean Water State Revolving Fund. The
administration proposes to reduce funding by $550 million and to
authorize states to set aside 20 percent of the fiscal year 2000
allocation for grants for nonpoint source projects. We support funding
for nonpoint source and estuary projects. Nonpoint source projects are
critical to watersheds attaining the designated beneficial uses of
water bodies, however more funding is needed in the total program in
order for the objectives we all are striving for--restoration of our
watersheds--to be accomplished.
research funding
Scientifically sound research is essential for effective drinking
water and clean water quality programs. WESTCAS urges full support of
funding for the various research projects undertaken in a timely manner
to implement regulations required pursuant to the Safe Drinking Water
Act and the Clean Water Act. We support the increased funding requested
for Human Health Risk Assessment and recommend increased funding for
Detection of Emerging Risk Issues and Drinking Water Research. A full
understanding of microbial contaminants and disinfectant/disinfection
byproducts is extremely important for the American people.
WESTCAS requests that EPA devote sufficient resources to implement
in a timely way the agreed to provisions under the settlement documents
in the WESTCAS Whole Effluent Toxicity (WET) litigation. We want to
insure that the WET testing required in NPDES programs and WET testing
to evaluate sediment quality is not used inappropriately to predict
impairment of water quality when it isn't valid. EPA had targeted $.5
million for the ongoing program in fiscal year 1999 and it cannot be
tracked in the fiscal year 2000 budget request.
american water works association research foundation (awwarf) and water
environment research foundation (werf)
WESTCAS urges partnering with both AWWARF and WERF for drinking
water research and clean water research funds. These programs offer an
opportunity to leverage EPA's research program and improve the time of
completion of critical projects dealing with arsenic, radon,
perchlorate, and many others.
drinking water--public water systems supervision grants
WESTCAS urges a review of funding for the Public Water Systems
Supervision Grants. Funding for this program has not increased, and
with the new requirements placed upon the states for consumer
confidence reports, operator certification and other regulations, it
would seem that the existing level of funding is not adequate for the
states.
We thank you for this opportunity to offer our comments on the
fiscal year 2000 appropriations for the EPA. If we can answer any
questions or provide additional information, please contact Peter
Carlson, WESTCAS' Legislative Representative in Washington, D.C. at
(202) 429-4344.
______
Prepared Statement of the Metropolitan Water Reclamation District of
Greater Chicago
I am Terrence J. O'Brien, President of the Metropolitan Water
Reclamation District of Greater Chicago, and on behalf of the Water
Reclamation District, I want to thank the Subcommittee for this
opportunity to present our priority for fiscal year 2000, and express
our appreciation for your support of our requests over the years. The
Metropolitan Water Reclamation District (District) is the sponsor for
the federally approved combined sewer overflow (CSO) project, the
Tunnel and Reservoir Plan (TARP), in Chicago, Illinois. Specifically,
we are asking that $10 million be included to continue construction of
this project in the Subcommittee's VA, HUD and Independent Agencies
Appropriations Bill for fiscal year 2000. The following outlines the
project and the need for the requested funding.
introduction
The District was established in 1889 and has the responsibility for
sewage treatment, and is also the lead agency in providing sponsorship
for flood control and stormwater management in Cook County, Illinois.
In fact, the District was established in response to an epidemic, which
killed 90,000 people in 1885. By 1900, the District had reversed the
flows of the Chicago and Calumet Rivers to carry combined sewage away
from Lake Michigan, the area's main water supply. The District has been
involved with major engineering feats since its inception.
In an effort to meet the water quality goals of the Clean Water
Act, to prevent backflows into Lake Michigan, and to provide an outlet
for floodwaters, the District designed the innovative TARP. The TARP
tunnels, which were judged by the Environmental Protection Agency (EPA)
on two occasions as the most cost-effective plan available to meet the
enforceable provisions of the Clean Water Act, are a combined sewer
overflow elimination system. The TARP reservoirs, also under
construction, will provide flood control relief to hundreds of
thousands of residents and businesses in the Chicagoland area.
tunnel and reservoir plan
The TARP is an intricate system of drop shafts, tunnels and pumping
stations which will capture combined sewer overflows from a service
area of 375 square miles. Chicago will remove three times the amount of
CSO pollution as Boston's projected removal--for approximately the same
cost. The remaining Calumet tunnel system will provide 3.1 million
pounds of biological oxygen demand (BOD) removal versus Boston's one
million pounds of BOD removal per year. In fact, Chicago's CSO
pollution problems are worse than the combination of Boston, New York,
and San Francisco's pollution problems. The Chicago Metropolitan Area's
annual BOD loading is 43 million pounds per year. This contrasts with
the combination of Boston, New York and San Francisco's combined annual
BOD loading of 35 million pounds.
A good portion of the remainder of the TARP system is to be built
in the southeast side of Chicago and the southern suburbs (Calumet
system), a low-income, highly neglected and highly polluted area. This
community suffers from tremendous land, air and water pollution--
literally a dumping ground for multimedia pollution ranging from
chemical waste to serious water pollution.
Due to the enormous risk to the community, the District as the
local sponsor cannot afford to leave the citizens vulnerable.
Therefore, it is imperative that this work must continue. Because the
construction industry is already doing work in the area, the climate is
favorable for proceeding with this work at this time, producing
significant cost savings. What we are seeking, then, is funding to
advance federal work.
We have a proven and cost-effective program. In fact, we have
estimated that TARP's cost is about a quarter of the cost of separating
the area's existing combined sewer systems into separate sewage and
stormwater systems. Upon reanalysis, the EPA has consistently found the
TARP program to be the most cost-effective solution that will reduce
the impacts by the greatest degree to meet the enforceable requirements
of the Act, with the least amount of dollars. The project, while
relating most specifically to the 52 tributary municipalities in
northeastern Illinois, is also beneficial to our downstream communities
such as Joliet and Peoria. These benefits occur because of the capture
of wastewater in the tunnels during the storm periods and by treatment
of the discharge before being released in to the waterways.
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 back-ups 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
excess CSOs would be allowed to backflow into Lake Michigan. Since the
implementation of TARP, some backflows to Lake Michigan have been
eliminated. After completion of both phases of TARP, all backflows into
Lake Michigan will be 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 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 to 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.
TARP was designed to give the Chicago metropolitan area the optimal
environmental protection that could possibly be provided. More
importantly, no other project was found to be as cost-effective. In
addition, the beneficial use of the project is being enhanced by the
addition of the flood control reservoirs now being designed and
constructed by the Corps of Engineers, which will be connected to the
tunnels for additional capture and storage of combined sewage during
flood events. We believe TARP stands as a tribute to our nation's Clean
Water goals and one that is being accomplished within the most
economical constraints.
requested action
The $10 million we are seeking in fiscal year 2000 funding in the
Subcommittee's bill will help keep the local sponsor whole for the
advance construction it plans to accomplish on the Torrence Avenue Leg
for the Calumet System of the congressionally-authorized TARP project.
While the TARP project was originally authorized at 75 percent federal
funding, the District as local sponsor has been contributing at least
50 percent of the total project cost. We greatly appreciate the
Subcommittee's endorsement of our request over the years to advance the
construction of this work. This fiscal year 2000 work will go a long
way to address serious water quality, stormwater and safety problems.
It will have a tremendously beneficial impact on a community, which
suffers from water pollution and significant flooding problems. The EPA
has approved the facilities plan for the overall TARP project and
design has been completed. The EPA has identified this particular
segment of work as the next critical section of the plan to be
constructed based on significant water quality benefits.
Once on-line, the Torrence Avenue Leg of the Calumet System will
capture 2.0 billion gallons of CSOs per year and will protect 15.6
square miles of the City of Chicago from raw sewage backup and
flooding.
We urgently request that this funding be included in the
Subcommittee's bill for the construction of the Calumet System of the
TARP project. We thank you in advance for your consideration of our
request.
______
Prepared Statement of the Metropolitan Water District of Southern
California
fiscal year 2000 appropriations for the u.s. environmental protection
agency
The Metropolitan Water District of Southern California (MWD) is
pleased to submit comments for the record, regarding programs contained
in the U.S. Environmental Protection Agency's (EPA) fiscal year 2000
budget for your Subcommittee's hearing on April 29, 1999.
MWD is responsible for meeting the supplemental water requirements
of 16 million people living in the Southern California coastal plain
and the economy which supports them. Our sources of water supply are
the Colorado River and surface waters from Northern California. Of
particular interest to MWD and our 27 member agencies are those federal
programs that provide assistance and facilitate partnerships for
addressing critical water resources issues.
MWD is pleased that the President's budget requests increased
funding for the Drinking Water State Revolving Fund (DWSRF) over the
prior fiscal year. The proposed funding of $825 million, however, falls
short of the $1 billion authorized by Congress, and we urge that you
support funding at the authorized level. We also ask that, in addition
to the $41.5 million request for safe drinking water research in the
President's budget, you provide $6 million to be designated for
research through the American Water Works Research Foundation (AWWARF)
and East Valley Water District in San Bernardino, California for
activities described below. Lastly, we ask that you fully support the
President's proposed fiscal year 2000 budget for other EPA programs
benefiting drinking water quality, including those which are part of
the Clean Water Action Plan.
While significant progress has been made in improving the quality
of our nation's water, many surface and ground waters do not meet water
quality standards. Further, as our understanding of the relationship
between the contaminants found in our water supply and their effect on
human health increases and detection methods are improved, new risks
have been uncovered. Adequate protection of drinking water quality
requires research to identify contaminant sources and effective control
methods, financial assistance for implementation of end-of-the-pipe
treatment and source water protection measures, and compliance
monitoring to ensure existing laws and regulations are upheld.
state revolving funds
In California, water suppliers have identified drinking water
infrastructure projects totaling in excess of $7 billion that could
benefit from low-cost DWSRF financing. Nationwide, community water
systems estimate they must invest over $138 billion over the next 20
years to ensure delivery of safe drinking water. Of this amount,
approximately $12 billion is needed to meet current Safe Drinking Water
Act (SDWA) requirements. Low-cost financing for projects which ensure
safe drinking water supplies is critical for protecting the health of
the more than 240 million Americans served by public water systems, and
MWD strongly urges that you provide $1 billion, the amount authorized
by Congress for fiscal year 2000. This amount, while greater than the
amount requested in the President's budget, is still only a small
fraction of the funding needed by drinking water suppliers to meet
existing SDWA requirements.
Significant investments are also needed to repair and replace aging
municipal wastewater infrastructure and combined sewer systems. Low-
cost financing is necessary to support substantial municipal water
quality infrastructure needs over the next 20 years. Capital
investments are also required to protect against non-point pollution
sources, and for the first time, EPA has proposed allowing states to
use up to 20 percent of their Clean Water Act State Revolving Fund
(CWSRF) capitalization grants to fund such projects. The President has
requested $800 million for fiscal year 2000 for the CWSRF to support
these activities which are also vital for ensuring protection of
drinking water sources. MWD asks that you support the President's
budget request.
non-point source grants
Another critical source of funding for source water protection
projects is grants under the Clean Water Act's Section 319 Non-point
Source Program (NPS). NPS grants are particularly important for smaller
projects and projects where debt financing is unsuitable. Further, the
NPS grant program is necessary to support the many watershed management
activities fostered by the states. The President has requested $200
million for NPS grants for fiscal year 2000, and MWD requests your
support at the level in the President's budget.
Other EPA grant programs which help maintain or improve water
quality and need your support are the CWA Section 106 Control Agency
Resource Supplemental Grants ($115.5 million), Wetlands Program
Development Grants ($15.0 million), and the Water Quality Cooperative
Agreements (WQCA; $19.0 million). Among other activities, section 106
grants provide funding for monitoring, water quality planning, and
development of Total Maximum Daily Loads for impaired water bodies. The
wetlands grants program will enable EPA to meet its goal of a net gain
of 100,000 acres of wetlands by the year 2005. Wetlands provide an
important cleansing mechanism which can protect drinking water sources.
WQCA provides funding to address water quality problems created by
storm water, combined sewer overflows, and confined animal operations,
all of which potentially threaten drinking water sources. Your support
for the President's fiscal year 2000 budget request for the above
programs will enable EPA to carry out its mission.
drinking water research
Scientifically sound research provides the underpinnings for
effective drinking water quality programs. EPA's fiscal year 2000
budget, under its strategic goal of clean and safe water, includes
$41.5 million for safe drinking water research. This research will
focus on developing dose-response data for certain contaminants such as
disinfection by-products (DBPs) and pathogens, filling data gaps for
contaminants on the Candidate Contaminant List (CCL), and identifying
cost-effective methods for removing pathogens while minimizing DBP
formation. Although not specifically noted in EPA's Summary of the 2000
Budget, we understand that funding will also be directed toward
research on methyl tertiary-butyl ether (MTBE), an oxygenate added to
some reformulated fuels to meet Clean Air Act requirements, and
perchlorate.
Dose-response data is critical for the proper characterization of
potential acute risks of drinking water contaminants, yet reliable data
is frequently absent. The CCL is the basis of potential new drinking
water regulations, and accurate data is essential in order to determine
whether new regulations are warranted. In California, MTBE has been
found in some groundwater wells and drinking water reservoirs,
resulting in objectionable taste and odor and potential health risks.
Similarly, perchlorate has been detected in groundwater sources of
drinking water, and nearly two dozen wells have been taken out of
service state-wide as a result of concentrations which exceeded state
action levels.
Despite a very ambitious research agenda, we note that the
President is requesting approximately $6 million less for drinking
water research for fiscal year 2000 than appropriated for the prior
fiscal year. We urge that you restore the $6 million through
designation of $3 million for AWWARF for further research on drinking
water contaminants such as DBPs and pathogens, $1 million for AWWARF
for research on arsenic, and $2 million for the East Valley Water
District in San Bernardino, California to continue research conducted
through AWWARF on perchlorate. AWWARF and public water suppliers will
provide 100 percent matching funds, and thus offer an opportunity to
leverage EPA's research budget. We strongly urge that you support an
appropriation of $47.5 million for safe drinking water research,
designating $6 million of this amount as described above.
MWD also requests your support for EPA's budget request of $56.2
million for its Human Health Risk Assessment program. Under this
program, EPA will develop approaches for more biologically defensible
health assessments instead of relying on default assumptions which may
be at variance with known mechanistic data. The program will also carry
out research on sensitive sub-populations, particularly children and
infants and will develop improved methods for measuring total exposure
from multi-media sources and multi-pathways. This research will help
bring better science to the risk assessment process used in the
development of drinking water standards.
EPA's 2000 budget includes $49.8 million for research on Emerging
Risk Issues, including endocrine disruptors. Endocrine disruptors can
cause adverse reproductive outcomes affecting both human and ecologic
health. The Endocrine Disruptor Screening and Testing Advisory
Committee (EDSTAC), a stakeholder group formed by EPA to develop
screening and testing recommendations, has identified DBPs as one of
the chemical classes which should be subject to early testing. DBPs are
formed as part of the disinfection process for drinking water.
Disinfection is necessary to protect against microbial disease and has
been responsible for the virtual elimination of widespread outbreaks of
waterborne disease in the U.S. MWD asks that you support the
President's funding request for research on Human Health Risk
Assessment and Emerging Risk Issues.
drinking water--public water systems supervision program grants
EPA's 2000 budget allocates $93.8 million for Public Water Systems
Supervision Program grants. This funding is necessary for states with
primary enforcement responsibilities to carry out their duties,
including implementation of the 1996 SDWA regulations. Additional
resources will be necessary to implement the changes resulting from the
1996 SDWA amendments, and we ask that you support this funding level.
better america bonds
The President's budget proposes to encourage the preservation of
open space, protect water quality, and clean up Brownfields through a
new, innovative Federal tax credit program. Under the Better America
Bond Program, states and local governments would have the authority to
issue bonds which provide Federal tax credits in lieu of interest
payments by the issuing entity. This program would enable communities
to acquire title to or purchase easements on environmentally sensitive
and other land for purposes such as protecting water quality from
polluted runoff. The President has requested bonding authority for the
states of $1.9 billion for fiscal year 2000, and we ask that you
support this request.
We look forward to working with you and your Subcommittee. Please
contact Brad Hiltscher, MWD's Legislative Representative in Washington,
D.C. at (202) 296-3551, if we can answer any questions or provide
additional information.
______
Prepared Statement of The Mickey Leland National Urban Air Toxics
Research Center
The Mickey Leland National Urban Air Toxics Research Center (the
Leland Center or NUATRC), was established by Congress under Title III,
Section 301(p) of the 1990 Clean Air Act Amendments as a non-profit,
public/private research organization to sponsor research on the
potential human health effects of the 188 listed air toxics. NUATRC
initiates research that is critical to conducting meaningful risk
assessments to help assure that air toxics regulations will be cost-
effective and balanced. NUATRC has become a nationally-recognized
leader in air toxics personal exposure research. This research, and the
ability of the Leland Center to make significant contributions to the
peer-reviewed science on air toxics, is becoming more vital with EPA's
initiation of the Integrated Urban Air Toxics Strategy and Residual
Risk programs.
NUATRC has been operational for about six years and receives EPA
assistance awards based upon Congressional appropriations. We use
corresponding private sector funding to leverage these federal monies,
with industrial firms being the major contributors. NUATRC has a small
staff and utilizes an administrative services agreement with the
University of Texas-Houston Health Science Center in the Houston
Medical Center complex. This arrangement allows the Leland Center to
take advantage of the world renowned scientific community at the
University of Texas and the Texas Medical Center, as directed by
Congress.
This testimony provides an update on the Leland Center's current
research and future directions. The NUATRC continues to focus its
research in several key areas, which we believe will help close
significant data gaps on the potential human health effects of air
toxics. These areas are the following:
--Human exposure to air toxics. Specifically, the relationship among
outdoor, indoor and personal exposures to air toxics; the
sources of those exposures; and the development of technology
to better assess human exposure to air toxics.
--Characterization of non-cancer health effects from air toxics
exposures, primarily respiratory and immune system effects.
Future research directions will include:
--Assessment of potential links between personal exposures to air
toxics and human health effects.
--Examination of possible rapid response to emerging air toxics
incidents.
--Small grants for new and minority investigators for air toxics
research.
Strategic Research Directions
NUATRC has continued to make significant progress in fulfilling its
Congressional mandate. It has achieved national recognition within the
scientific community, EPA and the corporate sector for its personal
exposure research. The Leland Center has profited significantly from
the work of its Board of Directors, appointed by Congress and the
President, and its Scientific Advisory Panel. This Panel, composed of
13 nationally-recognized scientists from the public, private, and
academic sectors, develops the Center's peer-reviewed research program.
This research is carried out at academic institutions and major
research centers across the nation, under a scientifically rigorous
award protocol.
In pursuing its research directions, NUATRC interacts with other
research organizations and public and private institutions to leverage
both money and scientific expertise. We have interacted with the
National Center for Health Statistics, the Health Effects Institute,
the Center for Air Toxics Metal Research, EPA, MIT, and many
corporations to assess critical research needs, to avoid duplication of
effort, and to build upon previous research.
Personal Exposure Research
The National Research Council's (NRC) March 1998 report Research
Priorities for Airborne Particulate Matter--Volume I states that
research on personal exposure and the relationships among outdoor,
indoor, and personal exposure is one of the nation's most critical
research priority areas. The NRC Report underscores the NUATRC Board of
Directors' decision several years ago to pursue this line of research.
NUATRC took an early lead in fostering this type of research and is now
a nationally-recognized leader in research on personal exposure to air
toxics.
As an initial effort, the Leland Center fostered the development of
new, reliable, and cost-effective passive personal monitor that
measures Volatile Organic Compounds (VOCs). NUATRC has two such major
personal exposure research programs currently underway that are
utilizing these personal monitors. These studies are being conduced by
the Environmental & Occupational Health Sciences Institute (EOHSI) and
Columbia University. Pilot studies for both projects were successfully
completed in 1998 and the full studies are in progress in three major
urban areas (Houston, Los Angeles, and New York City.) This research
will characterize the personal exposures to VOCs, aldehydes, and metals
on airborne particulate matter to which the individuals living in these
areas are exposed. In addition, the work will examine how these
exposures are influenced by outdoor and indoor sources, as well as the
relative importance of mobile, point, and area emissions. These data
will then be used in risk assessments to establish the most cost-
effective means of reducing public health risks. Such research will
help reduce a critical data gap in our understanding of the potential
human health effects of air toxics and the relationships among personal
exposures, emission sources and outdoor levels of air toxics.
Participation in NHANES
In addition to the EOHSI and Columbia studies, the Center began its
collaboration with the Fourth National Health and Nutrition Examination
Survey (NHANES), conducted by the National Center for Health Statistics
for the Centers for Disease Control. In this collaborative study,
personal exposures to selected air toxics will be measured using
passive personal exposure monitors in 1,000 NHANES participants.
Particulate Matter Methodology Development for Personal Exposure to Air
Toxics
In an analogous approach to that used in the development of the
exposure monitors used to measure VOCs, NUATRC is encouraging the
development of the next generation of monitors to measure personal
exposure to fine particulate matter (PM2.5). The NRC reported that the
development of new personal exposure samplers for measuring particulate
matter constituents is ``critical'' as constituent analyses are the
building blocks for other areas of research, particularly
epidemiological research. NUATRC has recently released a Request for
Proposal for the development of a new generation of particulate
personal monitors. The research would come on line in early 2000. The
development of a new PM2.5 monitor will facilitate large-scale studies
on the potential effects of PM2.5 and its constituents, again providing
critical information for air toxics risk assessments.
Air Toxics Health Effects
Measurement and analysis of personal exposures to air toxics is the
critical first step in determining what health risks urban populations
face from air toxics. The next step is to assess the potential link
between those exposures and human health effects particularly those
acute effects on the human respiratory and immune systems. While a
great deal of research has been focused on determining the potential
cancer causing effects of air toxics, relatively little effort has been
devoted to determining the potential non-cancer effects, (e.g. human
respiratory and immune systems). The importance of non-cancer health
effects research has been underscored both by the NRC in its March 1998
report and by EPA in its draft Integrated Urban Air Toxics Strategy.
While current data suggest a possible adverse effect on the lungs
and heart from exposure to PM, the reasons for such effects are not
apparent. The current hypothesis is that toxic metals present on the PM
contribute to adverse effects. The Center expects to fund two proposals
for multi-year research projects on the potential health effects of
particulate air toxics on human pulmonary and cardiovascular systems.
The first study will test the hypothesis that the metals present on PM
(and not the particles themselves) cause adverse respiratory and
cardiovascular systems. Results from the study will provide insights
into the relative toxicity to the respiratory and cardiovascular
systems of different sizes of particulate matter, as well as the
relative toxicity of the specific particulate metal species. The second
study will explore the relationship between exposure to PM2.5 metals
and human cardiopulmonary responses in both normal and chronic
bronchitic populations. This study will help determine whether
particulate metals cause adverse effects to the respiratory and
cardiovascular systems of people without a pre-existing disease or that
the metals exacerbate pre-existing conditions, like chronic bronchitis.
Small Grants for New and Minority Investigators
The Center is also supporting new and minority investigators in
environmental health research. This New Investigator Award program is
designed to facilitate community involvement in air toxics issues by
encouraging younger researchers to explore critical air toxics
environmental health issues in their immediate communities.
NUATRC Exploratory Research Program
NUATRC plans to support pilot study research on novel and important
aspects of personal exposures to air toxics and the potential health
effects of those toxics in urban populations. Such studies would
include:
--Identification and evaluation of health effects in susceptible
populations, such as children.
--Development of new techniques for assessing personal exposures.
--Development of personal exposure models for use in air toxics risk
assessment.
--Determination of the mechanisms of action of air toxics in human
cells.
Research grants under this program would be open to all
investigators and interdisciplinary collaboration would be encouraged.
Rapid Response to Air Toxics Situations
NUATRC is developing a program to enable it to respond rapidly to
air toxics incidents, such as the smoke/haze situation that occurred in
the spring of 1998 in Houston, Texas. Such incidents could present a
unique opportunity to obtain scientific information about high air
toxics personal exposure levels and/or related public health concerns.
Information from such incidents could be incorporated into other
national studies for linking high exposure levels of air toxics to
potential health effects.
Personal Exposure Symposium
As previously stated, there is a critical need to characterize
actual human exposures to air toxics and to assess the health
consequences of those exposures. The purpose of a symposium on personal
exposure research is to bring together key researchers in the field to
highlight the current technology being used to assess personal
exposures, major research initiatives and the development of a
consensus regarding future research directions on personal exposure.
Major academic researchers, EPA, state agencies, and the regulated
corporate community will be invited to participate. We anticipate
holding this symposium in Houston, Texas in the spring of 2000.
NUATRC Administrative Costs
NUATRC anticipates a moderate increase in its administrative budget
in 2000. Due to the continuing expansion of the air toxics research
programs discussed in this testimony, a 20 percent increase in
administrative costs will allow a key addition to the scientific staff,
specifically a full-time research director. This position is critical,
as it includes managing the overall research programs, development of
new programs, and interfacing with other research organizations and EPA
to avoid duplication of effort and to build upon previous research.
Even with this increase, the NUATRC's ratio of research
expenditures to administrative costs remains considerably lower than
comparable research institutions, at less than 25 percent. We are proud
of this efficient use of government research monies, and continue to
seek ways to further reduce this ratio.
appropriations request
To carry out the existing and anticipated research programs, NUATRC
respectively requests the Senate to appropriate $2.6 million to the EPA
research budget for the Leland Center program. The following table
carries those programs described above, with the approximate annual
anticipated costs.
Personal Exposure Research (EOSHI, Columbia).................. $630,000
Participation in NHANES....................................... 100,000
PM Methodology Development.................................... 260,000
Air Toxics Health Effects..................................... 400,000
--PM metals and respiratory/cardiovascular effects..........
--PM metals and cardiovascular effects in brochitic population
NUATRC Exploratory Research Grants............................ 300,000
New Investigator Awards Program............................... 200,000
Rapid Response Program........................................ 60,000
Personal Exposure Symposium................................... 50,000
NUATRC Administrative Cost--University of Texas............... 600,000
--------------------------------------------------------------
____________________________________________________
Total............................................... 2,600,000
NUATRC Management
NUATRC is governed by a nine-member Board of Directors composed of
leading academic administrators and regulatory and private sector
executives. The Board also oversees the activities of the Scientific
Advisory Panel. This Panel, composed of thirteen scientists and
physicians from private companies (DuPont, ICF Kaiser and Dow Chemical,
EPA), academic institutions (Harvard, Brigham Young, and the
Universities of Minnesota, Pittsburgh, and Washington), and the
National Jewish Medical and Research Center, develops the NUATRC
research program. This diverse group brings both different expertise as
well as different perspectives to the development of NUATRC's research
program. All NUATRCs research programs are rigorously peer-reviewed.
Funding
To date, NUATRC has relied on Congressional appropriations and
support from the private sector. Corporate contributors have been
consistent through the years and include Exxon, Phillips, Texaco, Rohm
and Haas Company, Sun Company, and FMC Corporation. We are continually
seeking new private sector partners to participate in NUATRC's research
initiatives. In addition, we are soliciting support from both local and
national philanthropic foundations. We have begun an intensive
development effort to increase our private sector support.
Conclusion
NUATRC is most appreciative of the support that we have received
from the U.S. Congress. We believe that NUATRC is advancing in the
manner anticipated by Congress. From a fledging organization created by
Congress in 1990, NUATRC has now become nationally-recognized for its
research on personal exposures to air toxics. NUATRC will seek to
advance research to help address the most critical scientific questions
related to the potential human health effects of air toxics.
We are gratified by the participation of EPA scientists in our
Scientific Advisory Panel discussions, and the continued positive
interactions with EPA's Offices of Research and Development and Air and
Radiation concerning NUATRC's research. We want to assure that NUATRC's
research is complementary to EPA's other research initiatives, i.e.,
that there is no meaningful overlap in these programs. We believe that
close scientific interactions and cooperation between these
relationships with government and the corporate sector will help foster
a consensus concerning the national debate over air toxics. Thank you
for your attention to this request.
______
Prepared Statement of the American Public Power Association
The American Public Power Association (APPA) is the service
organization representing the interests of the more than 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 statement concerning fiscal year 2000 appropriations for programs
under this Subcommittee's jurisdiction.
climate change action plan voluntary partnership programs
APPA generally supports the fiscal year 2000 Budget request of $4
billion 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
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.
Under the Initiative, the U.S. EPA will be directed to continue
funding of the Energy Star, Green Lights and Landfill Methane Outreach
programs. Public power systems have been active partners in these
programs and other initiatives designed to improving efficiencies and
lowering the cost of providing energy services to customers. We are
particularly interested in the creation of a new $200 million ``clean
air partnership fund.'' Under this, state and localities will be
encouraged to leverage additional funds to finance efforts and projects
to reduce greenhouse gas and other air pollutants.
Green Lights Program
The Green Lights program encourages use of energy efficient
lighting to reduce energy costs, increase productivity, promote
customer retention and protect the environment. Program partners agree
to survey lighting in their facilities and to upgrade it, if cost-
effective. Environmental benefits result from more efficient energy use
and from reductions in emissions of carbon dioxide, sulfur dioxide and
nitrogen dioxide, thus improving air quality. EPA provides program
participants public recognition and technical support. Both large and
small APPA member systems participate in this program including City
Utilities of Springfield, MO; Concord Municipal Light Plant, MA; City
of Georgetown, TX; Grant County Public Utility District, WA; Gray's
Harbor County PUD, WA; Greenville Utilities Commission, NC; Indiana
Municipal Power Authority, IN; Los Angeles Department of Water & Power,
CA; Mason County PUD, WA; New York Power Authority, NY; Norwood
Municipal Light Department, MA; Omaha Public Power District, NE;
Orlando Utilities Commission, FL; Port Angeles City Light Department,
WA; Puerto Rico Electric Power Authority, PR; Sacramento Municipal
Utility District, CA; City of St. Charles Electric Utility, IL; Salt
River Project, AZ; Virgin Islands Water & Power Authority, VI;
Springfield Utility Board, OR, and Taunton Municipal Lighting Plant,
MA.
Energy Star Programs
A number of EPA's Energy Star programs build on the successes of
Green Lights. These important EPA programs are examples of successful
public/nonpublic partnerships that promote the use of profitable,
energy-efficient technologies as a way to increase profits and
competitiveness while at the same time minimizing pollution. They
include Energy Star Buildings, the Energy Star Transformer Program,
Energy Star office equipment and the Residential Energy Star Program.
APPA member systems participate in and support EPA's Energy Star
efforts.
Landfill Methane Outreach Program
The Landfill Methane Outreach Program provides environmental
benefits by encouraging utilities to make use of landfill gas as an
energy source. Several APPA member systems participate in this program,
including Illinois Municipal Electric Agency, IL; Jacksonville Electric
Authority, FL; Emerald People's Utility District, OR; Los Angeles
Department of Water and Power, CA, and Orlando Utilities Commission,
FL. Utilities voluntarily agree to take advantage of the best
opportunities to use landfill gas in generating power. EPA recognizes
and publicizes the utility's efforts and provides technical assistance.
One of the success stories cited by EPA occurred with APPA member
system Emerald People's Utility District in Eugene, OR. This public
power utility worked collaboratively with the State of Oregon, Lane
County officials and a private investment company to develop a 3.4 MW
plant at the Short Mountain Landfill. EPUD's general manager says
landfill energy recovery is like ``turning straw into gold,'' providing
additional revenue to EPUD as well as a fee to the county.
council on environmental quality (ceq)
APPA supports the Administration's fiscal year 2000 budget request
of $3,020,000 for the Council on Environmental Quality (CEQ). As units
of local government APPA member utilities have a unique perspective on
environmental regulation. Public power utilities and others from
industry have experienced a general lack of consistency in federal
environmental regulation. While additional layers of government should
be avoided, a central overseer can perform a valuable function in
preventing duplicative, unnecessary and inconsistent regulations. The
council is responsible for ensuring that federal agencies perform their
tasks in an efficient and coordinated manner. For these reasons, APPA
supports the existence and continued operation of CEQ.
superfund
APPA member systems also support the Administration's request of
$1.5 billion for Superfund cleanups. The Superfund Trust Fund as well
as Superfund research programs are critical as we strive to improve air
quality and our environment. The increased emphasis on expedited
settlements and administrative relief, the Brownfields Initiative and
more effective use of alternative dispute resolution by EPA are worthy
goals.
Again, APPA member systems appreciate your consideration of our
views on priority appropriations issues for fiscal year 2000.
______
Prepared Statement of Joseph M. DeSimone, Ph.D.
Chairman Christopher ``Kit'' Bond; Ranking Member Senator Barbara
Mikulski; and other distinguished members of the Subcommittee, I
appreciate having the opportunity to share my comments about fiscal
year 2000 funding priorities for the U.S. Environmental Protection
Agency (EPA).
My name is Joseph M. DeSimone, Ph.D., and I wear many hats. I am
first and foremost an educator and researcher, as a professor of
chemistry at the University of North Carolina at Chapel Hill and of
chemical engineering at North Carolina State University. I am co-
director of the Kenan Center for the Utilization of Liquid Carbon
Dioxide in Manufacturing, a not-for-profit research organization
sponsored by 16 corporations from around the world.
With two of my former students, Timothy Romack, Ph.D. and James
McClain, we developed carbon dioxide applications for cleaning in
garment care, metal degreasing and textile processing. We founded
Micell Technologies, Inc., in 1995 to commercialize these
environmentally friendly cleaning systems. Located in Raleigh, North
Carolina, we currently employ 32 people.
I want to convey for the record how important Environmental
Protection Agency and National Science Foundation (NSF) support has
been to me and my partners in developing the carbon dioxide technology
platform to foster sustainable economic development. Seed funding and
technical guidance from the EPA's Green Chemistry program were
instrumental to our early research findings, which led us to the
creation of specialty detergent systems that would dissolve in carbon
dioxide. Micell Technologies' Micare system--an alternative to
traditional dry cleaning--eliminates the need for conventional dry
cleaning solvents such as perchlorethylene (perc) which has been
identified and regulated as a groundwater contaminant and a probable
human carcinogen. Since our discovery and throughout our progress
leading to commercialization, we have remained in close touch with EPA
officials in the Green Chemistry and Design for the Environment (DfE)
programs.
On February 5, 1999, in Wilmington, North Carolina, we launched the
first U.S. dry cleaning operation utilizing carbon dioxide, and the
success to date of this breakthrough will lead the way for Micell to
open many more environmentally friendly dry cleaning locations around
the country this year.
I am proud of this environmental success, but I want you and other
legislators to share in that success because Micell's discovery was
made possible in large part because of the federal seed funding I
received from the EPA and NSF in the early lean years of my research.
It is important for you to be aware of past successes and setbacks as
this Subcommittee prepares its ``mark'' for fiscal year 2000
programming.
I encourage the Subcommittee to provide an additional $2 million,
over and above the Administration's budget request, to the EPA for the
DfE Garment and Textile Care Program. Since 1992, the DfE has worked
with the nation's 30,000 commercial dry cleaners--one of the largest
users of chemicals that come into contact with the public. It all
started at an international roundtable on dry cleaning in which
industry leaders and the EPA agreed that health and environmental
issues surrounding the dry cleaning industry could be addressed most
effectively through a voluntary, proactive approach. The Design for the
Environment program has been a catalyst for positive, environmentally
responsible change in the dry cleaning industry as EPA professionals
have brought together a variety of stakeholders: Garment and textile
designers; dry and wet cleaners; manufacturers; fiber producers;
retailers; consumers; employees; government purchasing agents; industry
trade groups; environmental and health interest groups; and even
researchers.
This leadership from the EPA has resulted in a life cycle approach
that includes the identification of upstream industrial decisions and
trends that impact garment care process choices.
DfE accomplishes its mission by publishing the Cleaner Technologies
Substitutes Assessment for Professional Fabricare Processes (CTSA)
which is a technical report presenting relative cost, risk and
performance information on existing and new cleaning technologies and
substitute solvents. Comprehensive data from Micell's liquid carbon
dioxide dry cleaning machine will be featured in the next updated CTSA
publication.
EPA--through the DfE program--also supports university research on
various existing and new cleaning technologies, conducts training
courses for garment care professionals on new technologies, develops
case studies on new and existing cleaning processes, holds and attends
conferences on an as needed basis, and publishes many fact-filled
resource documents for its diverse audiences.
Now that a viable liquid carbon dioxide cleaning system is
commercially available, it is imperative that the DfE program work as
vigorously with stakeholders as the agency has done to educate them
about new wet cleaning technologies.
As a result of enhanced awareness of available technological
options, dry and wet cleaners can improve their operations and their
bottom line while contributing to a safer workplace and a cleaner
environment. The public--all taxpayers--deserve to understand the
choices available to them in fabrics, cleaning processes and
environmental protection.
The NSF has been instrumental as well by supporting basic
scientific inquiries into the CO2 technology platform. The NSF Young
Investigator program and the Presidential Faculty Fellowship program
through the Division of Materials Research supported my research at
NSF. This funding allowed my early, not fully developed ideas to be
explored at the start of my academic career in 1990 at the University
of North Carolina at Chapel Hill. The results from this support led to
numerous developments for improved polymer manufacturing and processing
technologies to avoid the use of billions of pounds of organic solvents
and even larger amounts of water that are currently used.
I appreciate your consideration of my viewpoint, and I hope this
Subcommittee will agree to appropriate more funding for both the EPA
and the NSF as it relates to green chemistry and education initiatives.
Thank you.
______
Prepared Statement of the City of Miami Beach, Florida
Mr. Chairman and Members of the subcommittee, my name is Neisen
Kasdin, and I am the Mayor of the City of Miami Beach, Florida. I
appreciate your allowing me the opportunity to submit testimony on a
number of important initiatives for which the City of Miami Beach seeks
federal assistance.
north shore open space park /north beach recreational corridor project
The City of Miami Beach, Florida, seeks your support for funding to
create the North Beach Recreational Corridor Project, an
environmentally sensitive recreational greenway which will interconnect
a series of park facilities distributed throughout the City's
residential North Beach District and to tie into a regional network of
recreational trails/alternative transportation routes.
The North Beach Recreational Corridor will provide a continuous
route throughout the entire North Beach District interconnecting and
improving public access to public parks, the beaches and other
recreational, cultural and educational facilities.
The main recreational destination along the corridor will be the
City's North Shore Open Space Park. The 35 acre facility is the largest
park in Miami Beach and is a highly treasured natural resource. Under
the City's plan, great emphasis will be placed on the preservation and
enhancement of the park's natural ecosystems which include the beach
shoreline, a sand dune system and a native coastal hardwood hammock.
New native vegetation plantings are proposed between the back dune and
coastal hammock areas, linking the two habitats and creating a stronger
dune community. Clear cutting of exotic nuisance plant species will
strengthen native plantings and help create a visual link from land to
sea. An expanded interpretive center is proposed to improve public
access to the highly successful Sea Turtle Hatchery program and other
nature education programs and activities. This unique combination of
natural resources and public facilities will offer the community an
``environmental classroom'' that will be highly conducive to the
exploration and understanding of the barrier island ecosystem
indigenous to Miami Beach.
In addition to the North Shore Open Space Park, the Corridor will
also connect with the Altos Del Mar Park, Band Shell Park, Ocean
Terrace Park, and the 64th Street Park facilities which offer a wide
array of recreational and cultural amenities. The Corridor will also
connect with eight beach access areas to enhance public access to the
beaches and to encourage park-beach cross utilization. Seven regional
parking facilities will also be connected to the recreation trail to
help improve recreational facility access for our residents and
visitors.
The estimated cost of the project is $7.1 million. The City has
secured $3.1 million from a Park Improvement Bond Program and an
additional $840,000 in ISTEA Enhancement Funds. An appropriation of
$3.2 million would provide the additional funds needed to allow this
valuable regional recreational enhancement project to become a reality.
water sewer revitalization
Description of the existing water system
The City of Miami Beach owns, operates and maintains the potable
water system serving customers within the corporate limits. The potable
water facilities include a water distribution system extending
throughout the city, five existing water booster pump stations, and
four welded steel ground storage tanks. A sixth water booster pump
station is planned for location on the MacArthur Causeway at Terminal
Island. Two elevated water storage tanks are located in the south area
of the City; however, both have been removed from service and at this
time there are no plans for future use of these tanks. The city's
potable water is supplied exclusively by the Miami-Dade Water and Sewer
Department (WASD), the department of the County that oversees operation
of the County's water and sewer system.
Because the City of Miami Beach is a coastal barrier island
surrounded by salt water, it was not practical or economical to develop
its own water supply system. The least costly and highest quality water
comes from the Biscayne Aquifer water supply wells located on the
mainland and owned and operated by the County. The city maintains four
large diameter metered supply interconnections with the County's
distribution system.
The water distribution system has approximately 180 miles of water
mains ranging from 2 inches to 36 inches in diameter. The water
distribution system currently serves approximately 11,123 retail
customers. The water distribution system serves 1,008 fire hydrants and
712 fire lines, and has 23,000 valves of various sizes. The system has
11,601 service connections.
Description of the existing wastewater system
The City owns, operates and maintains the wastewater collection and
transmission system serving customers within the corporate limits. All
land usage must connect to the sanitary sewer system as a matter of
City policy, and there are no septic tanks in operation within the
City. The system consists of 152 miles of lines, including both gravity
sewers and pressurized force mains, and 23 wastewater pump stations.
The wastewater system currently serves approximately 9,641 retail
customers.
All wastewater generated within the City is sent to the WASD
Central District wastewater treatment plant on Virginia Key for
treatment and disposal. The 54-inch force main which conveys the
wastewater to the plant is a subaqueous force main running from South
Pointe under Government Cut to Virginia Key. This force main is owned
and maintained by WASD. The County's wastewater collection,
transmission and treatment system is divided into three districts
referred to as the North, Central and South Districts, each served by
its own wastewater treatment plant. In addition to Miami Beach, the
Central District plant treats wastewater from the City of Miami as well
as other communities and unincorporated areas within the Central
District. The wastewater transmission system has the capability to
transfer limited quantities of wastewater flows between districts.
Five-year capital improvement program
The City has developed a Five-Year Capital Improvement Program
containing those projects needed in order to replace and upgrade
components of the Water and Sewer Utility and to provide for the
demands to be placed upon the Water and Sewer Utility by projected
growth. In connection with the water system portion of the Five-Year
Capital Improvement Program, all four of the Water and Sewer Utility's
existing storage tanks will be replaced, all of the existing water
booster pump stations will be renovated and upgraded and most of the
water mains throughout the System will be either cleaned and lined or
replaced and/or extended. The wastewater components of the Five-Year
Capital Improvement Program emphasize will provide improvements to the
wastewater pump stations, and to the gravity collection system to
reduce the amount of infiltration and inflow into the wastewater
system.
The cost of the projects included within the Five-Year Capital
Improvement Program is estimated at $105,208,000. The City expects to
fund these improvements on a cash flow basis primarily from the
proceeds of Series 1995 bonds and parity Bonds which are anticipated to
be issued this year. This method of funding will provide most of the
needed capital, but Federal assistance is still necessary to complete
these much needed improvements. Therefore, the City of Miami Beach
requests a 90 percent-10 percent local/Federal split in order to ensure
that the City meets its goal. Therefore, we are requesting $10.1
million to help up meet our goal of updating our system for the next
millennium.
indian creek waterway revitalization and greenway project
The City of Miami Beach exists as a cluster of barrier islands,
with the Atlantic Ocean on one side and the Biscayne Bay Marine Estuary
on the other. The historic and scenic Indian Creek Waterway system
snakes its way through this eight mile long chain of islands. Just
after the turn of the century, these natural waterways were
``improved'' by dredging and the construction of seawalls to stabilize
the shorelines and to allow the farmers who first settled the area,
transport their produce out to Biscayne Bay and the Port of Miami.
Indian Creek served as the main transportation corridor for the early
settlers, and as the island community grew, it remained the spine that
interconnected the public, commercial and residential areas throughout
Miami Beach. Today, the shoreline development along Indian Creek runs
the full gambit from large scale resort hotels to single family homes,
but it is predominately comprised of low and moderate income, multi-
family residential facilities.
Over the years however, these once pristine waterways have fallen
into decline. The waterway improvements so altered the shoreline
ecosystem that the mangroves and other native plants have died-out or
been overgrown by nuisance exotic species. The steel and concrete
seawalls have crumbled and collapsed.
The loss of native plant communities and the failure of the
seawalls has resulted in substantial erosion of the shorelines and the
undercutting of roadways and public and private structures. The erosion
has also transported thousands of tons of sand and topsoil into the
waterways. Silt and sediment from the eroding shorelines have smothered
benthic marine life and clouded the water. In addition, the eroded
shorelines allow rain water run-off to wash trash, debris, agricultural
chemicals and other pollutants into the waterways.
The loss of water quality and ecosystem destruction has killed-off
or driven away the manatees, dolphins, baitfish and gamefish
populations which used to be in abundance throughout Indian Creek. The
loss of the native wetland plant communities from along the shorelines
has also substantially reduced the available habitat for many key bird,
reptile and animal species, including many migratory birds which
utilize our area as winter nesting grounds.
Through the Indian Creek Waterway Revitalization and Greenway
Project, the City of Miami Beach proposes to create a Public-Private
Partnership between the City, the Indian Creek Area Residents and
Hoteliers, the State of Florida and the National Park Service to
revitalize the Indian Creek Waterway and to restore its historic role
as the backbone of Miami Beach.
The crumbling seawalls will be replaced with an innovative ``living
seawall'' system. This will entail the demolition of the old seawalls
and the construction of a new walls comprised of carefully intermeshed
boulders of different sizes. The slope and elevation of the new boulder
walls will be designed to closely mimic the natural tidal creek
shorelines which pre-existed the seawalls. Geotextile liners will be
installed along the eroded shoreline areas behind the new boulder walls
to prevent future erosion and then the shoreline will be refilled with
rich topsoil. The entire shoreline will then be replanted with native
coastal plant species.
Once the shorelines have been stabilized, the upland areas will be
developed to create a continuous public access corridor or Greenway.
The Greenway would provide public pedestrian/bicyclist access along the
entire length of the waterway with connections to residential area,
resort areas, civic centers, the beaches and four other regional
recreational trails/bike paths. Rest areas, vista areas and waterway
access areas (fishing & canoe launching) will be interspersed
throughout the greenway. Interpretive signage will also be incorporated
into the project to educate residents and visitors about the historic
landmarks and natural features along the greenway trail.
Finally, a comprehensive program will be implemented to maintain
the shoreline improvements and to foster the continuing restoration,
enhancement and protection of the Indian Creek Waterway System.
The City of Miami Beach requests an appropriation of $3.75 million
to implement this important initiative.
coastal erosion initiative
(Innovative beach erosion prevention and sand recycling system
demonstration Project)
Dade County, Florida has approximately 15 miles of sandy beaches.
The Miami Beach Segment makes up 10.5 miles or 70 percent of that beach
front area. The Miami Beach Segment is bounded to the north by Baker's
Haulover inlet and to the south by Government Cut Inlet. The
construction of these inlets, just after the turn of the century, left
the Miami Beach Segment isolated between two complete barriers to
along-shore sand migration. As a result, the Miami Beach Segment
continuously loses sand through natural processes but can only regain
sand through artificial means.
In the years that followed the construction of the inlets, the
Miami Beach shoreline steadily receded. By the mid-1970's the shoreline
had receded more than 500 feet and most of the sandy beaches had been
lost. Property owners were forced to build seawalls, bulkheads and
other hardened structures to prevent the coastal infrastructure from
being undercut by the encroaching tides.
The City remains committed to identifying alternate 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 our future
needs. However we have realized that continuing to pump sand on to our
beaches without addressing the underlying causes of the erosion, will
leave us in an endless cycle of needing more, increasingly expensive
sand.
If the erosion cycle can be successfully slowed, it would reduce
the demand for additional sand and save millions of dollars in
renourishment costs; not to mention the elimination of the
environmental, public and legal challenges to renourishment projects.
To achieve this goal, the City embarked upon a program to develop new
technologies which will slow down and help prevent beach erosion
processes. A Sediment Budget Analysis Report, prepared for Dade County,
revealed the presence of several ``hot spot'' areas along our shoreline
which accounted for the majority of the sand that has been lost.
Analysis of the data also revealed the presence of an area of
substantial sand accretion (accumulation) in a near shore area near the
southern end of Miami Beach.
The causative factors behind these hot spots have been linked to
changes in the shape (compass orientation) of the coastline and benthic
topographical anomalies in the near shore area. The worst of these hot
spots exist within two half-mile long areas along our shoreline. These
two hot spots have been shown to be responsible for the loss of almost
200,000 cubic yards of sand each year. The hot spots also accelerate
the erosion of the adjacent beaches for as much as a mile to the north,
as the sand from the adjacent beaches slough down to fill the voids
within the hot spots. With beach renourishment costs of about $14/cubic
yard of sand, these hot spots are responsible for the loss of more than
2.5 million dollars annually.
After detailed examination of the available data and careful
consideration of the possible alternatives, our coastal engineers have
designed a series of detached headlands or breakwater-type structures
which will significantly reduce the rate of erosion within these hot
spot areas and help to stabilize large sections of our beach. The size
and configuration of these headland structures have been carefully
``tuned'' to the specific conditions at each of the hot spot areas. Our
coastal engineers estimate that the elimination of each hot spot will
widen and stabilize approximately one mile of beach. It is believed
that these benefits can be gained without significant negative impacts
to the down drift beach areas or offshore reefs. Sea turtle nesting in
the area will also be enhanced by the widening and stabilization of
more than two miles of beach.
The City of Miami Beach and Dade County have jointly initiated an
emergency effort to develop and construct breakwater reef structure in
the location of the two worst hot spots. Preliminary estimates indicate
the breakwater structures will cost approximately $450,000 each. The
required funding has already been appropriated for the project and
construction is scheduled to begin in mid-1999.
The City's master plan is to develop a series of erosion control
breakwaters, positioned in key areas along the shoreline, to widen the
beaches and slow the erosion process. Concurrent with the efforts to
slow the beach erosion process, we plan to initiate a feasibility
study/demonstration project to pursue an innovative and promising
potential solution to our sand shortage problem. The Sediment Budget
Analysis Report revealed the presence of a highly accretional near-
shore area at the southern end of Miami Beach. The area is accreting
sand at a rate of more than 200,000 cubic yards per year. Sand is
accreting in the area because of the navigational Jetty that juts 1500
yards out to sea, along the north side of the Government Cut Inlet, at
the southern tip of Miami Beach. The jetty structure acts as a barrier,
blocking the natural, southerly migration of the near shore sand lens,
which causes the migrating sand to pile-up on the north side of the
structure. As more and more sand piles-up, the sand lens builds and
creeps offshore toward the end of the jetty. Because the seaward end of
the jetty extends out to the first line of coral reefs which parallel
our shoreline, the jetty and the reef line together form a 19trap'
which prevents most of the sand from being able to move further south.
This near-shore lens is continuing to build and will eventually 19over-
top' the reef and smother living corals. If authorized, the City will
seek to have the overfill accumulating at the southern end of the
segment ``back passed'' or pumped back up to the eroded beaches at the
northern end of our beach segment.
Local government has already made a substantial investment in the
development of this process. An appropriation of $6.5 million will
allow the City to complete a thorough engineering analysis of the
entire system, obtain the necessary Federal and State permits, and
contract for the renourishment of a mile long section of beach
utilizing back-passed sand. This project will serve as a demonstration
of the effectiveness of the Sand Recycling System and the importance of
regional sediment management.
______
Prepared Statement of the Missouri Rural Water Association & National
Rural Water Association
epa rural water technical assistance and ground water protection
Thank you Chairman Bond and Members of the Committee. My name is
Dennis Flanery. I represent the State of Missouri on the National Rural
Water Association Board of Directors. I am very honored to represent
all of Rural Water in front of you today.
My message today is that we believe the funding for rural water
technical assistance and small community groundwater protection is the
most effective use of EPA funds you appropriate from the drinking water
program. Each year this subcommittee approves hundreds of millions of
dollars for the EPA to increase the regulatory burden on small towns.
In turn, EPA increases the number and stringency of the regulations,
passing billions in compliance costs onto our small towns.
Much of this effort is misdirected because improving drinking water
in small communities is more of a RESOURCE problem than a REGULATORY
problem. Every community wants to provide safe water and meet all
drinking water standards. After all, local water systems are operated
by people whose families drink the water every day, who are locally
elected by their community, and who know, first-hand, how much their
community can afford.
Numerous studies have concluded that a majority of non- compliance
with EPA regulations is not due to actual water contamination, but is
caused by the complexity of the regulations. Also, studies by the
National Rural Water Association and EPA have shown that small towns
will quickly remedy any water problems when provided understandable
education and additional resources. More regulations won't help poor
communities which can't afford the current regulatory regime, much less
a new set of regulatory hurdles. What works in small towns is providing
common-sense assistance in a form they can understand and afford. It
takes someone sitting down with them evening after evening, and working
with them through the ENTIRE process. Giving them a copy of the federal
register and a phone number to call is not helping. Attached is a list
of the over one thousand on-site visits carried out in the State of
Missouri last year.
Each time we help a community we educate them on their resources so
that they can solve their problem on their own next time. THIS IS KEY .
. . ENCOURAGING LOCAL responsibility and building local know-how. If
the community does not accept and support measures to protect their
water, no amount of regulation will protect it. The TA program promotes
this kind of local initiative.
The need for technical assistance is increasing with the dramatic
increase in new federal regulations including: consumer confidence
reports, radon, ground water rules, operator certification, source
water protection, disinfection byproducts, etc. Our rural water
technical assistance staff will get thousands of the calls for help
from each of these regulations.
When local communities take responsibility for protecting their
environment they do it more effectively and economically than
governmental regulations. This has been documented in our groundwater/
wellhead protection program's rapid expansion to small communities all
over the state in the last four years, a list of affected communities
is attached to my testimony. My reason for pointing this out is that we
are facing the same challenge in source water/non-point source
pollution in rural areas.
As the Congress provides additional EPA funding (under the Safe
Drinking Water Act and the Clean Water Action Plan) for source water
protection, clearly we need a grassroots source water protection effort
that will do for source water what the grassroots groundwater
protection program did for groundwater. To this end, we urge you to
expand the ground water initiative to include source water. Last year
this House Committee provided $7.5 million for an innovative grassroots
source water protection program. We urge you to again provide this
funding and to specifically designate the National Rural Water
Association to carry out this program in each state. This will ensure a
bottom up, locally supported element as contrasted with EPA's proposed
top down regulatory approach.
Mr. Chairman, I will close with our request that the Committee
include $8.6 million in the EPA's budget for all state rural water
technical assistance and our groundwater protection initiatives and to
again provide $7.5 million for an innovative grassroots source water
program. Thank you for your past support and the opportunity to appear
before you today.
______
Prepared Statement of the Passaic Valley Sewerage Commissioners
Chairman Bond and Members of the Committee, my name is Robert
Davenport and I am the Executive Director of the Passaic Valley
Sewerage Commissioners in Newark, New Jersey. I would first like to
thank you for the opportunity to testify today.
PVSC owns and operates one of the largest wastewater treatment
plants in the nation. We treat wastewater from 1.3 million people in 47
towns and cities and from over 300 large industries in Northern New
Jersey.
When I addressed this distinguished committee last year our Passaic
River/Newark Bay Restoration Program was just getting started. This
year I'd like to thank you for your past support and update you on the
progress and the achievements of the program we've made in the last
year.
New Jersey is distinguished as being the birthplace of industry and
manufacturing in the United States. The industrial centers of Newark,
Jersey City and Paterson developed and thrived in the 1800's;
generating the goods and capital that contributed to the building of
our state and nation.
Unfortunately, the engineering standards at the time of this great
development called for the combining of both storm water and sanitary
sewers into one system. Therefore, when it rains, storm water enters
the combined sewer systems and the capacity of the sewer lines is
exceeded which causes a mixture of untreated wastes and rainwater
runoff to discharge into the local waters. This, as you know, is called
a Combined Sewer Overflow, or CSO. Engineers were simply unaware of the
environmental detriment caused by combining both systems into one.
Science followed the principle that dilution of wastewater by
stormwater runoff in a combined sewer system would have minimal impact
upon the environment. We have since learned that this is not the case.
The Passaic River and Newark Bay are now faced with swimming
prohibitions due to elevated coliform bacteria concentrations and
fishing and shellfishing bans due to the contaminated river sediments.
Dredged material disposal options are limited due to toxic contaminants
such as heavy metals and organic compounds in the river sediments.
Floatable debris impacts the aesthetic qualities of these water bodies.
While in the process of discovering the impact of CSOs on the
environment, the economic base of Passaic Valley's combined sewer
communities has experienced dramatic erosion. The cities of Newark,
Jersey City, Paterson, Harrison, East Newark, Bayonne and Kearny are
among the poorest communities in New Jersey, and each has a combined
sewer system which continually threatens the water quality of the
Passaic River and Newark Bay during wet weather events.
The traditional solution for reducing CSOs is to separate the storm
water from the sanitary sewers. The estimated cost of this traditional
solution will be well over $5 billion. This has never been and will
never be a feasible solution.
For the last 30 years New Jersey has been struggling to find a
solution that is both economically viable and environmentally
acceptable to the problem of CSOs. PVSC found just such a solution. The
Passaic River/Newark Bay Restoration program has a three pronged
approach to alleviate the ongoing pollution to these NJ resources.
The first element of the program is the implementation of plant
wide improvements to increase the treatment plant's wet weather
capacity from 368 million gallons per day to 700 million gallons per
day. Combined sewer discharges will be reduced by 332 million gallons
per day to attain 106 percent of EPA's Long Term Control Requirement
for wet weather flow pollutant removal. The program will result in the
removal of 4,000 lbs/year of Organic Compounds, 90,000 lbs/year of
toxic heavy metals, and 12,000,000 lbs/year of Conventional Pollutants
which is now discharged to the Passaic River and Newark Bay during wet
weather.
The second element is a trackdown of toxic discharges to the sewer
system. This work is being implemented in conjunction with the NJ
Department of Environmental Protection. The goal is to locate and
identify unknown sources of ongoing discharges of toxic chemicals of
concern.
The third element is the Shoreline Cleanup portion of the program.
We provide coordination and support to municipalities, counties,
citizens, service groups, and local businesses to remove trash along
the riverbanks in their communities. Gloves, trash bags, trash disposal
and other supplies are given to volunteer groups to help them with
their clean up efforts.
During the month of August 1998, PVSC's summer employees removed
trash on a daily basis in urban parks along the River. Due to the
success of last year's summer program, we anticipate covering more of
the river's banks during the months of June, July and August.
I'd now like to share the results of last year's efforts with you.
Last summer we assisted in 42 cleanups and helped remove more than 226
tons of trash from the Passaic River. So far, this year in two Earth
Week cleanup projects we assisted over 500 volunteers whom we presented
with a clean-up crew tee shirt as a thank you for their efforts.
We are looking forward to the June launching of a 50-foot skimmer
vessel which will remove floating debris from the waterways in our
district. Funds for the vessel's purchase were provided by the Port
Authority of New York and New Jersey, and the cost of operation will be
borne by PVSC.
PVSC is working with the State of New Jersey, the State of New
York, and the USEPA on a bi-state program to reduce discharges of toxic
materials throughout the New York/New Jersey Harbor Estuary. Led by
PVSC, ten NJ wastewater agencies were awarded over $300,000 to sample
for toxic materials in combined sewer, stormwater and treatment plant
effluents. An additional $600,000 will be spent by NJ to test the
samples for toxic material. We have applied to the State of NJ for an
additional $2 million to enable us to track down the sources of the
toxic compounds.
The real key to improving the water quality of the Passaic River
and Newark Bay is to reduce Combined Sewer Overflows. PVSC's solution
will cost $82 million compared to the traditional solutions cost of
over $5 billion.
The State of NJ awarded PVSC $15 million for the engineering design
for the plant improvements needed to implement the program. An
application was submitted to the USEPA for three projects to be funded
by a grant authorized by your committee in the fiscal year 1999
Appropriations Bill. Local funds will be used to provide the match for
the special appropriations grant. In an effort to accelerate the
program, PVSC has applied for a $25 million state revolving loan to
finance the construction of a major component of the plan. We look
forward to a late summer ground breaking for these projects.
In spite of all the progress we've made, the program is just
beginning PVSC has exhausted its ability to fund additional work
without continued Federal assistance. We are respectfully requesting
$10 million in Federal funds for this year to begin construction of the
next elements in the plant improvements program. The completion of the
next element will get us half way to our goal of doubling our wet
weather flow.
Once again, I would like to thank you and the committee for your
continued support for the Passaic River/Newark Bay Restoration Program.
We strongly believe that this program will restore the Passaic River
and Newark Bay as a recreational and economic resource for the region.
______
Prepared Statement of the El Paso Water Utilities Public Service Board
Thank you Chairman Bond and Members of the Committee for the
opportunity to provide testimony in support of $13.5 million for the
design and engineering phase of the New Mexico/Texas Water Commission's
Regional Sustainable Water Project. My name is Ed Archuleta, and I am
the General Manager of the El Paso Water Utilities Public Service Board
and the Program Manager of the El Paso-Las Cruces Regional Sustainable
Project.
The City of El Paso, Texas, and the City of Juarez, Mexico, rely on
the water from the Hueco Bolson aquifer for the majority of their
drinking water supply. This aquifer will be fully depleted within the
next twenty-five years if an alternative year-round surface water
supply is not found. It is the objective of the sustainable water
project to create an alternative long-term surface water supply for the
entire region.
This cooperative project will reverse the depletion of the major
groundwater aquifers in our area and will provide a long-term, high-
quality sustainable water supply for our rapidly growing bi-state/bi-
national region.
To allow for the proper coordination and timely completion of the
project, we urge the Committee to provide this specific funding as part
of the Border Environment Infrastructure Fund (BEIF). The BEIF was
utilized to fund the initial environmental and water resource studies
for the project ($3 million in fiscal year 1998) which are now being
completed. By specifically designating these funds for the sustainable
water project it has enabled the project to move forward with a minimum
of bureaucratic interference. This approach to funding has the support
of the EPA officials, Border Environment Cooperation Commission, and
NADBank staff responsible for the implementation of the BEIF programs.
Project benefits include:
--Improving and protecting the quality of the region's ground and
surface water;
--Preserving the Hueco and Mesilla groundwater bolsons;
--Implementing a year-round delivery system of surface water, which
will enhance agricultural and municipal water supplies and the
riverine ecosystem;
--Increasing surface water supply through efficient delivery and
water treatment; and
--Continuing to meet treaty and compact requirements for delivery of
Rio Grande Project water.
The El Paso-Las Cruces Regional Sustainable Water Project will
benefit more people on the Texas/Mexico border than any other project
that might be funded under the North American Free Trade Agreement
(NAFTA). The affected region includes El Paso, TX, Las Cruces, NM and
Ciudad Juarez, Chihuahua, Mexico. The current regional population is
over 2 million, and is expected to more than double by 2025. Chronic
unemployment is over 10 percent, yet the region's future economy,
environment and quality of life is dependent on a reliable supply of
water.
As mentioned above, concurrent with the region's population boom is
the depletion of its local aquifers. Those underground water sources
provide Las Cruces and Ciudad Juarez with 100 percent of their water,
and El Paso with 57 percent. The Hueco Bolson, designated a Priority
Groundwater Management Area by the Texas Natural Resources Conservation
Commission, is expected to be depleted by 2025. The Sustainable Water
Project will assure the long term preservation of this groundwater
source.
This sustainable water supply project is the top environmental
priority for this heavily populated El Paso region of the border. The
$13.5 million will design water plants in New Mexico and a plant in El
Paso. The project includes an aqueduct system, storage tanks, pump
stations, and aquifer storage and recovery system for the Hueco Bolson
(to store water during periods of high runoff for use during periods of
drought). The detailed phasing plan for these facilities will be
completed by the end of the year.
Without federal assistance the project cannot move forward. State
and local monies are difficult to obtain because the scope is regional
and multi-jurisdictional and if any participant decides to use its
funding as leverage then cooperation becomes more difficult. However,
the availability of BEIF funds allows the process to proceed under the
guidance of the New Mexico/Texas Water Commission. Attached is a list
of participants in this process. We believe this is exactly what the
Congress intended when NAFTA passed and the BEIF program was funded.
We thank you again very much for your past support for this
project. We urge you to specifically designate the $13.5 million from
the BEIF program so that the next phase of the program can proceed
immediately.
______
Prepared Statement of the Brownsville Public Utilities Board
Good afternoon Chairman Bond and Members of the Committee. Thank
you for the opportunity to testify before you today. My name is Robert
Lackner and I am Chairman of the Public Utilities Board in Brownsville,
Texas.
Our purpose for testifying is to first thank you for your
assistance last year in providing $2.5 million to allow for the initial
studies and regional coordination needed to initiate the Brownsville
Weir and Reservoir project and, second, to request an additional $3.5
million from the Border Environmental Infrastructure Fund to provide
the federal share of the design and engineering for the next stage of
implementation for the Brownsville Weir and Reservoir Project. The lack
of a stable long term water supply in Brownsville and other lower Rio
Grande communities is the top environmental need in the entire south
Texas region.
The Brownsville Weir and Reservoir Project is the most feasible way
to meet this need. It provides a means for capturing Rio Grande water
that has passed all other river water users and which now flows
directly into the Gulf of Mexico. The Weir is the most efficient way to
conserve water for the use of the local communities.
The Weir would release adequate water to satisfy all local
environmental and downstream uses. The Project uses the existing river
channel for storage and will be accessible to numerous communities
within the United States and Mexico. The alternative is for Brownsville
to construct currently authorized off-channel reservoirs which are
remote to existing water supply facilities, accessible to only a
limited number of municipal users, susceptible to excessive evaporation
losses and potential contamination by saline groundwater and provide no
benefit to Mexico.
The Project promotes water conservation at the highest level
because under current water management conditions, a significant
portion of the water flowing into the Lower Rio Grande goes unutilized
and flows into the Gulf of Mexico. Absent the Project, the
International Boundary Water Commission must release water from Falcon
Reservoir up to seven days in advance of the anticipated downstream
diversions and needs. If the released water is not diverted due to
unexpected reduced demands, mechanical pump failures, or climactic
changes, any uncaptured or unused water flows into the Gulf of Mexico.
The Weir solves this problem, and, as stated above, it avoids the
environmental and cost problems of building an off-site reservoir. The
Project is the ultimate water conservation strategy for our region and
can conserve more water than any other alternative available. Every
acre foot of water conserved by the Project will result in an
unreleased acre foot of water remaining in storage behind Falcon Dam
for the benefit of all downstream users, municipalities, industries and
agriculture.
The Project has the strong support of the State of Texas. In fact,
the Texas Water Development Board has incorporated the Project as its
top priority in the current Texas Water Plan. There is also written
support from City of Matamoros, Mexico and from the Mexican State of
Tamaulipas. In addition, the Project has the broad support of local
governments, citizens, and, increasingly, local environmental
organizations. For the record, we have attached a list of the many
individuals and groups that have expressed support for the Brownsville
Weir and Reservoir Project.
We cannot build the Project without federal environmental funding
assistance. The Brownsville Public Utility has spent $3 million on
hydrology and preliminary environmental studies for this project. As a
multi-jurisdictional bi-national effort, we need one source of funding
for this initial design and engineering phase. This is exactly the type
of project that the Border Environmental Infrastructure Fund (BEIF) was
designed to help, but we have found that in order to move this project
along in a timely manner, there must be Congressional direction given
on the expenditure of the funding in the appropriations bill. We
believe that EPA, NADBANK and the Border Environment Cooperation
Commission staff agree that a Congressionally mandated provision is the
most effective approach. Thus, we are asking you to earmark $3.5
million out of the BEIF $100 million in funding requested by the
Administration.
Thank you again for your kind support. This Committee has already
done more to assure a long term water supply for the over 500,000
persons in the South Rio Grande area than any other organization or
resource. We urge you again to assist us in completing the engineering
and design for the Weir.
______
Prepared Statement of the California Industry and Government Coalition
on PM-10/PM-2.5
Mr. Chairman and Members of the Subcommittee: On behalf of the
California Industry and Government Coalition on PM-10/PM-2.5, we are
pleased to submit this statement for the record in support of our
fiscal year 2000 funding request of $1.25 million in the EPA budget for
the California San Joaquin Valley Regional PM-10/PM-2.5 Air Quality
Study.
The San Joaquin Valley of California and surrounding regions exceed
both state and federal clean air standards for small particulate
matter, designated PM-10/PM-2.5. The 1990 federal Clean Air Act
Amendments require these areas to attain federal PM-10/PM-2.5 standards
by December 31, 2001. Attainment of these standards requires effective
and equitable distribution of pollution controls that cannot be
determined without a major study of this issue.
According to EPA and the California Air Resources Board, existing
research data show that air quality caused by the PM-10/PM-2.5 problem
has the potential to threaten the health of more than 3 million people
living in the region, reduce visibility, and impact negatively on the
quality of life. Unless the causes, effects and problems associated
with PM-10/PM-2.5 are better addressed and understood, many industries
will suffer due to production and transportation problems, diminishing
natural resources, and increasing costs of fighting a problem that begs
for a soundly researched solution.
PM-10/PM-2.5 problems stem from a variety of industry and other
sources, and they are a significant problem in the areas that are
characteristic of much of California. Typical PM-10/PM-2.5 sources are
dust stirred up by vehicles on unpaved roads, and dirt loosened and
carried by wind during cultivation of agricultural land. Soil erosion
through wind and other agents also leads to aggravation of PM-10/PM-2.5
air pollution problems.
The importance of this study on PM-10/PM-2.5 is underscored by the
need for more information on how the federal Clean Air Act Amendments
standards can be met effectively by the business community, as well as
by agencies of federal, state and local government whose activities
contribute to the problem, and who are subject to the requirements of
Title V of the Clean Air Act. There is a void in our current
understanding of the amount and impact each source of PM-10/PM-2.5
actually contributes to the overall problem. Without a better
understanding and more information--which this study would provide--
industry and government will be unable to develop an effective
attainment plain and control measures.
Our Coalition is working diligently to be a part of the effort to
solve this major problem, but to do so, we need federal assistance to
support research and efforts to deal effectively with what is
essentially an unfunded federal mandate.
Numerous industries, in concert with the State of California and
local governmental entities, are attempting to do our part, and we come
to the appropriations process to request assistance in obtaining a fair
federal share of financial support for this important research effort.
In 1990, our Coalition joined forces to undertake a study essential to
the development of an effective attainment plan and effective control
measures for the San Joaquin Valley of California. This unique
cooperative partnership involving federal, state and local government,
as well as private industry, has raised more than $24 million to date
to fund research and planning for a comprehensive PM-10/PM-2.5 air
quality study. Our cooperative effort on this issue continues, and our
hope is that private industry and federal, state and local governments
will be able to raise the final $4.6 million needed to complete the
funding for this important study.
To date, this study project has benefited from federal funding
provided through EPA's, DOT'S, DOD's, USDA's, and Interior's budgets--a
total of $13.3 million in federal funding, including $7.6 million in
EPA appropriations. State and industry funding has matched this amount
virtually dollar for dollar.
With the planning phase of the California Regional PM-10/PM-2.5 Air
Quality Study complete, a number of significant accomplishments have
been achieved. These interim products have not only provided guidance
for completion of the remainder of the Study and crucial information
for near-term regulatory planning, they have also produced preliminary
findings which are significant to the Environmental Protection Agency's
(EPA) interests.
The Study is significant to EPA interests for a number of reasons.
The San Joaquin Valley experiences some of the most severe PM episodes
in the nation. The Valley is currently classified as one of five
serious PM-10 non-attainment areas, and is likely to exceed both the
new annual and 24-hour national ambient air quality standards (NAAQS)
for PM-2.5. Exceedances of the PM-10 and PM-2.5 standards span many
seasons and are influenced by a broad cross-section of sources. The
information being collected by the PM study is essential for
development of sound and cost-effective control plans. A number of the
Study work products however will also have applicability to other areas
of the nation. Products such as evaluation of monitoring methods and
improved air quality and meteorological modeling techniques will assist
the will assist the EPA in addressing PM non-attainment problems in
areas outside of California as well.
To this end, the PM study is expending significant resources to
provide an improved understanding of the nature and causes of PM
exceedances within the San Joaquin Valley and surrounding regions. One
of the major recent efforts was a preliminary field monitoring program
that was conducted during the fall and winter of 1995/96. Extensive air
quality, meteorological, and fog measurements were collected. This
database is being analyzed to address a number of questions including:
(1) the sources contributing to elevated PM-10 and PM-2.5
concentrations, (2) the zone of influence of specific sources, (3) the
spatial representativeness of a monitoring site, (4) the adequacy of
current monitoring methods, and (5) wind flow patterns and transport
routes between the Valley and surrounding areas. The database produced
as a part of this study is unparalleled in the nation, and results from
the study are already providing a substantive base of understanding
about PM-2.5. Preliminary results indicate that PM-2.5 constitutes 70
percent to 80 percent of the PM-10 mass during the wintertime.
Secondary ammonium nitrate is often the largest fraction of PM-2.5
mass, and concentrations of ammonium nitrate tend to be very uniform
throughout the study region. Site to site variability in PM-2.5 mass is
primarily due to local variations in carbon, superimposed on the
regional background of ammonium nitrate.
The results of these analyses are being used to design large scale
field monitoring programs to be conducted in 1999 and 2000. These field
programs will address both the annual and 24-hour PM-10 and PM-2.5
standard. Surface and aloft monitoring of air quality, meteorology,
fog, and visibility will be conducted at a cost of over $12 million.
Final plans for these field studies are being developed, which will be
carried out by numerous contractors over a broad area encompassing
Central California, the Sierra Nevada Mountains, and the Mojave Desert.
Substantial resources will also be devoted to developing improved
emissions estimates. A database of the field study results will be
completed in 2001, with air quality modeling and data analysis findings
available in 2002. This timeline is ideally positioned to provide
information for federal planning requirements as a part of the new PM-
10/PM-2.5 NAAQS.
The Environmental Protection Agency's prior funding and strong
support for the Study have enabled projects to occur. Continued support
by EPA is essential to implement the major field programs and
subsequent modeling and data analysis and ensure that effective control
can be developed to meet the PM-10 and PM-2.5 NAAQS.
For fiscal year 2000 our Coalition is seeking $1.25 million in
federal funding through the U.S. Environmental Protection Agency to
support continuation of this vital study in California. We respectfully
request that the Appropriations Subcommittee on VA, HUD and Independent
Agencies provided this additional amount in the EPA appropriation for
fiscal year 2000 and that report language be included directing the
full amount for California. This will represent the final year of
funding requested from EPA.
The San Joaquin Valley PM-10/PM-2.5 study will not only provide
this vital information for a region identified as having particularly
acute PM-10/PM-2.5 problems, it will also serve as a model for other
regions of the country that are experiencing similar problems. The
results of this study will provide improved methods and tools for air
quality monitoring, emission estimations, and effective control
strategies nationwide. Consequently, the beneficial results of this
study will contribute to national policy concerns as well.
The Coalition appreciates the Subcommittee's consideration of this
request for a fiscal year 2000 appropriation of $1.25 million for EPA
to support the San Joaquin Valley Region PM-10/PM-2.5 Air Quality
Study. EPA's past contributions have helped ensure the success of the
study. The coalition thanks you for your support of this important
program.
______
Prepared Statement of the University of Miami
Mr. Chairman and Members of the Subcommittee, I appreciate the
opportunity to submit testimony on behalf of the University of Miami.
The University is seeking your support for several important
initiatives within your purview, through the Army Corps of Engineers,
the Environmental Protection Agency, and the National Aeronautics and
Space Administration. It is our firm belief, Mr. Chairman, that these
projects can provide substantial benefit to the nation.
Headquartered at the University of Miami, the Rosenstiel School is
recognized as one of the premier academic oceanographic research
facilities in the world. Located on a 16-acre tract on Virginia Key in
Miami's Biscayne Bay, the Rosenstiel School provides the only sub-
tropical marine research facility in the continental United States. It
located adjacent to and coordinates daily with the national NOAA lab
and research facility. Also, the Rosenstiel School because of its
unique location--the Gulf Stream is immediately offshore; just to the
south lies a vast of expanse of the only living coral reef off the
shores of the continental United States; and just to the east the
Florida-Bahamas Carbonate Platform--is a unique resource for the
nation, as well as for Florida and the southeast region.
There are close to 100 recognized scientists, researchers, and
educators at the Rosenstiel School who collaborate closely with other
Florida institutions and whose distinct expertise is vital in
addressing critical national, regional, and Florida natural,
environmental, and climatic challenges.
The Rosenstiel School has long been recognized as a major national
research institute focusing on the living coral reef as a unique and
critical national and international resource, critical to the vitality
and health of the marine life and coastal marine environment of Florida
and the southeast. Florida's coral reefs are the only living coral
reefs off the continental United States. The environmental, climatic
and man-made challenges to and stress on these precious resources are
extensive. To preserve and protect our reefs requires the organization
and coordination of the broadest range of talent and resources.
Coral reefs are the only ecosystems on Earth constructed entirely
by the secretions of a complex assembly of marine animals and plants.
They are economically important resources to humans as sources of food,
medicinals, building materials, and coastal protection. They are
especially invaluable, in our increasingly crowded world, for the
spiritual relief they provide the millions of people that journey to
visit them each year. Unfortunately, changes in water quality due to
coastal development, environmental changes potentially related to
global climate change, and over-exploitation of coral reef fisheries
resources, are contributing to world-wide coral reef deterioration at
an alarming pace, especially in the Caribbean region. U.S. coral reefs
in Florida are down-stream of the entire Caribbean coral reef system,
and are thus dependent on Caribbean reefs for larval recruits and
maintenance of fisheries stocks. Florida reefs could also be affected
by pollutants released into marine waters by nations in the region, and
from our own rivers via discharge into the Gulf of Mexico.
Symptoms of deterioration are manifested by losses in coral
diversity and percent cover, increases in the biomass of fleshy
seaweeds, and the absence of larger predatory fishes and invertebrates.
In some cases it is simple to determine the immediate cause(s) of these
ecosystem changes [and their solution]. But with increasing frequency,
these changes are being found at locations distant from human
populations of any size, and we do not know enough to discriminate
between the effects of far-reaching anthropogenic activities and
natural processes. Scientists are hampered in helping government make
critical and socially difficult management decisions by our rudimentary
understanding of coral reef ecosystem processes. U.S. coral reef
research has historically been piece-meal and under-funded, with few
attempts at interdisciplinary, process-oriented research. Synthesis of
existing information to produce new approaches for process-oriented
research is greatly needed, but the means to bring appropriate groups
of scientists together does not exist in the U.S.A. In this regard the
United States of America lags behind other nations, such as Australia,
that are stewards of major coral reef resources. As the most developed
country in the region, the U.S. must a role of leadership in coral reef
conservation and research in the Caribbean.
The National Center for Atlantic and Caribbean Coral Reef Research
seeks to coordinate U.S. coral reef policy and research, and assemble
major national and international initiatives pertaining to coral reefs.
The Center fosters organization and collaboration within the U.S.
scientific community, leads the development of a new level of
understanding of the processes and environmental conditions necessary
for the establishment, survival and sustainable use of coral reef
ecosystems public.
We seek to continue the support provided last year through the
Environmental Protection Agency for the National Center for Atlantic
and Caribbean Coral Reef Research. We have launched a targeted and
broadly constructed southeastern regional focus that can parallel and
complement the well-funded and structured approach the Congress has
established in the state of Hawaii. The long-term implementation
strategy involves all of the core Florida institutions and agencies
already working, along with the Rosenstiel School, on one or more
components of the overall reef challenge. For fiscal year 2000, we
request $2 million from the Subcommittee through the Environmental
Protection Agency to continue the implementation and expand the reach
of this vital coral reef research program.
Also through the Environmental Protection Agency, the University of
Miami's Rosenstiel School of Marine and Atmospheric Sciences and its
School of Medicine seek to establish a Joint Center for Pediatric
Asthma and Respiratory Disease. The objective is to establish a center
for the Southern United States to conduct, promote, and support
research into the effects of ambient particulate matter (PM) and other
airborne constituents on human health to formulate future environmental
regulations with a strong scientific foundation.
The Center will focus on airborne-particle/health issues in the
southeastern United States--a region that is subjected to a wide range
of airborne pollutant impacts. The levels of ozone and oxidants are
seasonably very high over large regions and the rate of noncompliance
with the ozone standards is increasing, resulting in a number of large-
scale, atmospheric, chemistry/pollution studies. Populations in coastal
regions are impacted by other types of particles whose health-related
properties have not been well characterized or understood, including
the impact of wind-blown sea-salt; marine toxins, bacteria, and various
marine micro-organisms. The Center will also provide expertise on
matters relating to air quality and human health in the Southeastern
U.S.
There are seven specific objectives of the proposed research that
will test the hypothesis that exposure to ambient (indoor and outdoor)
PM significantly affects the cardiopulmonary response of susceptible
populations of children and seniors. The Center activities involve the
participation of many different groups associated with six different
institutions, the activities of which are organized into research
themes.
Through the Rosenstiel School, the School of Medicine and a
partnership with other institutions, the Joint Center for Pediatric
Asthma and Respiratory Disease will provide a broad-base of expertise
in atmospheric chemistry (indoor and outdoor), exposure assessment,
cardiopulmonary medicine, epidemiology and public health. We are
seeking $2 million through the Environmental Protection Agency for this
important scientific and medical initiative.
Next, Mr. Chairman, my colleagues are seeking to use Synthetic
Aperture Radar (SAR), a powerful remote sensing system operating at
microwave frequencies where the atmospheric transmission is high. SAR
is able to operate in all weather, day or night and, because SAR
artificially synthesizes an aperture or antenna which is hundred of
meters long in space, it will provide multi-parameter high-resolution
observations in the microwave spectrum.
Space-based satellite SAR systems are able to monitor the movement
of targets on land and ocean in near real-time, map topography with
unprecedented accuracy, access storm and flood damage to urban and
rural infrastructure. SARs provide data that can be used to forecast
major volcanic eruptions and understand the earthquake process, and a
host of other civilian, and scientific applications.
Unfortunately, the current infrastructure in South Florida
precludes most of these applications. Florida lacks its own ground
receiving station, so even though satellites frequently pass over
targets of interest, the data must be downlinked to a station in either
Canada or Oklahoma. This downlink request must be made months in
advance, as large numbers of users are requesting time on a limited
facility. It takes so long to obtain and process raw SAR data into a
usable image that the ``window of opportunity'' is usually lost by the
time the data are ready.
The University of Miami uses SAR data for a variety of terrestrial
and oceanographic applications, and has a large amount of experience in
the analysis and use of SAR data, and expertise in the operation of
satellite downlink facilities. The proposed ground station would
greatly enhance SAR-based research and operational monitoring in the
Caribbean Basin and Gulf of Mexico. Through this partnership a broad
range of terrestrial and oceanographic research, civil monitoring, and
other applications research would provide vital information for the
region.
We propose that Subcommittee provide $3 million through NASA so
that the agency and the University of Miami can cooperate in the
construction and operation of a SAR ground facility, the Advanced
Tropical Remote Sensing Center of the National Center for Tropical
Remote Sensing Applications and Resources. This unique facility would
be located at the former Richmond VLBI site, a secure facility with
good satellite visibility.
Finally, Mr. Chairman, we ask that you consider a joint request
from the University of Miami and the City of Miami Beach, Florida to
support an effort to counter coastal erosion along the southeast
Florida coast. The effects of coastal erosion in South Florida are
acute. Replenishing our beaches--an economic necessity--consumes
millions of dollars annually. The Rosenstiel School is seeking to
determine cost-effective methods for halting the coastal erosion
process. Our scientists are joining the ongoing effort of the City of
Miami Beach to establish an innovative demonstration project which
would enhance continuous beach erosion prevention efforts and establish
an effective sand recycling system. For fiscal year 2000, the
Rosenstiel School seeks $2 million through the U.S. Army Corps of
Engineers for this important effort.
Mr. Chairman, we understand how difficult year this will be for you
and the Subcommittee. However, we respectfully request that you give
serious consideration to these vital initiatives. All of them have
great implications and will provide exceptional benefits to the well-
being of the nation.
Thank you for allowing me to appear here today.
______
Prepared Statement of the American Society for Microbiology
The American Society for Microbiology (ASM), the largest single
life science organization in the world, comprising more than 43,000
members, welcomes the opportunity to testify before the Senate
Appropriations Subcommittee on VA, HUD and Independent Agencies and
provide comments and recommendations for the fiscal year 2000
appropriations for the scientific research programs within the United
States Environmental Protection Agency (EPA) and the National Science
Foundation (NSF).
The ASM is comprised of scientists who work in academic,
governmental and industrial institutions worldwide. Microbiologists are
involved in research on problems related to human health, the
environment and agriculture. The mission of ASM 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 NSF provides the main source of funding for scientists in the
United working in many areas of biological research. Programs supported
by the NSF are critical to microbiologists, especially as they relate
to the exploration of biodiversity and the roles of microorganisms in
global biogeochemical cycling reactions that maintain the environmental
quality of the earth. The EPA also funds important basic research
activities in focused areas related to the agency's mission of
protecting the environment. This testimony will outline the ASM's
funding recommendations for both the EPA and NSF research and
development programs for fiscal year 2000.
environmental protection agency
The EPA's scientific research and development programs are of
interest to many of ASM's members who work in the fields of applied and
environmental microbiology. Research on environmental microbiology is
essential for maintaining air, water, and soil quality; for assuring
the safety of potable water supplies; and for providing safe means for
waste disposal. Support of applied research in the field of
environmental microbiology can lead to enhanced environmental quality
and help protect human health. The ASM believes that sound public
policy for environmental protection depends on adequately funded
programs of intramural and extramural research based on a system of
peer review to assure that support is awarded to research programs
having both quality and relevance. The EPA, which has partnered with
the NSF in recent years for peer review of some extramural research
programs, has begun its own peer review system based upon the NSF
model. Critical peer review of both the intramural and extramural
research programs of the EPA are necessary for ensuring the quality and
scientific validity of studies that are funded.
Science to achieve results program
The EPA's Science to Achieve Results (STAR) program is an important
mission-driven, extramural research initiative. This program is
targeted to receive $110 million for fiscal year 2000, a $14 million
increase over last year's budget of about $96 million. This program
funds important environmental research proposals from scientists
outside the federal government and is a valuable resource for the EPA
in finding solutions to many of the complex environmental problems we
face today. Grants made under the STAR program last from two to three
years and provide about $150,000 of scientific support per grant year.
The STAR program funds projects in specific focal areas including
drinking water, ecology of harmful algal blooms, water and watersheds,
ecological indicators, and pollution prevention, which have significant
microbiological components. The ASM urges the Congress to fully fund
the STAR program at the requested level of $110 million. ASM is
concerned, however, that the exploratory grants program, as opposed to
targeted RFAs, has dropped to only 10 percent of the STAR budget. This
portion is too small to meet the many needs within EPA's mission that
are not targeted in a limited number of RFAs.
Clean and safe water
The ASM supports the Administration's request of $3.4 billion for
Clean and Safe Water. The ASM applauds the EPA's support of such
program initiatives as drinking water safety standards, cost-effective
water treatment technologies focusing on microbes, improved water
safety guidelines and pollution indicators, and a federal database of
beach advisories and closings across the United States. ASM also
supports the EPA Research Plan for Microbial Pathogens and Disinfection
By-Products in Drinking Water focusing on Cryptosporidium and Giardia
and urges Congress to ensure that adequate funding is secured from
within the $41.5 million, targeted for Safe Drinking Water Research, to
allow this plan to be carried out. In addition, the ASM believes that
the next step in this research plan should be to focus on additional
pathogens such as microsporidia and Helicobacter pylori. ASM strongly
believes that there should be improved coordination among several
federal and state agencies in dealing with microbial pollutants in the
nation's drinking and recreational water.
Graduate environmental fellowship program
The ASM urges Congress to fully fund the EPA's Graduate Fellowship
Program at the requested level of $10 million for fiscal year 2000. The
EPA's Graduate Environmental Fellowship Program is one of the many
initiatives the federal government must fully support to ensure that
the nation is prepared to answer the complex scientific questions of
the future. Both the public and private sectors will benefit from a
steady stream of well-trained environmental specialists. The fellowship
program has had a major impact in attracting exceptionally talented
young people to pursue careers in environmentally related fields. With
environmental challenges facing the nation including cleaning up toxic
waste, ensuring cleaner air and water, and providing safe drinking
water, there is a clear need for highly skilled, well-trained
environmental experts to find solutions to these pressing issues.
However, it is essential that once EPA receives funding for this
important program, the agency support fellowships in areas related to
microbial risks in the environment including water quality and
bioremediation technologies to clean up toxic waste.
national science foundation
The ASM, a member of the Coalition for National Science Funding
(CNSF), supports the coalition's recommendation to provide the NSF with
an increase of $562 million or 15 percent over its fiscal year 1999
funding level. This would raise the NSF's overall budget from $3.773
billion in fiscal year 1999 to $4.335 billion in fiscal year 2000.
NSF's mission is to promote and advance scientific, mathematical, and
engineering research and education in the United States by funding the
highest quality academic research and education programs. A 15 percent
increase would enable NSF to support additional excellent research
projects in pursuit of important discoveries and innovations. Enhanced
support for the NSF's efforts to improve education will help expand our
nation's intellectual capital. Strong links between research and
education are essential to a healthy research enterprise, an educated
public, and a well trained future workforce.
Microorganisms surround us and affect our lives in many ways. They
play key roles in processing our wastes, recycling the nutrients that
support our agriculture, forests and fisheries, yield new
pharmaceuticals, provide key tools for biotechnology, affect the
quality of our food and water, control some pests (biocontrol), and
cause disease. NSF is to be complimented for recognizing a few years
ago the important role microorganisms play in our well-being and in
opportunities for basic science advances through its Microbial Biology
initiative. This led to new programs such as LExEN (Life in Extreme
Environments), Microbial Observatories which focus on the discovery of
important but uncultured microorganisms, and the first Biocomplexity
Program which is focused on microbially-based ecosystems. ASM applauds
these new initiatives. Microorganisms do present very different types
of research challenges and opportunities than those for macroorganisms.
Hence we encourage NSF to maintain its momentum in Microbial Biology
programming to ensure that basic discoveries for this group of
organisms is realized.
New advances in science have provided new opportunities and needs
in microbiology research which should be considered in NSF programming.
These areas are the following.
Genomics research
More than 20 microbial genomes have now been completely sequenced
and many more are underway. This information fundamentally changes the
approach to research and what can be learned about an organism.
Microorganisms, being the simplest forms of life, are the first in
which the roles of all genes can potentially be understood. To maximize
the value of the genome sequencing effort, NSF should expand its
research in functional genomics and associated genomic areas. This
should extend beyond the more obvious areas of molecular biology and
genetics to the areas of ecology, taxonomy and population biology for
example, so that the value of genomics is more fully realized. ASM
strongly endorses NSF's functional genomics research under its Division
of Molecular and Cellular Biosciences (MCB) and encourages the Division
of Environmental Biology (DEB) to more aggressively encourage genomics
technology to be used in their research. The ecological and population
fields hold great opportunities for a more comprehensive understanding
of the genome and hence cutting-edge advances to understanding biology.
Microbial biodiversity
Only a few percent of the microorganisms on earth are known,
leaving microorganisms as the largest untapped source of biodiversity.
New drugs, enzymes, biocontrol and bioremediation agents are examples
of the economic potential in the discovery of this biodiversity. The
NSF's Microbial Observatories Program is focused on observing,
recovering, and understanding microbes in diverse environments and is
an important introductory effort towards this goal. Efforts are also
needed to advance the systematic, ecological, biochemical, and
evolutionary understanding of particularly unique, newly discovered
microbes as well as new strategies to recover more difficult to culture
organisms. The tremendous opportunity in microbial diversity discovery
will hopefully be realized under NSF's proposed initiative on discovery
of new species and builds on the President's Committee of Advisors on
Science and Technology (PCAST) Report, ``Teaming With Life''. ASM
strongly supports this initiative.
Microbial systematics and databases
Microbial systematics research has not kept pace with research and
application needs. Organism characterization is key to a proper
taxonomy which in turn is vital to efficient research as well as to a
host of application sectors such as proper diagnosis of diseases,
quality control of a variety of products, safety of our foods and
waters, patent descriptions and novel biotechnologies. Advances in
molecular techniques have revolutionized our understanding of the
relationships among microorganisms and provided new tools for more
specific and rapid identification of microorganisms. The proper
systematic study of many important microorganisms is needed to underpin
much of the microbial research and its application. NSF is the
appropriate agency to support microbial systematics research on the
many organisms that do not cause human disease. We ask that NSF address
this fundamental gap in microbial knowledge in its future programming.
Because of the small size of microorganisms, information of all
types, including sequence, phenotype, function, chemistry and habitat
is needed to efficiently understand and identify an organism. The jobs
of the many practitioners of microbiology would be more efficient if
microbial data were available in an integrated electronic database and
new insight about the most numerous organisms in our universe could be
more readily realized. NSF needs to recognize that biological
databases, such as microbial databases, are a central and vital
infrastructure need to modern day biological research and should be
treated as a central national facility. NSF's information technology
programs (IT) appear to also provide for advances useful in future
biology research, including microbiology. With more intensive and
extensive data, we need better ways to analyze, visualize and compute
the information. ASM looks forward to the benefits from IT and IT\2\.
Members of the ASM, whose activities include research concerned
with the impact of microorganisms on the well-being of humans, animals,
plants, and the environment, are very supportive of NSF's increased
focus on microbial biology and the diversity of microorganisms, an
initiative begun in fiscal year 1996 under the auspices of the NSF's
Directorate for Biological Sciences (BIO). For years, research efforts
have concentrated on the study of microbes in human and animal health.
The unknown microbial biomass provides opportunities to discover new
knowledge about microbial life forms and their potential application in
industry, medicine and agriculture. In addition, microbiological
research continues to provide the foundation for today's advances in
biotechnology. These advances are based on understanding the molecular
basis of microbial physiology and the genetics of viral, yeast and
bacterial plasmid vectors. Future accomplishments and their application
to increased agricultural productivity (an important by-product of
biotechnology) will not be possible without NSF funded basic research.
The NSF is one of the few government agencies that support
fundamental basic research. United States leadership in science and
technology is dependent on sufficient funding for basic research. Most
of today's scientific achievements in areas such as bioremediation,
technology to clean up oil spills and industrial pollution, the
development of new antibiotics and drugs, biopesticides, and
biotechnology all have their roots in basic research. The many future
public health and environmental challenges the United States will face
can only be overcome through the potential of basic research to
generate crucial new scientific knowledge and advancements that lead to
new technologies for the future.
Mr. Chairman, on behalf of the American Society for Microbiology,
thank you for the opportunity to submit testify to your Committee on
the fiscal year 2000 appropriations for the EPA and the NSF. I would be
pleased to answer any questions from you in writing at a later date.
______
Prepared Statement of the State Agricultural Experiment Stations and
State Extension Service
Mr. Chairman, members of the subcommittee: On behalf of the members
of the State Agricultural Experiment Stations (SAES) and State
Extension Service (ES), we as chairs of the Experiment Station
Committee on Organization and Policy (ESCOP) and Extension Committee on
Organization and Policy (ECOP) appreciate the opportunity to appear
before you to discuss the importance of research, extension, and
education in environmental and natural resource programs. ESCOP and
ECOP are non-profit organizations representing a partnership that
includes the SAES and the USDA-Cooperative State Research, Education,
and Extension Service (CSREES).
A primary goal of these organizations is to broaden the
partnerships with other agencies involved in environmental and natural
resource management programs and research. These organizations are
committed to improving environmental decision making at the local level
by capitalizing on the comparative advantages in research, education,
and extension that the Land Grant Universities (LGU) can provide. In
working with federal agencies ESCOP and ECOP aim to focus additional
attention on the national environmental research agenda and to attract
new resources for environmental research activities conducted through
LGU programs. Furthermore, our LGU institutions have a critical mass of
scientific infrastructure and facilities and a history of long-range
research.
ESCOP and ECOPs major focus in the areas of environment and natural
resources include:
--Environmental modeling and forecasting (e.g., carbon
sequestration);
--Water and watershed management (e.g., nutrient/waste management);
--Land-use planning and management (e.g., community-based
environmental protection);
--Environmentally and economically sound agriculture (e.g., precision
agriculture); and
--Environmental education and outreach.
partnering with other agencies
ESCOP and ECOP share similar research priorities and goals as other
agencies, such as EPA. Although many initiatives target specific
agendas, a thorough inventory of research priorities and pooling of
resources can be achieved through collaborative discussions. In
recognition of these similarities, many agencies have targeted program
areas for pooling resources to address these common initiatives and
programs. One such organization to unfold in these efforts links the
organizational structure of the SAES and USDA-CSREES into a national
environmental initiative. A primary goal of this initiative, named
SUNEI (SAES/USDA-CSREES National Environmental Initiative) is to
facilitate teaching, research, and extension activities in the
environmental sciences as they relate to agriculture and natural
resource issues through traditional and new federal-state partnerships.
This organization is committed to improving environmental decision
making at the local level by capitalizing on the partnerships at the
national level.
ESCOP & ECOP promote LGU partnerships with EPA and other agencies
that will increase:
--the exchange of scientists between LGU institutions and Agencies
for collaborative projects.
--the amount of LGU participation in Agency peer review processes;
--the quantity/quality of proposals submitted by the LGUs for Agency
funded competitive grants
--the number of funding awards from agencies going to LGUs;
examples of collaboration
Recently USDA and EPA joined efforts to draft the Unified Strategy
for Animal Feeding Operations (AFOs). ESCOP & EPA applaud these
agencies for their collaborative efforts. It is this and similar
efforts which make meaningful partnerships. The nation is eager to see
implementation of voluntary policies, which establish incentives to
change or modify management practices. This Unified Strategy will
protect and preserve the priceless assets of our nation's water
resources in our coastal, surface, and groundwater. EPA has developed
competitive funding programs to address waste management that are
multidisciplinary and multistate driven. Programs such as this, which
are aimed at protecting the quantity and quality of our water in the
face of increased demands from population growth, should continue to be
encouraged by decision makers at the national level. This institutional
support by the various agencies solidifies and provides incentives for
local level resource managers from different agencies to work together
with local producers and state level nutrient managers.
role of cooperative extension
Under the AFO Strategy, we are pleased to see that USDA and EPA
have identified Cooperative Extension Specialists as qualified nutrient
management planners to assist owners/operators in meeting requirements.
Our university system accommodates rapid advances in information
technologies to extend outreach and education programs which are based
on sound research and understanding of the public learning process. The
LGU system offers a full environmental portfolio in its research,
education, and extension programs, and provides the technical
innovation and new management ideas to implement sound nutrient
management plans. Therefore, LGUs can serve as a valuable resource when
developing standards and providing technology transfer to owners and
operators who manage production facilities in our nation's watersheds.
office of research and development
EPA's Office of Research and Development (ORD) has demonstrated a
strong commitment in working with the LGU System. In 1996, ORD policy
makers held a workshop for LGU and EPA officials to discuss common
research priorities and agendas. ECOP and ESCOP would like to encourage
a strong continued commitment by ORD to collaborate with universities
through a variety of competitive grants, investigator-initiative
exploratory research grants, personnel exchanges, graduate fellowships,
and environmental research centers.
Overall, the LGU System appreciates and supports the continuation
of the Science To Achieve Results (STAR) program to fund core and
problem solving research. In particular, the joint Water and Watershed
Research program has provided increased opportunities for LGU
scientists to submit proposals, participate within the ORD peer review
process, and obtain needed funding to engage in watershed research
programs. One EPA priority, Integrated Ecological Economic Modeling and
Valuation of Watersheds, will assess the impact of future land use--
such as agriculture, forestry, and urban development--on the watershed.
Under this project, LGU faculty could provide valuable research and
extension capacity to EPA by educating local decision-makers with the
sound scientific information on the impacts of different land use
strategies on water quality.
Human activity has arguably caused changes to the earth's ecology
in ways that threaten sustained agricultural and forestry production.
Elevated levels of carbon dioxide from the burning of fossil fuels,
increased exposure of crops and livestock to harmful Ultra Violet-B
radiation, and the unknown consequences of elevated temperatures on
crop, forest, and livestock production are just some of the emerging
concerns for global changes on food and fiber production. ECOP and
ESCOP realize that EPA is one of the many contributing agencies to the
U.S. Global Change Research Program (USGCRP). We encourage USGCRP
studies that not only investigate the impacts of global change on the
environment and economy, but also research to develop the core science
knowledge about the carbon cycle and how problem-oriented research can
help mitigate excessive levels of CO2 and develop
agriculturally-based remediation methods for the changing global
environment.
sound science based-regulations
One of the critical issues that ECOP and ESCOP would like to
address is the need for sound-science based regulations. Both the
Unified Animal Feeding Operation (AFO) Unified Strategy and the Food
Quality Protection Action (FQPA) have the potential to dramatically
change the way agricultural and natural resource managers do business.
The Land-Grant community is therefore very concerned that the EPA
engage in credible research and outreach endeavors that provide a
sensible background for any major regulations that may negatively
impact agricultural producers during this ``farm crisis.''
LGUs encourage USDA and EPA to collaborate on the Integrated Risk
Information System (IRIS). It is very important that the public is
aware and educated about true risks of chemicals and contaminants,
rather than purely reacting to perceptions of danger. Therefore, LGU's
are supportive of EPA-ORD's Goal 8 for Sound Science. One area for
emerging risk research is endocrine disrupters which ORD addresses
under Goal 8. This is another example for potential participatory
research by land-grant scientists with EPA's STAR Exploratory Grants
program, since agricultural and natural resource faculty provide
critical expertise in studying the effects of agricultural chemicals
and fertilizers on endocrine disrupters.
the synergistic effect of interdisciplinary research and education
LGUs have an interdisciplinary mix of persons to address complex
interdependencies of environmental systems. LGUs also integrate
research and education. Thus, they can apply new knowledge to solve
environmental problems in the field and improve the rate of adoption of
new technologies. In particular, the Land-Grant community has existing
capacity, expertise, and resources dedicated in the following areas
that are consistent with ORD's over all goals for advanced integrated
ecosystem monitoring and analysis.
Water and watershed management including:
--Nutrient management
--Harmful algal Blooms
--Animal waste management
Land-use planning and management including:
--Riparian/buffer zones
--Coastal zone management
--Sustainable development/openspace/conservation
Environmentally and economically sound agriculture including:
--Integrated pest management
--Alternative pest management and sustainable agriculture
--Precision agriculture/forestry/range
Environmental modeling, monitoring, and forecasting including:
--Natural disasters and hazards
--Climate change (especially, carbon sequestration)
--Bio-fuels and renewable resources
Environmental education and outreach including:
--Improved environmental decision-making at the local level community
based environmental protection (CBEP)
--Geospatial and land-use extension specialists
--AFO-nutrient management planning assistance
ECOP and ESCOP also encourage EPA-ORD to work collaboratively with
other federal agencies on environmental challenges in the future and
with existing projects including:
--USDA-CSREES/National Research Initiative on basic environmental
science questions;
--USDA-CSREES on integrated research and education needs and
opportunities in the environmental area;
--The National Science Foundation, USDA-CSREES, and others on the
joint Waters and Watersheds research program; and
--NOAA, NASA and others on the ECOHAB research program.
The Administrator of ORD, Norine Noonan stated that ORD intends to
```work smart' by leveraging our investments in all of this work
through expanded partnerships with stakeholders in both the public and
private sector.'' ESCOP especially appreciates ORD's willingness to
collaborate with other federal agencies to better coordinate national
priorities, reduce redundancy, and leverage resources. Under the
Integrated Science for Ecosystem Challenges (ISEC), the Mid-Atlantic
Integrated Assessment (MAIA), and the Coastal Initiative, EPA has a
demonstrated need for geographically distributed monitoring and
continuity of data. LGUs are logical partners to meet the needs of a
geographically distributed environmental monitoring network (i.e.,
coastal and estuary water quality) and consistency of long-term data
collection. This is one area where SUNEI may encourage new federal-
state partnershipping.
additional collaboration
ESCOP and ECOP continue to build its relationships with various
other agencies such as DOE, NASA, NOAA, and NSF in support of the
nations agricultural and natural resource system. We plan to encourage
interagency communication and to broaden the LGUs federal participation
within USDA and other agencies. SUNEI also hopes to better unify
representatives from the Natural Resource Conservation Service (NRCS),
the Forest Service, and the Agricultural Research Service. This goal is
aimed at enhancing the collaboration that is occurring at the local
level between LGUs and USDA agencies.
The LGUs will continue to provide an ``on-the-ground'' and ``in-
the-field'' role on environmental and natural resources issues and
research. Under ESCOP & ECOP, the SUNEI initiative provides an
environmental and natural resource point of contact for Federal
agencies to reach the System. Furthermore, through the excellent
electronic communications network of the LGU System, the appropriate
administrators, scientists, academic program personnel, and extension
representatives can be reached almost immediately as circumstances
demand.
Mr. Chairman and members of the subcommittee, thank you for the
opportunity to testify on behalf of the LGU research, extension and
education system. We will continue to build collaborative partners to
provide for a sustainable agriculture and natural resource environment.
We stand ready to work with you in these efforts.
______
Prepared Statement of the Associated General Contractors of America
The Associated General Contractors of America (AGC) appreciates the
opportunity to submit testimony in strong support of the State
Revolving Fund (SRF) programs--the Clean Water State Revolving Fund
(CWSRF) and the Drinking Water State Revolving Fund (DWSRF). These two
revolving funds, based on assessments taken before they started, have
been tremendously successful programs that were established to meet
federal mandates.
The 1972 Clean Water Act created a federal grant program that was,
in 1987, transformed into the Clean Water State Revolving Fund program
to fund the construction and modernization of municipal sewage plants.
Low-cost loans are provided to local governments to finance needed
facilities. The loans are then repaid and new loans are made from the
CWSRF.
The Drinking Water State Revolving Fund originated in the Safe
Drinking Water Act Amendments of 1996. The program, which operates like
the Clean Water State Revolving Fund, assists public water systems to
finance the costs of infrastructure needed to achieve or maintain
compliance with the Safe Drinking Water Act requirements and to protect
public health.
AGC is proud of the role the construction industry has played in
improving water quality. Our members build and rehabilitate the
facilities financed by these two programs, both of which have been
responsible for significant water quality improvement. Since enactment
of the Clean Water Act in 1972, water quality has improved
significantly on over 50,000 miles of waterway. Streams and lakes, once
devoid of fish and other aquatic life, now support abundant and varied
populations. The foundation for many of these environmental
improvements is in the construction grants program and the SRF
programs.
The needs, however, are still staggering. In the Environmental
Protection Agency's (EPA) first report to Congress in January, 1997
entitled ``Drinking Water Infrastructure Needs Survey,'' the EPA
reported that the nation's 55,000 community water systems must invest a
minimum of $138.4 billion over the next 20 years to install, upgrade,
or replace the infrastructure. Of this total, $12.1 billion is needed
immediately to meet current Safe Drinking Water Act (SDWA) mandates.
The EPA's report is a conservative estimate because many of the systems
surveyed were unable to identify all of their needs for the full 20-
year period.
In fact, a more complete and independent study released in October
of last year by the American Water Works Association (AWWA) found that
the capital investment needs for the water supply community over the
next 20 years is $325 billion.\1\ The EPA's emphasis in their survey
was on identifying the utility investment needed to comply with the
federal mandates issued under the Safe Drinking Water Act Amendments
(SDWAA), so that Congress could better understand the costs imposed by
federal drinking water regulations. The objective of the AWWA
investigation, on the other hand, was to examine the longer-term
infrastructure investment requirements of U.S. water utilities,
regardless of whether they are directed at current or future needs over
the twenty-year period.
---------------------------------------------------------------------------
\1\ American Water Works Association: Infrastructure Needs for the
Public Water Supply Sector, October, 1998.
---------------------------------------------------------------------------
Even if we use EPA's estimates, the water infrastructure needs are
overwhelming. EPA's report indicates that the largest category of need
is installation and rehabilitation of transmission and distribution
systems--$77.2 billion. Aging, deteriorating pipes can allow water in
the distribution system to become contaminated, leading to illnesses
from ingestion of waterborne pathogens as well as interruptions in
water service. Most needs in this category involve the extraction and
replacement of existing pipe.
The second largest category is treatment, constituting a total 20-
year need of $36.2 billion. Storage needs are the third largest
category at $12.1 billion. The fourth category of need is source
rehabilitation and development, estimated at $11.0 billion. An
additional $1.9 billion in need is categorized as ``other.''
In addition to the extensive capital needs, the American public is
very concerned about water quality and supports the federal government
investing in the effort to clean up our water supply. In a recent
survey commissioned by the Rebuild America Coalition, 66 percent of the
American people from all regions and areas of the country describe
spending on America's infrastructure as a ``strong investment in
America.'' 74 percent are even willing to pay 1 percent more in taxes
if it meant you could guarantee a safe and efficient sewage and water
treatment system. The support transcends party lines, carrying
overwhelming support from Republicans, Independents and Democrats.
Despite the extensive needs and tremendous support from the
American people, President Clinton's fiscal year 2000 budget proposed
cutting the Clean Water State Revolving Fund from $1.35 billion to $800
million, a $550 million reduction. It is unthinkable that when needs
are so severe President Clinton would cut the funding by 41 percent.
Equally disturbing is a new proposal by Senator Ron Wyden to direct
``a significant portion'' of the CWSRF funding to promote ``smart
growth'' of cities and suburbs. Senator Wyden has said the plan would
``set aside a portion of clean water dollars and then invite applicants
to produce creative homegrown solutions to urban sprawl.'' \2\ With the
mounting wastewater needs, it is hardly the time to divert the precious
and limited funding from these important state revolving funds. This
program is too important to short-change in favor of the latest
political campaign fad.
---------------------------------------------------------------------------
\2\ Senator Ron Wyden's comments to the Environmental Media
Services news breakfast.
---------------------------------------------------------------------------
AGC believes that the nation's clean water program should be viewed
for what it truly is--an investment in the future health and economic
viability of the nation. Each one billion dollars invested in the
construction of wastewater facilities generates some 52,000 new jobs.
Even more importantly, wastewater treatment creates opportunities for
economic development in communities by allowing new industries and new
homes to locate there. These facilities are fundamental elements of the
nation's environmental infrastructure. At this time, when our global
competitors are recognizing the importance of infrastructure as the
vital foundation on which future economic growth is based, the United
States must provide the needed capital investment to allow our nation
to thrive.
AGC believes in these times of economic prosperity and with the
increasing needs in our nation's drinking water and wastewater, now is
not the time for the federal government to lessen its commitment to
clean water. Toward that end, AGC urges Congress to appropriate stable
annual funding of at least $1.5 billion for the Clean Water State
Revolving Fund and $1.2 billion for the Drinking Water State Revolving
Fund.
Again, AGC appreciates the opportunity to submit testimony in
support for the two state revolving funds. We look forward to working
with you to ensure that the necessary investment is provided to improve
the quality of our nation's drinking and wastewater.
______
FEDERAL EMERGENCY MANAGEMENT AGENCY
Prepared Statement of the Association of State Dam Safety Officials
The Association of State Dam Safety Officials is pleased to have an
opportunity to comment on the fiscal year 2000 budget request for the
National Dam Safety Program within the Federal Emergency Management
Agency.
The Association of State Dam Safety Officials (ASDSO) is an
association of over 1,700 federal, state, and local dam safety
officials and private sector individuals and was established in 1984 in
response to a need for stronger coordination of dam safety programs on
state and federal levels. This need was made apparent after several
devastating dam failures in the late 1970s focused national attention
on the lack of regulatory authority over the safety of these
structures. The goal of ASDSO is to save lives, prevent damage to
property, and maintain the benefits of dams by preventing failures.
Last year, the Subcommittee supported the National Dam Safety
Program to the fullest extent possible as authorized in the Water
Resources Development Act of 1996. The total amount was $2.9 million in
fiscal year 1999. This small but vital amount of money took the new
National Dam Safety Program into its second year of progress toward
improved dam safety nationwide(progress that will be characterized
later in this testimony.
But, there is no progress without continued funding. ASDSO,
therefore, respectfully requests this Subcommittee's support for the
authorized level of $5.9 million to fully fund the National Dam Safety
Program in fiscal year 2000. We would also request that the $400,000
authorized for staff to administer the Program within FEMA be
specifically earmarked for that purpose.
The following activities will be funded through this appropriation:
--$4 million for incentive grants to state to upgrade their dam
safety programs,
--$500,000 for training state dam safety staff,
--$1 million for research to improve the techniques and equipment for
rapid and effective dam inspections and dam engineering, and
--$400,000 for salaries and expenses for FEMA to administer the
program.
This modest, yet vital funding would help reduce the risks to life
and property due to dam failures by providing states with resources to
improve their dam safety programs. It is an investment in public safety
that will reduce loss of life, property damage and large federal
expenditures that are a result of payments for disaster assistance
through the Disaster Relief Fund and the National Flood Insurance
Program.
dam safety, regulation and the extent of the hazard
According to the National Inventory of Dams housed at the US Army
Corps of Engineers, there are approximately 74,935 dams \1\ in the
United States. Sixty percent of these dams are privately owned.
Federal, state and local governments own the other 40 percent.
---------------------------------------------------------------------------
\1\ These are structures meeting the federal definition of a dam.
There are still thousands of smaller dams in the United States that are
regulated and/or inventoried by the states.
---------------------------------------------------------------------------
Dams are an essential part of our national infrastructure. They
serve a multitude of functions including the following: Flood control;
Hydropower; Water Supply; Fire and Farm Uses; Irrigation; Recreation;
Mine Tailings Retention; and Navigation.
But, failures of these structures can affect thousands of lives and
cost millions of dollars. Safety is essential to all dams, but most-
importantly to the approximately 9,300 dams determined by regulators to
be high-hazard, meaning they threaten human life and could cause
significant downstream damage should they fail.
Even more significant are the 1,800 dams that are considered
unsafe. This means they have deficiencies that leave them more
susceptible to failure. Many of these unsafe dams are also high-hazard.
Every member of this Subcommittee has high-hazard dams operating within
his or her state. Nearly every member on this Subcommittee has an
unsafe, high-hazard dam in their state. North Carolina, Pennsylvania
and Texas have over 500 high-hazard dams each.
Other state statistics include the following:
------------------------------------------------------------------------
High hazard Unsafe
------------------------------------------------------------------------
Arizona....................................... 73 23
Montana....................................... 153 13
New Jersey.................................... 183 32
West Virginia................................. 248 49
------------------------------------------------------------------------
A complete chart of states' dam inventory data is included at the
end of this written testimony.
For these reasons, safety regulation is essential to reduce the
hazards involved with dams. That responsibility rests almost entirely
with the states. States have responsibility for safety regulation over
about 95 percent of the nation's dams. The federal government regulates
the other 5 percent.
Although many thousands of dams have responsible owners and are
maintained safely, there are still many thousands more where the
potential for disaster grows as time passes. These dams are
deteriorating, downstream development is increasing and owners face
rehabilitation costs that they cannot meet.
Furthermore, support for state regulatory programs is lacking in
many states. According to the National Inventory of Dams, 35 percent of
high-hazard dams have a last inspection date of 1990, when it is
generally agreed that high-hazard dams should be inspected every year.
(Inspection being a function of a regulatory program.) A handful of
states have exemptions in their law leaving thousands of dams not
regulated across the nation. Lack of enforcement power in some states
has given irresponsible owners the ability to ignore orders to repair
their dams or to abandon their dams altogether; leaving a serious
safety threat when these structures are determined to be high- or
significant-hazard.
costs of dam failures
It has been said that few man-made structures have the potential
for causing catastrophic devastation, as do dams should they fail. Here
are some historic examples:
--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.
--The Georgia Floods of 1994 caused the failure of over 200 dams and
millions of dollars in property damage.
Failures and devastation still occur and threaten lives and
property today. According to the National Performance of Dams Program
at Stanford University, there were approximately 20 dam failures and
about 200 incidents in 1998. Included in the costs for these failures
are:
--Emergency evacuation costs
--Downstream property damage
--Clean-up costs
--Loss of dam infrastructure and revenue generated from the dam
operation
--Environmental impacts
--Economic losses to nearby communities
successes of the national dam safety program
The National Dam Safety Program is currently into its second year.
With the funding made available to FEMA, an enormous amount of progress
has been made toward improving dam safety.
Thirty-nine states have taken advantage of the training assistance
to send state inspectors to needed continuing education courses. Forty-
six states received incentive grants in fiscal year 1999 to improve
their dam safety programs. Here are some success-stories from these
state recipients:
Florida
``Florida is holding a series of simulated failures to test
emergency action planning procedures. A part-time data entry person has
been hired to update Florida's dam inventory database.''
Hawaii
``The Flood Control & Dam Safety Section has expanded by hiring
eight new personnel. Hawaii will have a full time person and two part
time persons on dam safety. The maintenance crew will also be available
for emergency operations. Additionally, a maintenance facility will be
constructed.''
Kansas
``Thanks in part to the FEMA State Assistance Grant Program, the
State of Kansas has begun a regular inspection of all dams that were
rated ``unsafe'' and all dams that are classified as ``c'' (high)
hazard dams. The inspection focuses on ensuring that all these dams
meet regulatory requirements pertaining to hydrologic adequacy and that
they have acceptable Emergency Action Plans. The department is also
enhancing its computer equipment and software to perform its regulatory
functions credibly and efficiently.''
Kentucky
``Kentucky is coordinating with federal agencies, with jurisdiction
over dams in the Commonwealth, to better inform the public of state
regulations.''
Missouri
``The NDSP funding has allowed the Missouri Program to send 3
engineers to much needed training. The training attended includes a
Concrete Rehabilitation Course, HEC-RAS, and a course on how to detect
seepage around conduits. Efforts are currently underway to purchase a
remote controlled camera to use in inspecting conduits in dams. This is
especially important due to the amount of Corrugated Metal Pipe that
was used for primary spillways 30 years ago. Much of this pipe is now
at the end of its useful life and the pipe has deteriorated to the
point that the integrity of the dams is being threatened. Due to the
high cost of this type of equipment, purchase of this equipment using
the state budget allotment was impossible.''
Montana
``Montana put on a Flood Hydrology Seminar on March 30, and 31,
1999 in the state. We used $3,000 of the $3,800 available for
individual state training needs from the National Dam Safety Act. The
seminar was about the flood hydrology techniques used in Montana for
spillway design for dams. The seminar included an illustration of the
recent USGS extreme storm unit hydrographs and a recent study of runoff
parameters.''
Nevada
``As a result of the federal grant money given to Nevada, we have
purchased a notebook computer. By having the notebook computer in the
field, we will now be able to write up our inspection reports at the
site so that when the engineer returns to the office, the report can be
printed and sent out. We are currently revamping our inspection
checklist so that it can be filled out easily on the computer and be
ready for mailing. The computer also houses our inventory database and
will allow the database fields to be automatically inserted into the
inspection forms. Without the federal grant money, there is no way the
dam safety section would've gotten a notebook computer to do this type
of work. And this is only the tip of the iceberg. We are planning on
purchasing an outlet camera so that visual inspections can be done on
old, small diameter conduits. The money is helping Nevada's dam safety
program immensely.''
New York
``New York is receiving $103,089 in incentive grants from FEMA in
fiscal year 1999. Thanks to the training funding, each of the three
state inspectors have been able to attend training that they would not
have otherwise been able to attend.''
North Carolina
``Several state dam safety engineers have been taking advantage of
the new training opportunities at Emmitsburg, Maryland and at ASDSO
regional workshops.''
Washington
``The FEMA assistance money will be used for equipment and a summer
intern, mproving productivity. It will result in a reduction in the
time elapsed between inspections.''
West Virginia
West Virginia is receiving $20,944 from FEMA to improve its dam
safety program.
Other progress in 1998:
--Eleven states increased the number of dam inspections in 1998 over
1997
--Twelve states increased the number of emergency action plans filed
with the state for those dams requiring them
--Six states said they executed quicker turn-around times on issuing
permits
--Fifteen states reported improvement in remediation of deficient
dams
--Fourteen states said they improved their coordination with state
emergency preparedness officials
--Nine states reported better quality technical reviews at dams
conclusion
Dams are a critical part of our national infrastructure. They
provide benefits upon which our communities and industries depend.
However, safety is essential to the efficient operation of the dam and
to the people and property surrounding the structure. Safety cannot be
realized without adequate regulatory programs at the state and federal
levels.
To strengthen the effort, a strong, centralized national
program(such as the one at FEMA, geared toward assisting the states
through leadership, public awareness, and technical assistance(is
imperative. It is, therefore, increasingly essential, as we will surely
continue to face natural disasters and as our infrastructure ages, to
place a high priority on mitigating risk associated with all types of
disasters, whether natural or manmade.
Full funding of the National Dam Safety Program would continue to
provide the needed tools to assist state dam safety programs, to
increase the knowledge base and technical understanding through
research and to strengthen the partnership between the federal, state
and private sectors.
In closing, ASDSO strongly urges this Subcommittee to recognize the
benefits of this modest investment in public safety by providing the
authorized level of $5.9 million in fiscal year 2000 to FEMA.
Thank you to this Subcommittee for its support in years past for
the National Dam Safety Program at FEMA. ASDSO looks forward to working
with the Subcommittee and its staff on this important public safety
issue.
1998 STATE DAM INVENTORY DATA
[Inventory sizes vary from state-to-state because of number of dams, but also because state laws vary on which
dams are included under their jurisdiction]
----------------------------------------------------------------------------------------------------------------
Total
State national Total state State high- State reg. Government
inventory \1\ regulated \2\ hazard \3\ unsafe \4\ ownership \5\
----------------------------------------------------------------------------------------------------------------
Alabama.................................. 1,570 1,704 184 150 25
Alaska................................... 99 87 18 ........... 55
Arizona.................................. 315 214 73 23 173
Arkansas................................. 927 427 98 25 363
California............................... 523 1,238 392 ........... 536
Colorado................................. 1,648 1,808 292 189 428
Connecticut.............................. 707 3,230 236 (\6\) 251
Delaware................................. 73 98 9 (\6\) 75
Florida.................................. 572 (\6\) (\6\) (\6\) 15
Georgia.................................. 4,853 3,311 366 57 634
Hawaii................................... 129 129 56 ........... 29
Idaho.................................... 343 431 100 13 80
Illinois................................. 1,232 1,232 157 (\6\) 387
Indiana.................................. 1,463 1,414 243 (\6\) 317
Iowa..................................... 2,465 2,514 66 2 1,437
Kansas................................... 6,077 9,899 200 51 1,363
Kentucky................................. 955 924 147 ........... (\6\)
Louisiana................................ 381 311 12 ........... 90
Maine.................................... 617 694 23 59 57
Maryland................................. 273 361 56 6 162
Massachusetts............................ 1,528 2,921 333 21 685
Michigan................................. 909 1,191 83 (\6\) 378
Minnesota................................ 932 852 40 (\6\) 532
Mississippi.............................. 3,191 3,328 238 10 121
Missouri................................. 4,032 614 195 20 206
Montana.................................. 3,517 3,219 153 13 795
Nebraska................................. 2,029 2,029 92 ........... 1,027
Nevada................................... 323 577 106 8 74
New Hampshire............................ 613 3,148 88 (\6\) 364
New Jersey............................... 806 1,580 183 32 350
New Mexico............................... 501 521 162 6 182
New York................................. 1,633 5,645 372 57 676
North Carolina........................... 2,699 4,646 874 40 199
North Dakota............................. 770 1,308 26 5 191
Ohio..................................... 1,766 2,703 502 450 505
Oklahoma................................. 4,510 4,380 145 5 150
Oregon................................... 833 3,733 122 ........... 186
Pennsylvania............................. 1,315 2,886 735 7 501
Puerto Rico.............................. 36 36 33 ........... 31
Rhode Island............................. 185 506 17 ........... 80
South Carolina........................... 2,252 2,242 149 3 283
South Dakota............................. 2,392 2,252 48 4 140
Tennessee................................ 1,044 593 136 28 382
Texas.................................... 6,838 7,247 818 403 2,734
Utah..................................... 654 1,948 214 41 198
Vermont.................................. 343 1,001 51 (\6\) 141
Virginia................................. 1,581 482 103 50 360
Washington............................... 653 865 94 13 238
West Virginia............................ 537 354 248 49 233
Wisconsin................................ 1,291 1,080 192 (\6\) 618
Wyoming.................................. 1,216 1,332 64 3 221
----------------------------------------------------------------------
Total.............................. 74,935 93,913 9,280 1,840 19,037
----------------------------------------------------------------------------------------------------------------
\1\ Includes federal and non-federal dams over 25' in height or 50 acre-feet in volume; or anything above 6' ft
in height with downstream damage potential should it fail.
\2\ Includes all dams under state regulatory control.
\3\ High-Hazard by state definition derived from state inventory in column 2.
\4\ Dams with identified deficiencies by state definition (varies state to state) derived from state inventory
in column 2.
\5\ Derived from national inventory in column 1.
\6\ Not Reporting. Some states do not keep data on ``high-hazard'' and/or ``unsafe'' categories.
______
Prepared Statement of the American Public Works Association
My name is Robert H. Miller, and I am Director of Public Works for
the Village of Schaumburg, Illinois. I submit this statement regarding
fiscal year 2000 appropriations for the U.S. Environmental Protection
Agency and the Federal Emergency Management Agency as President of the
American Public Works Association.
The American Public Works Association (APWA) represents 1,700
public agencies and 25,000 professionals nationwide charged with the
planning and daily management of local public services and the
construction, operation and maintenance of the public infrastructure.
APWA members are responsible for providing a safe drinking water
supply, collecting and treating sewage and implementing federally
mandated urban stormwater management programs, and for the proper and
safe collection and disposal of municipal solid waste. Public works
agencies also manage the nation's flood control infrastructure and play
an important role in communities' work to mitigate for and recover from
disaster.
In determining fiscal year 2000 appropriations for VA, HUD and
Independent Agencies, APWA urges the Congress to:
1. Restore funding to the water and wastewater state revolving loan
funds.--Appropriate a combined minimum of $2 billion to the U.S. EPA
for the clean water and drinking water state revolving loan funds
(SRFs). The SRFs help capitalize local investment in drinking water and
wastewater infrastructure. Retain caps on state administration expenses
drawn from the SRF so that the maximum possible funds reach local
governments to support actual water quality programs.
2. Retain funding for brownfields assessment, cleanup and
redevelopment.--Appropriate the approximately $92 million proposed for
U.S. EPA's budget and the additional funds for brownfields programs
requested for the U.S. Department of Housing and Urban Development.
Brownfields grants to local governments are playing an important role
in encouraging the efficient cleanup of low-level hazardous waste sites
and spurring economic development in the nation's cities.
3. Provide funding for the FEMA flood mapping program, Project
Impact, and domestic anti-terrorism programs.--APWA also supports
creation of the National Flood Mitigation Fund, so long as other
activities currently eligible for flood loss reduction project grants
are not sacrificed.
water & wastewater infrastructure
The great majority of costs associated with providing drinking
water and wastewater services are borne by local governments. However,
by providing access to interest-free and low interest loans, federal
funding for the drinking water and clean water SRFs plays a vital role
in helping local governments to build and maintain water and wastewater
infrastructure. Continued water quality improvement can only be assured
with the continued support of the federal government.
The public overwhelmingly supports federal investment in water
quality infrastructure. A January 1999 poll conducted by the The Luntz
Research Companies on behalf of the Rebuild America Coalition found
that three-quarters of Americans are willing to pay an additional one
percent in taxes to guarantee a safe and efficient sewage and water
treatment system. Meanwhile, in a 1998 survey, 40 percent of APWA
members identified the top challenge facing public works as the funding
and financing issues associated with maintaining infrastructure. With
this backdrop, the U.S. EPA proposed a combined $500 million cut in
funding for the drinking water and clean water SRFs in 2000. Thus,
local governments are under increasing pressure to expand water quality
programs, largely due to federal regulations, with shrinking federal
dollars available to support those programs.
The Cost of Clean, a study released in March 1999 by the
Association of Metropolitan Sewerage Agencies and Water Environment
Federation puts the price tag at $330 billion for wastewater
infrastructure needs over the next 20 years. Even EPA, in its most
recent Clean Water Needs Survey, identified a wastewater funding gap of
$139.5 billion. These needs are driven by increasing federal regulation
under the Clean Water Act aimed at controlling pollution from urban
runoff, combined sewer overflows and sanitary sewer overflows, and from
the capital improvement needs of an aging American infrastructure.
Later this year, EPA is expected to finalize new regulations to require
the nation's small municipalities to implement stormwater quality
programs. Thus, the need continues to grow, and APWA urges the Congress
to fully fund the clean water SRF to help meet those needs.
As the Safe Drinking Water Act Amendments of 1996 are implemented,
drinking water agencies must make capital improvements to meet new,
stricter federal standards. Changes to the surface water treatment
rules and new regulations for removing the byproducts of conventional
treatment will require major infrastructure investments by water
suppliers. To comply with forthcoming new limits for arsenic, for
example, the American Water Works Association projects a cost of as
much as $1 billion nationwide. Water agencies also are making new and
increased investments toward protect drinking water at its source under
the sourcewater protection program. The drinking water SRF, authorized
by the 1996 amendments at $1 billion per year, is an indispensable tool
to help local governments achieve new standards.
APWA supports full funding of the drinking water and clean water
SRFs, with a minimum combined appropriation of $2 billion for 2000.
brownfields programs
Federal funding for the assessment, cleanup and redevelopment of
low-level hazardous waste sites known as ``brownfields'' is playing a
key role in spurring economic development in many of the nation's large
and small cities. The brownfields program provides an efficient
alternative to clean up and encourage investment in disturbed sites,
instead of pushing new development into undeveloped green space.
APWA supports continued funding for the federal brownfields
program, administered by the U.S. EPA and the Department of Housing and
Urban Development.
disaster mitigation & relief
Given our responsibilities as the keepers of America's
infrastructure, public works agencies play a broad and critical role in
supporting the functions of emergency management, including delivering
sand bags for flood fighting, repairing roads and bridges in the
aftermath of an earthquake, and cutting-off and restoring utilities in
the wake of a terrorist incident. On many occasions, public works
departments have been applicants for disaster relief, and we are
grateful for FEMA's presence and assistance. For all these reasons,
APWA has given keen attention to the proposed fiscal year 2000 budget
for the Federal Emergency Management Agency (FEMA).
In particular, APWA supports FEMA's efforts to improve the
integrity of flood insurance rate maps. Because of their function, many
public works facilities, particularly water and sewage treatment
plants, are located in special flood hazard areas. To minimize the
flood hazard risk, it is imperative that public works agencies have
accurate flood maps to guide the planning, construction,
rehabilitation, and retrofitting of public works facilities. While APWA
supports efforts to increase funding for the map modernization program,
the association harbors doubts regarding the viability of the proposed
mortgage fee. APWA would welcome the opportunity to partner in FEMA's
modernization efforts and work to identify other funding sources.
In its proposed budget, FEMA has identified the mitigation of
repetitive flood loss properties as a high priority. APWA recognizes
how costly repetitive loss properties are to the National Flood
Insurance Program--to American tax payers--but is concerned that the
creation of the National Flood Mitigation Fund would divert or
eliminate Flood Mitigation Assistance funds currently available for
other flood loss reduction projects, such as enlarging culverts and
creating small retention basins. These types of projects can be very
effective in reducing flood losses and protecting insurable property
and are worthy of funding, as well. APWA would support the creation of
the National Flood Mitigation Fund so long as other activities
currently eligible for project grants are not sacrificed.
The rising costs of disasters underscore the need for a pre-
disaster mitigation program--resources jurisdictions can use to redress
natural hazards outside of a presidential disaster declaration. APWA
supports the initiative behind Project Impact and hopes that FEMA will
move toward defined program eligibility criteria and performance
measurements. APWA is concerned that without these metrics, support and
funding for a pre-disaster program will diminish. APWA, along with
other FEMA stakeholders, would gladly assist in this effort.
On the subject of domestic terrorism, APWA will work to expand the
definition of ``first responders,'' currently defined as police, fire,
and rescue personnel. The role of public works departments in preparing
for and responding to incidents of domestic terrorism continues to be
overlooked. Currently, there are no resources or programs to train
public works personnel in crisis and consequence management, or how to
self protect. Following the Oklahoma City bombing, it was public works
officials that suspended utilities in the affected areas, preventing
additional damages and devastation. Public works officials also ensured
the delivery of community services--water, electricity, refuse
collection, traffic control--to areas not directly impacted by the
bomb.
APWA would like to work with FEMA to infuse public works into
domestic preparedness activities, supplementing the role of first
responders. APWA supports FEMA's efforts to secure an additional $13.2
million in funding for anti-terrorism planning, training, and exercise
activities with the hope that these funds will be coordinated with
resources already available through the Department of Justice. APWA
also hopes that the role of public works agencies in domestic terrorism
will be recognized and that necessary training will be forthcoming.
Thank you for your attention and consideration. APWA would be
pleased work with you to provide additional information upon request.
______
Prepared Statement of the National Flood Determination Association
Mr. Chairman, Senator Mikulski and Members of the Subcommittee: The
National Flood Determination Association strongly supports the Federal
Emergency Management Agency's plan to fully modernize its mapping
program. The NFDA is a professional association of leading companies,
both large and small, which make determinations on whether or not a
property is in a special flood hazard area. Our clients are primarily
lenders and also insurance agents or companies. The NFDA members play
an important role in furthering the program compliance and floodplain
management objectives of the National Flood Insurance Program. The
Association represents the flood determination industry on FEMA's
Technical Mapping Advisory Council.
Accurate flood zone determinations depend on accurate and up-to-
date maps. The maps were required for implementation of the National
Flood Insurance Program, enacted in 1968, but since that time, their
uses have expanded while the maps have grown older and technology has
advanced. Some 100,000 map panels have been produced by FEMA, but 33
percent of them are more than 15 years old and another 30 percent are
between 10 and 15 years old. Development and changed land use patterns
significantly alter flood risk over a period of 10 to 15 years. Some
areas are mapped with more accuracy and detail than others, often
depending on the quality and age of the base map upon which other
information is superimposed. Often those maps reflected old engineering
analyses or approximate methods that do not provide sufficient data.
Also, some flood prone communities have never had a map study done.
The problem with access to good quality, up-dated flood maps was
recognized by the Congress in the Flood Insurance Reform Act of 1994,
which required a Five Year Map Update Needs Assessment. The Federal
Emergency Management Agency has found that the results of that process
make the importance of regular updating very clear because flood hazard
conditions are dynamic. NFDA members and FEMA are very much aware of
calls from frustrated lenders, property owners, insurance agents,
developers and community officials for maps that can be used to
interpret the effects of growth, construction and prior flooding
events.
The Flood Insurance Reform Act of 1994 also included measures
designed to improve program compliance. New tools such as the ability
of lenders to force-place flood insurance on a property have resulted
in much greater program participation, but have also led to more
awareness of map inaccuracies and age. The 1994 law requires FEMA to
respond promptly to appeals of map determinations. Appeals and requests
for Letters of Map Amendment (LOMA) or Letters of Map Revision (LOMR)
have grown from about 4,000 annually to about 12,000 annually. The
process of changing and reissuing the paper maps is cumbersome and time
consuming. LOMAs and LOMRs respond to a particular property inquiry and
do not immediately result in a changed flood map. despite issuance of a
number of LOMAs in a community, for example, the map in current use
would still have to be used for new flood zone determinations, but may
not reflect these changes. In many cases, this is due to lack of funds.
Digital technology now makes it possible to keep maps in a form
that can be readily updated as new information becomes available. Use
of modern technology is essential to facilitate effective functioning
of the NFIP and to promote wise community planning and good development
decisions. Yet, digitizing alone is not sufficient since the base maps
themselves must be of a higher quality.
FEMA's Mitigation Directorate has developed a well conceived plan
to update and modernize flood maps over a seven year period. The plan
is costly, as investment in efficiency and longer term objectives often
is. FEMA's benefit-cost analysis for the modernization plan is 2 to 1.
At the present time, all of the costs of FEMA's mapping are borne by
flood insurance policy holders. Some 40 percent of overall mapping
activities funds are now spent to respond to map appeals, brought on
largely because of map inaccuracies. There are many users of FEMA's
flood maps, ranging from lenders to engineers, surveyors and community
officials and emergency response professionals. It seems inappropriate
for flood insurance policy holders to absorb the cost when so many
others benefit.
NFDA fully supports FEMA's timely effort to begin the major task of
improving and modernizing flood maps for the nation. It is critical
that funds be provided for this task which is already overdue. Improved
maps will save the federal government in disaster relief monies and in
the cost of unnecessary LOMAs and LOMRs. Less directly, it will save
money in promoting better community and development decisions.
This is a wise investment. While other funding proposals are being
examined and, later, in addition to funds which may eventually become
available by some other means, the appropriation of funds for map
modernization is appropriate. This is an urgent need. NFDA strongly
urges the Committee to appropriate funds to make sure that flood map
modernization can get underway promptly.
______
Prepared Statement of the Association of State Floodplain Managers,
Inc.
Mr. Chairman and Members of the Subcommittee: The Association of
State Floodplain Managers, Inc. is pleased to have the opportunity to
share with you our thoughts relating to three initiatives in the fiscal
year 2000 budget request of the Federal Emergency Management Agency. We
support the initiatives to (1) begin a major overhaul and update of the
flood maps that provide the basic information for hazard reduction
across the country; (2) address the problem of repetitive claims
against the National Flood Insurance Program; and (3) fund the pre-
disaster mitigation concept of public-private partnerships targeted to
specific communities with a goal of becoming ``disaster resistant''.
The Association of State Floodplain Managers and its 10 Chapters
represent over 3,500 state and local officials as well as other
professionals who are engaged in all aspects of floodplain management
and hazard mitigation. All are concerned with reducing our nation's
flood related losses. Our state and local officials are the federal
government's partners in implementing programs and working to meet our
shared objectives. Many of our members are their states' coordinators
for the National Flood Insurance Program.
flood map modelnization
FEMA's Flood Insurance Rate Maps have been developed over the life
of the National Flood Insurance Program, using technologies of varying
sophistication and reliability. Early maps were produced quickly, using
readily available resources, when there was pressure under the
emergency phase of the program to make maps available. More advanced
technology has often been superimposed on differing qualities of base
maps. Full engineering studies to update maps have often not been
possible due to financial and time constraints.
Accuracy questions are often settled through Letters of Map
Amendment (LOMA) or Letters of Map Revision (LOMR). In this process,
changes are not made to the map itself, but only to the map's
application to an individual property, so continued and repetitive
questions of accuracy arise. Approximately 45 percent of the maps are
10 years old and about 33 percent are at least 15 years old.
Accurate and up-to-date maps are important so that banks and
lenders can make good decisions about what properties do and do not
require flood insurance. Good maps are also important for community
planning and development decisions as well as emergency evacuation
planning. Flood maps are used by for state and local floodplain
management for the purpose of preventing future losses to homes and
public facilities. Flood maps are widely used by engineers, developers,
community planners, state and local emergency management officials
federal officials. Flood maps are used by HUD, EPA, the Army Corps of
Engineers and FEMA's Mitigation Directorate, its Response and Recovery
Directorate as well as in the Federal Insurance Administration. The
Flood Insurance Rate Maps are widely recognized as being critical to
efforts to reduce loss of life and property, to reduce insurance and
disasters costs and to protect and utilize the natural and beneficial
functions of our nation's floodplains.
Since flood maps serve so many purposes for our society, it is
appropriate for American taxpayers to support modernization and
updating of FEMA's mapping capabilities. Since 1990 and passage of the
Omnibus Reconciliation Act, the cost of FEMA's mapping program is
funded only by flood insurance policy holders through their servicing
fees. The budget request seeks $65 million, including only $5 million
in appropriated funds to fund the beginning of a multi-year effort. The
remainder of the funds would come from a mechanism that has not been
authorized.
About 40 percent of the current mapping budget pays for evaluating
and responding to dramatically increasing numbers of requests for LOMAs
and LOMRs. This shows the need for better maps, but it also makes clear
the importance of beginning map modernization now so as not to
``waste'' more money on the much less efficient LOMA and LOMR process.
ASFPM believes that it is fitting and proper for this Committee to
approve the appropriation of general funds for flood map modernization.
Indeed, ASFPM would urge an annual general fund contribution
commensurate with the value of the flood maps for all taxpayers.
repetitive loss
Repetitive loss properties are those that have filed numerous flood
insurance claims. This has emerged as a problem that demands attention.
While most cases of repetitive loss are hardly as egregious as those
featured in national news coverage this past year, the losses do
represent a drain on the Flood Insurance Fund. The drain has
contributed to the need for more borrowing from the federal Treasury,
representing a cost to taxpayers.
The NFIP was established so that flood-prone citizens would
contribute to their own recovery. It saves the federal government and
the taxpayers the cost of disaster relief every time a flood strikes.
It provides a means to encourage communities to plan and implement
effective floodplain management strategies.
Most properties subject to repetitive loss are older structures,
built before the Flood Insurance Rate Maps (FIRMs) were developed. The
NFIP has shown itself over its 30 years to be an effective vehicle for
addressing recovery needs of flood-prone property owners rather than
repetitive payment of disaster relief from the general Treasury. Some
form of federal assistance will likely always be provided after major
floods, therefore, it does not seem useful to deny insurance to
repetitive loss properties. ASFPM believes it is more effective to
address the problem through mitigation to prevent future flooding.
FEMA has proposed to combine a new appropriation of $12 million
with the Floodplain Management Assistance program (FMA) in a focused
effort to deal with the most problematic cases of repetitive loss. The
NFIP, now funded entirely by premiums from policyholders, has lessened
disaster relief costs to taxpayers. It is, therefore, reasonable to
appropriate $12 million in general funds to assist in managing this
serious drain on the National Flood Insurance Fund.
project impact
Project Impact is FEMA's disaster loss prevention initiative which
fosters partnership between the federal, state and local governments as
well as with the private sector, including businesses and non-profit
entities. The objective is to mobilize a community's members to plan
and implement their own disaster loss reduction plans, programs and
projects. Success at the local level, where disasters' impact is most
felt, requires full local participation. Local public and private
generation and implementation of plans is an important pilot concept to
support. ASFPM supports the requested $30 million for this effort.
The Association of State Floodplain Managers would be very glad to
respond to any questions from Subcommittee Members or staff. I can be
reached at the South Carolina Department of Natural Resources at (803)
734-9120 and the ASFPM Executive Director, Larry Larson, can be reached
in Madison, Wisconsin at (608) 274-0123.
______
Prepared Statement of the International Association of Emergency
Managers
Mr. Chairman and Members of the Subcommittee: The International
Association of Emergency Managers (IAEM) would like to comment for the
subcommittee's record on the proposed fiscal year 2000 budget for the
Federal Emergency Management Agency (FEMA). IAEM urges Congress to
fully fund the FEMA budget request for fiscal year 2000.
IAEM is a 1,700-member organization which represents the interests
of emergency management professionals in local, state and federal
governments, the military, private business and the non-profit sector,
both in the U.S. and in other countries. Most of its members, however,
serve local governments within the U.S. borders.
Comprehensive emergency management encompasses the entire public
safety and service community, with a mission that includes mitigation,
planning, response and recovery. On a daily basis, our members help
their communities or their organizations plan for, respond to and
recover from a wide variety of emergencies hurricanes, winter storms,
floods, fires, droughts, earthquakes, chemical spills, transportation
accidents, infrastructure breakdowns and others. Lately we've added
terrorist activities, cyber-terrorism and Y2K.
For many years, there has been a recognized emergency management
partnership that encompasses local, state and federal governments.
Although the federal partner (FEMA) acknowledges the primary importance
of that local component, budget pressures in recent years have meant a
dwindling amount of federal dollars passed through to the local level,
which is the first line of defense in any emergency.
full funding
IAEM urges Congress to fully fund the FEMA budget request for
fiscal year 2000. Many of the initiatives to be funded by the proposal
are long overdue, including continued attention to pre-disaster
mitigation and flood mitigation in particular, a start on modernization
of floodplain maps, the focus on repetitive flood losses, and money for
enhanced training and planning for anti-terrorism efforts at the state
and local level.
consolidated grants
FEMAs budget request calls for consolidating the bulk of FEMA grant
programs for state and local jurisdictions into a single, more flexible
funding stream, called Emergency Management Performance Grants (EMPG).
One of the grant programs to be put under this new umbrella is State &
Local Assistance (SLA).
While IAEM believes the new grant mechanism may mean fewer
complications and greater ability for states to target their particular
needs, members have serious concerns about what the change will mean
for funding at the local level--especially when coupled with the new
requirement that all SLA funding be a 50-50 federal/state match.
(Previously, parts of the SLA money was 100 percent federal funds.)
Aside from direct funding of local jurisdictions, there is a second
concern: continuation of state-provided training, which is among the
most important services that state emergency management agencies
provide to local governments, and unfortunately is also the first
service they cut when funding is cut.
local requirements
Emergency management happens at the local level. If there is no
local program, an emergency situation quickly gets out of control, and
there is no focal point for coordination of outside help from the
state, the federal government or private relief agencies.
In the pre-Stafford Act, Civil Defense days, FEMA distributed SLA
funds to states and required them to pass through two-thirds of the
money to local jurisdictions. This requirement helped to ensure a
floor-level local capability in many jurisdictions. Not all states
strictly observed the requirement, and the federal pass-through funds
in recent years typically provided only 15-30 percent of program
budgets for most localities which received SLA funds. Nevertheless, it
was a commitment by the federal and state governments to the local-
state-federal partnership so crucial to effective emergency management.
There is no longer a pass-through requirement, and states are free
to pass funds through or not. Its not hard to understand how the
increasing demands on emergency management lead to a great temptation
to keep more funds within state programs.
IAEM believes it is essential that FEMA develop and maintain
standardized minimum program requirements relative to state
administration of funds in support of local programs, should the
proposed Emergency Management Performance Grants (EMPG) concept be
approved. These requirements should include a formula by which local
jurisdictions are assured an equitable portion of FEMA dollars.
importance of training
For emergency managers at the local level, one of the greatest
direct benefits derived from federal funding to states is the provision
of training and exercise programs. These were among the 100 percent
federally-funded SLA programs, and we fear that the move to a 50-50
match will result in degradation of these programs. We already have
seen that training for local jurisdictions is one of the first items to
suffer a hit when state budgets are squeezed either there is less
training offered, fees are tacked on, or state employees become the
major beneficiaries instead of local-level practitioners.
In the best of all worlds, IAEM would like to see the continuation
of 100 percent funding for training and exercise programs that directly
benefit all local jurisdictions within the state. At the least,
Congress should require that FEMAs rules for its new performance grant
program include requirements to maintain a certain level of training
and exercising to benefit local jurisdictions.
IAEM members thank you for the opportunity to comment on the
proposed FEMA budget. Our members and staff are available if you have
any follow-up questions.
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Prepared Statement of Florida State University
Mr. Chairman, thank you and the Members of the Subcommittee for
this opportunity to present testimony. I would like to take a moment to
acquaint you with Florida State University. Located in the state
capitol of Tallahassee, we have been a university since 1950; prior to
that, we had a long and proud history as a seminary, a college, and a
women's college. While widely known for our athletics teams, we have a
rapidly emerging reputation as one of the Nation's top public
universities. Having been designated as a Carnegie Research I
University several years ago, Florida State University currently
exceeds $110 million per year in research expenditures. With no
agricultural or medical school, few institutions can boast of that kind
of success. We are strong in both the sciences and the arts. We have
high quality students; we rank in the top 25 among U. S. colleges and
universities in attracting National Merit Scholars. Our scientists and
engineers do excellent research, and they work closely with industry to
commercialize those results. Florida State ranks fourth this year among
all U.S. universities in royalties collected from its patents and
licenses, and first among individual public universities. In short,
Florida State University is an exciting and rapidly changing
institution.
Mr. Chairman, let me describe several projects that FSU is pursuing
this year. The first is a joint project with the City of Tallahassee
involving an economic development initiative with the arts.
Florida State University and the City of Tallahassee propose to
jointly seek funding to stimulate economic development in an area of
Tallahassee that is adjacent to the FSU campus. The Frenchtown
community, a redevelopment priority for the city, is one of the highest
priorities of the City and is the University's highest capital
construction project. The vehicle for providing this boost to the
economic revitalization of this area will be a performing arts center
that will be housed on the edge of the FSU campus adjacent to the
Frenchtown area. That area, once a thriving resource to the Tallahassee
area has, in recent years, become a high crime area consisting of
deteriorating buildings, empty lots and abandoned housing. Such a new
facility would provide a location that would allow for over 400
performances a year with audiences drawn from the surrounding
communities throughout the Panhandle region of Florida, and including
portions of southern Georgia and western Alabama. Audiences for the
Center's performances will be drawn to commercial establishments
created as part of the Frenchtown Revitalization Project. Small shops
and restaurants, immerging as part of this revitalization effort, would
be the catalyst for further development and enhanced opportunities for
residents.
Private funds would be available to match the federal portion
several times over. We will be requesting $3 million in fiscal year
2000 for this effort as an Economic Development Initiative grant.
Next, I would like to discuss a project involving Digital Emergency
Broadcasting. Since 1995, FSU has delivered emergency information to
citizens of northwest Florida as they have endured floods, hurricanes,
tornadoes, and wildfires. These experiences have not only enhanced our
awareness of the need to pass on accurate information to the general
public but has also strengthened the ties between our stations and
Florida's Department of Emergency Management and their Emergency
Operations Center (EOC). Because of the success of our broadcasts, the
FSU stations have recently entered into an agreement to act as the
television production entity for the EOC during emergencies.
FSU and their broadcasting stations recognize a genuine need for
additional emergency services and propose a partnership with the
Federal Emergency Management Agency (FEMA) to explore the possibility
of broadcasting emergency information to FEMA field personnel and/or to
the general public during emergencies in the stations' coverage area
using this new technology. We believe that there can be great
advantages in the ability to broadcast the latest information available
directly to PCs using DTV at times when other telecommunications
infrastructure may be inoperative. With FEMA's investment into this
initiative, a partnership could be formed with the FSU stations and
Florida's Department of Emergency Management to better serve the
citizens of the North Florida area during a disaster, which could
eventually be duplicated nationwide. This is a worthwhile project will
save lives in the areas where implemented.
We are requesting $600,000 from FEMA in fiscal year 2000 for basic
infrastructure costs for this initiative.
Another project, Mr. Chairman, that Florida State University is
pursuing is related to the creation of a Challenger Learning Center in
Tallahassee and located at the FSU-Florida A&M University College of
Engineering building. That Center, which will have 34,000 square feet
of exhibit space, will house a space mission simulator with a mock-up
of ``Mission Control'' and the laboratory node of a ``Space Station''
as well. Between 10-15,000 middle school students will visit the Center
each school year, having been drawn broadly from 66 counties in north
Florida, south Georgia, and southeastern Alabama. As a member of the
Florida Space Grant Consortium, Florida State University is one of the
seventeen public and private members of this association. Collectively,
the Consortium serves more than 230,000 university students and also is
involved in substantial outreach work with K-12 students as well.
Our request, Mr. Chairman, is that you and your Subcommittee
consider funding NASA's Space Grant Consortium program at a level above
the level requested by NASA. This is an important national program and
deserves greater funding, The Florida Space Grant Consortium will be
approached to provide additional funds for the FSU-FAMU Challenger
Learning Center project. It is our hope that at least $100K could be
made available to the Challenger Learning Center of any additional
Florida funding that might be available. It would greatly enhance our
outreach efforts throughout Florida, Georgia, and Alabama to K-12
students.
Finally, Mr. Chairman, I would like to thank this Subcommittee for
its interest last year in your report and the conference report on the
concerns expressed about orimulsion and its potential environmental
impact. The Environmental Protection Agency (EPA) will be issuing some
program guidance resulting from similar concerns about environmental
impacts this and other heavy fuels might have and how those impacts
might affect water quality and how could these various fuels be
mitigated in case of a spill. We here at FSU are persuaded we have a
unique approach to a examine such impacts in a total biological
community approach. We are persuaded we have a unique and much more
effective means of assessing impacts on the marine environment and will
be discussing this further with EPA. We will keep the Subcommittee
informed of our progress in this arena.
Mr. Chairman, as you can see, Florida State University has numerous
projects and proposals pending before several of the agencies and
departments within your jurisdiction. I would like to discuss one final
activity that is preparing its renewal proposal to NSF. I call it to
your attention because the decision made in the early 1990's by the NSF
and its Board was an excellent one and one that has been borne out to
have been highly successful. Florida State University's National High
Magnetic Field Laboratory was awarded its first five-year contract in
the early 1990's following a highly-publicized competition and decision
by NSF and its Board. The NHMFL was renewed for another five years in
1996 and is preparing for its third proposal to NSF in the fiscal year
2000 budget year. I would only like to call your attention to this
extraordinary facility which is an excellent example of partnerships
between both the federal government and the State of Florida, a
national laboratory, and Florida State University. It has developed
state-of-the-art magnet technologies and systems in collaboration with
numerous industries. It has attracted a world-class faculty to
Tallahassee. It is doing research, development, and education at all
levels including an extremely active K-12 outreach effort with the
children of Florida and the southeastern U.S. It is a success story
that your Subcommittee and the National Science Foundations should be
proud to claim.
Mr. Chairman, I would like to conclude with a discussion of the
overall budget of the National Science Foundation. NSF provides support
for scientific and engineering research and educational activities at
colleges and universities around the Nation. Their support and the
quality of their programs and staff are unparalleled in the federal
government. They provide approximately $30million per year to Florida
State University so selfishly they are incredibly important to this
university. I am asking that your Subcommittee look at the NSF request
as the base and make every effort to secure additional funds that you
could invest in the NSF and its programs. There can be no better return
on investment than in research and development.
Related to NSF is a concern that is becoming broadly shared by the
research community. That concern relates to the disproportionate share
of federal R&D being appropriated to the biomedical sciences and
substantially lesser amounts for other R&D activities that truly
provide the foundation for new knowledge and breakthroughs in all
sciences, including the medical sciences. While many of our scientists
are less articulate in making the case for basic scientific research
support like that provided by NSF, it clearly is incredibly important
for our Nation's future.
I hope that your Subcommittee, as it makes its very difficult
decisions regarding priorities for spending those resources allocated
to your Subcommittee, please consider this issue of balancing federal
R&D. This might require coordination among several of the key
Appropriations subcommittees to ensure that investments which can
benefit several scientific areas be considered appropriately. For
instance, there are recent funding precedents that have seen NIH
supporting the upgrades of synchrotrons which have been the
responsibility of the Department of Energy. The OSTP Director, in a
January 1999 report on this subject, indicated that this type of
multipurpose funding by NIH of broader scientific instruments and
facilities should be considered. Nuclear Magnetic Resonance (NMR) was
one area noted as a possible candidate for such NIH funding because
such funding by NIH would benefit broader scientific areas like
biology, materials sciences, and others. I would request that your
Subcommittee consider working with other key Appropriators to determine
if utilization of certain NIH funds might be designated for
instrumentation that has multidisciplinary benefit. While NSF clearly
has successful programs to manage such large instrumentation projects,
the NIH does not. Yet NIH has consistently garnered funding increases
that the NSF has never seen previously. Seeking creative ways to
redress the balance among scientific fields might assist in
``rebalancing `` federal funding among agencies and functions.
Mr. Chairman, I have described just a few of the exciting
activities going on at Florida State University that will make
important contributions to solving some key problems and concerns our
Nation faces today. Your support would be appreciated, and, again,
thank you for an opportunity to present these views for your
consideration.
______
Prepared Statement of the National Emergency Management Association
Please accept these comments from the National Emergency Management
Association (NEMA) regarding the Federal Emergency Management Agency
Year 2000 budget request. NEMA represents the emergency management
directors in the 50 states and territories responsible to their
governors for emergency preparedness, mitigation, response and recovery
activities. The FEMA budget provides critical dollars to support state
and local emergency management programs. NEMA urges your strong support
of the budget as presented with consideration for additional dollars
above the request in the State and Local Assistance program.
The FEMA Year 2000 budget request reflects the incredible growth of
all-hazards emergency management activities in recent years--from
domestic terrorism preparedness to Y2K to international disaster relief
and now planning for school safety. Emergency management programs at
all levels of government face difficult challenges today including the
expectation to do more with less, increased competition for resources,
increased frequency and destructiveness of disasters and increased
public expectations for services. In addition, there is an expectation
by Congress to reduce disaster costs.
NEMA is proud to inform you that states are rising to meet these
challenges. They are committing greater resources than ever before to
emergency management. According to a recent survey by NEMA, states
spent $2.77 billion on emergency preparedness, mitigation, response and
recovery in fiscal 1997, which is nearly double the amount spent only
five years ago. And while emergency management once focused on
responding to and recovering from disasters, states are now clearly
focusing their efforts and resources on mitigation or prevention
efforts to reduce the costs of future disasters. The NEMA survey
revealed that states spent $1.24 billion on mitigation activities in
fiscal 1997 which is 45 percent of spending on all four phases of
emergency management. This is an 80 percent increase over the previous
year.
The budget request includes a new Emergency Management Performance
Grant (EMPG) that will consolidate separate funding streams and replace
the current Performance Partnership Agreement. NEMA understands the
benefits of the consolidated grant will include flexibility for the
states to meet emergency management priorities, and more efficiently
use state staff end financial resources. The increased flexibility
promised by FEMA will help to enhance the professionalism of state and
local emergency management programs and build a decentralized
capability for preparedness and response. NEMA has been working in
cooperation with FEMA to develop program goals and objectives. We are
excited about the opportunities the consolidated grant provides for
states.
The proposed Emergency Management Preparedness Grant includes a
request of $141 million for grants to states with an increase of
approximately $4 million for State and Local Assistance funding. The
SLA funds are pass through grants to state and local governments and
provide the very foundation upon which basic emergency management
capabilities are built. The $4 million increase in SLA funds over the
previous year is sorely needed. In fact, a significantly larger
increase in SLA funding is needed to bring the program up to the
intended 50/50 match between the federal government and states. States
reported that shortfalls in SLA grants totaled more than $152 million
in fiscal 1997. This is $27 million more than fiscal 1996 and $68
million more than fiscal 1992. As you can see, funding has not kept
pace with increased emergency management responsibilities and public
expectations for a world class emergency management system. In
addition, the cost share for the SLA program will shift to 50/50 in the
Year 2000. This has had a negative impact on budgets and staffing
levels in several states with limited financial capacity. Other states
have been able to secure the necessary matching fund requirements.
Regardless of their states' current financial capacity, all state of
finials share the common concern that the future of basic emergency
management programs and capabilities will be in jeopardy if we continue
to shift costs to state and local governments and piecemeal funding for
emergency management through special programs that may or may not be
national priorities in future. With this in mind, we urge you to
seriously consider providing additional SLA funds over and above the
FEMA request.
Other FEMA budget initiatives supported by NEMA include the request
for $30 million for pre-disaster mitigation. This is truly the only way
we can reduce disaster costs. As I mentioned earlier, states have
followed FEMA's lead and focused their efforts on prevention. Ninety
percent of spending for emergency management in fiscal 1997 occurred
before disasters could strike. NEMA is working in partnership with FEMA
to collect mitigation success stories and to document the cost-
effectiveness of such activities as property buyout and relocation
projects. FEMA's request for an additional $12 million to focus on
removing repetitive loss structures from floodplains is very important
and will prove to be a wise use of federal and state dollars.
A critical initiative that has been significantly under-funded
within FEMA is the domestic preparedness program. FEMA has a critical
role to play as the lead federal agency for consequence management, but
hasn't received the funds to appropriately support that lead role. In
turn, states have received little funding to adequately plan, train and
exercise for potential terrorist incidents. NEMA fully supports FEMA's
request for additional anti-terrorism funds $8 million of which is
targeted to go to states for planning and exercises. This is critical
if states are to develop comprehensive state terrorism strategies that
build upon the existing capabilities of local, state and federal
government already in place as part of the nation's all hazards
emergency management system. It is important to note however, that
special program funds such as these cannot be used to support day-to-
day emergency management functions and should not be viewed as a source
of funding to replace critical State and Local Assistance dollars.
Having said that, the nation's domestic preparedness program is of
great importance to NEMA and there are many coordination issues that
must be addressed if we are to be successful in this endeavor.
In closing, NEMA would like to express its continued support and
appreciation for FEMA Director James Lee Witt. He remains a good friend
to state and local government, but more importantly a strong advocate
for all our citizens when they become victims of disasters.
Please feel free to call on NEMA at any time as a resource on
emergency management issues. Thank you for your strong interest and
work in the emergency management arena.
______
Prepared Statement of the Association of State Floodplain Managers,
Inc.
Mr. Chairman and Members of the Subcommittee, The Association of
State Floodplain Managers, Inc. is pleased to have the opportunity to
share with you our thoughts relating to three new initiatives in the
fiscal year 2000 budget request of the Federal Emergency Management
Agency. We support the new proposed initiatives to (1) address the
problem of repetitive losses in the National Flood Insurance Program;
(2) begin a major overhaul and updating of the flood maps produced and
used by FEMA; and (3) fund the concept of public-private partnerships
targeted to specific communities with a goal of becoming ``disaster
resistant''. The Association of State Floodplain Managers and its
Chapters represent over 3,500 state and local officials as well as
other professionals who are engaged in all aspects of floodplain
management and hazard mitigation. All are concerned with working to
reduce our nation's flood related losses. Our state and local officials
are the federal government's partners in implementing programs and
working to achieve effectiveness in meeting our shared objectives. Many
of our members are their states' coordinators for the National Flood
Insurance Program.
repetitive loss
Repetitive loss, the filing of numerous flood insurance claims on
the same property, has emerged as a problem in the functioning of the
NFIP that demands attention. While most cases of repetitive loss are
hardly as egregious as those featured in national news coverage this
past year, the losses do represent a drain on the Flood Insurance Fund.
Such a drain on the Fund can result in the need for more borrowing from
the federal Treasury, representing a cost to taxpayers. The NFIP was
established to help citizens with the cost flooding in a manner in
which those at risk paid into their assistance, to save the federal
government and its taxpayers the cost of disaster relief every time a
flood struck and to provide a means of encouraging communities to plan
and implement effective floodplain management strategies. Often,
properties subject to repetitive loss are older structures, in place
before the Flood Insurance Rate Maps (FIRMs) were developed. The
program considers pre-FIRM properties to be those built before 1974.
Since the NFIP has shown itself over its 30 years to be a useful
vehicle for addressing recovery needs of flood-prone properties rather
than repetitive disaster relief payments from the general Treasury.
Since it is unlikely that some form of federal assistance would not be
provided in the face of a natural disaster, it does not seem useful to
deny insurance to repeat claims, but perhaps to address the problem
through increased premiums or through steps to prevent future flooding.
Unfortunately, many policyholders do not have sufficient savings or
income to take often expensive steps to mitigate future flooding. FEMA
has proposed to combine an appropriation of $12 million with its funds
for the Floodplain Management Assistance program (FMA) in a new effort
to assist the most problematic cases of repetitive loss through
elevation, floodproofing or buyout of the property. Since the NFIP,
funded largely by premiums from policyholders, has lessened disaster
relief costs to taxpayers, it seems very appropriate to appropriate $12
million in general funds to assist in removing the most serious drains
from the National Flood Insurance Fund.
flood map modernization
FEMA's Flood Insurance Rate Maps have been developed over the life
of the National Flood Insurance Program, using technologies of varying
sophistication and reliability. Early maps were produced quickly, using
readily available resources, when there was pressure under the
emergency phase of the program to make maps available. Later, more
advanced technology has often been superimposed on differing qualities
of base maps. Full map studies to update maps have often not been
possible due to financial and time constraints, so accuracy questions
have often been settled through Letters of Map Amendment (LOMA) or
Letters of Map Revision (LOMR). In this process, changes are not made
to the map itself, so continued and virtually repetitive questions of
accuracy arise. Approximately 45 percent of the maps are 10 years old
and about 70 percent are at least 5 years old. Accurate and up-to-date
maps are important to making proper decisions about what properties do
and do not require flood insurance, but they are also important to
community planning decisions. Flood maps are used by our members in
floodplain management for the purpose of preventing future losses to
homes and public facilities. Flood maps are tools widely used by
engineers, developers, local community planners, state and local
emergency management officials and federal officials, both in FEMA's
Mitigation Directorate and its Response and Recovery Directorate as
well as in the Federal Insurance Administration. The Flood Insurance
Rate Maps(FIRMs) are widely recognized as being critical to efforts to
reduce loss of life and property, to reduce insurance and disasters
costs and to assist in utilizing the natural and beneficial functions
of our nation's floodplains. Since flood maps perform so many functions
for our society, it seems entirely appropriate for American taxpayers
to support modernization and updating of FEMA's mapping capabilities.
At present, the cost of FEMA's mapping program is funded only by flood
insurance policy holders through their premiums and servicing fees. The
budget request seeks $65 million, including only $5 million in
appropriated funds to fund the beginning of a multi-year effort. The
remainder of the funds would come from a mechanism that has not been
authorized. Apparently about 40 percent of the current mapping budget
pays for evaluating and responding to dramatically increasing numbers
of requests for LOMAs and LOMRs. This shows the need for better maps,
but it also makes clear the importance of beginning map modernization
now so as not to ``waste'' more money on having to issue more LOMAs and
LOMRs. It is the view of ASFPM that it is fitting and proper to
contribute general funds to flood map modernization.
project impact
Project Impact is an important disaster loss prevention initiative
which fosters partnership between the federal, state and local
governments as well as with the private sector, including businesses
and non-profit entities. The objective is to mobilize a community's
members to plan and assist in funding their own disaster loss reduction
plans, programs and projects. Success at the local level, where
disasters' impact is most felt, requires full local participation.
Local public and private generation and implementation of plans is an
important pilot concept to support. We hope that the requested funding
for this effort can be provided. It is my hope that these comments on
aspects of FEMA's fiscal year 2000 budget request will be helpful to
the Subcommittee. The Association of State Floodplain Managers would be
very glad to respond to any questions from Subcommittee Members or
staff. I can be reached at the South Caroline Department of Natural
Resources at (803) 734-9120 and the ASFPM Executive Director, Larry
Larson, can be reached in Madison, Wisconsin at (608) 274-0123.
______
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
Prepared Statement of the State Cooperative Extension Services and
State Agricultural Experiment Stations
Mr. Chairman, members of the subcommittee: As the respective Chairs
of the Extension Committee on Organization and Policy (ECOP) and the
Experiment Station Committee on Organization and Policy (ESCOP) of the
National Association of State Universities and Land Grant Colleges
(NASULGC), we appreciate the opportunity to discuss the importance of
inter-agency partnership in education and research in space and
agricultural programs.
As components of NASULGC, a non-profit organization, ECOP and ESCOP
represent a national network of Land Grant University-based State
Cooperative Extension Services (CES) and State Agricultural Experiment
Stations (SAES). The Land Grant University system (LGU) and the USDA-
Cooperative State Research, Education, and Extension Service (CSREES)
have had a thriving partnership of many years, providing the technology
which has made American agriculture the most productive and efficient
in the world. Our organization is committed to advancing
scientifically-based decision making at the local level by capitalizing
on the LGU comparative assets in extension, education, and research.
Furthermore, our Land Grant University institutions have a critical
mass of educational and scientific infrastructure and facilities.
We believe technology transfer models are crucial to the ultimate
success of any proposed joint venture. Joint venture partners must be
able to integrate their intellectual assets and science infrastructures
efficiently, and then move-out the products of the joint effort quickly
into practical applications to be used in the real world.
As a key anchor in the real world of agriculture, the State
Cooperative Extension Services would be the cornerstone of our proposed
space-based technology and education delivery model to the ultimate end
user--the American Farmer.
The Land Grant University system can contribute significantly to
such a model with NASA as the partner. The Land Grant system has a
knowledge base about the way agriculture is practiced and can readily
find opportunities within agriculture for fruitful space research
partnerships. We believe Agriculture can be made a solution to many of
the problems the nation faces.
CES and SAES's major focus in the space and related food and fiber
production and natural resource management areas include: NASA Remote
Sensing Applications Research in Agriculture, Forestry and Range
Resource Management and Precision Agriculture; Risk and damage
assessment caused by a variety of physical, biological, chemical and
anthropogenic stresses; Vegetation Mapping, Inventory, Characterization
and Monitoring; Earth science applications and technologies; The
National Agricultural Weather Information System, and Environmental
education and outreach.
In not recreating the wheel, the Land Grant University system aims
at partnering with NASA, and where helpful by also including the
supplemental contributions of agencies such as NOAA and NSF, to
collaborate on numerous space and food and fiber production and natural
resource management initiatives. Many agencies share similar public
education priorities and research goals that can be utilized to develop
partnerships and collaboration. Many initiatives and goals are targeted
to specific agendas, however a more thorough inventory of extension,
education and research priorities can be assessed through collaborative
discussions and pooling of resources.
Through a variety of means, a partnership between NASA and the Land
Grant University system as well as NOAA and NSF and other agencies
would increase: The rate of technology transfer and development between
the partners; the amount of LGU participation in agency peer review
processes; the quantity/quality of proposals submitted by the LGUs for
government funded competitive grants in related space/agricultural
areas; the exchange of scientists between LGU institutions and the
government for collaborative projects.
For example, the USDA (through the Land Grant System) and NASA have
already jointly developed the Space Grant Geospatial Extension
Specialist Program. The National Space Grant College and Fellowship
Program--in short: the Space Grant Program--has begun an effort to
bring the benefits of NASA's Earth Science Enterprise and of Remote
Sensing to the American public in partnership with the Land Grant
Cooperative Extension System.
The Space Grant Program, modeled after Land Grant and Sea Grant
university programs, is administered by NASA and consists of a
nationwide network of universities, aerospace and related industries,
state and local government organizations and other institutions
dedicated to education, research and public service, including
outreach, in aerospace science and technology. There are 52 Space Grant
Consortia in each of the 50 states, the District of Columbia, and
Puerto Rico, with over 700 affiliates. A large part of the more than
$19M allocated yearly to Space Grant go to scholarships and fellowships
for university students and are matched with university and other
funds. A smaller percent of Space Grant funding is used to build new
research infrastructure. The partnership with Extension is a more
recent effort and is presently in a pilot phase.
Space Grant Consortia are led in each state by exceptionally
dedicated administrators who strive to better help educate our youth in
science and technology, to bring the benefits of Aerospace Science and
Technology to the public, to build local programs benefiting their
states, who utilize NASA seed funding to leverage opportunities, create
partnerships between universities, industries, state agencies, non-
profit organizations, local government and schools, and build high
technology research infrastructure at colleges and universities. They
are a bridge between the public and youth on one side and NASA and
aerospace industry on the other side.
Four years ago Space Grant began exploring the possibility of
partnering with the Cooperative Extension System to bring the benefits
of NASA space products one step closer to the taxpaying public. The
obvious NASA Enterprise chosen to work with is the Earth Science
Enterprise (formerly Mission to Planet Earth). In the process it became
clear that many applications of Earth imagery from space would result
from commercial remote sensing. For example, a marriage of sorts could
be envisioned between data and information technology on one hand and
user communities on the other hand. The Space Grant Extension
Specialist will have expertise in remote sensing and associated
technologies, strong ties to the NASA Earth Science Enterprise and be
part of the Cooperative Extension System.
The Specialist will act as a two-way conduit for information
between NASA and user communities. He or she will: (1) Assess state
needs for remote sensing research, value-added products, training,
information and technology; (2) Initiate pilot research projects for
remote sensing applications and extend their results to the users
communities in the state through the network of county agents; (3)
Involve commercial remote sensing data providers and value-added
companies in his/her activities; (4) Facilitate the development of
training curricula for professionals, Agents and other extension
specialists; and (5) Support the education, research and outreach
efforts of the State Space Grant Consortium in Earth Science and Remote
Sensing.
Three Land-Grant universities, Utah State University, the
University of Arizona, and Mississippi State University will serve as
pilot programs to test and further develop the concept this year. It is
expected that future NASA funding will allow additional Space Grant
State Consortia to become involved in the project. Linking Space Grant
and Extension networks is a very worthwhile and promising endeavor
which may provide NASA an effective-vehicle for technology and
information transfer to the user communities.
The Land Grant University system would like to see the formation of
a partnership between these agencies for an expanded effort. It is
efforts like these that make for meaningful partnerships. Such a
partnership should be formed and accelerated, given the U.S. and world
population growth, and its future need for food both in quality and
sustainability as well as the nation's need to maximize new space-based
technologies to maintain our global competitiveness in food and fiber
production and natural resource management on public lands.
It is just these kinds of partnerships with the Land Grant
Universities that can be developed which utilize the expertise that has
been established over many years of striving to achieve rather
different goals, i.e., increased productivity, and can now be focused
on different but related problems.
Over the many scores of years they have been operating, the Land
Grants also have developed a system of technology transfer that is the
envy of the world. It is this kind of expertise which may be used to
disseminate the progress made through extension and research and is not
necessarily limited to farmers but can be used to educate the general
public.
Thus the partnership approach maximizes the effective use of
established skills to solve new sets of problems and in the overall
scheme can be expected to solve them more efficiently and with less
cost toward factors in an era of constrained resources.
The Land Grant infrastructure is a proven delivery system.
NASA and other agencies have existing and new initiatives to
address many of the nation's agricultural and environmental problems.
The Land Grant University system continues to build its relationships
with various agencies in support of the nation's agricultural and
natural resource system. It plans to encourage interagency
communication and to broaden LGUs federal participation in USDA. A
well-planned initiative could unify representatives from the State
Cooperative Extension and Services the State Agricultural
Experimentation Stations, Natural Resource Conservation Service (NRCS),
the Forest Service, and the Agricultural Research Service and extend
this unified expertise to NASA. This goal is aimed at enhancing the
collaboration that is occurring at the local level between LGUs and
USDA and other agencies. CES and SAES have identified existing
resources in agencies for various programs which are targeted at
addressing the scientific educational and research infrastructure
between agriculture and NASA.
------------------------------------------------------------------------
Endorsed programs areas Department/agency
------------------------------------------------------------------------
Precision Agriculture and Forestry................... NASA/OES
Remote Sensing Applications...................... USDA/NASA
Geospatial Extension............................. DOE/NASA
Earth Science Enterprise............................. NASA/USDA
Risk and Damage Assessment........................... NASA
Global Climate................................... NASA/NOAA
Socio-economic Dimensions........................ NASA/NOAA
------------------------------------------------------------------------
The Land Grant University system offers a full portfolio in its
extension, education, and research program. The LGUs offer the
technical innovation and new management ideas to implement a national
agricultural/space research and development program. Our scientists
provide public understanding through our extended outreach and
educationprograms and provide for rapid advances in information
technologies through our research portfolio. Additionally the LGUs can
serve as a valuable resource when developing standards and perhaps most
critically by providing technology transfer to farmers and communities
in every county in America and the U.S. territories.
In the area of small farms, extensive research expertise already
exists among the Land Grant system's 1890s (traditionally African-
American) colleges about how agriculture is practiced on small scale
farms. Jointly developed NASA and Land Grant technology could focus on
the problems of small farmers and could reverse hopefully recent trends
enhancing their competitiveness. Tuskegee University has already made
significant contributions toward NASA-driven technologies in the area
of precision agriculture. The 1890s as well as many other Land Grant
Universities could help advance the development of these important
space-based agriculture technologies.
CES and SAES would be pleased to provide an expanded ``on-the-
ground'' and ``in-the-field'' role for the LGU System on energy and
environmental issues and research. Through the excellent electronic
communications network of the LGU System, government agency-partners
can reach the appropriate administrators, scientists, academic program
personnel, and extension representatives almost immediately as the
situation demands. We hope we have highlighted the science benefits and
value of partnerships between the Land Grant system and NASA and other
agencies to solve some of the nation's pressing agricultural problems.
We stand ready to help.
______
Prepared Statement of the United Space Alliance
Mr. Chairman, thank you for giving me the opportunity to submit
testimony for the record before your Subcommittee.
I am Russ Turner, the President and Chief Executive Officer of the
United Space Alliance (USA). USA is responsible for the day-to-day
management of NASA's shuttle fleet under a single prime contract
awarded by NASA in 1996. The company employs 9,000 people, mostly in
Texas and Florida and had 1998 revenues of $1.4 billion. USA's primary
mission is safe operation of the Shuttle; additional duties under our
contract are: Mission design and planning; flight operations; payload
integration; logistics; astronaut and flight controller training;
vehicle processing, launch and recovery; and software development and
integration.
Mr. Chairman, we at USA are proud to operate this vital and unique
national resource. The Space Shuttle is a critical part of the Nation's
space infrastructure and will continue to fly for at least 10 more
years. To insure safe and efficient operation of the Nation's Space
Shuttle fleet, NASA and its industry team have embarked on an upgrades
road map for the Shuttles.
The International Space Station (ISS) is critically dependent on
the Space Shuttle from assembly through the end of the program, and
today, only the Shuttle can meet NASA's human space flight needs beyond
ISS. The Shuttle fleet has more than 75 percent of its design life
remaining so upgrades will maximize the return on our nation's
investment. Upgrades that combine both the latest technology and the
most dependable and proven technology benefit the entire program.
Our central issue to bring to the Subcommittee's attention is this:
the Space Shuttle Upgrades program is underfunded, and it is imperative
that NASA continue upgrading the only reusable launch system in the
world to insure that maintainability and obsolescence issues do not
jeopardize the Nation's Human Space Flight Program.
To improve Shuttle safety and productivity, investments need to be
made in technologies beyond those in NASA's fiscal year 2000 budget
request. We are asking your Subcommittee to add $25 million above the
budget request to support the purchase of long-lead items for Phase 3
upgrades which will further improve Shuttle safety and reliability
while reducing cost. In addition to those upgrades included in the NASA
budget request, others have been identified, as follows:
--Electric Auxiliary Power Units (APUs) will make significant
improvement in safety as well as, improve the performance and
reliability of the Space Shuttle's hydraulic systems.
--SSME Advanced Health Management System (AHMS) will help flight
safety and ground maintenance checkout of the Space Shuttle
Main Engines (SSMEs) through advanced monitoring and detection
systems.
--Main Propulsion System (MPS) Electromechanical Actuators will
provide safer and more efficient operation and monitoring of
propellant valves.
--Proton Exchange Membrane (PEM) Fuel Cells will reduce operating
costs while also increasing electrical power for Orbiter
systems and payloads.
No other launch vehicle in the world, either in use or in
development today, possesses the capability or versatility of the Space
Shuttle. Additionally, the Shuttle program is better than ever with
improved safety and reliability, better performance, and lower
operating costs. Additional upgrades will lead to even greater safety,
reliability, and efficiency.
Mr. Chairman, the Space Shuttle is safer and more efficient than
ever and an excellent example of how a major government program can be
operated more efficiently for less money. Consider the following:
--In fiscal year 1992, the annual space shuttle budget was $3.9
billion--today it is $3 billion.
--Since USA signed the prime contract in 1996, metrics used to
measure safety have shown a dramatic improvement.
--At the same time USA has contributed to shuttle cost savings of
$267 million in 1997 and 1998; plus an additional $192 million
in savings are projected for this year.
--USA has invested back into the program its share of contract
underrun funds for system improvements. The Space Shuttle's on-
time record is nearly perfect over the last three years,
building on an outstanding record already started by NASA.
--Core jobs that required 15,000 people in fiscal year 1992 need only
8,900 in fiscal year 1998.
By investing in upgrades, the Space Shuttle will continue to meet
the challenges in the next century. As has been proven with commercial
and military aircraft, technology upgrades can extend the life of
aircraft and return great value to the taxpayer. In this way we can
assure that the unique capabilities of the Space Shuttle--still
unmatched in the world for the foreseeable future--are available to our
country in the next century.
Therefore, we ask your Subcommittee to support the following
request: Support the NASA fiscal year 2000 budget request of $13.578
billion, particularly funding for the Space Shuttle, the International
Space Station, and Space Shuttle Upgrades; and, provide an additional
$25 million in NASA Shuttle Upgrades funding to continue investing in
technology that improves Space Shuttle safety, productivity,
reliability, and performance.
______
Prepared Statement of the American Museum of Natural History
Good morning Mr. Chairman and Members of the Committee. My name is
Ellen Futter and I am the President of the American Museum of Natural
History. I very much appreciate the opportunity to submit to you today
a summary of our recent activities and our fiscal year 2000 plans and
objectives. Most of all, I want to thank this Subcommittee for the
contributions it has made to scientific research and education in this
nation.
Founded in 1869, the American Museum of Natural History is one of
the nation's pre-eminent scientific and educational institutions
drawing four million visitors on-site annually and another four million
to our website. For over 129 years, the Museum has pursued a mission of
examining critical scientific issues and increasing public
understanding about them. More than 200 active research scientists,
many with internationally recognized expertise, conduct more than 150
field projects each year. In fact, since its founding, the Museum has
sponsored tens of thousands of expeditions, sending scientists and
explorers to every continent. This rich scientific legacy includes a
collection of approximately 32 million natural specimens and cultural
artifacts that together form a record of life on earth.
Early in the year 2000, the Museum will begin a new chapter in its
history with the opening of the new Rose Center for Earth and Space,
including a rebuilt and scientifically cutting-edge Hayden Planetarium
and a new Hall of the Universe and Hall of Planet Earth. With the
construction of the Rose Center, the Museum will better join science
and education to provide a seamless educational journey taking visitors
from the very beginnings of the universe, to the formation and physical
processes that exist on Earth to the extraordinary and irreplaceable
diversity of life and cultures on our planet.
Consistent with the federal government's stated commitment to an
interagency and multi-disciplinary direction, the Museum's ongoing
scientific research and educational programming increasingly emphasizes
an interagency and multi-disciplinary approach. Under the leadership of
Congress, the American Museum of Natural History has fostered a close
scientific and educational partnership with NASA. As you know, unlike
any other federal agency, NASA has captured the imagination of the
American public and reinvigorated a national thirst for exploration
into previously unknown realms.
The fiscal year 1998 Congressional appropriation enabled the Museum
to launch the National Center for Science Literacy, Education, and
Technology (``the National Center'') in cooperation with NASA. In the
National Center NASA and the Museum joined resources to create programs
that neither one could do as effectively on its own. This extremely
productive partnership rests largely on the shared goal of fostering
scientific literacy nationwide. The National Center creates materials
and programs that reach beyond our institutional walls into homes,
schools, museums, libraries, and community organizations around the
nation. NASA's partnership with the National Center has fueled four
major components: the Educational Materials Laboratory, Electronic
Science Bulletins, Digital Galaxy Mapping Project, and the Black Smoker
Expedition and Educational Initiatives.
The Educational Materials Lab develops materials and programs to
bring cutting-edge science to formal and informal science education
settings across the country. One such program, Biodiversity Counts, is
now in more than 100 schools nationwide as a middle-school curriculum.
Three interrelated efforts--the BioBulletin, GeoBulletin, and
AstroBulletin--gather, interpret, and transform data and images into
comprehensive, digital ``snapshots'' of events, research, and phenomena
in global and cosmic systems displayed in the new permanent exhibition
halls. Information displayed in the Bulletins is reinterpreted for
dissemination via the World Wide Web, and can be compiled into digital
almanacs or bulletins distributed on CD-ROMs and in other media. The
BioBulletin centers on global biodiversity, the GeoBulletin will track
data about climate systems, and the AstroBulletin will include images
from NASA and other observatories, as well as updates on NASA missions,
images and information about astronomical events.
The Digital Galaxy brings together diverse data sets to create the
first scientifically accurate three-dimensional map of the Milky Way
Galaxy. The Hayden Planetarium Space Theater was part of the principal
motivation for the Digital Galaxy project. The Space Theater will
feature the most advanced real-time digital dome projection system in
the world. This project will showcase data from NASA and make it
available for widespread public use. It will also explore new ways of
compiling, interpreting, and communicating complex scientific data to
the public in ways that are engaging, entertaining and highly
educational.
A team of Museum scientists and educators has successfully
participated in an expedition with the University of Washington to
recover four ``Black Smokers,'' sulfide structures located on the deep
ocean floor on the Juan de Fuca ridge, off the coast of Washington.
Nine teachers accompanied scientists on this expedition and experienced
the process of scientific discovery. They also contributed to the Black
Smoker Web site journals and will take their experiences back to their
classrooms. The National Center plans to develop earth-science
curriculum materials inspired by the themes in the Hall of Planet
Earth, including the retrieval of and learning from the Black Smoker.
We have recently expanded our work with NASA to meet our common
goals of exploring and developing ways to understand the earth, its
biodiversity, and the history of life in the universe. By joining the
Museum's massive biological collections, accumulated over the last 129
years and extending back hundreds of millions of years, with NASA's
enormous datasets, this partnership will effectively address the goals
of NASA's new investments in interdisciplinary research in biology,
earth science, and space science. Our partnership with NASA will
greatly enhance biological research by focusing on four key areas: (i)
incorporation of satellite technology into biodiversity conservation;
(ii) utilization of DNA sequencing in systematics and conservation;
(iii) improving collections by adding compact storage and a super-cold
tissue storage for microbial and molecular biology; and (iv) use of
digital imaging technologies for improved perception of specimens and
dissemination of research.
The Museum now seeks to extend and broaden the relationship between
the American Museum's National Center for Science Literacy, Education
and Technology and NASA by expanding the role of NASA in the new Rose
Center with the goal of educating a broader segment of the American
public. We are seeking, therefore, a fiscal year 2000 NASA investment
of $5 million to support an expand the Educational Materials Lab, which
is accessed by millions of Americans, and will include the development
of additional curriculum modules from prototypes created in the first
phase of the National Center's NASA grant in the areas of Tools for
Making Sense, Black Smokers, Hall of the Universe, and Digital Galaxy.
In addition, we seek to deepen and broaden our partnership with NASA in
the realm of the Digital Galaxy by bringing this astounding compilation
of information to teachers, students, and the general public through an
easily accessible format such as a data archive and coordinated
website. We plan to develop an on-going Digital Dome visualization
project that will contain a NASA ``news'' element that will highlight
current NASA priorities such as progress in the space station and new
astronomical discoveries. These elements can then be integrated into
the planetarium space theater presentations for greater public access.
In partnership with NASA, we seek to implement a second phase of the
highly successful Electronic Science Bulletins that were instituted
under the first NASA agreement.
This is our agenda for the coming years. Much of the support for
research, exhibition, and education comes from foundations,
corporations, and individuals. However, it is significant that we have
been able to leverage federal funding such as that from NASA with the
result that the support has been matched many times over by private
dollars. We seek a similar public/private partnership for our further
federal collaborations. The American Museum of Natural History is
deeply appreciative of the support of this Subcommittee and looks
forward to continuing and strengthening this fruitful partnership.
Thank you again, Mr. Chairman and Members of the Committee, for all of
your support.
______
NATIONAL SCIENCE FOUNDATION
Prepared Statement of the National Corn Growers Association
The National Corn Growers Association, representing 30,000 corn
growers in 47 states, appreciates the opportunity to provide you with
our recommendations regarding fiscal year 2000 funding for the National
Science Foundation's Plant Genome Initiative. We appreciate the
Chairman's leadership and the support of this Subcommittee for this
Initiative. This program is laying the foundation for agricultural
research in the 21st Century.
We are at a critical juncture in plant genomics, one comparable to
that faced in human genomics this past year. Last year, two companies
announced that they were going to sequence the entire human genome and
obtain patents on the data. In response, the National Institutes of
Health (NIH) pumped an additional $80 million into the human genome
project. They accelerated the project to ensure that vital genome data
and materials remained publicly available.
Many other countries and companies have announced major initiatives
in plant genomics and have announced intentions to file patents on
fundamental plant genomics data. Earlier this month, a company
announced that it planned to sequence the entire rice genome and to
create a commercial database for which companies would be required to
pay $30 million to have five years of access. Because of the
similarities between crops, the patenting of rice genomic data will
affect research on every crop, including corn. Most companies and
public sector scientists at universities and within the Federal
government will not have the financial wherewithal to have access to
the data unless Congress acts swiftly to increase the Federal effort in
plant genomics.
We urge Congress to respond to the recent announcement in the same
manner that the NIH did last year by providing a significant increase
in funding for the NSF Plant Genome Initiative. We urge you to provide
not less than $70 million for the NSF plant genome initiative. We
recognize that this will be extremely difficult due to budgetary
constraints. However, we believe that we cannot be complacent about
maintaining access to fundamental plant genomic data.
In January 1998, the National Science and Technology Council issued
an Interagency Working Group report on the National Plant Genome
Initiative. The report stated that the time was right for the
implementation of a comprehensive, five-year National Plant Genome
Initiative to meet the major challenges that will face mankind in the
21st Century. In the transmittal letter accompanying the report, the
President's science advisor, Dr. John H. Gibbons, stated the following:
``The timing of this initiative is critical, since our
international and private sector partners are moving forward
aggressively. A significant public sector program . . . carried out in
partnership with industry will ensure plant genome data and materials
are openly accessible to all scientists. It is a critical step toward
promoting future scientific breakthroughs in plant biology and their
practical application.''
The Interagency Working Group on Plant Genomes estimated that $400
million in funding was needed, over five years, to accomplish the
short-term goals of the National Plant Genome Initiative that focus on
building plant genome research infrastructure. However, funding for the
initiative has fallen far short of that needed to meet the $400 million
level. Fiscal years 1998 and 1999 provided only $90 million for the
effort. If full funding had been provided from the very beginning, it
is possible that we would not be faced with losing accessibility to
vital plant data today.
The Plant Genome Initiative is, critically, important to the
nation's corn growers and to the nation's consumers. While world
population continues to expand and protein demand increases
exponentially, there is an expectation of higher quality, safer, and
more nutritious food. These accelerating demand pressures mean that
existing resources of land, water, and nutrients must be used more
effectively if the supply of food, feed, and fibers is to remain in
balance with world needs.
The NCGA believes that the future of the corn industry is written
in corn's genetic code. The NCGA concurs with Philip H. Abelson's
statement, in a recent Science editorial, that we are in the early
phases of the third technological revolution--a genomics revolution and
that ``. . . the greatest ultimate global impact of genomics will
result from manipulation of the DNA of plants.'' As he stated,
``ultimately, the world will obtain most of its food, fuel, fiber,
chemical feedstocks, and some of its pharmaceuticals from genetically
altered vegetation and trees.'' (Science, Vol. 279, p. 2019.)
The Plant Genome Initiative supports research that advances our
understanding of the structure, organization and function of plant
genomes, and accelerates utilization of new knowledge and innovative
technologies toward a more complete understanding of basic biological
processes in plants. The primary focus of the PGI is on economically
significant plants, such as corn. The Plant Genome Initiative will help
scientists, geneticists, and plant breeders identify and utilize genes
from corn and other economically significant crops that control
important traits, such as nutritional value, stress tolerance, and
resistance to pests. The far-reaching benefits of this Initiative
include:
--Protection of U.S. interests and access to important biotechnology
and gene patents and basic plant genome data;
--Retention of U.S. leadership in cutting edge research;
--Revitalization of rural America due to a more robust agricultural
sector;
--Expansion of plant-based renewable resources for energy and raw
materials;
--Significant reductions in crop losses and reliance on pesticides
through improved biological methods to control and alleviate
serious industrial threats and targeted pests;
--Improved yields and reduced crop losses caused by adverse
environmental conditions such as heat, drought, and salt;
--Improved nitrogen-use efficiency, thereby, limiting the potential
for nitrates in the water supply;
--Reduced environmental problems confronted by livestock producers,
such as modifying the digestibility of phosphorous in feed corn
to reduce the amount of phosphorous that enters our ground
water;
--Improved animal nutrition leading to healthier meat and increased
meat productivity;
--Reductions in the occurrence of mycotoxin contamination by
significantly improving resistance to fungal infection;
Development of tailored hybrids with valuable specialty starches, oils,
and protein content; and
--Reduced worldwide malnutrition due to higher yielding and more
nutritious crops.
The Plant Genome Initiative is critical to the long-term viability
of U.S. agriculture. To compete in the global market, the U.S. must
continually strive to efficiently and economically improve production
capabilities--to maximize yield and combat serious threats from
disease, pests, and climate changes--without harming the environment.
Genomics research holds the key to achieving this goal.
A significant increase in funds will help the US to remain at the
cutting edge of plant genomics and will help guarantee that we have
continued access to fundamental plant genome data. This is the number
one appropriations issue for the National Corn Growers Association. We
urge you to provide not less than $70 million for the NSF Plant Genome
Initiative to ensure that our growers have the tools to meet the
challenges and demands of the 21st century.
Thank you for allowing us to share our views on the fiscal year
2000 VA, HUD appropriations bill.
______
Prepared Statement of the American Psychological Society,
Mr. Chairman, Members of the Subcommittee: Thank you for the
opportunity to submit this statement on the fiscal year 2000
appropriations for the National Science Foundation. I am Alan Kraut,
Executive Director of the American Psychological Society (APS). APS's
15,000 members are scientists and academics who conduct research in
cognition; memory; auditory and visual perception; decision-making;
human development; emotions; and group behavior, to name just a few
topics. To summarize the main points of my testimony:
--As a member of the Coalition for National Science Funding, APS
supports the Coalition's recommendation that the NSF budget be
increased 15 percent in fiscal year 2000.
--We ask the Subcommittee to significantly increase the fiscal year
2000 budget for NSF's behavioral and social science research
divisions to support the reorganization of those divisions and
to allow the initiation of programs in emerging areas such as
cognitive neuroscience.
--Disparities in the length and duration of NSF grants in behavioral
and social science compared to other NSF grants mean that the
behavioral sciences continue to be underfunded. We ask the
Subcommittee to encourage the elimination of these funding
disparities at NSF, recognizing this would require some
``catch-up'' funding for these disciplines.
--We ask the Subcommittee to support the establishment of small
grants at NSF specifically designed to sustain new
investigators in the behavioral sciences at a critical junction
in their career.
I want to begin by expressing our appreciation for the substantial
increase that Congress provided for NSF in fiscal year 1999. That
increase has made a difference throughout the agency and particularly
in the programs that I know best, those that support psychological
science. It is our position that this general growth needs to continue
at NSF in fiscal year 2000. As a member of the Coalition for National
Science Funding (CNSF), APS supports the Coalition's recommended 15
percent increase for NSF in fiscal year 2000, for a total appropriation
of $4.3 billion. The President's request this year is a 5.8 percent
increase, but a substantial portion of that is in information
technology. We support increased funding for information technology--
this will benefit science as well as the public. However, it should not
be at the expense of other areas which also provide essential
scientific knowledge. The CNSF recommendation would allow a balanced
distribution of increases in the fiscal year 2000 budget.
Social and Behavioral Structure and Funding.--I'll talk about some
of the initiatives that are being funded in fiscal year 1999 in a
moment, but first, within the context of NSF's overall budget, I'd like
to discuss some of the agency's policies as they affect basic
behavioral and social science research. For the past several years,
this Subcommittee has strongly encouraged these areas at NSF. Your
support was instrumental in establishing the Social, Behavioral and
Economic Sciences Directorate--known as SBE--and later in strengthening
it. You also were instrumental in helping the Directorate expand its
Human Capital Initiative program. Most recently, this Subcommittee,
along with your colleagues in the House, expressed strong support for
the planned reorganization of SBE's single research division into two
separate divisions. I am pleased to report that the final touches to
this reorganization have now taken place, and the SBE directorate has a
Behavioral and Cognitive Sciences Division, and a Social and Economic
Sciences Division.
This reorganization will enable NSF to accommodate the explosive
pace of discovery in the behavioral and social sciences and to promote
partnership with other disciplines. There was just too much breadth and
depth in these fields to be contained in one research division.
However, the reorganization is just a beginning. Providing a critical
mass of funding is the next step.
The President's budget request includes a 5.3 percent increase for
NSF's behavioral and social science research programs, which would
bring them to just over $106 million for fiscal year 2000. We
appreciate the proposed increase, but it is also clear that additional
resources are needed if the two new divisions are to sustain the
scientific momentum that led to the reorganization. We ask the
Subcommittee to support a significant increase in the NSF budget for
behavioral and social science research programs in the SBE directorate.
In addition, we are asking the Subcommittee to encourage NSF to
increase the average amount and the duration of awards in the
behavioral and social sciences. The average length of an award in the
behavioral and social sciences is only 2 years, compared with the NSF-
wide average of 2.7 years. Further, the average grant in these areas
receives $20,000 less than the average NSF-wide grant. These
disparities exacerbate the underfunding that NSF's behavioral and
social science research experiences, both in terms of the number of
grant proposals that are funded compared to the number submitted, and
in comparison to overall budget levels in other areas of science. We
ask the Subcommittee to encourage NSF to examine its support for these
essential areas, and to stress that any plan to provide additional
equity among the sciences will not be accomplished through a reduction
in the number of awards made in these disciplines.
Young investigator mechanisms.--The need to support the next
generation of scientists is especially acute in basic research in the
behavioral and social sciences. The underfunding of our fields has an
impact beyond principal investigators whose proposals aren't being
funded. It jeopardizes the supply of high-quality future investigators
who would otherwise receive training under those grants. The beginning
of an investigator's career is an important juncture; it is a time when
a relatively new PhD should be collecting initial data and gaining
experience that is often necessary to later compete for larger grants.
In order to protect our ``seed corn'' investigators, we suggest that
NSF use a mechanism such as NIH's B/START (Behavioral Science Track
Awards for Rapid Transition) grants, which provide small amounts of
funding specifically to sustain new investigators at that critical time
in their careers. We ask the Subcommittee to encourage the
establishment of small grants such as B/START at NSF for new behavioral
and social science investigators.
social and behavioral science initiatives
The remainder of my testimony describes specific initiatives at NSF
that are being funded in the current year. These illustrate the
important work in my own field, psychological science, that is being
supported by NSF's behavioral and social science programs, and how this
work is combined with many other disciplines. By expanding NSF's
capacity in these areas, you would be allowing much more of this kind
of work to be done. The increase we are requesting will allow NSF to
increase the number of grants funded under these initiatives, plus the
agency will be able to launch additional initiatives in fiscal year
2000.
Knowledge and Distributed Intelligence.--Research in Knowledge and
Distributed Intelligence (KDI) is an NSF-wide priority for fiscal year
2000 and is funded by all six NSF research directorates. Behavioral
science is a core area of the initiative, which is using
interdisciplinary research to examine such phenomena as learning and
memory, social cognition, human-computer interactions, and visual and
auditory perception. This initiative involves research in areas ranging
from neuropsychology to cognitive science to social and developmental
psychology.
Of the nearly 700 research proposals received by the KDI program,
40 were funded, and of those 40, about a quarter included a significant
cognitive, behavioral or psychological science aspect. Here are some
examples of projects on which psychological scientists are serving as
principal investigators:
--At the University of Pittsburgh, investigators on a KDI project
called Computational Models and Coordinated Neuroimaging of
Learning and Cognitive Function will be mapping human brain
function and developing computational models of brain
structures involved in human cognition.
--In Virtual Environments and Behavior, a KDI project at the
University of California, Santa Barbara, scientists will be
using immersive virtual environment technology (IVET, a state-
of-the-art research tool which creates illusory physical and
social surroundings) in four areas of basic research: education
and learning, visual perception, spatial cognition and social
psychology. Among other things, they will study social
interactions in virtual environments and how people develop
natural interactions under virtual circumstances. IVET is
already invaluable to many areas of psychological research, and
one primary goal of the project is to expand the use of IVET in
social psychology research.
--In a KDI project at Michigan State University, titled Sequential
Decision Making in Animals and Machines, investigators from
cognitive psychology, computer science, and zoology will be
examining issues that cut across biological and artificial
intelligence, yielding knowledge that will be relevant to many
disciplines.
--In a project with the complicated title of Segmental and Prosodic
Optical Phonetics for Human and Machine Speech Processing,
psychologists and others from the House Eye Institute at UCLA
will be studying fundamental issues in visual speech perception
and optical speech synthesis. Specifically, they will be
characterizing optical speech signals and examining how optical
speech characteristics relate to acoustic and physiologic
speech characteristics.
Enhancing Infrastructure for the Social and Behavioral Sciences.--
In social and behavioral science, the term ``infrastructure'' refers to
large, innovative and long-running projects that involve data bases,
technology, some longitudinal research, and other resources useful
across a wide base of scientific inquiry. NSF has historically
supported several important infrastructure initiatives in the
behavioral and social sciences. In fiscal year 1999, the SBE launched a
new infrastructure initiative that among other things will capitalize
on the expanding capabilities of the World Wide Web to bring data,
researchers and experimental facilities together electronically in
arrangements that are being called ``collaboratories.'' These
collaboratories will enable scientists from different geographical
locations to jointly conduct real-time controlled experiments and to
share the use of expensive experimental equipment. More generally, it
allows a greater number of scientists to be involved in, and gain
results from, research in progress. Other infrastructure activities
will involve large-scale surveys, electronic databases and archives
that can be accessed through the Web, and interdisciplinary research
centers that develop innovative methods of collaborative research
activity.
The fiscal year 1999 round of proposals have been received, and
since the review process is under way we don't yet know what specific
proposals will be funded. But I am sorry to report that with the
current level of funding, $3 million, only a very few of the 100
proposals received--perhaps as few as 4 or 5--will be funded under this
infrastructure initiative.
Child Learning and Development.--Another initiative to be funded in
fiscal year 1999 is in the area of child learning and development. This
multidisciplinary competition will support research that increases our
understanding of cognitive, social, and biological processes involved
in learning, with particular emphasis on new theories and methods for
studying learning and child development. Specific issues to be
addressed include: the development and transfer of knowledge in
specific subject areas; the effects of peer relationships, family
interactions, and other social factors on learning; the impact of
family, school and community resources on learning and development; and
the role of demographic and cultural characteristics in learning and
development. A minimum of $2 million will be available for this
initiative in fiscal year 1999, and it is anticipated that 15-20 of the
60 proposals received will be funded.
Cognitive Neuroscience.--I would also like to briefly highlight an
area where NSF is seeking to increase its activities. The emerging
field of cognitive neuroscience combines behavior and biology in a
multi-disciplinary approach to understanding the mind. The result is a
new approach to unraveling the complexities of mental processing and
the underlying biological intricacies. Drawing on theoretical advances
in cognitive science and technological advances in brain imaging, this
field has significant implications for our understanding of memory,
learning, perception, emotion, of virtually any brain-based behavioral
process. Cognitive neuroscience has potential applications in education
generally, and in diagnosing and treating learning disabilities and
assessing cognitive ability in cases of disease and trauma, among other
things.
NSF is in an excellent position to expand and strengthen the field
of cognitive neuroscience. We ask the Subcommittee to support the
development of a cognitive neuroscience initiative at NSF and to
provide new funding in fiscal year 2000 to help launch a program in
this area.
This concludes my statement. I would be pleased to answer any
questions.
______
Letter From the University Corporation for Atmospheric Research
University Corporation for Atmospheric Research,
National Center for Atmospheric Research,
Boulder, CO, April 22, 1999.
Hon. Christopher Bond,
Chairman, Subcommittee on VA, HUD and Independent Agencies,
Senate Appropriations Committee, Washington, DC.
Dear Mr. Chairman: On behalf of the University Corporation for
Atmospheric Research (UCAR) and the university community involved in
weather and climate research and related support activities, I would
like to submit this letter for the record of the U.S. Senate Committee
on Appropriations, Subcommittee on VA, HUD and Independent Agencies.
UCAR is a university membership consortium composed of 63 U.S. and
Canadian institutions that grant the Ph.D. in atmospheric, oceanic, and
related sciences. It is a not-for-profit Colorado corporation
established in 1959 to support, enhance, and extend the capabilities of
the university community, nationally and internationally; to understand
the behavior of the atmosphere and related systems and the global
environment; and to foster the transfer of knowledge and technology for
the betterment of life on earth. UCAR manages and operates the National
Center for Atmospheric Research (NCAR) and the UCAR Office of Programs
(UOP). UCAR is supported by the National Science Foundation (NSF) and
other federal agencies including the Department of Energy (DOE),
National Aeronautics and Space Administration (NASA), the National
Oceanic and Atmospheric Administration (NOAA), the Environmental
Protection Agency (EPA), the Department of Defense (DOD), and the
Federal Aviation Administration (FAA).
We appreciate the opportunity to submit written testimony on the
proposed fiscal year 2000 budgets for the following agencies:
the national science foundation (nsf)
We urge the Committee to support the overall proposed budget of
$3.95 billion for the National Science Foundation (NSF) for fiscal year
2000, a 5.8 percent or $217 million increase over fiscal year 1999. NSF
is a critical source of funding for the research and education
activities of our community and the welfare of the nation. Scientific
advances funded by NSF over almost 50 years of service have helped to
fuel the vibrant economy that makes the U.S. the strongest country in
the world.
Within the NSF, we would like to provide written testimony on the
following specific programs:
New Initiatives
The new Information Technology for the 21st Century (IT\2\)
initiative is funded at $146 million, $110 million in NSF's CISE
Directorate and $36 million in NSF's Major Research Equipment Account.
IT\2\ has the potential to address the critical supercomputing needs
for science in the U.S. Our nation has lagged behind other developed
nations in high-end computing, a situation that will adversely affect
our economy and has already impacted the atmospheric science
community's position of scientific leadership. As the atmospheric
sciences community strives to learn more about the effects of solar
variability on the earth's atmosphere, space weather that impacts
satellite communications, climate variability and weather patterns, the
need for computational power grows. We do not have the computation
tools to effectively address many of our nation's weather and climate
policy issues. This is particularly important as we get closer to the
next round of international climate change assessments in 2004. If
investments in basic information technology are made in concert with
the computational science needs of the weather and climate community,
our nation will get significantly larger return on these IT2
investments.
The exciting Biocomplexity in the Environment (BE) initiative,
funded at $50 million in the new Integrating Activities line, will
explore the complex interdependencies among living organisms and the
environments that affect, sustain, and are modified by them. We expect
that contributions can be made to this effort from across the science
and engineering community. In fact, we believe the atmospheric and
related science community is well positioned to contribute, including
proposing the integration of biogeochemistry, especially the carbon
cycle, into NCAR's Climate System Model, one of the world's premier,
fully-coupled, climate system models.
We urge the Committee to support the new IT\2\ and Biocomplexity
initiatives.
Geosciences Directorate
We urge the Committee to support the proposed fiscal year 2000
budget of $485.48 million for NSF's Geosciences Directorate (GEO). We
are concerned, however, that this represents only a 2.6 percent
increase over the fiscal year 1999 Current Plan of $472.98 million.
Given inflation factors, this amount allows little or no enhancement of
the work supported by GEO focusing on the atmospheric, earth and
oceanic sciences. GEO is the principal source of funding for
university-based research addressing the nation's ability to
understand, predict and respond to environmental events and changes. As
our ability increases to do more complex research on the interactions
of the earth's systems, so do the costs of research tools such as
computation time and instrumentation. In future years, we believe that
the GEO budget should increase in proportion to its key role in this
critical area of research and that the following components of the GEO
budget should increase accordingly.
We urge the Committee to support the proposed fiscal year 2000
budget of $164.00 million for Atmospheric Sciences (ATM) within NSF's
Geosciences Directorate, a 2.7 percent increase over the fiscal year
1999 Current Plan. The ATM Subactivity within GEO funds university
research activities as well as the country's large research facilities
that further our understanding of weather, climate, and the solar-
terrestrial environment. Research studies include understanding the be
havior of weather and climate on all scales, the chemistry and chemical
cycles of the earth's atmosphere, and the sun as it relates to the
Earth's atmosphere and space environment.
Within ATM, we urge the Committee to support the proposed fiscal
year 2000 budget of $68.15 million for the National Center for
Atmospheric Research (NCAR), a 2.7 percent increase over the fiscal
year 1999 Current Plan. This world-class center for atmospheric
research supports the broad atmospheric sciences community through
observational and computer facilities, instrumented research aircraft,
and an extensive visiting scientist program. In fiscal year 2000, NCAR
will continue the badly needed refurbishment of the NCAR Mesa
Laboratory building at a level of $4.0 million. This $12 million,
multi-year refurbishment was begun in fiscal year 1999 and will ensure
that NCAR's primary building will continue to serve the scientific
community at the highest level.
U.S. global change research program
We urge the Committee to support the fiscal year 2000 proposed
budget of $187 million for the U.S. Global Change Research Program
(USGCRP) within NSF. The USGCRP is an interagency program that
addresses interactions among physical, biological, ecological, and
human systems at various scales. Working with national and
international research institutions, this program allows the
atmospheric sciences community to improve prediction capabilities for
climate fluctuations between excessively wet and dry periods, and for
long-term climate change. This research is a critical investment for
the future of this nation, its economy, and the health and safety of
its citizens.
U.S. weather research program (USWRP)
NSF and the National Oceanic and Atmospheric Administration (NOAA)
are partners in the USWRP, a program designed to bring the operational
and research weather communities together to extend the way in which we
utilize the technologies of the National Weather Service's $4 billion
Modernization Program. USWRP was authorized by Congress in 1992 and an
implementation plan for $130 million over five years was submitted to
Congress in 1994. According to that plan, the fiscal year 2000 USWRP
funding level for NSF and NOAA should be $12 million each for a total
of $24 million. We were discouraged to see that NOAA's proposed fiscal
year 2000 funding for USWRP is only $1.5 million. The program is
mentioned in the NSF budget, but no dollar amount is specified. The
disaster relief savings realized through USWRP research on hurricane
landfall and heavy precipitation could be many times the initial
investment. We urge the Committee to fully fund the USWRP in NSF's
fiscal year 2000 budget.
High-performance instrumented airborne platform for environmental
research (HIAPER)
The atmospheric sciences community were extremely disappointed when
HIAPER was omitted from NSF's Major Research Equipment (MRE) account in
the fiscal year 2000 proposed budget. This high-altitude, modern
research aircraft has been approved by the National Science Board and
was slated to begin funding in fiscal year 2000. The scientific need
for HIAPER is well documented. The study of the upper atmosphere is
vital to the understanding of how severe weather and other climate
phenomena develop and impact the nation and the globe. The aircraft is
scheduled to be operational five years after funding begins. Since at
least one other aircraft currently in service at NSF will end its
useful lifetime in the next five years, we urge the Committee to
provide a modest start for HIAPER within NSF's MRE account in fiscal
year 2000, provided it doesn't significantly impact other NSF
initiatives.
The National Aeronautics and Space Administration (NASA)
We urge the Committee to support proposed funding for Solar B
within NASA's Solar Research account. Solar B is part of NASA's Solar-
Terrestrial Probe (STP) program and, from what we understand, is
recommended at the full funding level for fiscal year 2000. Solar B is
a collaboration with Japan to carry out a series of highly focused
satellite missions to study the Sun and its many influences on the
Earth and other planets. The data gathered should help us understand
events such as solar flares that can hit Earth's atmosphere with enough
force to cause extremely expensive and dangerous communications
disruptions.
We understand that the High Resolution Dynamics Limb Sounder
(HIRDLS) instrument is fully funded through the Earth Observing
System's chemistry mission of NASA's Office of Earth Science and we
urge the Committee to maintain that support. We are pleased with the
progress achieved for the HIRDLS instrument, scheduled for flight on
the Chemistry platform of the Earth Observing System. HIRDLS is being
jointly developed with the United Kingdom and with extensive
participation by the U.S. academic community. It will return
observations with unprecedented detail, notably on the transition
region between the troposphere and stratosphere. These data will enable
detailed studies of chemical and dynamical processes that are
fundamental to improved understanding of global change.
On behalf of the atmospheric sciences community, I want to thank
you for the important work you do for U.S. scientific research,
education, and training. We appreciate your attention to the
recommendations of our community concerning the fiscal year 2000
budget.
Sincerely,
Richard A. Anthes,
President.
______
Prepared Statement of the Board on Human Sciences of the National
Association of State Universities and Land Grant Colleges
Mr. Chairman and members of the committee: My name is Patricia
Knaub. I am Dean of the College of Human Environmental Sciences at
Oklahoma State University. This testimony is in behalf of the Board on
Human Sciences of the National Association of State Universities and
Land Grant Colleges (NASULGC). The Board on Human Sciences (BOHS)
represents those State Universities and Land Grant Colleges which
conduct research, extension and education programs on nutrition and
health, food safety and product development, p K-12 teacher education,
workforce development, human development, family and community
viability. Our work is supported by federal, state, and privately
funded grants as well as CSREES formula funds and USDA competitive
grants programs. In 1998 member colleges reported $1.5 million in
projects supported by NSF. Some of our colleges are located in major
research institutions and several others are located in EPSCoR
designated institutions.
The BOHS strongly supports the National Science Foundation
initiatives outlined in the fiscal year 2000 budget proposal. Our
member colleges are prepared to carry out work in support of several of
these initiatives, especially aspects of Information Technology for the
21st Century (social, economic, and workforce impacts of technology);
Educating for the Future: A 21st Century Workforce; and encouragement
of scientific participation of underrepresented groups.
information technology for the 21st century
The IT\2\ initiative places emphasis on enhancing the fundamental
capacity of technology to support scientific investigation but also
recognizes the critical need to develop and maintain literacy of the
workforce at all levels to use current and new technology in the
application and dissemination of scientific advances. Workers in
America are being displaced because their jobs become obsolete or
change with the advent of technology. They must be retrained. Users of
information available via technology need support in accessing
information and in verification of its quality.
educating for the future: a 21st century workforce
A generation caught between low and high technology must be
retrained or redirected into economically viable jobs, but the emerging
generations of workers must be prepared to utilize available and new
technologies to become employable. The pairing of graduate assistants
and undergraduates with p K-12 learners and their teachers not only
provides direct assistance, but reinforces skills being learned by
these graduate and undergraduate students. A long term technology
literate workforce is likely to be assured with such pairings.
human science researchers and educators respond
Human science researchers and educators in all 50 states are
conducting programs which directly address the issues identified as
fiscal year 2000 NSF priorities. Extension educators work directly with
displaced workers in need of technological skills and teacher educators
conduct programs to enhance the scientific literacy of p K-12, but also
conduct programs which increase interest in science as a career.
Further, all human science faculties are linked through the Board on
Human Sciences so that interstate and interdisciplinary programs can be
carried out and information freely exchanged across the country.
Workforce Transition.--Consortia of human sciences colleges in
several states are providing coursework, degree programs, or skill
upgrade workshops to help place-bound workers' transition from jobs
which no longer exist. These opportunities are being made available by
distance learning technologies so that learners can remain at home or
study at times available around work schedules. Not only do these
opportunities retrain workers with new marketable skills, it
familiarizes them with the use of technology, enhancing their
marketable skills.
Educating for the Future 00 Faculty and p K-12 teachers have
developed science programs which introduce fundamental science
knowledge via subjects of interest to students. For example, a program
based upon food safety has been introduced into biology and chemistry
classes. Science teachers are introduced in summer sessions to course
materials on food safety. Similarly, high school students participate
in textile and polymer science summer courses working with graduate
students on research projects. A member Human Sciences college is
currently conducting an NSF funded project teaching textile and polymer
science to non-science university students.
Serving underrepresented groups.--Human sciences faculty in 1862
Land Grant Universities team with Faculty in 1890 and 1994 LGU
institutions in undergraduate/graduate/faculty exchanges to work on
joint research projects in nutrition, food product development, and
dietetics. In several cases these are funded projects resulting in
enhanced institutional capacity as well as collegial enhancement.
The Board on Human Sciences welcomes these well targeted
initiatives for fiscal year 2000. Human Sciences faculties contribute
significantly to the programs addressed in this budget as outlined
above. Support for this budget can help assure that contribution. Thank
you or the opportunity to comment. We urge your support of these
initiatives.
______
Prepared Statement of the State Agricultural Experiment Stations
Mr. Chairman, members of the subcommittee: On behalf of the State
Agricultural Experiment Stations (SAES), I appreciate the opportunity
to appear before you to discuss the importance of research and the
National Science Foundation (NSF). The SAES comprise a nationally
coordinated system of experiment stations that serve as the research
arm of the Land Grant Universities (LGUs). The mission of the SAES is
to generate knowledge and technology to support a highly diversified
agricultural and natural resource system that produces, processes and
delivers a high quality, safe, affordable and abundant supply of food,
fiber and forestry products.
In support of its mission, SAES seeks to broaden partnerships with
other agencies, including NSF, that are involved in agriculture and
natural resource management programs and research. SAES is committed to
improving the technology and information base by capitalizing on the
LGU comparative advantages in research, education, and extension.
partnering with nsf and other agencies
Many agencies such as NSF share similar research priorities and
goals that can be utilized to develop more effective programs. Many
initiatives and goals are targeted to specific agendas, however a more
thorough inventory of research priorities can be assessed through
collaborative discussions and pooling of resources. Through a variety
of means, partnerships with NSF and other agencies increase:
--number of funding awards from agencies going to LGUs;
--the amount of LGU participation in Agency peer review processes;
--the quantity/quality of proposals submitted by the LGUs for Agency
funded competitive grants;
--the exchange of scientists between LGU institutions and agencies
for collaborative projects.
nsf fiscal year 2000 budget proposal
The SAES strongly support the priorities outlined in the NSF fiscal
year 2000 budget proposal including:
Information technology for the 21st century (IT\2\)
This initiative requests $146 million across two components: $110
million for fundamental information technology research (Software
systems, scaleable information infrastructure, high-end computing, and
social, economic, and workforce impacts of information technology). An
additional $36 million is designated for tetrascale computing systems
allowing researchers access to leading edge computational systems.
According to NSF, 60 percent of this will go to support university-
based research. This program will help address the need to better
manage and utilize information and technologies produced and
disseminated by the Land Grant University system.
Biocomplexity in the environment
$50 million is requested to better understand:
--Biodiversity and ecosystem dynamics, diversity of life responses to
changes in land, water and air,
--Environment and the human dimension, the impact of population
distribution and human decision-making on environment and
global change, and
--global and environmental change including earth system history,
tectonics, glaciology and hydrology.
Given that one of the five major goals of the Land Grant University
system is to address greater harmony between agriculture and the
environment, the LGUs bring a high level of expertise in the area of
biocomplexity in the environment to the table. Our system supports this
investment and stands ready to work with NSF to address these critical
issues.
Plant genome research
NSF proposes a $55 million investment to advance understanding of
plant structure and function, with emphasis on economically significant
plants, and advance use of new knowledge and innovation technologies
toward basic biological processes. The mapping of genomes of
economically important crops and other plants has tremendous
implications for agricultural production and processing, food safety
and quality and environmental protection. Increased investment in this
area of research it extremely important and the competitive grants
provided by NSF facilitate continued partnerships between the NSF, Land
Grant Universities, USDA/ARS, Department of Energy and the private
sector.
Experimental program to stimulate competitive research (EPSCoR)
An investment of $48 million is proposed for the Experimental
Program to Stimulate Competitive Research (EPSCoR). EPSCoR targets
those states that have historically received lesser amounts of Federal
R&D funding and have demonstrated a commitment to develop their
research bases and to improve the quality of science and engineering
research conducted at their universities and colleges. EPSCoR is
successful at identifying, developing, and utilizing a state's academic
science and technology resources in a way that supports wealth creation
and a more productive and fulfilling way of life for a state's
citizenry. This program is particularly important to the 1890's
institutions. Land Grant Universities in EPSCoR states have built
important linkages through this program that have resulted in lasting
improvements to the state's academic research infrastructure and
increased national R&D competitiveness. Continued investment in this
program is critical.
Thank you again for the opportunity to provide testimony to the
subcommittee regarding the National Science Foundation's fiscal year
2000 budget. I strongly urge the subcommittee to support the NSF fiscal
year 2000 budget proposal and I look forward to working with you, the
NSF, and other agencies to address the science and technology needs of
the future.
______
Prepared Statement of the Council for Chemical Research
issue
The National Science Foundation (NSF) is the only federal agency
with the responsibility for research and education in all scientific
and engineering fields. It is the heart of the Nation's science and
technology enterprise. Any erosion of this enterprise will impact many
areas of our Nation. The 9.1 percent increase in the NSF budget for
fiscal year 1999 provided an opportunity to address the declining
purchasing power of NSF funding that has occurred since fiscal year
1995. The fiscal year 2000 budget must continue to address these
impacts which fall directly on today's researchers, students, and
population overall.
position
The Council for Chemical Research (CCR) appreciates the support of
both the President and the Congress that resulted in a 9.1 percent
increase in the NSF budget for fiscal year 1999. This increase began to
address the loss of purchasing power of the NSF budget that has
occurred since fiscal year 1995. CCR also appreciates the President's
submission of a 5.8 percent increase for the NSF fiscal year 2000
budget to a level of $3.954 billion. However, the Council believes it
is important to go farther than this. Greater support is needed for the
physical sciences that form the basis for advances in so many other
areas. In particular, we urge larger increases than the proposed 2.2
percent to chemistry and 2.1 percent to materials research.
Additionally, CCR along with other members of the Coalition for
National Science Funding asks Congress to support a 15 percent increase
to the overall NSF budget. This increase will enable new discoveries
and educate the world's best scientists and engineers; it is clearly in
the best interests of the Nation and crucial to our continued economic
growth.
rationale
Not only is NSF the guarantor of basic research for the United
States, but it has a primary role in building the science and
engineering workforce of the future and helping to educate the public
about science in an increasingly technological world. As leaders of the
Nation's chemical research enterprise, CCR well understands the role of
NSF funding on scientific research, on kindergarten through post-
graduate education, and on enhancing public understanding of science
and technology.
NSF provides the core research and infrastructure upon which all
can build. Nearly half the research cited in chemical industry patents
is from public science, and most of that science was supported by NSF.
These contributions at the basic end of the R&D spectrum enable the
science and technology enterprise. In the chemical sciences and
engineering alone, such research has contributed to the development of
plastics, synthetic fabrics, cleaning products, fuels, medicine,
advanced electronics, environmental solutions, and many other
necessities of modern life.
The budget decisions confronting government decisionmakers are not
easy. The case for investing in the future by funding NSF at the level
requested, or more, must stand up against concerns about spending for
individual health and security. NSF is only about 0.2 percent of the
federal budget, but it provides nearly 25 percent of all federal
support to academic institutions for basic research. Although it is
classified as part of the discretionary budget, funding for the
Foundation should be properly viewed as an investment that yields very
high return to our society. Half our economic growth in the past fifty
years has come from technological innovation and the science supporting
it. It therefore follows that decisionmakers must take a long view in
choices that affect the future capability of the Nation's innovation
engine.
LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS
----------
Page
Air Force Sergeants Association, prepared statement.............. 931
American Association of Homes and Services for the Aging,
prepared statement............................................. 934
American Battle Monuments Commission, prepared statement......... 870
American Gastroenterological Association, prepared statement..... 928
American Heart Association, prepared statement................... 912
American Museum of Natural History, prepared statement........... 1058
American Psychological Society, prepared statement............... 1062
American Public Power Association, prepared statement............ 1016
American Public Works Association, prepared statement............ 1043
American Society for Microbiology, prepared statement............ 1031
American Water Works Association, prepared statement............. 998
Anderson, George, Executive Vice President, Government National
Mortgage Association, Department of Housing and Urban
Development.................................................... 475
Apgar, William P., Assistant Secretary for Housing--Federal
Housing Commissioners, Department of Housing and Urban
Development.................................................... 475
Armstrong, Spence M., Associate Administrator for Aerospace
Technology, National Aeronautics and Space Administration...... 197
Asrar, Ghassem, Associate Administrator for Earth Science,
National Aeronautics and Space Administration.................. 197
Associated General Contractors of America, prepared statement.... 1037
Association of State Dam Safety Officials, prepared statement.... 1039
Association of State Floodplain Managers, Inc., prepared
statements.................................................1046, 1053
Board on Human Sciences of the National Association of State
Universities and Land Grant Colleges, prepared statement....... 1067
Bond, Hon. Christopher S., U.S. Senator from Missouri:
Opening statements.......................1, 181, 197, 375, 476, 609
Prepared statement of........................................ 613
Questions submitted by.............40, 127, 193, 252, 434, 522, 727
Statement of................................................. 77
Briggs, Xavier, Deputy Assistant Secretary for Research,
Evaluation and Monitoring, Department of Housing and Urban
Development.................................................... 475
Brown, Ann, Chairman, Consumer Product Safety Commission,
prepared statement............................................. 880
Brown, Carrye, Administrator, U.S. Fire Administration, Federal
Emergency Management Agency.................................... 1
Browner, Carol M., Administrator, Environmental Protection Agency 609
Prepared statement........................................... 629
Statement of................................................. 625
Brownsville Public Utilities Board, prepared statement........... 1026
Burns, Hon. Conrad, U.S. Senator from Montana:
Prepared statement........................................... 236
Questions submitted by.................................57, 463, 589
Statement of................................................. 202
Byrd, Hon. Robert C., U.S. Senator from West Virginia............ 74
Questions submitted by....................................... 835
California Industry and Government Coalition on PM-10/PM-2.5,
prepared statement............................................. 1027
Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado,
questions submitted by......................................... 605
Catlett, Mark, Deputy Assistant Secretary for Budget, Department
of Veterans Affairs............................................ 375
Cemeterial Expenses, Department of the Army, prepared statement.. 886
Center for Cognition, Learning, Emotion, and Memory at New York
University, prepared statement................................. 979
Center for the Engineered Conservation of Energy at Alfred
University, prepared statement................................. 968
Chemical Safety and Hazard Investigation Board................... 873
City of Dayton, Ohio, prepared statement......................... 943
City of Gainesville, Florida, prepared statement................. 940
City of Miami Beach, Florida, prepared statement................. 1019
City of Newark, New Jersey, prepared statement................... 951
Coalition of Community Development Financial Institutions,
Community Development Financial Institutions, prepared
statement...................................................... 904
College of Agriculture and Technology at Morrisville, New York,
prepared statement............................................. 958
Committee for the National Institute for the Environment,
prepared statement............................................. 969
Consumer Information Center, General Services Administration,
prepared statement............................................. 894
Cooper, Cardell, Assistant Secretary for Community Planning and
Development, Department of Housing and Urban Development....... 475
Coronado, Gil, Director, Selective Service System, prepared
statement...................................................... 902
Council for Chemical Research, prepared statement................ 1069
County of Sutter, California, prepared statement................. 939
County Sanitation Districts of Los Angeles County, prepared
statement...................................................... 1003
Cowan, Jon, Chief of Staff, Department of Housing and Urban
Development.................................................... 475
Craig, Hon. Larry, U.S. Senator from Idaho:
Questions submitted by...........................303, 465, 598, 797
Statements of..............................................385, 483
Cuomo, Andrew, Secretary, Department of Housing and Urban
Develop-
ment........................................................... 475
Prepared statement........................................... 489
Statement of................................................. 485
D'Amours, Norman E., Chairman, National Credit Union
Administration, prepared statement............................. 895
DeCell, Hal, Assistant Secretary for Congressional and
Intergovernmental Relations, Department of Housing and Urban
Development.................................................... 475
Prepared statement........................................... 575
Department of Neighborhood and Community Services, City of
Tallahassee, Florida, prepared statement....................... 955
El Paso Water Utilities Public Service Board, prepared statement. 1025
Executive Board of the Veterans Consortium, prepared statement... 885
Fleet Reserve Association, prepared statement.................... 918
Florida State University, prepared statement..................... 1049
Frampton, George T., Jr., Acting Chair, Council on Environmental
Quality and Office of Environmental Quality, Executive Office
of the President............................................... 839
Prepared statement........................................... 840
Gaffney, Susan, Inspector General, Department of Housing and
Urban Development.............................................. 476
Gentille, Paul R., Deputy Director, Management and Chief
Financial Officer, Department of the Treasury.................. 181
Gianni, Gaston L., Jr., Inspector General, Office of the
Inspector General, Federal Deposit Insurance Corporation,
prepared statement............................................. 888
Gibbons, David, Acting Chief Financial Officer, Department of
Housing and Urban Development.................................. 475
Glickman, Rhoda, Deputy Chief of Staff, Department of Housing and
Urban Development.............................................. 475
Goldin, Hon. Daniel S., Administrator, National Aeronautics and
Space Administration........................................... 197
Prepared statement........................................... 205
Statement of................................................. 202
Gross, Roberta, Inspector General, National Aeronautics and Space
Administration................................................. 197
Habitat for Humanity International, prepared statement........... 944
Hampton University, prepared statement........................... 956
Harkin, Hon. Tom, U.S. Senator from Iowa:
Questions submitted by.....................................473, 830
Statement of................................................. 509
Harper, Sallyanne, Chief Financial Officer, Environmental
Protection
Agency......................................................... 609
Heffernan, Edward, Associate Administrator for Legislative
Affairs, National Aeronautics and Space Administration......... 197
Holcomb, Lee, Chief Information Officer, National Aeronautics and
Space Administration........................................... 197
Holz, Arnold G., Chief Financial Officer, National Aeronautics
and Space Administration....................................... 197
Hutchison, Hon. Kay Bailey, U.S. Senator from Texas:
Questions Submitted by....................................... 465
Statement of................................................. 384
Information Technology Center at Fairfield University, prepared
statement...................................................... 959
Integrated Petroleum Environmental Consortium (IPEC), prepared
statement...................................................... 983
International Association of Emergency Managers, prepared
statement...................................................... 1048
Isbell, David B., Chair, Executive Board of the Veterans
Consortium, Court of Appeals for Veterans Claims, prepared
statement...................................................... 885
Jacobs, David, Director, Office of Lead Hazard Control,
Department of Housing and Urban Development.................... 476
Johnson, Gary, Chief Financial Officer, Federal Emergency
Management Agency.............................................. 1
Johnson, Jackie, Deputy Assistant Secretary for Native American
Programs, Department of Housing and Urban Development.......... 475
Jones, Maurice A., Deputy Director, Program and Policy,
Department of the Treasury..................................... 181
Jordan, Hon. Luise S., Inspector General, Corporation for
National and Community Service................................. 77
Prepared statement........................................... 120
Statement of................................................. 118
Joseph M. DeSimone, Ph.D., prepared statement.................... 1017
Joslin Diabetes Center, prepared statement....................... 907
Kizer, Kenneth W., M.D., M.P.H., Under Secretary for Health,
Veterans Health Administration, Department of Veterans Affairs. 375
Knight, George, Executive Director, Neighborhood Reinvestment
Corporation, prepared statement................................ 897
Koplan, Jeffrey P., Administrator, Agency for Toxic Substances
and Disease Registry, Department of Health and Human Services,
prepared statement............................................. 865
Kraus, Edward, Director, Enforcement Center, Department of
Housing and Urban Development.................................. 475
Kyl, Hon. Jon, U.S. Senator from Arizona, questions submit135, 467, 603
Laster, Gail, General Counsel, Department of Housing and Urban
Development.................................................... 475
Lautenberg, Hon. Frank R., U.S. Senator from New Jersey:
Prepared statement of,....................................... 622
Questions submitted by....................................... 73
Statements of..............................................484, 621
LaVoy, Donald J., Director, Real Estate Assessment Center,
Department of Housing and Urban Development.................... 475
Lawing, Jacquie, Deputy Chief of Staff for Policy and Programs,
Department of Housing and Urban Development.................... 475
Lazar, Ellen W., Director, Community Development Financial
Institutes Fund, Department of the Treasury.................... 181
Prepared statement........................................... 185
Statement of................................................. 182
Leahy, Hon. Patrick J., U.S. Senator from Vermont:
Prepared statement....................................383, 481, 620
Questions submitted by................................474, 607, 820
Statement of................................................. 382
Lovelace Respiratory Research Institute, prepared statement...... 976
Lucas, Harold, Assistant Secretary for Public and Indian Housing,
Department of Housing and Urban Development.................... 475
Metropolitan Water District of Southern California, prepared
statement...................................................... 1010
Metropolitan Water Reclamation District of Greater Chicago,
prepared statement............................................. 1008
Mickey Leland National Urban Air Toxics Research Center, prepared
statement...................................................... 1012
Mikulski, Hon. Barbara, U.S. Senator from Maryland:
Prepared statements.........................................81, 618
Questions submitted by............................60, 174, 467, 819
Statements of.........................7, 79, 182, 200, 380, 505,617
Missouri Rural Water Association & National Rural Water
Association, prepared statement................................ 1022
Molnar, Karen, KPMG auditor, Corporation for National and
Community Service.............................................. 77
National Association for Equal Opportunity in Higher Education,
letter from.................................................... 938
National Association for Uniformed Services, prepared statement.. 916
National Association of Conservation Districts, prepared
statement...................................................... 964
National Association of Convenience Stores and the Society of
Independent Gasoline Marketers of America, prepared statement.. 966
National Corn Growers Association, prepared statement............ 1060
National Credit Union Administration, prepared statement......... 895
National Emergency Management Association, prepared statement.... 1052
National Flood Determination Association, prepared statement..... 1045
National Grain and Feed Association, prepared statement.......... 993
Nebeker, Hon. Frank Q., Chief Judge, Court of Appeals for
Veterans Claims, prepared statement............................ 883
Neighborhood Reinvestment Corporation, prepared statement........ 897
Nicogossian, Arnauld E., Associate Administrator for Life and
Microgravity Sciences and Applications, National Aeronautics
and Space Administra-
tion........................................................... 197
North American Lake Management Society, prepared statement....... 1005
Northwest Indian Fisheries Commission, prepared statement........ 990
Passaic Valley Sewerage Commissioners, prepared statement........ 1023
Peppercorn, Ira, Director, Office of Multifamily Housing
Assistance Restructuring, Department of Housing and Urban
Development.................................................... 475
Peterson, Malcom, Comptroller, National Aeronautics and Space
Administration................................................. 197
Plaza, Eva, Assistant Secretary for Fair Housing and Equal
Opportunity, Department of Housing and Urban Development....... 475
Ramirez, Saul, Deputy Secretary, Department of Housing and Urban
Development.................................................... 475
Rapp, Roger, Acting Under Secretary for Memorial Affairs,
National Cemetery Administration, Department of Veterans
Affairs........................................................ 375
Retired Enlisted Association, prepared statement................. 908
Robertson, Peter, Acting Deputy Administrator, Environmental
Protection Agency.............................................. 609
Rochester Institute of Technology, prepared statement............ 985
Rothenberg, Joseph H., Associate Administrator for Space Flight,
National Aeronautics and Space Administration.................. 197
Schumacher, John D., Associate Administrator for External
Relations, National Aeronautics and Space Administration....... 197
Shelby, Hon. Richard C., U.S. Senator from Alabama, questions
submitted by.......................................134, 301, 463, 795
Smith, Joe, Acting Assistant Secretary for Administration,
Department of Housing and Urban Development.................... 476
St. Joseph's Hospital Health Center, prepared statement.......... 946
State Agricultural Experiment Stations and State Extension
Service, prepared statement.................................... 1034
State Agricultural Experiment Stations, prepared statement....... 1068
State and Territorial Air Pollution Program Administrators and
the Association of Local Air Pollution Control Officials,
prepared statement............................................. 995
State Cooperative Extension Services and State Agricultural
Experiment Stations, prepared statement........................ 1054
Stevens, Hon. Ted, U.S. Senator from Alaska:
Questions submitted by....................................... 58
Statement of................................................. 5
Texas A&M University, prepared statement......................... 1002
Thompson, Joseph, Under Secretary for Benefits, Veterans Benefits
Administration, Department of Veterans Affairs................. 375
Tubman African American Museum, prepared statement............... 950
United Space Alliance, prepared statement........................ 1057
University Corporation for Atmospheric Research, letter from..... 1064
University of Medicine and Dentistry of New Jersey, prepared
statement...................................................... 961
University of Miami, prepared statement.......................... 1029
University of the Sciences in Philadelphia, prepared statement... 949
Vietnam Veterans of America, Inc., prepared statement............ 926
Village of Freeport, Long Island, prepared statement............. 948
Walker, Mike, Deputy Director, Federal Emergency Management
Agency......................................................... 1
Weiler, Edward J., Associate Administrator for Space Science,
National Aeronautics and Space Administration.................. 197
West, Hon. Togo D., Jr., Secretary, Department of Veterans
Affairs........................................................ 375
Prepared statement........................................... 390
Statement of................................................. 387
Western Coalition of Arid States, prepared statement............. 1007
Westphal, Dr. Joseph W., Assistant Secretary of the Army for
Civil Works, Cemeterial Expenses, Army, Department of Defense--
Civil, prepared statement...................................... 886
Witt, James L., Director, Federal Emergency Management Agency.... 1
Prepared statement........................................... 11
Statement of................................................. 10
Woerner, Gen. Fred, American Battle Monuments Commission,
prepared statement............................................. 870
Wofford, Hon. Harris, Chief Executive Officer, Corporation for
National and Community Service................................. 77
Prepared statement........................................... 87
Statement of................................................. 83
Zenker, Wendy, Chief Operating Officer, Corporation for National
and Community Service.......................................... 77
Statement of................................................. 105
SUBJECT INDEX
----------
CORPORATION FOR NATIONAL AND COMMUNITY SERVICE
Page
AmeriCorps:
Education awards, use of..................................... 107
Program impact, sustainabillity.............................. 110
Attrition........................................................ 109
Chief Financial Officer.......................................... 106
Financial management, progress on................................ 85
Financial statements............................................. 83
Full- and Part-time participants, characteristics of............. 114
Health services and senior services.............................. 116
Independent evaluations.......................................... 85
Material weaknesses, addressing.................................. 104
Monitoring grantees.............................................. 114
National Service Trust.........................................106, 112
Waste, fraud, and abuse.......................................... 112
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Affordable housing, need for..................................... 486
Audit findings................................................... 479
Community builders............................................... 561
Disabled:
Housing for the.............................................. 512
Loss of units for the........................................ 513
EEOC:
Complaint, cost of........................................... 518
Complaints................................................... 524
Costs........................................................ 517
Investigation................................................ 524
Elderly housing.................................................. 518
Emergency CDBG Funding........................................... 566
Empowerment Zones................................................ 529
Fair Housing:
Act, Violations of the....................................... 603
Activities Re: Property Insurance............................ 582
Guidelines: Relating to Group Homes.......................... 604
Available HUD Technical Assistance on.................... 601
Initiatives Program (FHIP) Awards............................ 585
Insurance Investigations..................................... 532
Fair market rents................................................ 511
Fannie Mae/Freddie Mac........................................... 574
FHA Single Family Property:
Disposition.................................................. 581
Property Insurance........................................... 531
FHIP Funding, Use of............................................. 588
Fighting Housing Discrimination--Fiscal Year 1998................
GAO.............................................................. 516
Reviews...................................................... 481
Ginnie Mae Were Privatized, Would Money be Lost If?.............. 520
GNMA, privatization of........................................... 520
Home Improvement Loans........................................... 533
Home Warranties.................................................. 534
Homeless Assistance.............................................. 527
Hope VI.......................................................... 505
HUD:
Accessibility Guidelines..................................... 598
Accomplishments at........................................... 488
Fair Housing Education Efforts and Measurement of Its
Effectiveness.............................................. 602
Fiscal year 1998 Financial Statements, Financial Audit of.... 534
Funds, obligation and monitoring of.......................... 517
Oversight of State Disability Related Enforcement Efforts.... 602
Section 8 Project-Based Inventory............................ 573
Staff, introduction of....................................... 485
2020 management reform plan.................................. 480
Idaho Fair Housing:
Complaints................................................... 496
Council Accessibility Issues................................. 599
Indian Housing Block Grant Program............................... 589
Industry and Construction Professions, Fair Housing Educational
and Technical Assistance to.................................... 600
Lead-Based Paint Grants.......................................... 594
Los Angeles Community Development Bank (CDB)..................... 536
Management reforms............................................... 487
Mark-to-Market................................................... 579
NAHASDA...................................................605, 606, 607
New Initiatives................................................488, 573
Opt-outs..................................................478, 513, 514
Property Disposition, Management and Marketing Firms for......... 601
Public Housing:
Concentrations of poverty in................................. 506
Costs........................................................ 578
Issues....................................................... 526
Real Estate Agents Accessibility Responsibilities................ 600
Rental Assistance Overpayments................................... 525
Rental subsidy overpayments...................................... 516
Rural Housing..................................................589, 594
Rural housing and economic development........................... 509
Section 8:
Contract Renewal And Incremental Section 8 Assistance........ 522
Contracts, renewal of expiring............................... 476
Housing...................................................... 596
Incremental assistance....................................... 477
Opt-Outs..................................................... 523
Project-Based Contracts...................................... 607
Renewals..................................................... 487
Flat funding for......................................... 499
Section 108...................................................... 537
Single Family Property Disposition............................... 580
Staffing.......................................................565, 577
State/local decision-making...................................... 481
Total development costs.......................................... 508
Use of FHIP Funds for Homeowners' Insurance-Related Purposes..... 583
Welfare to Work.................................................. 596
Year 2000........................................................ 581
DEPARTMENT OF THE TREASURY
Community Development Financial Institutes Fund
Bank enterprise awards program................................... 183
CDFI's........................................................... 183
Conflicts of interest............................................ 191
Federal investments, impact of our............................... 184
Fiscal year 2000 budget.......................................... 184
Major points..................................................... 183
Nonmonetary programs............................................. 183
Prime proposal................................................... 192
DEPARTMENT OF VETERANS AFFAIRS
Academic affiliations............................................ 456
Albuquerque Regional Office...................................... 467
Asset:
Disposal..................................................... 420
Restructuring................................................ 439
Board of Veterans' Appeals....................................... 468
Boise VA:
Hospital..................................................... 465
Medical Center............................................... 465
Cancer of the Esophagus, acid reflux as a risk factor for........ 462
Capital asset fund proposal...................................... 411
Colorectal screenings............................................ 461
Congressional Commission on Servicemembers and Veterans
Transition Assistance.......................................... 458
Construction--Murfreesboro....................................... 460
Contract Services and Outreach Clinics in New Mexico............. 468
Daily census information......................................... 414
Department of Veterans Affairs and Department of Defense--
Computerized medical record systems............................ 474
Enrollment....................................................... 438
Future Veterans' Homes, construction of.......................... 467
Goals, resources needed to meet.................................. 428
Health care:
In rural areas, providing..................................418, 419
Progress and challenges in transforming...................... 397
Hepatitis C Program..............409, 437, 462, 463, 467, 472, 473, 474
Iowa:
City, VAMC study............................................. 417
Community-based outpatient clinics........................... 419
CBOCs in..................................................... 419
Kerrville VA Hospital............................................ 465
Long term care................................................... 441
Market assessment process........................................ 422
Market Assessments............................................... 422
Medical care..................................................... 422
Budget formulation........................................... 408
Cost fund.................................................... 439
Management efficiencies...................................... 408
Needs........................................................ 463
Two-year spending availability for........................... 410
Medical school affiliations...................................... 431
Medical staffing reductions...................................... 432
Montana, funding for............................................. 414
National Cemetery, transfer of land for.......................... 466
Outpatient Clinics, community based.............................. 458
Personnel reductions and closing facilities...................... 416
Processing claims................................................ 425
Performance standard in...................................... 426
Quality management............................................... 455
Restructuring, potential staffing efficiencies through........... 434
Short-Term Action Plan--April 1999............................... 431
Specialized services, access to.................................. 441
Telemedicine..................................................... 415
VA facilities and employment, statistics on...................... 413
VA's:
Budget, other concerns in.................................... 379
DC Field Office.............................................. 468
Disposal of Capital Assets................................... 470
Medical care program......................................... 376
Request to OMB............................................... 435
VA/DOD sharing................................................... 457
Veteran Benefits Administration................................378, 459
Veterans Equitable Resource Allocation (VERA).................... 454
Veterans Health Administration, a strategic plan for long term
care provided by the........................................... 441
VHA Actions, Protocol for Processing............................. 433
VISNs, integration of............................................ 466
Washington Regional Office....................................... 431
Plans to solve problems at.................................429, 431
Washington, DC regional office................................... 428
ENVIRONMENTAL PROTECTION AGENCY
AFO's............................................................ 689
Agency audit policy: Self disclosure of potential violations..... 741
Agency performance measures...................................... 735
Agency, grant recipients and their litigation records against the 656
America bonds, better..........................................772, 781
Animal Waste:
Livestock permits funding.................................... 830
Regional mechanism for manure management..................... 831
Research and development techniques for pollution standard... 831
Aspirations, our................................................. 723
Budget status.................................................... 724
Carney site, St. Maries, Idaho................................... 817
Central Information Office, status of EPA's efforts to create a.. 632
Children's health................................................ 753
Clean air partnership fund:
Grants to cities............................................. 756
Programs..................................................... 782
Clean lakes program (section 314): 319 program funding........... 828
Clean water action plan: USDA and EPA draft strategy on animal
feeding operations............................................. 789
Clean water: unmet capital needs................................. 694
Climate change:
Climate science.............................................. 813
Global climate issue--EPA outreach........................... 803
Greenhouse gas emissions credit for early action...........800, 812
Kyoto protocol implementation................................ 797
Meeting in Kansas City, MO................................... 810
Coeur d'Alene:
Basin........................................................ 720
SF........................................................... 719
Superfund.................................................... 816
Completing financial audits...................................... 695
Compliance assistance..........................................737, 765
Activities................................................... 726
Effectiveness of programs.................................... 726
Conferences at which:
EPA staff have participated as speakers and/or exhibitors.... 806
Will participate as speakers and/or exhibitors........... 808
Consent decrees.................................................. 698
Contractors' Superfund Program support costs are still high, in
part, because EPA has too many contracts for its cleanup
workload....................................................... 637
Corrective Action Cleanups, while shifting funds could
accelerate, the impact on Superfund is uncertain............... 639
CWAP: Added funds................................................ 751
Data quality:
CERLCIS...................................................... 760
Computer security centralized validation process............. 759
Empact initiative funding.................................... 760
Error correction plan strategy............................... 758
Fiscal year 2000 budget request.............................. 759
Grant management............................................. 763
RCRIS........................................................ 761
Stakeholders involvement..................................... 759
State water quality assessment report........................ 762
States involvement........................................... 759
Developments to date............................................. 723
Dioxin reassessment study........................................ 820
Early action projects............................................ 724
Embedded chip failures, potential impact of...................... 652
Enforcement:
Accomplishments.............................................. 743
Performance goals and measures............................... 736
Ensuring grant programmatic and administrative requirements are
met............................................................ 695
Environmental:
Information, reinventing..................................... 745
Justice programs............................................. 773
Preferable products.......................................... 689
$1 Million Congressional Add................................. 691
EPA:
Decentralized organizational structure, overcoming problems
associated with............................................ 635
New Information Office....................................... 723
Will face significant challenges......................... 634
Sponsored and co-sponsored public meetings, upcoming.......805, 808
Fiscal year 2000 budget:
Priorities for............................................... 680
Reduction.................................................... 780
Support for States; justification for 5 percent increase in
operating programs......................................... 783
Food funding, Safety of.......................................... 734
Food quality and safety.......................................... 681
Food safety...................................................... 791
GAO:
Contract capacity program support costs...................... 767
RCRA corrective action program............................... 769
Reinvention.................................................. 770
Superfund program............................................ 766
Government Performance and Results Act (GPRA).................... 770
Accountability of managers................................... 777
Changes to improve link between resources performance goals.. 779
Cost accounting.............................................. 780
Data for performance report.................................. 779
Impact on future funding requests............................ 779
Link between resources and performance goals................. 779
Performance based management................................. 777
Program changes to improve performance....................... 778
Use of performance information............................... 778
In developing fiscal year 2000 budget request............ 778
Grandfather regulation: Environmental defense fund vs. EPA....... 795
Grant audits..................................................... 694
IG's report.................................................. 697
Grantees, outreach and review of................................. 695
Grants management:
Post award management policy................................. 764
Statutory authority.......................................... 764
Grants oversight of assistance agreement:
Oversight of assistance agreement--Material weaknesses
correction................................................. 728
Post award management......................................727, 730
Hazardous Waste: Observations on EPA's Cleanup Program and Budget
Management Practices........................................... 636
Information Management Office.................................... 721
Information plan is needed....................................... 633
Issues in the 1998 NAS/National Research Council analysis of
science uncertainties and the October 1998 Hansen NAS paper.... 814
Key Goals, our................................................... 723
Key issues....................................................... 724
Known or suspected carcinogens................................... 821
Lake Champlain:
Action plan time frame....................................... 827
Great lakes program.......................................... 827
Survey of fish and great lakes epidemiological study......... 826
Lawsuits against EPA that have resulted in consent orders that
led to new requirements, organizations that have brought....... 699
Litigation, grant money used for................................. 696
Low sulfur gasoline proposed rule................................ 787
Mercury thresholds and emissions................................. 825
Missouri:
Lawsuits..................................................... 725
Air quality lawsuits......................................... 725
Need for change.................................................. 723
Needed resources are still unknown............................... 634
New office, programs coming into the............................. 724
Nitrogen oxide: State implementation plans....................... 717
NOX SIP call:
Analysis or studies on impact of individual air quality...... 836
Imbalance between control burden and nonattainment........... 835
NOX reductions compliance deadline................ 837
Nonpoint source pollution......................................642, 679
Projects..................................................... 830
NPDES:
Backlog...................................................... 749
Permitting program funding................................... 733
Observations..................................................... 636
Office of Information Management................................. 756
Implementation plan.......................................... 756
Reporting Burden Reduction and REI........................... 757
Organizational structure is not yet determined................... 633
Orimulsion:
Conclusive report on research................................ 819
Research funding............................................. 820
OSHA carcinogens, TRI on-site and total releases of, by State,
1993-1997...................................................... 825
Pesticide risks, food safety..................................... 652
Pollution prevention and the Federal Government: Bio-based EPPS.. 832
Project XL....................................................... 748
Radon standards:
Air mitigation-technical assistance to small water systems in
rural
areas...................................................... 833
Effect of radon rule......................................... 834
Impact of radon reduction on small water systems............. 835
Increased costs for radon abatement in water................. 834
Reduce reporting burdens, balancing the need to collect more data
and efforts to................................................. 635
Regional haze.................................................... 682
Implementation of final regulations.......................... 783
Rules........................................................ 817
Selective burning............................................ 693
Statutory authority.......................................... 693
TEA-21 legislation--integration with NAAQS PM2.5............. 785
Western Governors Conference................................. 691
REI: Data Standards.............................................. 758
Resource breakout, specific...................................... 691
Resources and expertise, obtaining sufficient.................... 634
Resources and strategies remain unresolved, progress is being
made, but key questions on..................................... 633
Risk management plan rule on propane............................. 785
Safe Repainting, Sampling tech course, eng. octane additives..... 776
Small Business compliance assistance centers..................... 739
Small Business Regulatory Enforcement Fairness Act (SBREFA)...... 748
State counterparts working more effectively with................. 635
State Grants: Fiscal year 1999 funding increase.................. 753
Superfund:
Contracting that could be addressed through EPA's contracts
2000 initiative, recurring problems raise broader questions
about...................................................... 638
Proposed cleanup actions..................................... 783
Timeline......................................................... 724
TMDL:
Program: Internal cost assessments........................... 751
Sound Science................................................ 752
Transportation construction projects:
Impact....................................................... 796
List......................................................... 796
Transportation Partners:
Awards....................................................... 655
Grants....................................................... 654
Program....................................................653, 796
Transportation projects, EPA review of........................... 731
Tribal support................................................... 794
Water quality needs, GAP analysis of............................. 640
Who's involved................................................... 723
Y2K readiness:
Of drinking water plants for................................. 643
Waste water.................................................. 642
Year 2000:
Preparedness survey summary, community public water systems.. 644
Survey analysis, AMSA........................................ 646
Survey--Addendum, AMSA....................................... 652
EXECUTIVE OFFICE OF THE PRESIDENT
Council on Environmental Quality and Office of Environmental Quality
Agency comments.................................................. 858
America bond, better............................................. 849
Board's actions, concerns about the.............................. 855
Business, a new way of doing..................................... 845
Chemical Safety Board............................................ 850
Status of implementation efforts............................. 850
Contracting activities........................................... 853
Council on Environmental Quality:
Accomplishments of the....................................... 842
Responsibility............................................... 846
Coordination role............................................ 849
Current and planned staffing levels, responsibilities, and
salaries....................................................... 853
Different purposes............................................... 847
Dispute resolution............................................... 843
Fish mitigation process.......................................... 847
Investigations and Recommendations, status of.................... 851
NEPA reinvention................................................. 846
Partnership Program.............................................. 841
Policy coordination.............................................. 844
Scope and methodology............................................ 858
Statutory integration............................................ 842
Superfund........................................................ 848
Office of Science and Technology Policy
Biotechnology.................................................... 341
Educating the public on issues............................... 342
Community college, importance of................................. 348
Education Reserach Initiative.................................... 346
Food Safety Council.............................................. 345
Foreign individuals in the United States, education of........... 353
Information on science in the Federal Government, availability of 337
Information technology........................................... 333
Information Technology Initiative................................ 352
NIH, funding..................................................... 333
R&D, funding..................................................... 335
Science budget, overall.......................................... 351
FEDERAL EMERGENCY MANAGEMENT AGENCY
Anti-terrorism funds, allocation of.............................. 31
Budget priorities................................................ 24
Consequence management........................................... 27
Disaster:
Criteria..................................................... 38
Insurance.................................................... 6
Needs, unmet................................................. 25
Prevention................................................... 8
Program, cost savings in the................................. 36
Emergency supplemental........................................... 5
Fire Academy:
In anti-terrorism training, role of.......................... 35
Issues, urgency for addressing............................... 31
First responders, training for................................... 34
5-Year historical average, disaster.............................. 24
Flood mapping.................................................... 26
Mortgage transaction needs....................................... 25
National Fire Academy............................................ 30
Report on the................................................ 9
Professional emergency managers.................................. 39
Stafford Act amendments.......................................... 38
Terrorism:
Coordination with State and local governments on............. 33
Interagency coordination on.................................. 32
Y2K:
And counter-terrorism efforts................................ 9
Disaster relief for.......................................... 28
Hearing...................................................... 7
Informing the public about................................... 29
State preparedness for....................................... 27
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
Civilian Space Program, setting goals for the.................... 230
Flood plane mapping program...................................... 229
Goddard Space Flight Center, fiscal year 2000 budget for......... 249
Hubble:
Follow-up.................................................... 248
Servicing mission cost for................................... 234
Space Telescope.............................................. 232
NASA--The millennium............................................. 252
Primakov, meeting with........................................... 242
Rankiong minority closing remarks................................ 252
Russian:
Proliferation activities..................................... 243
Report....................................................... 234
Space Agency, monies paid to the............................. 239
Shuttle or reusable launch vehicles, upgrades to the............. 246
Solar stereo mission............................................. 251
Space Hope Instruction Program................................... 248
Space Station:
Commercializing the.......................................... 244
Completion................................................... 246
Hardware and services, Russian delivery of................... 238
Operation cost............................................... 246
Overruns..................................................... 231
Y2K.............................................................. 247
NATIONAL SCIENCE FOUNDATION
Biotechnology, benefits and dangers of........................... 340
Education:
Needs, addressing future..................................... 349
Valuing higher............................................... 351
Educational research............................................. 346
EPSCOR........................................................... 338
Funding for.................................................. 339
Experimental program to stimulate competitive research, funding
for the........................................................ 337
Funding, geographic distribution of.............................. 338
Information technology:
Funding, priority of......................................... 332
Plans for.................................................... 332
IT2 initiative, funding breakdown within the.......... 334
K-12 education, graduate teaching fellows in..................... 347
Middle school learning, innovations for.......................... 347
NSF:
Award size and duration, increasing.......................... 350
Programs, adequacy of funding for............................ 349
Overall funding priorities....................................... 332
Plant genome reserach............................................ 340
Distribution of support for.................................. 339
Public education in science, need for............................ 342
Public fears related to science, managing........................ 343
R&D funding across the United States, distribution of............ 339
Scientific disciplines, distribution of funding across scientific 335
U.S. leadership in the future, maintaining....................... 336
Work force, preparing tomorrow's................................. 345
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