[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]



[DOCID: f:77148.wais]


 
                   DEPARTMENT OF TRANSPORTATION AND

                    RELATED AGENCIES APPROPRIATIONS

                                FOR 2002

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS
                              FIRST SESSION
                                ________
 SUBCOMMITTEE ON THE DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES 
                             APPROPRIATIONS

                    HAROLD ROGERS, Kentucky, Chairman


 FRANK R. WOLF, Virginia       MARTIN OLAV SABO, Minnesota
 TOM DeLAY, Texas              JOHN W. OLVER, Massachusetts
 SONNY CALLAHAN, Alabama       ED PASTOR, Arizona
 TODD TIAHRT, Kansas           CAROLYN C. KILPATRICK, Michigan
 ROBERT B. ADERHOLT, Alabama   JOSE E. SERRANO, New York
 KAY GRANGER, Texas            JAMES E. CLYBURN, South Carolina
 JO ANN EMERSON, Missouri
 JOHN E. SWEENEY, New York          

 NOTE: Under Committee Rules, Mr. Young, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
 Richard E. Efford, Stephanie K. Gupta, Cheryle R. Tucker, and Linda J. 
                        Muir, Subcommittee Staff
                                ________

                                 PART 3

 DEPARTMENT OF TRANSPORTATION:
                                                                   Page

   Coast Guard....................................................  793
   Office of Inspector General....................................  611
   Office of the Secretary........................................  341
   Saint Lawrence Seaway Development Corporation.................. 1077
   Secretary of Transportation....................................    1

 RELATED AGENCIES:

   Architectural and Transportation Barriers Compliance Board..... 1123
                                ________
         Printed for the use of the Committee on Appropriations
                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 77-148                     WASHINGTON : 2002

                                  COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

 RALPH REGULA, Ohio                      DAVID R. OBEY, Wisconsin
 JERRY LEWIS, California                 JOHN P. MURTHA, Pennsylvania
 HAROLD ROGERS, Kentucky                 NORMAN D. DICKS, Washington
 JOE SKEEN, New Mexico                   MARTIN OLAV SABO, Minnesota
 FRANK R. WOLF, Virginia                 STENY H. HOYER, Maryland
 TOM DeLAY, Texas                        ALAN B. MOLLOHAN, West Virginia
 JIM KOLBE, Arizona                      MARCY KAPTUR, Ohio
 SONNY CALLAHAN, Alabama                 NANCY PELOSI, California
 JAMES T. WALSH, New York                PETER J. VISCLOSKY, Indiana
 CHARLES H. TAYLOR, North Carolina       NITA M. LOWEY, New York
 DAVID L. HOBSON, Ohio                   JOSE E. SERRANO, New York
 ERNEST J. ISTOOK, Jr., Oklahoma         ROSA L. DeLAURO, Connecticut
 HENRY BONILLA, Texas                    JAMES P. MORAN, Virginia
 JOE KNOLLENBERG, Michigan               JOHN W. OLVER, Massachusetts
 DAN MILLER, Florida                     ED PASTOR, Arizona
 JACK KINGSTON, Georgia                  CARRIE P. MEEK, Florida
 RODNEY P. FRELINGHUYSEN, New Jersey     DAVID E. PRICE, North Carolina
 ROGER F. WICKER, Mississippi            CHET EDWARDS, Texas
 GEORGE R. NETHERCUTT, Jr.,              ROBERT E. ``BUD'' CRAMER, Jr.,
Washington                                Alabama
 RANDY ``DUKE'' CUNNINGHAM,              PATRICK J. KENNEDY, Rhode Island
California                               JAMES E. CLYBURN, South Carolina
 TODD TIAHRT, Kansas                     MAURICE D. HINCHEY, New York
 ZACH WAMP, Tennessee                    LUCILLE ROYBAL-ALLARD, California
 TOM LATHAM, Iowa                        SAM FARR, California
 ANNE M. NORTHUP, Kentucky               JESSE L. JACKSON, Jr., Illinois
 ROBERT B. ADERHOLT, Alabama             CAROLYN C. KILPATRICK, Michigan
 JO ANN EMERSON, Missouri                ALLEN BOYD, Florida
 JOHN E. SUNUNU, New Hampshire           CHAKA FATTAH, Pennsylvania
 KAY GRANGER, Texas                      STEVEN R. ROTHMAN, New Jersey
 JOHN E. PETERSON, Pennsylvania
 JOHN T. DOOLITTLE, California
 RAY LaHOOD, Illinois
 JOHN E. SWEENEY, New York
 DAVID VITTER, Louisiana
 DON SHERWOOD, Pennsylvania
   
 VIRGIL H. GOODE, Jr., Virginia     
                                    

                 James W. Dyer, Clerk and Staff Director

                                  (ii)


 DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS FOR 
                                  2002

                              ----------                              

                                         Wednesday, April 25, 2001.

                      DEPARTMENT OF TRANSPORTATION

                                WITNESS

NORMAN Y. MINETA, SECRETARY, U.S. DEPARTMENT OF TRANSPORTATION

                       Chairman's Opening Remarks

    Mr. Rogers. Good morning. Today we are pleased to have with 
us the Secretary of Transportation, and welcome the Secretary 
back to Capitol Hill as we think this is his rightful home. We 
are pleased to hear him present to us today the department's 
$59.5 billion budget request for fiscal year 2002.


                              coast guard


    That budget goes a long way to improve capital 
infrastructure around the country by providing the higher 
spending levels called for in the TEA-21 and AIR-21 
authorization acts. It kicks off the largest acquisition in the 
department's history, the Coast Guard's deepwater program, and 
it sustain's the nation's commitment to finance Amtrak's 
glidepath, to operational self-sufficiency which continues 
through fiscal year 2002.
    However, the budget request also has some problems which I 
believe this Committee will ultimately need to address: Glaring 
holes in the Coast Guard's search and rescue safety net 
recently cost the federal government $19 million in a lawsuit 
resulting from the fatal sinking of the sailboat Morning Dew in 
1998; too many Coast Guard sailors are being hurt and killed 
due to inadequate training and equipment; too many ``men 
overboard'' accidents; too many small boats not ready to go to 
sea. Yet the budget defers most of the needed improvements. 
Furthermore, the budget proposes a rash of air station closures 
and cutter and aircraft retirements due to lack of funding. 
Some of these assets were purchased only two years ago in an 
emergency appropriation, in fact, to fight the war on drugs. 
Today, even with a six percent budget increase, the rise in DOT 
and Coast Guard administrative expenditures are squeezing out 
funding for these needed assets, cuts that will be very hard 
for this Congress to approve.


                             airline delays


    And in aviation, there is very little in the budget 
specifically addressing the monumental and growing problem of 
airline delays. We need fast and decisive action, and 
leadership from DOT to combat the callous disregard which so 
many airline passengers are subjected to today. I know from his 
public statements that the Secretary agrees with us on the 
severity of this problem. I know that also from private 
conversations with him, and from his actions when he was here 
on the Hill.
    And with that enormous experience in the aviation field, he 
is in a unique position to command respect as well as action 
from the airlines, FAA management, controllers, and airport 
officials. We are looking forward to hearing what the Secretary 
has to say this morning on this very important subject.
    The millions of American travellers who were delayed or had 
flights cancelled last year are waiting to hear what all of us 
are going to do, not tomorrow, but right now.


                      transportation budget trends


    The Inspector General at a hearing a few weeks ago said 
that trends in the transportation budget resembled the movie 
``The Perfect Storm.'' By that he meant the ominous requests or 
requirements or huge increases in spending for Amtrak, FAA 
operations and Coast Guard's deepwater program are all 
converging on us at the same time, coupled with the large 
funding guarantees of transit, highways, and aviation capital 
programs.
    We see some of those pressures before us even now, and the 
impact of our decisions this year will be felt over the coming 
years of the new administration. We are being asked to put more 
money into capital programs and pay for those increases by 
holding the line on operating accounts. While consistent with 
congressional authorizations, it may involve some painful 
decisions up here, as well as stronger dedication to the 
oversight of the capital spending which is not yet apparent.


                          resource management


    In terms of resource management, DOT has plenty of room for 
improvement. The Inspector General states that there are 
increasing numbers of fraud, waste and abuse cases with the 
increase in highway and transit funding. I agree with the IG 
that there is a major problem with project management and 
oversight.
    The poster child for this problem is the central artery/
tunnel project in Massachusetts. This project is seeing cost 
increases of 464 percent, the most recent cost estimate is 
$14.1 billion. And as I have said before, Mr. Secretary, and I 
think you probably agree with this, we will not have another 
central artery project on our watch. I do not think we will--I 
know I will not. I am interested in your thoughts as well. 
States and project sponsors must develop accurate project cost 
estimates and there must be strong project oversight and 
management at the state and federal level. In addition, DOT 
needs to drive forward its environmental streamlining efforts 
in the highway, transit and aviation arenas without 
compromising the existing environmental laws. Our nation needs 
good projects built faster in order to emerge from our 
congestion problems. Strong project oversight and management, 
together with environmental streamlining, will lead to the most 
effective and efficient use of our tax dollars.
    So without further ado, we welcome Secretary Mineta before 
the Subcommittee today. Certainly the Secretary is no stranger 
to congressional hearings, having had an illustrious career in 
this body, and of course, as Chairman of the Public Works and 
Transportation Committee for several very productive years. He 
might be more comfortable on this side of the desk based on his 
long career here, but we look forward to workingclosely with 
the Secretary, and I know that warm relationship that all of us share 
with the Secretary will be a good one and will continue in that vein.
    Mr. Secretary, as you know, without objection your written 
statement will be entered into the hearing record, and we would 
appreciate hearing your oral summary of that. But first let me 
yield to my colleague, the gentleman from Minnesota, for any 
opening comments he would like to make.
    Mr. Sabo. Thank you, Mr. Chairman, and let me simply 
welcome Mr. Mineta back to the Congress, and I am sure it is a 
different experience to be on that side of the table. We have 
known you for many years and you were an outstanding member of 
this body, and we know you are going to continue to provide the 
kind of leadership that you provided in the Congress in your 
current job. We look forward to working with you, and we will 
have some questions later on.
    Welcome.
    Mr. Rogers. Mr. Secretary.

                     Secretary's Opening Statement

    Secretary Mineta. Thank you very much, Mr. Chairman, Mr. 
Sabo, Members of the Subcommittee. It really is a great 
pleasure for me to have this opportunity to be before you 
today, to testify on President Bush's $59.5 billion 
transportation budget.
    Let me assure you, Mr. Chairman, the view from this side of 
the table is vastly different.
    When I was Mayor of San Jose, California, I learned that 
the tool that made the most difference in my community was 
transportation. Nothing else had as great an impact on our 
economic development, on the pattern of growth, or on the 
quality of life. Today, the most fundamental transportation 
challenge that we face is not congestion, it is not delays, it 
is not modernizing the aviation system. Our biggest challenge 
is to get everyone working together to solve problems.
    I intend to devote my energy to working across party lines 
and build consensus to achieve solutions, and I will look to 
you, Mr. Chairman, Mr. Sabo, and Members of this Subcommittee, 
to help me do that.

                                 SAFETY

    Transportation safety is the department's number one 
priority. The 2002 budget includes $7.3 billion for 
transportation safety programs, a 7.5 percent increase above 
2001. The funding requested will help us address our safety 
challenges which include: reducing runway incursions, 
increasing seat belt use, overseeing improved pipeline safety 
measures, improving the Coast Guard's ability to respond to 
those in distress, and allowing the United States to honor the 
North American Free Trade Agreement safely and responsibly.

                         MOBILITY AND CAPACITY

    When I took this job, I knew that in addition to safety a 
central challenge was addressing the gap between the demand for 
transportation and the capacity of our transportation 
infrastructure. That gap is what generates the traffic that we 
all face on the highways, at our airports, and at our seaports. 
And since this Committee has already held two hearings on this 
topic, you know that nowhere is that challenge more evident 
than in air traffic control.
    In 1997, the National Civil Aviation Review Commission, 
which I had the privilege to chair, saw the coming storm. We 
predicted that there would be gridlock by the turn of the 
century, and by the spring of 2000, it hit. I take no 
satisfaction in saying I told you so, but I told you so.
    Now we face the stiff challenge of building the necessary 
capacity to match that demand. President Bush's budget includes 
the aviation capital and grant levels authorized by AIR-21, and 
the highway and transit funding levels contained in TEA-21. 
Now, this investment is not the sole answer to our capacity 
constraints, but it will help greatly.
    Today the FAA is releasing its report on capacity 
benchmarks, and I believe that this benchmark data confirms 
that we must take action in three key areas: placing additional 
focus on the chokepoints, increasing runway capacity, and 
encouraging review of airline practices, including scheduling.
    We also have to be sure that we get what we pay for. I have 
seen too many instances of large cost increases in 
transportation projects, and we at the department need to be in 
front of this, not behind it. We need to be aware of the 
potential of waste, fraud and abuse, and improve our mechanisms 
to identify it early and prevent it. If we pay for a ten-sack 
concrete job, we should get a ten-sack concrete job, and not a 
seven-sack concrete job.
    President Bush also wants to help to close the mobility gap 
for Americans who do not have mobility options. The budget 
requests $145 million for the transportation component of the 
President's new freedom initiative to provide more 
transportation options to those with disabilities.

                           NATIONAL SECURITY

    Mr. Chairman, I cannot conclude my testimony without 
mentioning the department's role in national security and the 
Coast Guard's performance in drug interdiction.
    In this fiscal year alone the Coast Guard has seized 27 
metric tons of cocaine. Our budget invests some $759 million 
for the Coast Guard to conduct drug law enforcement activities.
    The United States enjoys the safest and the best 
transportation system in the world. However, we face capacity 
and safety challenges. The funding requested in President 
Bush's 2002 budget, as well as the management and 
accountability improvements that we will make over the next 
year, will help us to address those challenges.
    Thank you very much, Mr. Chairman, Mr. Sabo, Members of the 
Subcommittee. I will be happy to respond to your inquiries.
    [The prepared statement and biography of Norman Mineta 
follow:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


                         AIRLINE DELAY HEARINGS

    Mr. Rogers. Well, thank you, Mr. Secretary, for that 
statement, and thank you for your appearance with us today as 
we begin the process of looking over your budget, the budget 
request of the President for the Department of Transportation 
and related agencies.
    You referred to the Subcommittee's two hearings we have had 
on airline delays, and that is a priority of this Subcommittee 
because of the huge number of Americans now traveling by air, 
several hundred million per year, projected to double in the 
next few years. Already one in four flights is now delayed, and 
the number of cancellations is increasing. The length of delays 
is increasing, and people are outraged. I think they expect 
both the Congress and the administration to act.
    I will let you know from this forum that we plan to act, 
and I am hopeful that you will be out in front of us in acting 
on it.
    You see behind me a chart that was prepared following the 
first hearing at which we had the head of the airline pilots, 
the head of the air traffic controllers, the head of the 
airport executives group, the FAA administrator, of course, and 
the Inspector General of the department.
    And after a very lengthy hearing, I asked each one of those 
people to tell me five things that they personally would see to 
in order to get at airline delays and cancellations and better 
service. They each promised me five things.
    We will be having that group back before us very soon, and 
we will be issuing a report card on their activities, and that 
may not be the last time they appear here. We have a committee 
task force, if you will, that this Subcommittee is going to 
ride herd on. And if we do not get action, we will deal with 
that appropriately. I know the Secretary has been deeply 
involved in this problem.
    So far the FAA administrator told us at her appearance here 
a week or so ago, on her budget request, she was able to tell 
us that she had completed at least one of her five chores, and 
that was to secure an agreement among all the parties as to 
what a delay is.
    Now that seems a fairly simple thing, what is a delay, and 
yet pilots--here is one right here, in fact. [Laughter.]

                DELAY DEFINITION AND PROPOSED SOLUTIONS

    The very definition of a delay, but obviously the airlines 
have a different view from the airport people and the FAA has a 
different view from the pilots and the air traffic controllers 
and so on.
    But finally she says we have an agreement on the definition 
of delay, and that is a flight that arrives 15 minutes at the 
gate beyond the due time.
    Well, maybe that is big progress. At least we are on the 
road toward getting a system in place to where we can now rank 
airlines based on their on-timeness, so that the traveling 
public has a way to judge how they want to purchase their 
travel time.
    We are going to insist that that be the case, that we find 
a way that we can let the public judge which airline is best in 
terms of being on time, and let the marketplace do its will. 
And for that we gave Ms. Garvey a gold star, as you can see.
    We will hear from the others in a few days, and we will 
have smiley faces and we will have frowning faces. We will 
continue, and we will see to it that we do the best we can to 
bring this problem to a happy conclusion.
    Have you any thoughts on the problem of airline delays, and 
how we can get at it and what you are going to do about it?
    Secretary Mineta. First of all, Mr. Chairman, I think part 
of the reason it takes a long time to come to a definition of a 
delay is that there is just too much finger pointing going on 
because no one really wants the brown bag on their doorstep. 
And so they are always trying to shift the blame to somebody 
else. As you say, something as simple as trying to find a 
definition of a delay took a long time because no one wants the 
responsibility for having a delay being on their doorstep.
    But now that a definition is in place, and as I look at 
that list behind you, I would say that those 32 items up there 
are my choices of what ought to be done in terms of delays, 
because there is no silver bullet in this whole business. There 
are certain things you can be doing in terms of concentration. 
But in terms of what has to be done to reduce cancellations, 
delays, all of those things up there have to be done, and much 
more.
    In terms of the specifics, and what five I would think of, 
I would talk about airports, air traffic control, and airlines. 
They are the moons and stars and the earth of our galaxy, and 
they are not in alignment. The three elements of airports, air 
traffic control and airlines are like a dysfunctional family, 
and the biggest thing that we have to do is to get everyone 
working together.

                             ACCOUNTABILITY

    Mr. Rogers. Well, I agree with you entirely that the 
problem is getting all of these groups to work together and 
stop finger pointing at each other, and that is the reason we 
had the six people around this table. We sort of formed a 
circular firing squad, and we asked them to point fingers at 
that meeting.
    Well, there was some of that, but not that much. And I just 
think getting all of the heads of the parties in the same room 
periodically and forcing something to happen, and putting names 
beside promises, and then holding that person accountable to 
their promises is the way it needs to be done. Not only is the 
situation unyielding, and the executive branch can do it much 
more efficiently, I think, and more effectively than can we. We 
will be happy to join, but is that something that you are 
contemplating perhaps?
    Secretary Mineta. Not only contemplating, but have been 
doing since the 25th of January, when I became the Secretary. I 
can say that within the last month, probably every day, I have 
been on the phone with Northwest Airlines, Aircraft Mechanics 
Fraternal Association (AMFA), Delta Airlines, pilots, the 
National Mediation Board, and the White House, dealing with the 
labor airline situation. That has been the case with some of 
those items that you have on that board where I have been 
dealing on a one-on-one basis with the airlines, some 
collectively.
    I have met with the board of directors of the Air Transport 
Association in addition to meeting with specific CEOs of 
airlines, to do that kind of one-on-one. As you say, part of my 
job is jaw-boning to get things done, and I am not reluctant to 
do that. I feel that I have been doing that since the 25th of 
January.
    Mr. Rogers. Well, you have, and I agree with you that you 
have been doing that very effectively.
    Let me just say this. There are certain things that 
Congress can do that you cannot. You have to work within 
certain personnel rules. You cannot fire somebody perhaps that 
you would like to without some long, laborious process,and 
therefore discipline, I think, within the department and the federal 
government at large, to be frank with you, is very, very tough to 
accomplish.
    But there are certain things that we can do to assist you 
in that respect, and I told Jane Garvey this same thing. If you 
find somebody that is not following orders and being a part of 
the team to make these things happen, I want their name, rank 
and serial number. We are not above, on this Subcommittee, 
writing in the appropriations bill, ``none of these funds shall 
be used to pay the salary of `Joe Dokes'.''
    Now, you cannot fire them, but we can, and we shall. I am, 
like you, tired of finger pointing and blame calling without 
effective results.
    Now, we are going to continue to bring these people before 
this public body here and hold them publicly accountable for 
the promises they have made, and for carrying out the duties 
that they have been sworn to uphold until we get at the bottom 
of this specific problem of airline delays, cancellation and 
ineffectiveness.
    And I want to volunteer to you that any way we can assist 
you in the executive branch of bringing about that conclusion I 
hope you will let us know.
    Secretary Mineta. That would be very helpful. As you and 
others of this Subcommittee know very well, our mantra is 
accountability and accessibility. And so both from a giver and 
a taker of accountability, as well as accessibility, you are 
correct in saying that that is what I will be doing.

                      TASK FORCE ON AIRLINE DELAYS

    Mr. Rogers. Now, before I turn you over to another member, 
the previous Secretary had convened a task force to identify 
the causes of delays in a credible and agreed-upon framework 
that all parties could sign off on. Jane Garvey told us the 
other day that we have agreed on the definition of a delay, and 
we have agreed that there are three categories of causes of 
delays, and that all the parties had agreed to furnish 
information that would fit into the three categories. And the 
Inspector General recently told us that there are some 
reasonable sets of recommendations that still need to be 
implemented, referring to those findings.
    I think, until we have a system, we are going to continue 
to be pointing fingers about why we have delays and 
cancellations. The task force was disbanded after the election 
and has not, to my knowledge, been put back in place.
    Do you have plans to put in place such a task force?
    Secretary Mineta. As soon as I get the full team together, 
I will be asking the Deputy Secretary to head up that task 
force and to bring into play the recommendations that are 
talked about.
    Mr. Rogers. And who is that Deputy Secretary?
    Secretary Mineta. It will be Michael Jackson. In fact, as 
we speak right now, he is at the Senate Committee for his 
confirmation hearing.
    Mr. Rogers. Let me get this straight. This person will be 
the one that we will all look to to solve the airline delay 
problem?
    Secretary Mineta. Well, I am not sure that it will be a 
problem that Michael will be able to solve alone, but he will 
be heading up the task force, developing the recommendations of 
the task force, and looking at the previous task force study.
    Mr. Rogers. Well, we look forward to hearing from him 
fairly soon after his confirmation at two o'clock. [Laughter.]
    Secretary Mineta. We will have to swear him in first before 
you swear at him, Mr. Chairman. [Laughter.]
    Mr. Rogers. Maybe we can do that at the same time. Well, 
thank you, Mr. Secretary. I will have questions later.
    Mr. Sabo.

                      REASONS FOR AVIATION DELAYS

    Mr. Sabo. Thank you, Mr. Chairman. In terms of having some 
understanding of the delay problem, to what degree do 
departures or arrivals come during peak hours versus non-peak?
    Secretary Mineta. First of all, when you look at delays, 
roughly 70 percent, 68.7 percent are weather related.
    I was looking at a chart by airport. These are five-minute 
intervals at a given airport. This is the Visual Flight Rules 
(VFR); this is the Instrument Landing Systems (ILS). We can 
tell what the delays are and what time of the day.
    And when we look at the delays, 68.7 percent are due to 
weather; terminal volume is 8.1 percent; center volume, 3.8 
percent; and runway and taxiways, 4.7 percent.
    I looked at the delays over time; this is a delay because 
of the air traffic control strike in 1981. All of a sudden here 
in 1998, delays go up very, very high. And I asked the question 
about why, all of a sudden in 1998, delays go up.
    Well, the FAA said 68-70 percent of delays are weather-
related. And I cannot think that in 1998 we had that kind of 
bad weather. But what happened that year is that the air 
traffic controllers got weather radar with the capability of 
superimposing that on their screen. I think as they looked at 
the yellows and the oranges and the reds, they said that flight 
637 is not going to come into this area.
    There are seven choke points, number one that Jane Garvey 
has up there on her list, in the triangle of Boston, Chicago, 
D.C. As flights are coming from the west, air traffic 
controllers look at their radar and say, ``Oh, I am not sure I 
want these planes coming in through this kind of weather.'' And 
so they are delaying the flights because of weather.
    I do not know whether or not we are getting too sensitive 
about letting flights come in. I have sat in the jump seat for 
years where you see thunderheads over here, and thunderheads 
over there, and pilots are asking for a seven degree deviation 
from their flight plan in order to wend their way.
    I think what is happening is that a lot of flights are 
being delayed in Dallas-Fort Worth, Chicago, San Francisco, and 
wherever they are coming in from, because of better equipment 
and access to more information. But I think it is also slowing 
down the whole system. We are taking a look at that right now 
to see whether or not this ``supposition'' of mine has any meat 
to it, or whether I am coming to conclusions that may not be 
correct.
    The technology has improved, and maybe we are victims of 
our own success. We have a new tool, but it is being used 
against getting flights from point A to point B. And we have 
always experienced some turbulence that we go through. No one 
wants to send planes into red weather on the radar screen.
    Anyway, we are taking a look at that, Mr. Chairman, to see 
whether or not we are being too sensitive to the charts and the 
radar screens.

                       NOISE MITIGATION RESEARCH

    Mr. Sabo. Mr. Secretary, I hear all the reports on our need 
to build runway capacity and to do it more quickly. I also 
notice and live with it locally, the incredible problems that 
exist with airplane noise, and I think that clearly is one of 
the major reasons that you are going to have trouble getting 
acceptance of new runways and greater airport capacity in many 
communities.
    We spend millions in mitigation, and in most cases still 
leave people unhappy. My sense is we spend very little on the 
basic problem, which is the noise of the airplane. And I know 
historically it is NASA that is supposed to be doing that 
research on aeronautics. My sense is that of the research they 
do, very little relates to the noise question, and that the 
research they do is on the decline.
    It would seem to make sense to me that maybe we should be 
directly transferring some funds to NASA from FAA to do 
research on the noise of engines, and some noise, I am told, 
comes from the construction of the airplane itself. I just 
think it makes incredible sense to make that kind of 
investment, maybe in some fashion with the industry.
    Secretary Mineta. Mr. Sabo, I share your concerns about 
noise. When I chaired the aviation subcommittee for the Public 
Works and Transportation Committee, we did a great deal of work 
in that area. You really pinpointed what the problem is.
    In fiscal year 1995, the total amount spent on noise 
reduction technology was $30.1 million: $28.8 million was for 
NASA, FAA was $1.3 million, for a total of $30.1. million. 
Fiscal year 1996, $31.1 million, NASA; FAA, $1.2 million; total 
$32.3 million. Fiscal year 1997, $31.8 million for NASA; $1.2 
million for FAA; for a total of $33 million. For fiscal year 
2001, NASA was $9.9 million; FAA was $.5 million; for a total 
of $10.4 million.
    NASA has the primary responsibility, but you know what is 
happening to NASA. All the money is getting drained for the 
space station and aeronautics. I remember when I was a member 
of the House I always used to hear from Dan Golden about how 
important that ``A'' is to NASA. Then when I was in the private 
sector, I was always concerned about what was happening with 
the NASA budget. And I said, ``Dan, you used to tell me how 
important `A' is.''
    If the aeronautics budget keeps going down, you are going 
to end up closing the Langley, John Glenn, and Ames Research 
Centers, because those are the three centers of excellence for 
aviation. And you can see now what is happening on noise 
technology.
    The areas that they deal with are engine noise reduction, 
nacelle, acoustics, integration, community noise impact, and 
interior noise. In terms of those areas, the budget is going 
down.
    This is also a big point of contention right now between 
the European Union (EU) and the United States. The EU is 
attempting to impose some new standards, including what is 
called Chapter 4. ICAO, the International Civil Aviation 
Organization, is doing a great job of trying to resolve the 
problem between the European Union and the United States.
    Mr. Sabo. When do we head to states for I am told that, for 
instance, with states' stray aircraft, the noise difference is 
immense. However, the old planes that are refitted with our 
hush kits, there is a dramatic difference between a----
    Secretary Mineta. Hush kits----
    Mr. Sabo [continuing]. Plane and----
    Secretary Mineta [continuing]. For engine. No question. 
Absolutely.
    Mr. Sabo. And people really notice the difference in a 
dramatic fashion. Clearly, the sooner we can move to stage 4 
the easier it is going to be to deal with the capacity problem.
    Secretary Mineta. Yes, and the costs are very high on that.
    I think there is a practical perspective, whether or not we 
want to transfer that cost from airports to airlines by having 
them either re-engine or use new airplanes with a better 
ability to meet the noise standards.
    As an example, when I was Mayor of San Jose, our airport 
approach pattern was right over residences, and it was like a 
cash register. Every time another airplane went over, people 
would say, ``Oh, boy, I get to increase the suit against the 
City of San Jose.''
    So I went in and in what is known as the Coleman-Loop, 
bought 221 homes, relocated 221 families. There was a funny 
thing that came out of it. After I had purchased all these 
homes and moved them, I had all of this vacant land. Some 
mortuaries, funeral home operators, asked, ``Would you lease 
that land to us and the funeral parlor association?'' I said we 
might build a freeway.
    I finally said no to them because I thought it would give a 
new meaning when the pilot says ``Ladies and gentlemen, we are 
now making our final approach to San Jose.'' But youknow, the 
airport and the community did something.
    What you are talking about is a shift in public policy from 
communities, to the airlines, and sure, we bear a big burden 
right now under noise mitigation.

                       NOISE MITIGATION SPENDING

    Mr. Sabo. How much do we spend in total on mitigation 
between FAA and local airports?
    Secretary Mineta. I have no idea on the local portion. Let 
me check--I am not even sure that we have in our FAA budget how 
much is spent specifically on noise mitigation because that 
could be insulation of schools and homes, and acquisition 
removal.
    Mr. Sabo. Air conditioning.
    Secretary Mineta. Air conditioning, yes.
    Mr. Sabo. It is millions and millions.
    Secretary Mineta. Oh, I am quite sure it is.
    Mr. Sabo. And our history in aeronautics has been that a 
significant amount of research and development in that industry 
has either been government-sponsored or at least a government-
shared endeavor between the public and private sector.
    It just seems to me it makes sense that in light of all the 
money we are spending on noise mitigation, spending a fraction 
of that to develop the research for making quieter engines 
would make sense.
    Secretary Mineta. One of the other things I remember we 
used to do when I was Mayor of San Jose, was trying to 
determine the footprint on noise by an airplane. You could have 
an airplane with all of its engines off coming in, and as you 
indicate, air foil noise is tremendous. It is very big.
    Mr. Sabo. I am told that just on a formula basis we spend 
over $300 million.
    Secretary Mineta. I see now that for fiscal year 2002 we 
will have $332.7 million for noise compatibility set aside.
    Mr. Sabo. And then you add to that a significant amount of 
local money.
    Secretary Mineta. Absolutely. That is what the private 
sector is doing.

                       TRANSIT CAPITAL INVESTMENT

    Mr. Sabo. I would look forward to working with you on ideas 
on how one might significantly escalate the money that we are 
spending on research on engines and how we make them more 
quieter or the airplanes themselves.
    Just quickly one other question long term. Let me just 
state my concern and not necessarily hear your response today 
so you can move on to other questions.
    I am convinced we have a very fundamental long-term problem 
with our funding of our new capital obligations in transit. 
Transit ridership is up. I think that is good. We are faced 
with long, long lists of communities that want to do something 
in terms of new capital investments in transit.
    Our federal law has the fiction that we are going to pay 80 
percent, we rarely do. We pay varying percentages, and I find 
that the demands that exist on us is very legitimately for many 
communities around this country, we have very little money left 
simply because the money is eaten up by existing projects.
    And I have one of those today. For years I was walking in 
watching others. Now we have a project going. But the list of 
worthy projects that want some help from the federal government 
is long, and to pretend that we can pay 80 percent is simply 
unrealistic. If we continue to pay a significant portion for a 
few projects, it means that many are going to be left with no 
money.
    And I just think that we have to have a more systematic and 
a fairer of way of saying to communities here is what you can 
legitimately expect from the federal government.
    People will argue that there is varying need or varying 
fiscal capacity. I have not found any evidence in any of the 
varying matches or that the higher matches are at all related 
to fiscal capacity. I think they are only related to what 
somebody has the gumption to ask for. And I just think that we 
need to rework that program, rework our promises and find some 
way that we could be realistically helpful and at the same time 
maximize the number of projects we can be helpful to.
    Secretary Mineta. Mr. Chairman, may I quickly just point 
out one thing. In the 1991 Intermodal Surface Transportation 
Efficiency Act (ISTEA) legislation, highway funding used to be 
90 percent Federal/10 percent local, transit was 75/25. What 
was happening was that local decision-makers were making 
decisions saying, hey, I spend 10 dollars, I get 90 from the 
government. And over here I have to spend 25 dollars to get 75. 
So it was all going to the highway projects.
    In ISTEA, I made everything 80/20 so that decisions are 
made on what is the better transportation response, not where 
do I get more money by putting out a certain sum.
    So I think you are absolutely correct in having to examine 
this whole picture. But even today, in terms of transit, it is 
an 80/20 split, I bet it is probably closer to 60/40 right now 
in terms of the kind of negotiations that go on between FTA and 
local communities.
    And so the only thing I would caution about is whether or 
not we have a dislocation of what we want to do. We have seen a 
rapid increase in transit in the last three to five years, both 
in urban, rural, and suburban areas. So that would be the only 
caution. But that is something that I would want to work with 
you and members of the Subcommittee.
    Mr. Sabo. Thank you.
    Mr. Rogers. Thank you, Mr. Sabo.
    Now, we have delayed, Mr. DeLay over delays long enough. 
Mr. DeLay.
    Mr. DeLay. Thank you, Mr. Chairman. I would hope that the 
new Secretary of Transportation would come up with a more 
politically correct term than delay for airports. I am getting 
tired of being blamed for the schedules. [Laughter.]

                   SEATTLE CENTRAL LIGHT RAIL PROJECT

    And Mr. Secretary, I am very pleased to see you in this 
position. I have known you and worked with you in public works 
and transportation now almost 18 years. And when I first came 
on the Public Works Committee and had an excellent working 
relationship with you, and admired you in your work on the 
infrastructure of this country. So having somebody as Secretary 
of Transportation that knows what he istalking about is very 
refreshing.
    Having said that, that is a great segue for Mr. Sabo to 
hear because I want to talk transit too. In fact, this 80/20 
that people talk about, I have a situation in Houston that I 
represent where people are looking at rail. Might also add that 
Austin and San Antonio have rejected rail. I have one of my 
mayors who said we ought to build a commuter rail through Fort 
Bend County because the federal government pays 80 percent.
    And I said it makes viable sense, not that it makes 
economic sense, not that there is a cost/benefit analysis, but 
just because the federal government will pay for 80 percent of 
it, why not build it. That is another phenomenon that we have 
to look at as we look at transit here.
    And having said that, I am sure you are aware that the 
Subcommittee held a hearing on the federal transit capital 
projects this last week, and among those projects discussed was 
Sound Transit, the light-rail project in Seattle.
    Sound Transit has apparently declared itself to be a 
billion dollars over budget and three years behind schedule. Of 
course, that means that they want more federal dollars, and I 
find it disturbing that a project like this could receive a 
full funding grant agreement in the first place, a project with 
the potential to develop such a severe overrun and burden not 
only local taxpayers in Seattle, but taxpayers across the 
country.
    And I want to applaud the Bush administration for their 
decision to leave funding for this project out of their 2002 
budget in light of the Inspector General's findings. And I 
would like to know whether the new administration plans any 
changes in direction of policy based on those lessons learned, 
and even the transit projects in Los Angeles.
    Do you have any sense of any policy changes at FTA with 
respect to light-rail?
    Secretary Mineta. First of all, you are absolutely correct 
about this project. I came to the Department on the 25th of 
January, and in putting the budget together for 2002 this issue 
came up. This is a project that went to the voters in 1996, for 
a total of $2.5 billion for a 21-mile project in two phases: 
seven miles and 14 miles. The total project was $2.5 billion, 
but they came in for phase I, the seven-mile piece, at $2.6 
billion.
    I said, ``Hold it, time out, let us take a look at this 
thing.'' And I had conversations with the Chairman at the time. 
So what I had recommended was that we pull the $75 million for 
2002 and take a look at this.
    Now, this is something that I am very keen about during my 
tenure. I talked about a 10-sack concrete job, because I do not 
want projects to blow up in our faces during ``my watch.''
    So I am going to be scrutinizing all of these full funding 
grant agreements (FFGAs) to make sure that we get in front of 
these problems early on.
    Maybe one of the self-cleansing approaches is raise the 
local share 50 percent. The locality says, ``Holy cow, if I 
have got to put up 50 percent, maybe I won't do it.''
    But on the other hand, there are a lot of good projects 
that should be encouraged, and by going to 50/50 maybe what we 
are going to be doing is throwing the baby out with the bath 
water. But you are absolutely correct, I do not want to see 
these kinds of projects go out of control either in terms of 
time that it takes to get done, or the dollar amount. We are 
going to be watching these.
    Mr. DeLay. How about making sense?
    Secretary Mineta. You know, it is sort of in the eyes of 
the beholder as to what makes sense. People can always 
rationalize what makes sense, and they are going to have 
differing opinions on what makes sense. But I think there are 
ways that we can have a graph that says, ``Yes/No,'' and be 
able to determine whether or not the project makes sense. Even 
after a project gets an FFGA, if it goes south on us, we ought 
to be able to rein it in or have some kind of cap to make sure 
that we are not just saying 50 percent of an increasing amount.
    I think that those where we do put a cap, we are better off 
for it. So that any increased costs are going to be borne by 
the locality and not as a shared cost with the Federal 
Government.

                           HOUSTON LIGHT RAIL

    Mr. DeLay. Houston has 16 million trips on their road 
system a year. We are adding 500,000 trips a year through our 
road system. Houston has been doing a pretty good job over the 
last few years of implementing a regional mobility plan that 
was designed in the late eighties, but congestion is starting--
right now we are only able to keep up with new capacity to 
about 40 percent of those 500,000 trips.
    Rail is being considered in Houston, and there is a lot of 
talk about it right now.
    In your opinion, do urban rail, light-rail or heavy-rail 
systems actually reduce traffic congestion?
    Secretary Mineta. From my personal experience, I think we 
have seen traffic being lowered in amounts that are substantial 
enough that you can look at a cost/benefit ratio and say, 
``Yes, the investment that was there was worth it.''
    I think one of the things that we have to do today is 
utilize technology a lot more than we are. This Committee has 
been very generous in terms of intelligent transportation 
systems and funding. We have done so much in research and 
development but the public and all of us have not seen enough 
deployment to be able to get the benefits of it.
    There are some very simple things that can be done such as 
in New York City when they went from manual toll collection to 
electronic toll collection. They were handling 400 cars per 
lane per hour. When the electronic toll collection went into 
place, they went up to 1,100 cars per lane per hour. That was 
in 1996. Today there are about 1,450 cars per lane per hour. 
Not a single dime was spent on additional lanes or anything 
else, but they converted from manual to electronic toll 
collection, and they increased the through-put.
    There are a lot of examples, I think, where that can be 
done. Your own City of Houston has probably the most 
sophisticated transportation management center in the country. 
You have the advantage of space-age engineers there, and there 
is a degree of rocket science to even transportation planning.
    What we were able to do there is to transfer technology. 
You have seen those screens at the traffic center. Then you go 
out to the Johnson Space Center, and they are very similar.
    Mr. DeLay. Yes.
    Secretary Mineta. That is what we have to be doing.
    Mr. DeLay. Well, and when it comes to the federal 
participation of light-rail system, should not--in considering 
putting in a light-rail system, should not that consideration 
have a positive impact on reducing traffic congestion? Should 
that not be a priority in transportation planning?
    Secretary Mineta. It has got to be an element. I am not 
sure that it should be a priority. Otherwise, what is the value 
of spending that money in transit if you are not getting some 
relief in terms of total traffic congestion and vehicle miles 
traveled. That has to be very much weighed in every one of 
these decisions.

                       SUGAR LAND AIRPORT, TEXAS

    Mr. DeLay. Mr. Chairman, I am trying to be sensitive to 
time. I just have one more question in a different area.
    I was flying out of my own hometown, Sugar Land, out of the 
Sugar Land Airport last week, and I was approached by the 
airport manager who was very concerned. We are building a tower 
there under the contract tower program. And they were informed 
by the FAA that the monies for our application had been 
withdrawn to participate in that program.
    The reason was given that we had lost out because 
construction of our tower had not been completed. Yet when we 
checked and found that the benefit/cost ratio of those that 
received the funding for their contract tower program, they had 
a lower cost/benefit ratio than Sugar Land's, which is 1.55.
    I have a local interest in making sure that contract tower 
program is implemented.
    What are the criteria that you use to select airports for 
that program? And what factors would you examine to choose 
between airports which meet the qualifications in the event 
that do you not intend to provide funds for all the qualified 
applications? And what are the minimum requirements for a full-
funding program?
    Secretary Mineta. Mr. DeLay, I'm not sure of all the 
details, but when the traffic gets down to a certain level at a 
given airport the question is rather than have FAA employees 
there, it is better to contract it out.
    What all those elements are that make up that decision, I 
am not really sure. But let me take a look at this because I 
did not realize that you represented Sugar Land.
    [The information follows:]

    The objective of the Federal Contract Tower (FCT) Program 
is to reduce costs to the Federal Government by contracting out 
the operation of low-activity airport traffic control towers 
(ATCT). To become a candidate for Federal funding, three 
criteria must be met: the airport must have an operable airport 
traffic control tower structure that meets FAA functional 
requirements; the airport must also achieve a benefit/cost (B/
C) ratio of 1.0 or greater; and the sponsor must commit in 
writing to the provisions and maintenance of a suitable tower 
structure and operational equipment, including janitorial 
services and utilities.
    The airport sponsor provides input to be considered in the 
B/C analysis. A B/C analysis on an applicant's request looks at 
airport-sponsor-provided data; historic, current and forecast 
traffic activity; and contractual costs to validate the 
sponsor's eligibility for inclusion in the FCT program. 
Projects with a B/C of 1.0 or better are ranked in descending 
order from highest to lowest, and the sponsor is notified that 
the airport is a candidate for inclusion in the program, 
subject to the availability of funding. If the B/C is below 
1.0, the sponsor is notified that the airport may qualify for 
the cost-share program, considering all other criteria are met.
    With a B/C ratio of 2.42, Sugar Land is number three on the 
list, behind Ellington, TX with a B/C of 8.50 and Kalaeloa 
airport in Kapolei, HI with a B/C ratio of 6.13.

    Mr. DeLay. Yes.
    Secretary Mineta. Denny's family is from Sugar Land.
    Mr. DeLay. That is right.
    Secretary Mineta. And you have a personal interest, all of 
a sudden my personal interest has been peaked.
    Mr. DeLay. Thank you, sir. [Laughter.]
    I appreciate that.
    Secretary Mineta. I will take a look at this as well.
    Mr. DeLay. Thank you, sir.
    Mr. Rogers. I think you had better stop, Mr. DeLay.
    Mr. DeLay. Sir?
    Mr. Rogers. I think that is as good as you are going to do. 
[Laughter.]
    So thank you.
    Secretary Mineta. Otherwise, I am going to be Roger'ed by 
the Chairman.
    Mr. DeLay. Thank you.
    Mr. Rogers. This is getting out of hand. [Laughter.]

                            TRANSIT FUNDING

    On the transit question, and Mr. Sabo is temporarily out of 
the room, I think that is a very salient point that he and Mr. 
DeLay and you have made in terms of the percentage of federal 
dollars that go into a project. We have hundreds of millions of 
dollars, dozens of billions of dollars worth of projects that 
want to be done out there in transit, and yet the monies 
available to us to finance the federal share of that is 
minuscule compared to that.
    So we have got a lot of worthy projects that we cannot even 
start on unless we are able to somehow find a smaller 
percentage of federal dollars that go into that project.
    Now, this Subcommittee, of course, will be picking and 
choosing between those projects at the appropriate time this 
year when we appropriate dollars. For the new projects, 
however, for those that are not yet signed on, we are going to 
take a very close look at any project that requires more than a 
60 percent federal share. Those that are 60 or below, we will 
look at. But the ones that exceed 60 percent, we are going to 
look at very carefully before we commit any annual funding of 
those projects because we are, in effect, precluding so many 
other worth projects by going too far in funding a few.
    Does that make sense to you, Mr. Secretary?
    Secretary Mineta. Mr. Chairman, I hope that you would allow 
me the privilege of sitting in on those discussions as you talk 
about them. I want to make sure that there are more communities 
that can be part of the program, but I also want to make sure 
that even though a community comes in at 50/50, we take a look 
at it and make sure that it is a good program. There could be 
another one here at 60/40 that is a real good project, and we 
know that its projections are real and are going to hold. I 
have had directors of public works lowball something because 
they want you to approve it.
    So I want to make sure that it is more than just what the 
federal/local share is going to be. I want to take a look at 
these projects in their entirety and then be able to make 
decisions on a project given the----
    Mr. Rogers. Sure.
    Secretary Mineta [continuing]. Total picture.
    Mr. Rogers. Well, you are certainly welcome and we will sit 
together and talk about the projects at the appropriate time. 
But I just wanted to let you know that any future project that 
you want to sign a Full Funding Grant Agreement on, just be 
mindful that this Subcommittee is going to be very cautious in 
spending annual appropriations on any project where the federal 
share is above 60 percent.
    We will look at them all, but if they are above 60 percent 
they will really get the evil eye because we have to have the 
monies, the scarce monies available for as many projects as we 
can in worthy communities.
    Now, Mr. Olver.

                            AVIATION DELAYS

    Mr. Olver. Thank you, Mr. Chairman.
    Mr. Secretary, I too want to welcome you to the other side 
of the table here. We, I think, all have high expectations for 
progress in transportation under your leadership at the 
Department.
    And I am particularly pleased to hear you from that 
previous executive experience as Mayor of San Jose pointed out 
that transportation, soon understood, was critical to the 
economic future of San Jose. It takes that and all of its 
aspects as I have seen it, amended in all of its aspect of--as 
a balanced transportation program.
    Okay, you made a few comments about the role that you can 
play in solving the problems in airport delays, getting the 
airports and the air traffic controllers and the airlines 
together. That seems very cogent. Maybe we can do something 
about that, although it does seem to me that your very first 
priority of safety is in some juxtaposition certainly with the 
issue of delay has characterized with how the air traffic 
controllers may be moving people and moving planes around the 
yellow and orange and red places on the weather maps.
    So I would be interested, of course, in how that ends up 
playing out once you have figured out whether that is really 
what has been happening there.

                         AVIATION CHOKE POINTS

    But in the area of your choke points on the air traffic, it 
is not--well, it is more than just the airports, the airlines 
and the air traffic controllers that affect the choke points on 
your issue of, you know, providing capacity where there is a 
demand. The demand is in that triangle and so on, so you need 
more capacity, which may not be just scheduling. It may be 
partly scheduling, but it may be infrastructure.
    What do you do, what groups do you have to bring in? The 
mix is different from just the airports and the airlines and 
the traffic controllers if you are interested in new capacity, 
new runways, or maybe even new airports. And how do you solve 
that problem? Who do you have to get together--what real power 
do you have to make things happen faster than they are 
happening? I have the impression that things are not happening 
very quickly.

                            AIRPORT CAPACITY

    Secretary Mineta. Well, first of all, the whole issue of 
airports is bottom-up. It's from local government determining 
that they are going to take a certain course of action. It's 
not the Federal government saying, ``Now hear this. Now hear 
this. We're going to be building airports across the country.'' 
So in this instance we are responding to what the needs are at 
the local area. We can see the bigger picture of what happens 
in a given airport, but all of that really starts at the local 
level, and so the local level has to deal with the NIMBYs and 
all the other elements.
    There is no question that what we need is concrete in many 
instances, but new airports take 20 to 25 years. We have not 
had any new airports. Denver International was the last 
airport, but that was really a substitute for Stapleton. We 
have much better service capability with six runways running 
during instrument landing conditions. It is a new airport in a 
sense, but it is really substitute capacity.
    What we have to have are new runways, if not new airports. 
New runways take seven to ten years. Our problems are not that 
long range. To me, short range or short term is measured by my 
watch. Long term is maybe three months.
    So as I look at congestion and delays, we have a bank of 
hours from say 7:00 until 10:00 in the morning and about 4:00 
to 7:00 in the afternoon. Now, there are some people who have 
to travel in those hours, but I think there is also a very 
large group of people who are discretionary travelers, and they 
ought to travel in the 11:00 to 3:00 range.
    If you look at some of these airports by five minute 
increments, there is no room in this part of the barbell, but 
there is a great deal of available concrete in time travel. 
Instead of leaving on a 7:30 plane, if people can leave at 
11:10 they would be better off.
    Maybe what we should do is somehow get the airlines to 
figure out if there is a way to give a 15 percent discount to 
the person who flies at 11:00 in the morning, rather than at 
7:30 in the morning, and be able to have a more even flow.
    You talk about concrete investment at an airport where you 
are only using it from 7:00 to 10:00 in the morning and from 
4:00 to 7:00 in the afternoon and early evening.From a cost/
benefit basis I would go ask ``What about this time period here? Why 
can we not utilize this more and in a better way?''
    That to me is part of the congestion issue. If we can move 
it from what I would call the ends of the barbell to the 
midpoint, then maybe we could help congestion problems without 
an additional dollar. It does not cost any more to have planes 
being utilized during this time period.
    Again, this is where I think I have to work with the local 
airports, with the American Assoc. of Airport Executives 
(AAAE), with all these alphabet organizations you have up here 
and be able to say, ``Is there a better way of doing it than we 
are right now?''
    Mr. Olver. Okay. You had used the term jawboning and being 
a jawboner. So you are a facilitator, a convener or jawboner, 
and you feel that you can do some things about these capacities 
by the scheduling.
    I think what I was wondering about was how much jawboning 
is possible? I will accede to your skill at jawboning, but how 
much jawboning can there be in the issue of actual concrete 
capacity?
    I think you said since it comes bottoms up that you do not 
have much capacity there, so is it fair to say we are not going 
to see too much construction in your tenure relatively?
    Secretary Mineta. My opinion is that the concrete is 
already there. We are just not utilizing it very well.
    Mr. Olver. Utilize it as well as we can, and you think----
    Secretary Mineta. Absolutely.
    Mr. Olver [continuing]. We may be able to solve our delay 
problem?
    Secretary Mineta. You know, jawboning is probably going to 
be 20 percent successful, but as I look at this thing, there is 
no one answer that is going to----
    Mr. Olver. Do you have jawboning capacities in places where 
after you thought through that you just do not see any way of 
doing the scheduling and that place where you can get people 
together to get greater efficiency than what you have already 
got?
    Do you think there are places where you really simply have 
to have more concrete on the ground? Are there any capacities 
for jawboning there, or is that just totally subject to what 
happens at the local level and at the state level and regional 
planning levels?
    Secretary Mineta. When you say where do we need more 
capacity, to me that says we need more concrete. Then we have 
the dollars to leverage on the process.
    Mr. Olver. But only if that bottoms up aspect is ready to 
use the dollars.
    Secretary Mineta. Absolutely.
    Mr. Olver. I would assume you would put dollars where it is 
needed if they were ready to do it. It seems to take a very 
long time to make those things happen.
    Secretary Mineta. Not only where it is needed, but where it 
is wanted. There is no way that the Federal Government can come 
in and say do it, but where we have the dollars we can do that.
    I will give you an example. San Francisco Airport. San 
Francisco Airport, when it goes ILS, goes down to one runway, 
and traffic east and west, north and south, gets fouled up. Now 
they are talking about new runway capacity, reconfiguration of 
their present runway pattern. It has the potential, and I am 
not going to prejudge this, but it has the possibility of 
filling and paving roughly 1,200 or 1,400 acres of the San 
Francisco Bay.
    Now, this is something that is needed, and yet it has to 
start from a local airport perspective in terms of local 
government making sure that they get their own citizens behind 
it. You know, we cannot be so cavalier or arrogant that we are 
just going to say, ``Do it'' because if I were to do something 
in your community you would be the first one to come back to me 
and say, ``Hey, Norm, the people in my district do not want 
it.''
    Again, we have a lot of places that want the money, so we 
can go play in that sandbox rather than try and convince people 
who are not willing to accept a new airport or additional 
runways.
    Mr. Olver. I would love to have you whisper to me what year 
you think that that plan will be operational and working.
    Secretary Mineta. In San Francisco?
    Mr. Olver. Up and working.
    Secretary Mineta. In San Francisco? Again, like any 
project, I would say probably landfill for 1,400 acres is a lot 
of land. I do not know where they are going to get the dirt to 
do that.
    They did that in Seoul. They did that with a 14,000 acre 
airport.
    Mr. Olver. Hong Kong.
    Secretary Mineta. Hong Kong and Seoul.
    Mr. Olver. And Seoul.
    Secretary Mineta. What they did there was to level a hill. 
We would not be able to do that.
    Mr. Olver. They filled the whole thing for the new Tokyo 
Airport.
    Secretary Mineta. They did. Absolutely. Again, these are 
all capacity restraints. They have taken the bull by the horns 
to do something. Our democratic process takes a lot longer, and 
we have to be a lot more sensitive.

                          AIRPORT CHOKE POINTS

    Mr. Rogers. Mr. Secretary, I am told there are five 
airports in the country that account for 50 percent of the 
delays. Is that your information as well? You referred to them 
as choke points----
    Secretary Mineta. Yes.
    Mr. Rogers [continuing]. Which obviously they are.
    Secretary Mineta. Right. Yes.
    Mr. Rogers. There are just five of those airports that are 
causing half the delays, and those are the airports, I assume, 
that the airlines with their hub system that they have set out 
expect the Federal and the taxpayers, Federal, state and local, 
to pay for adding runways or adding concrete.
    At the same time, those airports, those airlines and 
perhaps airports, as you have suggested, are not scheduling 
flights to fully utilize the concrete they already have in 
place. If they were to disburse the flights during the day, it 
would greatly decrease the delays at any given time, would it 
not?
    Secretary Mineta. I think so, Mr. Chairman.
    Mr. Rogers. Number two, if the airlines would utilize 
existing runways laying idle in adjacent communities or even 
new hubs somewhere or mini hubs we have been calling them I 
think here, that would also decrease the delays, would it not?
    Secretary Mineta. It would. I think both our perspective as 
the Federal Government, as well as from the airlines, when they 
make an investment they want critical mass. They do not want to 
dissipate their resources in a number of places.
    Mr. Rogers. They do not want to dissipate their resources 
to mini hubs, but they expect the Federal Government to 
dissipate our resources in building more runways at the choke 
points.
    Secretary Mineta. But it may still be even in terms of how 
those monies are split--the federal/local share. You know, it 
is costly to us as well, but again it is based on whatever the 
federal/local share might be.

                           AIRLINE SCHEDULES

    Mr. Rogers. How can we communicate to the airlines and the 
airports that they need to adjust their operations so that we 
can maximize the use of the runways in especially these five 
critical airports? Maybe the top 20, but at least these top 
five. How can we do that since we have deregulated the 
airlines?
    I mean, what you have said in answer to the questions 
heretofore was that you will jawbone the airlines into doing 
that. Good luck. How can we expect one airline, let us say 
serving LaGuardia to, on its own, arbitrarily say well, I am 
not going to fly at the prime time, 8:00 a.m., because I want 
to see the airport work better, so I am going to give up some 
of my business for that purpose.
    That is not going to happen, number one. Number two, they 
cannot meet together to decide to jump off the cliff as a group 
because the antitrust laws prevent that, so we are caught 
between a rock and a hard place.
    I do not think they are singly going to agree to adjust 
their schedule to alleviate crowding at these major airports, 
and they cannot meet together to decide as a group to do that. 
How can we get out of this box we are in, it seems to me? Is 
there a way out?
    Secretary Mineta. Next question?
    There is, as you indicated, antitrust action for the 
collusive practices of airlines. I think that maybe there are 
ways of having scheduling committees.
    First of all, if we do this, the best way would be to have 
antitrust protection for scheduling committees. On the other 
hand, I am trying to think of other ways to deal with this 
problem without legislation and within the confines of the law.
    Mr. Rogers. With respect to that, let me ask you this. 
Maybe we need to ask the lawyers this.
    If we ask the airlines heads to appear before us in this 
subcommittee, would they not be able to talk about their 
schedule in the five major airports without being prosecuted 
for antitrust violation?
    Secretary Mineta. They would not be able to say, as I 
understand it, ``Hal, why do you not depart every hour on the 
hour, and I will depart every hour on the half hour.'' You 
know, John sits here and says, ``Well, what about me? Where do 
I fit in?''
    We cannot sit there and come to those kinds of conclusions. 
That would be against the----
    Mr. Rogers. No. I mean if we ask them to appear before the 
Subcommittee----
    Secretary Mineta. No, I do not think even then.
    Mr. Rogers [continuing]. And testify, subpoena them if 
necessary for legal protection. Would they not be able to talk 
about their schedules to this Subcommittee of the Congress and 
not fear prosecution?
    Secretary Mineta. I think they can talk about their own 
schedules. They just would not be able to sit here and say, 
``Well, I will leave every hour on the hour, and Bill can leave 
every half hour on the hour, and everybody else will just leave 
at 15 minute increments, or whatever.''
    If you look at the Official Airline Guide (OAG), everyone 
is leaving at 9:10 in the morning. We know everyone cannot be. 
They can push back from the gate at 9:10, but they sure as heck 
cannot rotate off the airport at 9:10.
    When you look at the airlines or the scheduling, people 
want to come in and they want to depart at 8:30. They want to 
arrive then. It is like commute hours, unless you have a 
rotating hour at which you can bring your employees in. People 
have to be at work at 8:00 in the morning. That is why we have 
the congestion here between 5:00 in the morning until 7:45.
    Mr. Rogers. Well, are we saying it is really going to be 
left up to the local airport to decide who they let land at 
given times?
    Secretary Mineta. No. I think it can still be done at the 
federal level. That is what I am trying to think how to do. I 
have not come to a conclusion yet on how to do that.
    Mr. Rogers. Can we talk?
    Secretary Mineta. Absolutely.
    Mr. Olver. Mr. Chairman.
    Mr. Rogers. We have some other people I need to recognize 
here.
    Obviously that is a deep concern to this Subcommittee, as 
it is you.
    Secretary Mineta. Absolutely.

                 DISBURSAL OF FLIGHTS AT CHOKE AIRPORTS

    Mr. Rogers. We are staying on the airline delay problem, 
and we plan to track it all the way through and bring before us 
various groups that we think can contribute an answer or help 
contribute an answer, but you hit upon the one point here I 
think that could make an enormous difference, and that is the 
disbursal of flights at these five choke airports during the 
day or the flight flying day, and, two, the use of mini hubs or 
adjacent hubs to alleviate the traffic on the five chokes.
    Secretary Mineta. Mr. Chairman, some airlines do that as a 
matter of practice. They do not want to fly into Dulles or into 
National Airport, so they use BWI. They do not want to go into 
Boston, so they go to Providence. They do not want to go to San 
Francisco. They go to Oakland. They do not want to go to L.A. 
They go to Burbank.
    A lot of these places are becoming alternate major 
airports.
    Mr. Rogers. Of course, the big choke points--New York, 
Chicago, Atlanta, Dallas, and there is a fifth one. I cannot 
think of it.
    There is not much you can do, though, using mini hubs or 
adjacent hubs. You cannot do that more than what is being done 
in New York, for example. There is just nothing adjacent to 
land on.
    Secretary Mineta. You can go to Stewart. The problem with 
Stewart is the distance, you know, unless we have a high-speed 
rail to get from Stewart into town.
    The same thing with Los Angeles. Los Angeles is just 
overcrowded, and yet there is Ontario. There is a potential at 
Palmdale. There is Riverside where we have two Air Force bases 
that have been closed.
    The concrete is there. We have 12,500-foot runways, and we 
are letting that go to seed. Now, that to me is an asset that 
maybe we ought to be utilizing, but by the same token San 
Bernadino is 90 miles away from Los Angeles.
    Mr. Rogers. Mr. Secretary, if these five airports, at least 
these five, are scheduling more flights in those airports than 
they could conceivably handle on a perfect weather day, no 
wonder that by midmorning we are stacked up all over the 
country because you cannot get into these airports on basically 
the east coast. L.A. is one of the five, by the way.
    Should there not be some regulation that says an airport 
cannot schedule more flights than they can conceivably handle 
in perfect weather? I mean, that is an elementary thing, it 
seems to me. Would that not also force the airlines to begin to 
discipline themselves on scheduling flights where they know 
they cannot land on time?
    Secretary Mineta. I do not want to suppress demand. I am, 
and I hate to use the term, more a supply sider in that respect 
by trying to make sure we have more concrete.
    I think what you are talking about, and maybe we have to do 
some, is that we may get to the point of having to suppress 
demand by statutory caps. I would hope we would not go that 
way. To me, it is a form of re-regulation.
    Mr. Rogers. But we are inconveniencing the travelers. One 
out of four now is delayed. Should the public not expect us to 
do something about trying to bring some discipline that will 
alleviate that intolerable situation we are in?
    Secretary Mineta. Oh, no. I agree with you on that part of 
it, Mr. Chairman. I think it is a question of how does it get 
done.
    Mr. Rogers. We cannot build enough runways quick enough to 
alleviate it----
    Secretary Mineta. Not quick enough.
    Mr. Rogers [continuing]. Quickly, so we are going to have 
to have alternative plans in the short term.
    It seems to me mini hubs and requiring airports to not 
schedule more flights than they can handle is, number one, a 
safety thing, not to mention the problem with forcing delays 
all across the country because of their gluttonous appetite.
    I mean, why should the folks in Kansas City who want to fly 
to Chicago or want to fly to Sacramento be hung up because of 
delays out of LaGuardia Airport half a continent away because 
LaGuardia has scheduled more flights than they can handle and 
everything is backed up across the country jamming everybody 
up? Can we not expect some relief from that?
    Secretary Mineta. Well, we should. We should be working 
towards that.
    Again, if you look at the volume of traffic, the airlines 
are going to go to where the population is, where the 
vacationers want to go. To the extent that Kansas City becomes 
a real vacation spot, people will go there, but to the extent 
there is nothing to drive people there, the airlines are not 
going to go there.
    As an example, San Jose in 1970 was roughly 380,000 in 
population. Today, the city of San Jose's population is 
1,200,000, the capital of Silicon Valley. Traffic has just gone 
up tremendously with a very small airport, a 1,280-acre 
airport. That is pretty small.
    Mr. Rogers. These hub airports are expecting or the 
airlines are expecting us to spend billions of dollars over 20 
or 30 years, maybe hundreds of billions, in constructing 
additional runways at the so-called choke points and then do 
nothing about disbursing the flights during the day on the 
existing concrete or using runways laying idle all over the 
country waiting to be used.
    Secretary Mineta. That is what I want to deal with, Mr. 
Chairman.
    Mr. Rogers. It would not be a difficult thing to do. For 
example, and I expect you cannot see this chart very well, but 
it is the Cincinnati Airport on the bottom chart here.
    It shows the frequency of landings and takeoffs and the 
operations at Cincinnati Airport over a 24-hour period. Where 
the peak goes above the line is overcapacity. Where it is below 
the line it is under capacity use of that airport. You can see 
there is only seven--well, basically seven--peak times during 
that period where they are way over capacity in use, and they 
are under most of the time.
    It would not take a shift in flight from maybe 15 or 20 
minutes during these peak times to get them all under capacity.
    Secretary Mineta. Right.
    Mr. Rogers. I mean, we are talking minuscule times, a 15 to 
20 minute change.
    I understand your jawboning project. I just do not know 
whether it is going to have good results or not. I wish you 
well.
    Secretary Mineta. And to that extent, I will comerunning to 
you after I have failed at that effort and say, ``Let us talk.''
    Mr. Rogers. Mr. Tiahrt.
    Mr. Tiahrt. Thank you, Mr. Chairman.
    Secretary Mineta. Did I talk about Kansas?

                       AIRPORT PROJECT MANAGEMENT

    Mr. Tiahrt. Yes, but there are some questions I would like 
to submit for the record.
    Congratulations, Mr. Secretary. It is nice to have you on 
board. I want to congratulate the Administration and your 
commitment to safety. It is evident in the FAA's Office of 
Aviation Regulation and Certification, which helps us get new 
modifications to aircraft in place.
    Safety is something that is a continuing commitment that 
starts with research and development. In our nation today, we 
do not have adequate wind tunnels for problems like icing, and 
I hope that you will continue your commitment for strong 
research and development so that we can continue to make safer 
aircraft. We not only want to be safe, but we also want to feel 
safe when we are in the air.
    The problem with airport choke points, the choke points 
that the Chairman was talking about. I think there are a couple 
of things. One that came up in testimony from Mr. Chip Barclay 
from the American Association of Airport Executives was that 
there does not seem to be any focal point on getting these 
projects completed, no project manager, if you would, no proper 
consultant. Something seems to be lacking.
    Do you think if you could name a project manager that was 
one focal point for each one of these logjams in the process of 
getting new runways built that it would expedite the process? 
Have you considered that in your early tenure now of your 
position?
    Secretary Mineta. Project managers within FAA or DOT to 
oversee?
    Mr. Tiahrt. Yes.
    Secretary Mineta. Yes. I had not really thought of these as 
delays from things that we are not doing in terms of the 
construction part of it.
    Mr. Tiahrt. Part of it is the environmental, just getting 
the paperwork for the environmental process.
    Secretary Mineta. Okay. All right.
    Mr. Tiahrt. An interface between the local airport and the 
federal government and all the different agencies they have to 
deal with. If we had one person who was responsible, perhaps 
that would expedite the process.
    Secretary Mineta. Yes. The responsibility at the local 
level has got to be the sponsor of the airport.
    What we are doing now, is that once a major airport is 
going to undertake a project, and not even a major airport, but 
once there is going to be a runway project, for example, the 
local FAA office usually puts a team together to deal with that 
project.
    They see it through at the local level, and then they take 
all the paperwork and bundle it up and send it to Washington, 
D.C., and then the D.C. team picks up on it, and they do what 
they have to.
    What I am saying is that the Washington team and the local 
team are going to be working at the same time so that we do not 
do it sequentially. We do it concurrently. Whether it is the 
Environmental Impact Statement (EIS) and Environmental Impact 
Report (EIR), we are going to do those concurrently. Whether it 
is the team at the local FAA office, or the FAA Washington 
office, they are going to be sandwiched together and work that 
project to shorten the time period.
    Mr. Tiahrt. I think that is a good plan. Part of what I do, 
as you experienced when you were a Member of the House, is I am 
the interface between people out there in the community and the 
Federal Government.
    If there was one person who would just be responsible for 
that, I personally think that it would shorten the process. You 
know, when they have a problem they know who to call, sort of a 
focal point for all their interface problems with the Federal 
Government. Perhaps just a suggestion.
    Secretary Mineta. We do have a lead person on all of these 
projects. The only part that I was alluding to earlier that I 
did not want to get involved in was if there are local groups 
in opposition to something and we go in and try to mediate 
that. That to me is local government's problem, and they are 
going to have to work that out. I just do not see me going to 
San Francisco Airport and saying, ``Well, let me go help 
resolve your problems with San Mateo County.''

                       AIRLINE TRAFFIC INCENTIVES

    Mr. Tiahrt. Yes. I agree with you.
    Getting back to these choke points, is there some way that 
we can provide an incentive to move traffic out of the choke 
points? For me, I go from Point A to Point B, and I have to go 
through Point C to get there. I do not care where Point C is. 
It could be Nashville. It could be Lexington. It could be 
Wichita, Kansas, if I was traveling from some other part of the 
United States. Instead, I go through Chicago or some other 
place that seems to be very sensitive to weather and often 
delayed traffic.
    Is there a way that we can provide an incentive to airlines 
to utilize these areas which do not have much traffic now like 
Lexington, Nashville, Wichita, Kansas, so that that could be 
Point C in the travel process? I do not care about, you know, 
going through Nashville when I am on my way to someplace else. 
I would like to go to Nashville.
    Some people want to come to Wichita, but if they are going 
from the east coast to Denver or the east coast to San 
Francisco they really do not care where that interim stop is as 
long as it is not too much trouble and not delayed enroute.
    Is there some incentive we could use to move traffic out of 
the hubs, out of the choke points, into these under utilized 
regional airports?
    Secretary Mineta. Well, I suppose our airport grant program 
could serve in that position. The problem is that even after 
the investment is made, there is no guarantee that the airline 
will stay there.
    I am trying to think of examples. I know we poured a lot of 
money into Charlotte with U.S. Airways, and then they pulled 
out. We did the same thing with American Airlines in Nashville, 
and then they decided that they did not want to utilize that 
city as a major hub for themselves. There we were stuck with 
having made the investment, and the airport is sitting there 
today. In fact the former Administrator of FAA, Allan McArtor, 
started Legend Airlines utilizing Nashville as his base, but, 
unfortunately, Legend has now gone bankrupt.
    FAA did respond at that point because Nashville wanted to 
become a hub. American Airlines in fact was bidding for 
Nashville to Gatwick. They were hoping to build that as a major 
airport operation forthem to the European market and feed 
through Nashville to Europe.
    Mr. Tiahrt. Well, the concrete is still there, even though 
the airlines are not.
    Secretary Mineta. The concrete is still there.
    Mr. Tiahrt. Perhaps rather than incentives there may be 
some disincentives to consider, too.
    Before I yield the microphone, though, I would like to make 
one comment. General aviation has often been blamed for a big 
problem in these choke points. It is not a big problem in these 
choke points from the data. I just want the record to show that 
general aviation is a big part of our economy and sector and is 
growing, and I want to see it grow, even from the air capital 
of the world.
    Secretary Mineta. Absolutely. Wichita, Kansas.
    Mr. Tiahrt. Thank you, Mr. Chairman.
    Mr. Rogers. Thank you, Mr. Tiahrt.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Mr. Rogers. Mr. Pastor.
    Mr. Pastor. Good morning.
    Secretary Mineta. Good morning.
    Mr. Pastor. Welcome. Thank you for your testimony. I will 
apologize beforehand because there are other hearings going on 
so I will have to leave. I want to thank you.
    My questions are going to be a little bit different. They 
are going to deal with the border, the NAFTA and also on the 
rules of service that we worked on for the last couple years.
    Let me just take a few moments and talk about the 
scheduling. You talked about the barbell, the dumbbell. We have 
the two time zones in which people want to travel. I would find 
that it is possible I think to find by passing a regulation or 
passing a law that would give you the authority or FAA the 
authority to convene on a quarterly basis the airlines to talk 
about their scheduling.
    To me, I think people would accept it as being reasonable, 
and I think the airlines might be able to talk about scheduling 
and maybe work out better scheduling so that at those key hours 
you may have incentives for airlines and airports and 
passengers so that we remove that mass between 6:00 and 8:00 or 
6:00 and 9:00 and the evening.
    I still think that possibly, Mr. Chairman, in this 
appropriation bill we may find a way to give either FAA or the 
Secretary the authority to legally convene the airlines and 
talk about scheduling. That way we might find a short term 
solution to some of the airport delay problems.
    Secretary Mineta. I was just going to say that what it 
would require, as the Chairman had indicated earlier, is some 
kind of antitrust laws----
    Mr. Pastor. Right. I understand that.
    Secretary Mineta. From a jurisdictional perspective. I have 
talked to some of the Judiciary Committee members about the 
possibility of what I call antitrust protection to do this.
    Mr. Pastor. Protection. Right. I think it is worth the 
effort.
    Secretary Mineta. It is, but I will tell you. I have been 
rebuffed on this thing.
    Mr. Pastor. Well, maybe the Chairman of this Committee with 
the Speaker, who are concerned about the delays, might be able 
to work something out in a very small niche that would allow 
you or the FAA to get together with the airlines and work out 
scheduling problems.
    Secretary Mineta. Your powerful help from this Committee 
would be very helpful.
    Mr. Pastor. I would recommend that the Chairman pursue it.
    The other one is I agree with Mr. Tiahrt that there is 
under utilization all over this country. If we take Los 
Angeles, you have Burbank. You have Ontario. You have 
Riverside. I asked the Administrator if there are ways that we 
can try and provide incentives or disincentives to encourage 
airlines to use some of these airports that are close to the 
big hubs.
    I also would ask you to look at the idea of providing 
incentive to the airports themselves if they become intermodal 
centers because what happens is you land at these airports, and 
the only transportation you might have is a taxi or rental car.
    I have seen airports where they integrated their light rail 
or integrated other modes of transportation, so if the 
passenger can land in Ontario, get on the metro system and get 
to L.A. a lot quicker than if they landed at LAX, maybe that 
may be something that as you look at airport expansion that you 
encourage them to become intermodal centers. That may be 
something that they may want to do.

                 NAFTA BORDER OPENING AND TRUCK SAFETY

    As you know, we have been told that in order to comply with 
NAFTA that our borders have to be open to trucking, the 
trucking industry, to come into the United States. It is my 
belief that the Mexican Government believes right now maybe 25 
percent of their trucks would pass the safety inspections and 
safety requirements.
    The IG told us years ago that we are lacking facilities at 
the border communities to inspect these trucks, and also we are 
lacking personnel. California probably had their act together, 
and they were probably better to do it. Arizona and New Mexico 
and Texas did not have the facilities or did not have the 
personnel.
    My question is now that we have to start bringing trucks in 
or allow trucks to come in, what are we doing at the border 
communities so that we can ensure the safety of thetrucks and 
ensure that the public is not put in any jeopardy?
    Secretary Mineta. When you take a look, Mr. Pastor, at the 
southern borders of California, Arizona, New Mexico and Texas, 
California has taken their Motor Carrier Safety Program (MCSP) 
monies and, let us say if they got $3 million or $5 million in 
MCSP money, they probably put $20 million of their own money 
into the motor carrier safety program.
    Mr. Pastor. Right.
    Secretary Mineta. Now, in the case of Arizona, New Mexico 
and Texas, if you look at the whole range of border crossings 
in Texas it is something like 1,200,000 border crossings. It is 
about 80,000 trucks. Last year we inspected about 46,000 of 
those 80,000. What we are going to do because this panel has 
ruled that we must open up the border, is to make sure that we 
have the inspection facilities and personnel, as you have 
indicated.
    In this budget we have 80 new motor carrier inspectors. 
These are on-the-ground inspectors hitting the tires, checking 
the brakes, doing the whole inspection, and we also have $56 
million for facilities.
    I think even with this panel ruling as it did, most of the 
traffic across the border is still going to be within 50 miles 
of the border. I do not anticipate that all of a sudden there 
will be trucks coming through on their way to Cincinnati, 
Chicago, Miami or wherever. The trailers may, but the tractors 
will just be drayage operations bringing trailers across the 
country. Someone else will pick up the trailer and take it to 
its final destination.
    Mr. Pastor. Excuse me. I was just going to ask you if those 
80 additional personnel are going to be at the border or not, 
at other places other than the border?
    Secretary Mineta. At the border.
    Mr. Pastor. At the border?
    Secretary Mineta. At the border, conducting inspections. 
They are not going to be at a terminal checking paperwork. They 
are not going to be in Ohio. They are going to be on the 
border.
    Mr. Pastor. Knowing some of the economic conditions of some 
of the border states, including Texas and including California, 
their state budgets, which at one time probably had a surplus, 
are now going into a lower surplus if a surplus at all, maybe a 
deficit, so they will probably be asking for more of a grant 
from DOT than matching funds. Are we prepared to be able to do 
that?
    Secretary Mineta. The facilities are going to be funded by 
grant monies going to the states.

                     MOTOR CARRIER HOURS OF SERVICE

    Mr. Pastor. To the States. Thank you very much.
    The other question I had was hours of service. We worked on 
that issue for the last two years. Where are we?
    Secretary Mineta. First of all, the Department is 
prohibited right now from issuing the Order.
    Mr. Pastor. Right.
    Secretary Mineta. Until that is lifted, there is nothing we 
can really do. I am hoping that the new Administrator of the 
Federal Motor Carrier Safety Administration and the Deputy will 
put their focus on that. That is really what I can only hope 
for right now.
    Mr. Pastor. During those hearings I remember that one of 
the problems was that inspectors on our roads within the United 
States, that we were having some inspections, and they were not 
as thorough. What is your Administration going to concentrate 
on as it concerns truck safety?
    Secretary Mineta. First of all, remember that the Federal 
Motor Carrier Safety Administration used to be within the 
Federal Highway Administration.
    Mr. Pastor. Right.
    Secretary Mineta. Secretary Slater asked me in 1999 to take 
a look at that. As a result of that study, the Congress then 
decided to establish a separate Federal Motor Carrier Safety 
Administration and pull that whole unit out of the Federal 
Highway Administration.
    Because the law was enacted in early December 1999, the 
Administrator of the Maritime Administration was also made the 
Acting Administrator of the Federal Motor Carrier Safety 
Administration. So in 2000, other than getting organized into 
its new form, not much was done.
    I am hoping that as soon as I get my nominee cleared by the 
President and confirmed that we will then be working on that 
whole issue of hours of service to bring it to a conclusion. 
Frankly, it takes 3.8 years to get rules and regulations 
through the Department of Transportation. I am trying to 
scrunch that time down.
    Mr. Pastor. I congratulate you, Mr. Secretary, and look 
forward to working with you.
    Secretary Mineta. Absolutely. Thank you very much.

                    MOTOR CARRIER SAFETY INSPECTORS

    Mr. Rogers. Thank you, Mr. Pastor.
    Just a quick clarification. There was a rumor that some of 
these new 80 employees may not be located at the border itself, 
but within the four border states somewhere. Can you clarify 
that?
    Secretary Mineta. Part of the new charge that we have under 
NAFTA is not only the border crossing, but to inspect the 
terminals of the trucking company. Some of the 80 new employees 
will have to go into Mexico to do the inspection at the 
terminal. By and large, they will still be at the borders.
    Mr. Rogers. Not just in the border states, but at the 
border?
    Secretary Mineta. I would hope that they would not be in 
Prescott, Arizona, but rather at the border.
    One of the other things, too, is because of the traffic in 
Texas, at maybe seven or eight crossings, it just jams up at 
those places and so we are thinking about having the inspection 
point away from the border crossing.
    Maybe at these border crossings, we can have one central 
space ten miles up from the border crossing and not have all 
the trucks at the border. You have seen where they are backed 
up, and it takes seven hours to clear through there. By 
spreading out, not only at the border crossing, but moving the 
trucks up the road a piece and then inspecting them there, we 
would try to minimize the seven or eight hours that it takes to 
get through.
    Mr. Rogers. So we can say then these 80 safety inspectors 
will be at the border, meaning that their goal is to inspect at 
or near the border?
    Secretary Mineta. My interest is in inspecting trucks to 
get them cleared through the border, and so to me that would 
mean that a vast majority will have to be at the border 
crossings.
    Some will still have to do their motor vehicle inspections 
in Mexico, but I do not anticipate that they would be far away 
from the border in the U.S. border states.
    Mr. Rogers. Of course, we do not want those inspection 
stations to be so far from the border that trucks will be able 
to come in and then evade the----
    Secretary Mineta. Oh, no. Absolutely. Besides, the trucks 
are going to have special license plates, so they will be 
easily identifiable.
    Again, the way we look at the road structure is you have 
State Route 35 and State Route 36, whatever the routes are. We 
are trying to find a place up the road, not that they are going 
to go down Main Street and run the inspection points.
    Mr. Rogers. I understand that, but we want to be sure.
    Secretary Mineta. We also want to utilize technology, 
whether it is electronic clearance or something else.
    Mr. Rogers. Well, do not let them do an end run.
    Secretary Mineta. Absolutely.
    Mr. Rogers. Mr. Sweeney?

                       STEWART AIRPORT, NEW YORK

    Mr. Sweeney. Thank you, Mr. Chairman.
    Welcome, Secretary Mineta. Unlike my colleagues, most of my 
colleagues anyway, I have not had the opportunity to work with 
you in the past because I am a relatively new Member, but I am 
looking forward to it. I want to thank you and commend you for 
your forthright and informative and insightful testimony.
    I want to touch back on the capacity issue as it relates to 
aviation and air travel. It is my belief that not only does the 
hub and spoke system currently in place create or exacerbate 
our capacity problems, but I also think it stifles competition. 
In representing upstate New York, that is a substantial issue.
    I was happy or at least certainly interested to see your 
reference to Stewart, the proposal that Stewart may provide us 
as a nation an option to alleviate some of the problems out of 
LaGuardia and JFK and Newark.
    Indeed and so that you know, I have asked the committee and 
put a request in for a proposal to study the issue of whether 
that indeed could occur, that Stewart could alleviate some of 
those problems and what the feasibility of a connection of rail 
from midtown Manhattan to Stewart and what that would mean for 
that instance and circumstance.
    I am only interested briefly in understanding that no study 
has been conducted. This is something that has been talked 
about for a number of years. I hope to be a Member that moves 
this idea. What would your thoughts be on that?
    Secretary Mineta. First of all, after the Base Alignment 
and Closure (BRAC) turned Stewart back, I was the one who put 
the money in the aviation bill, and I have forgotten what year 
it was, to improve the facility at Stewart. So I have had a 
long connection and interest in Stewart Air Force Base.
    As you have indicated, the biggest problem is that of 
distance from central city. I think that if there is a 
possibility of having transit or other rail coming in, that 
would really be a relief point for the three main airports in 
New York right now.
    Mr. Sweeney. My thinking is that that could be an hour or 
hour and 15 minutes from midtown Manhattan. Whether that is 
doable or not I am not sure, but certainly it would offer that 
kind of an option since it is an hour or hour and 15 minutes 
from midtown Manhattan to any of the other airports.

                            FLIGHT SCHEDULES

    I am also intrigued by your proposal to establish a 
scheduling committee of sorts. As you pointed out, many of the 
issues relative to capacity are sort of a bottom up or locality 
up prospect. I have met with the Port Authority folks in New 
York, who are very interested in developing their own 
scheduling process out of LaGuardia, for example.
    What role would you envision the local airport authorities 
or the airport authorities generally in such a scheduling 
committee or such a process? Do they have a role?
    Secretary Mineta. I would think they would have to be an 
integral part of that. They are the provider of the facilities, 
and to the extent that they are the provider of the facilities, 
I would think they would have to be part of that discussion as 
well.

                                 AMTRAK

    Mr. Sweeney. In the brief time that I have, let me switch 
gears a little bit and get to an Amtrak question just because 
no one has asked.
    Years ago, you know, Congress gave a bundle of money to 
Amtrak in the hopes that it could become self-sufficient. We 
are quickly approaching the day when this is going to be again 
a substantial dilemma for those of us. Many believe that it is 
time for a national dialogue regarding the future of Amtrak.
    If such a dialogue were to occur, you are probably the most 
important player in that. I would like to hear your thoughts on 
Amtrak and what you see for the short term at least.
    Secretary Mineta. The President has included $521 million 
in his budget, which puts Amtrak on the glide path towards 
self-sufficiency.
    You are correct. I think there is going to have to be 
adiscussion on the whole issue of intercity rail. I would like to 
preface it by the words high-speed, but that becomes relative. I think 
we have to be talking about intercity rail. We are also going to have 
to watch financially what happens to Amtrak.
    The ARC, the Amtrak Reform Council, has submitted their 
report with certain direction about separating Amtrak into 
operational, planning, and some other functions. I have not 
really focused on that ARC report yet, but I think right now we 
are really focusing more on self-sufficiency. Can they make it? 
How do they get financed?
    In order to make their operation successful, they need some 
capital investments. Right now, there is very little capital 
investment money. Most of it is operational.
    Mr. Sweeney. Are you optimistic? Pessimistic? Fifty 
percent?
    Secretary Mineta. It is interesting that the bond bill, 
which was defeated in the last Congress, now has I believe 53 
or 54 co-sponsors in the Senate, so I am 53 percent hopeful.
    Mr. Sweeney. Let me switch to----
    Secretary Mineta. I have been corrected. I am 55 percent 
confident.
    Mr. Sweeney. You picked up two today apparently.
    Secretary Mineta. That is right.

                         DHL AIRFREIGHT LICENSE

    Mr. Sweeney. DHL is wholly owned by the German postal 
service, and they recently received a license from DOT as a 
foreign air freight forwarder. Since they are owned by the 
German Government essentially, they can use public subsidies to 
enter and compete in the highly competitive market here. I, 
Mrs. Emerson and other Members have written to you to ask for a 
revocation of the license.
    My simple question is the career staff, we are told, 
awarded this license. Normal procedure would be an appointee 
review. That decision would be undertaken. Will that happen? Is 
that happening?
    Secretary Mineta. It will happen. Hopefully we will have a 
decision shortly on the issue.
    Mr. Sweeney. Thank you. I look forward to working with you, 
Mr. Secretary. Thank you very much.
    Secretary Mineta. Thank you.
    Mr. Rogers. Thank you, Mr. Sweeney.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Mr. Rogers. Ms. Kilpatrick.

                          ANTITRUST PROTECTION

    Ms. Kilpatrick. Thank you, Mr. Chairman.
    Mr. Secretary, again thank you for coming to Michigan over 
the weekend. The Big Three and the entire business community 
appreciated your time, as well as your presentation at the 
Economic Club. You were a hit, and we looking forward to seeing 
you in Michigan again. Thank you very much.
    Secretary Mineta. Thank you.
    Ms. Kilpatrick. I want to add my voice, first of all, and 
thank you for already approaching the Judiciary Committee as it 
relates to the antitrust that keeps the airlines from talking 
to one another. I think the antitrust regulation was made at a 
time, but it needs to be reviewed.
    The demand, the 700,000,000 ridership that the airlines now 
see, has really put the industry at a disadvantage, and 
certainly we are hoping that no catastrophic things happen, but 
the delays and really the problems that the riders are 
experiencing needs to be corrected.
    As you heard from the Chairman and the many Members on this 
subcommittee, we will support you as you go to the Judiciary 
and see if we can do something to help you with that. That is a 
major problem.

                       COAST GUARD DRUG SEIZURES

    You mentioned earlier in your testimony that the Coast 
Guard seized 27 metric tons of cocaine in this fiscal year. I 
have a Coast Guard station in my district. As you know, 
Michigan and Canada border. Attention is usually on the 
southwest part of the border more so than Canada, and I am 
assuming that you have not found problems there, but they may 
result and increase.
    Twenty-seven metric tons of cocaine. I cannot fathom 
because it is a powder I think that I see on TV. When it is 
seized it is in bricks like packages. How much got through? 
Twenty-seven metric tons seized. Any way to evaluate that?
    Secretary Mineta. Not really, except to look at what is 
happening at the street level. We do not know where it is 
coming in from.
    Just recently, for instance, I participated when the Coast 
Guard seized nine metric tons off a ship off of Acapulco. It 
was estimated that those nine metric tons had a street value of 
between $5 billion and $6 billion.
    In terms of how much came through, in the eastern Pacific 
interdiction we figured we got 80 percent of all--no. Eighty 
percent of all drugs received by the Coast Guard. I do not have 
any figures in terms of----
    Ms. Kilpatrick. I mean, there is no real way of knowing, 
although I see your assistant is giving you numbers there.
    Secretary Mineta. Yes, I would be guessing. For marijuana 
and cocaine 10 to 12 percent of the total is seized by the 
Coast Guard. Very little.

    Ms. Kilpatrick. Okay. Right. That is a point I am trying to 
make, too. I appreciate what you have done. I want to make sure 
the Coast Guard staffing is what it ought to be, and I hope you 
will ask for and it is already in the budget that would sustain 
it or increase it.
    Cocaine and heroin particularly and marijuana to a 
lesserdegree are the cancers of America and permeate the whole society. 
Whatever efforts I can do personally or the committee at large, I want 
to work with you on that and commend the Coast Guard for what they have 
done.
    That 10 or 12 percent, if that is the best you can do with 
what you have, but it is a drop in the bucket of what is 
getting through. We need to do whatever we can do on that.
    The tragedy in Peru over the last week. That was a Michigan 
family, the woman and her baby. I do not know about the rules, 
and I understand the President has ceased some of the 
interdiction efforts in that part of the world, but we do know 
that even in our Colombia effort when we seize Colombia and 
work with them that they move, and Peru may not be another hot 
spot.
    Any comment on that in terms of our interdiction? That 
would not be necessarily the Coast Guard in some instances, but 
any comment on what we are doing in that regard?
    Secretary Mineta. I am just not knowledgeable about what is 
happening outside of our Coast Guard responsibilities.
    I do know that we are going to be hard pressed, given the 
budget, on 100 percent effort in the three major areas of 
search and rescue, drug interdiction and illegal immigrant 
interdiction. I have said ``spare no expenses'' in terms of 
search and rescue operations.
    Given the other responsibilities the Coast Guard has in 
terms of policing fisheries, marine boat safety and other 
responsibilities, except for search and rescue, all the others 
are going to take some kind of a roll back.

                          COAST GUARD FUNDING

    Ms. Kilpatrick. So an additional appropriation and staffing 
is what is needed that you are not asking us for this morning? 
You served on this side of the table.
    Secretary Mineta. Yes.
    Ms. Kilpatrick. You know how it works.
    Secretary Mineta. Whatever you could do to help us would be 
greatly appreciated.
    Ms. Kilpatrick. And I understand the restraints that you 
are operating from. I understand the President's budget, but 
again that is a major problem. Whatever this committee can do, 
and I will be supporting and proposing additional funding for 
those. I think it is a must. We will never be as great as this 
country can be until we get a handle on our problem with drugs.

                            TRANSIT FUNDING

    Finally, as it relates to transit, the Chairman has said 
and other Members have acceded to the fact that 60/40 is a lot 
better than 80/20 these days. TEA-21 will be reauthorized and 
begin to be worked on next year. I think it is expiring in 
December of 2003 or something to that effect.
    60/40 versus 80/02. Your comment on that? I mean, is that 
the projects that have not come in, 60/40, who are good 
projects as you now have told us this morning, considering all 
other things? Are we going to kind of use that as an unofficial 
standard?
    Secretary Mineta. Well, even though the law talks about 80/
20, there are very few at 80/20. There are probably more in the 
area of 60/40, so to the extent that the threshold is coming 
down on the federal/local share, we take a look at not only 
what is the percentage or what is the value of the project.
    I just announced when I was in Detroit a $3.8 million grant 
to DDOT, the Detroit Department of Transportation, on a transit 
center. This is where you have----

                        DETROIT TRANSIT PROJECT

    Ms. Kilpatrick. Intermodal.
    Secretary Mineta [continuing]. Multi modal, but you also 
have services there.
    Ms. Kilpatrick. Yes.
    Secretary Mineta. There is job training available at that 
transit center. To the extent that Detroit and DDOT had a very 
good program----
    Ms. Kilpatrick. We will make sure that it is utilized.
    Finally, our business community, led by General Motors and 
some of our other businesses, are really stepping up to the 
plate as it relates to the 60/40 or 50/50 or whatever it is 
going to be. I think Detroit is probably the last world class 
city that does not have our transit act together.
    With the Big Three now participating and partnering with 
the other business community, we intend to be in that next TEA-
21 or whatever it is going to be called and come with a plan 
that is sound and that is funded very strongly from the local.
    Secretary Mineta. In my conversations with the Big Three, 
the auto parts companies, the United Auto Workers (UAW) others, 
there was a great deal of interest. Again not knowing the 
specifics, but you have two local operating transit systems.
    Ms. Kilpatrick. Unfortunately.
    Secretary Mineta. The question is whether they are going to 
be combined----
    Ms. Kilpatrick. Not combined, but----
    Secretary Mineta [continuing]. Or at least be interoperable 
and work together. Those kinds of things go a long way.
    Ms. Kilpatrick. Yes, and working with our MPO.
    Secretary Mineta. Right. The Southeast Michigan Council of 
Governments (SEM COG) is a well-known Metropolitan Planning 
Organization (MPO).
    Ms. Kilpatrick. Right. Thank you for your support.
    Secretary Mineta. The Southeast Michigan COG is a good 
agency.
    Ms. Kilpatrick. Yes. Look for some good things fromus. We 
want to be models for the country to watch. Thank you very much.
    Thank you, Mr. Chairman.
    Mr. Rogers. Thank you.
    Mrs. Emerson.
    Mrs. Emerson. Thank you, Mr. Chairman.
    Welcome, Mr. Secretary. Although I have not had the good 
fortune of working with you when you were in the Congress, my 
late husband, Bill, spoke so highly of you and enjoyed working 
with you on the Transportation Committee, among other things, 
so it is good to have you here.
    Secretary Mineta. He was great.

                   STATEWIDE TRANSPORTATION PLANNING

    Mrs. Emerson. Speaking of my late husband, he started this 
years ago, along with Congressmen Bob Ney and Jim Barcia, and 
that had to do with the involvement of rural local officials in 
the planning and the programming process. Back in 1998, with 
TEA-21 we actually had some success in taking a step forward by 
including or at least by trying to close the gap or level the 
playing field, if you will.
    I am a little concerned because now it has been two years, 
and we have not had any kind of finalized planning regulations. 
Do you know what the status of these rules is?
    Secretary Mineta. I am sorry. I do not. Let me get back to 
you on that.
    [The information follows:]

    The Department is studying options for the planning 
rulemaking. These options range from withdrawing the notice of 
proposed rulemaking and doing nothing until after 
reauthorization to advancing a final rulemaking. The Department 
is considering an option of advancing the planning rulemaking 
separately from the more controversial National Environmental 
Policy Act regulation.
    The FHWA has communicated to the States that the absence of 
new planning regulations does not relieve them of the 
responsibility to follow the law. The States have been advised 
of a number of statutory changes to the planning requirements 
made by TEA-21 that must be incorporated into their planning 
processes. Among these provisions was the increased role for 
local elected officials.

    Mrs. Emerson. Okay. I would very much appreciate that and 
just want to strongly urge you to urge the Highway 
Administration and DOT to consider and to remember what 
Congressional intent was when we put that particular piece into 
the legislation.
    I would also like to know, if I could, please, if the 
planning regulations are tied up with any sort of environmental 
regulations and, if that is the fact, then can they be 
decoupled.

                          GRADUATED CDL SYSTEM

    My second and last question has to do with commercial 
drivers licenses. For those of us who live in rural areas, this 
is a real important issue. In TEA-21, Section 4019, it stated 
that the Secretary should complete a review and a cost and 
benefit analysis of implementing a graduated licensing system 
for commercial drivers. Can you tell me what the status of that 
study is?
    Secretary Mineta. Let me get back to you on that in 
writing. I am sorry.
    [The information follows:]

    The study is being conducted for the Federal Motor Carrier 
Safety Administration by contract with the American Trucking 
Association's Trucking Research Institute. A cross section of 
State governments, motor carrier industry leaders and public 
interest groups are being queried to quantify the need for and 
likely use of a graduated CDL. The study is expected to be 
completed in December 2001.

    Mrs. Emerson. Okay. Should I now tell you the things that 
we were interested in knowing about that CDL program?
    Secretary Mineta. Sure.
    Mrs. Emerson. Okay. First of all, obviously I would like to 
know when it may be completed. I would like to know whether the 
Department supports a graduated CDL system. If so, are you 
prepared to implement that if your study finds that that is a 
good idea?
    Then I have one more question that you can maybe answer 
with regard to that. With regard to existing authority, can DOT 
grant waivers to individual states to permit them to implement 
a graduated licensing system for intrastate driving, short 
distances within----
    Secretary Mineta. Let me get back to you on that as well.
    Mrs. Emerson. Okay. I would appreciate that.
    [The information follows:]

    If a determination were made to proceed with a graduated 
CDL on a national basis, individual States would have the 
option to implement such a program under certain conditions. 
Minimum Federal standards for State compliance with the CDL 
program are set forth in Federal statute and regulation. A 
State may impose stricter standards on drivers who operate in 
either intrastate or interstate commerce. However, the stricter 
standards imposed by a State on its own CDL drivers could not 
be imposed on CDL drivers properly licensed in other States.
                                ------                                


          Questions for the Record From Congresswoman Emerson

                   environmental streamlining report
    Mrs. Emerson. AIR-21 required FAA to report to Congress on things 
the Agency could do to streamline environmental reviews. I believe that 
report is due sometime in April. When can we expect that report? Will 
the Department use the report to take steps to streamline environmental 
reviews?
    [The information follows:]
    The report was recently transmitted to Congress. The FAA is already 
taking steps, as pointed out in the report, to expedite environmental 
reviews of airport infrastructure projects. For instance, the FAA is 
reallocating staff and consultant resources to environmental impact 
statements for major runway projects, shortening environmental 
documents and processing times, and developing a reimbursable agreement 
approach with airports to fund additional environmental staff needed 
for environmental reviews.
                         new freedom initiative
    Mrs. Emerson. Will you include increased funding for wheelchair 
lifts for over-the-road buses in your legislative proposal to implement 
President Bush's New Freedom Initiative?
    [The information follows:]
    The New Freedom Initiative would not provide new funds for wheel 
chair lifts for over-the-road buses. However, FTA has requested 
$6,950,000 in FY 2002 for accessibility on over-the-road buses. These 
grants go to operators of intercity and charter/tour coach bus service.

    Mrs. Emerson. Mr. Chairman, Mr. Sweeney asked my other 
question. I am short and sweet today. Thank you.

                     REGULATING FLIGHTS AT AIRPORTS

    Mr. Rogers. Thank you very much. We appreciate that.
    Mr. Secretary, we want to wind this hearing up shortly 
because we are into the noon hour, and I know you have other 
engagements that you must live up to, so we will wind up here 
fairly soon.
    Back on the airline delay question briefly. Let me ask you. 
Would the LaGuardia Airport officials have the authority to say 
who can land at their airport and when and how many times a 
day? Does that authority reside with the airport?
    Secretary Mineta. In terms of their slot and gate 
limitations. Under a deregulated environment, if you and I 
decide to form an airline and wanted to fly into LaGuardia we 
would have to get gate space and fly once we gain that slot.
    Mr. Rogers. Does that mean we still have to schedule our 
flights into that airport, do we not, and the Airport Authority 
has that authority to decide at what time we are allowed to 
land within reason?
    Secretary Mineta. Yes. The determination on the scheduling 
is done in a negotiated process, but it is not as if the 
airport could say, ``No, you cannot land at 9:10.'' They would 
probably come back and say, ``What about 9:30?''
    Mr. Rogers. I guess the point I am trying to get at is the 
airports do have certain authorities----
    Secretary Mineta. They do.
    Mr. Rogers [continuing]. About regulating the flow of 
traffic in and out of their airport for safety reasons if 
nothing else, it seems, but now the antitrust laws would not 
apply to airports, would it?
    Secretary Mineta. It only applies to the airlines.
    Mr. Rogers. What would be wrong with you or someone 
convening a meeting of the choke point airports, to coin a bad 
phrase, for the purposes of discussing regulating the flights 
off peak hours at their airports at least and perhaps even 
subsidiary airports, mini hubs? Is that a feasible possibility?
    Secretary Mineta. I think the minute they sit around the 
table to discuss that, it would become illegal.
    Mr. Rogers. Not the airlines. I am talking about the 
airports?
    Secretary Mineta. The airports? Oh, I am sorry.
    Mr. Rogers. Airports.
    Secretary Mineta. I am thinking of the airlines.
    Mr. Rogers. I agree on the airlines, but on the airports.
    Secretary Mineta. Airports can.
    Mr. Rogers. What do you think about you getting a meeting 
of these major choke airports, about jawboning them? I mean, 
you do have some persuasive powers with the airports that you 
may not have with the airlines. Is that a possibility?
    Secretary Mineta. We will schedule those, Mr. Chairman. I 
think it is a good approach. The thing is that, as I said 
earlier, I am trying to think of some ways to deal with the 
airlines.
    Mr. Rogers. Well, I appreciate that, and I wish you 
success. That is the most direct way to solve the problem, but 
it seems to me that perhaps an alternative would be to work 
with the airports, who I assume in turn would work with the 
airlines that serve them, but under some schedule that is not 
haywire.
    I mean, an airport that is scheduling more flights than 
they can conceivably handle. It seems to me something is wrong 
there. I do not know what it is, but something is wrong. Surely 
there is a way we can resolve that.
    Let me ask you something. You are in Mr. Rogers' 
neighborhood here. I would like to add you to my board. Is that 
something we could do?
    Secretary Mineta. I will give you a list of five.

            SECRETARY'S COMMITMENTS TO SOLVE AIRLINE DELAYS

    Mr. Rogers. Help me out here. I have written down what I 
think are some general comments that you have made this morning 
that I think would comprise such a list, and you are perfectly 
able to change it or add to or subtract from.
    As I heard your testimony, one, you said you would work to 
establish scheduling committees. Two, you agreed or promised to 
speed up the permit process and the construction process for 
runways and facilities. Three, I heard you talk generally about 
trying to clear the choke points in the airways, particularly 
in the northeast triangle that you mentioned.
    Four, and we just talked about this, to work with the 
airports in the choke points to disburse flights during the day 
and perhaps even to adjacent airports or nearby airports. Five, 
to develop incentives and disincentives for airlines and 
airports to disburse flights to alleviate overuse.
    Is that a fair summary?
    Secretary Mineta. Mr. Chairman, on that first one regarding 
the scheduling committee, I do not know where I am going to end 
up on this, but I do not think, given the law, that I will end 
up with a committee. I am working on a process more than as a 
committee, so if I could change committee to process.
    Mr. Rogers. That is good. So you are working to establish a 
process of what or to do what?
    Secretary Mineta. To be able to accommodate or to balance 
the capacity of an airport with the scheduling desires of the 
airline.
    Mr. Rogers. Gotcha. Any problems with any of the others?
    Secretary Mineta. Let me ask about the incentives and 
disincentives. Is it just with the airlines, or is it----
    Mr. Rogers. And airports.
    Secretary Mineta. And airports. Okay. Good.
    Mr. Rogers. Any other problems with those? Would you add to 
or subtract from those five? Feel free.
    Secretary Mineta. No. I think the problems that we have 
discussed fall into one of those five categories, Mr. Chairman. 
I think they are both broad enough and specific enough to be 
inclusive.
    Mr. Rogers. Very good. We will add your name above all the 
others to the board here. I know that you probably have your 
board down there, too.
    Secretary Mineta. I am joining a very distinguished list. I 
can tell.

               COAST GUARD CLOSURES AND DECOMMISSIONINGS

    Mr. Rogers. You are. In fact, a couple of the points that 
you agreed to some of the others have agreed to as well, but we 
know who carries the big stick.
    Quickly, we will ask you questions for the record, but let 
me touch just on a couple very quickly before we conclude. On 
the Coast Guard budget, you include cuts in services to the 
public through the proposed closure of search and rescue air 
stations, reduction of operating hours for search and rescue 
aircraft and decommissioning of drug interdiction vessels.
    You are asking for a 12 percent increase in your budget. 
Why can we not maintain the current level of services at least 
for these things within the Coast Guard?
    Secretary Mineta. On the decommissioning of a couple of 
ships, they are very costly to operate. As I recall, two of 
them were ``gifts'' from the Navy, but they are very expensive 
for us to operate and maintain, so those are the ones that we 
are decommissioning.
    On search and rescue, there is a realignment of where the 
bases are going to be, but there is no cutback in terms of 
coverage or level of effort as it relates to search and rescue. 
Just as safety is our number one priority in the Department, 
search and rescue is the number one priority of the Coast 
Guard. To the extent that we are realigning some assets, there 
is no cutback in service level.
    Mr. Rogers. The drug interdiction effort will not be harmed 
then by this in any way?
    Secretary Mineta. It will be cut back.
    Mr. Rogers. Well, I think you know that with the commitment 
that the Congress has to fighting the war on drugs that this 
may not be approved, these cutbacks. I would hate to see us 
hurt you where you do not want to because we want to keep some 
of these things going.
    Secretary Mineta. I appreciate your understanding of that, 
Mr. Chairman. The problem is that the Coast Guard is one of 
five uniformed services, and when the other four uniformed 
services decide to do something, especially related to pay and 
entitlements, it includes the Coast Guard.
    The other four decide what we are going to do. The Coast 
Guard is part of that uniformed services group. The problem is 
that the other services are in Function 050. The Coast Guard is 
in Function 400. Theirs goes up, and then we have to scramble, 
given our limitation on the budget.
    To the extent that you understand, and are sympathetic and 
sensitive to that, I really appreciate that, Mr. Chairman.
    Mr. Rogers. So you are saying even though you are asking 
for a 12 percent increase for Coast Guard, the largest or 
highest percentage increase of any agency within your 
budgetrequest, because of the pay increases and other benefits to 
personnel that that is going to eat up most of----
    Secretary Mineta. And two other areas. One is spare parts, 
and the other is related to fuel. Fuel costs have gone out of 
sight for all the services, but it has especially hit the Coast 
Guard.
    We have to deploy our resources up to the Bering Sea and 
out to the far reaches of the Caribbean and the Gulf of Mexico. 
A lot of fuel is consumed. Some of these cutters are out for 
five weeks. They have to take on a lot of fuel out there.
    Mr. Rogers. We have to find a way. You are talking about 
decommissioning three 210 foot cutters, two 210 and one 180 
foot cutters, and, among other things, the aid of the pursuit 
boats, the drug running pursuit boats, the fast boats, so 
called, and then a lot of aircraft, 13 Falcon jets and three C-
130s, which we just equipped I think with nighttime radar, and 
closing two air stations.
    We have to find a way to work with you on these. I do not 
think we can politically stand for that.
    Secretary Mineta. The Falcon jets that are being retired 
are very expensive planes to maintain and operate. They are 
older jets, so it is based a lot on operational cost. The older 
vessels are the ones that are being decommissioned or being 
retired and moved from the fleet.
    Mr. Rogers. Perhaps before we finally write the 
appropriations bill we will have a chance to discuss this 
further because it is something I know will concern other 
Members as well.
    Secretary Mineta. That would be great, Mr. Chairman. Thank 
you.

                   BUS AND JOB ACCESS FORMULA FUNDING

    Mr. Rogers. Let me quickly deal with this. Your budget 
states that, ``Both formula based funding for buses and job 
access would best leverage limited federal dollars and ensure 
the projects are targeted at communities with the greatest 
need.'' In the past, formula programs have largely benefitted 
older, urban cities in two states in particular, New York and 
California.
    Under the bus and bus facilities account, almost every city 
and state has a need for new buses. Can you assure me that this 
new formula based proposal does not disproportionately favor 
older urban areas or just a few states?
    Secretary Mineta. No. Conversely, I think what they are 
trying to do within the Administration, and what we are all 
trying to do, is bring some stability to the program. The 
Administration especially wants to deal with the job access and 
reverse commute program. That is going to be formularized which 
would give greater stability.
    Mr. Rogers. Is that the same for buses, which is what 
really was my concern?
    Secretary Mineta. For buses? Yes, also the bus program.
    Mr. Rogers. We want to be sure that all the buses do not go 
to just a couple of states, do we not?
    Secretary Mineta. Absolutely. I do not think that this 
would do that, but let me get the specifics.
    [The information follows:]

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    Mr. Rogers. If you could respond to that perhaps for the 
record we would appreciate it very much.
    I think all the rest that I have we can ask for the record 
and have you respond to for the record.
    Mr. Sabo.
    Mr. Sabo. Thank you, Mr. Chairman.
    First, let me indicate the same concerns as the Chairman 
over formularizing the discretionary bus funds or the 
discretionary transit funds that are under formula today.
    I find it a very inequitable formula, and I would not be 
enthusiastic about switching what is discretionary to the 
formula because I look at what comes to our state and the 
relation to our population. What we get under that program is 
not very good, but let me----
    Secretary Mineta. Let me stand corrected. As I look at this 
it says, ``Since the passage of TEA-21, Congress has fully 
earmarked the bus and bus related component of capital 
investments.''
    I will have to take a look at it and see how that bus 
program is put under a formula.

               AIRPORT ARRIVALS AND DEPARTURE PRIORITIES

    Mr. Sabo. It is a very skewed formula.
    A question on this congestion. Who has priority at an 
airport, an arriving or a departing plane? The reason I ask is 
I assume----
    Secretary Mineta. I believe it is arrivals.
    Mr. Sabo. The arrivals have? I assume to the degree that 
some of these choke point airports complicate life for the rest 
of the world is that there are planes in the air waiting to 
land, and they get backed up in the air.
    Secretary Mineta. That is why I believe it is the arrival 
that has----
    Mr. Sabo. But then it would seem if it is arrivals then 
they should not be backing up.
    Secretary Mineta. I think it is still a lack of concrete, 
and, as I said, weather is a big factor in air traffic.
    Mr. Sabo. I guess I would really be curious if there are 
some guidelines because, you know, if the airlines are over 
scheduling themselves from 7:00 to 9:00 in the morning and they 
get delayed and it is because they created a problem there and 
they goof up their travelers, they are going to pay a price for 
it I would hope or I would think eventually.
    If that over scheduling means that other airplanes cannot 
land that have taken off at an appropriate time and no weather 
problems, or even if it is a little complicated, then what they 
are doing in terms of over scheduling there is complicating 
life for everyone else.
    It seems to me we should give priority to the people 
arriving and make them suffer even further severe consequences 
for over scheduling.
    Secretary Mineta. Just as a side note on this, just last 
week I signed off on a new rulemaking comment period relating 
to over booking.
    We have not changed, so to speak, the penalty or the over 
booking fee since 1978. Last week I started a comment period. 
We are going to be publishing a notice in the Federal Register 
about examining the fee structure since we have not changed it 
since 1978.
    Mr. Sabo. Thank you.
    Mr. Rogers. Thank you, Mr. Sabo.
    Mr. Secretary, we thank you for taking as much time with 
us. We know how busy you are, and we apologize for going almost 
through the lunch hour with you.
    You have served the Department well in your testimony 
today, living up to what we all expected of you. You were a 
great Chairman of the Authorizing Committee that we 
appropriated for in this body. Sometimes these two committees 
get at loggerheads, but not anymore.
    As Tom DeLay said, it is refreshing to see a Secretary who 
has the breadth and wealth of knowledge that you have not only 
about the substance of the Department, but also the inner 
workings of the Congress and how that plays into the 
Department's goals and ambitions.
    We are expecting a lot of you. There is a lot of promise 
there, and we like what we see so far. We want to work with you 
and fund the priorities that hopefully we can agree upon, but 
we expect a lot from you.
    What is the saying? To those who much is given, much is 
expected. You are a very talented Secretary and a very 
experienced person in that slot. We want to work with you and 
do the right thing for the public. We appreciate your 
testimony, and we hope that you will stay in touch with us.
    Secretary Mineta. Absolutely. Thank you very much for this 
opportunity, Mr. Chairman and Members of the Subcommittee, and 
I look forward to working with you and the staff and the 
Members of the Committee.
    Mr. Rogers. Thank you very much.
    Secretary Mineta. Thank you very much.
    Mr. Rogers. The meeting is adjourned.

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                                           Thursday, March 8, 2001.

                      OFFICE OF INSPECTOR GENERAL

                               WITNESSES

KENNETH M. MEAD, INSPECTOR GENERAL
ALEXIS STEFANI, ASSISTANT INSPECTOR GENERAL FOR AUDITING
TODD J. ZINSER, ACTING DEPUTY INSPECTOR GENERAL
THOMAS J. HOWARD, DEPUTY ASSISTANT INSPECTOR GENERAL FOR MARITIME AND 
    HIGHWAY SAFETY PROGRAMS
MARK R. DAYTON, DEPUTY ASSISTANT INSPECTOR GENERAL FOR COMPETITION 
    OVERSIGHT, ECONOMIC, RAIL AND SPECIAL PROGRAMS

                            Opening Remarks

    Mr. Rogers. The Committee will come to order. First let me 
say welcome to all of the Committee Members, and I suspect you 
could say the same to me because this is a new Chair from my 
perspective, although I have been a Member of this Subcommittee 
for several years.
    Due to the rule of the House that requires Committee chairs 
to move or vacate the chair after six years, which I did on the 
Commerce Justice State Subcommittee, this was my first pick, so 
I am honored to sit in this chair and to work with what I think 
is one of the finest group of Members in the whole House and to 
be the work mate of Marty Sabo, who I have admired for a long 
time.
    We are very pleased with this Subcommittee. We will work in 
a very vigorous way. We have 14 hearings scheduled, the first 
of which is today, and we look forward to trying to address the 
challenges that our transportation system in this country is 
facing.
    This morning we welcome the Inspector General, Kenneth 
Mead. During the next several weeks we will have hearings on a 
broad range of issues, including airline delays, airport 
capacity, management and cost growth at the FAA, the current 
and future viability of Amtrak, highway issues, the Coast 
Guard's Deepwater acquisition program and the oversight of 
transit projects around the nation, which are ballooning even 
as we speak.
    Mr. Mead, your office is well versed in all of these 
issues, and you have been forthright in your testimony and your 
comments about the nation's transportation problems. For 
example, in January you released your top ten management 
challenges report that identified a significant number of 
challenges facing the Department. In addition, each year you 
update the Congress on Amtrak's financial condition and whether 
or not the railroad will be able to reach operational self-
sufficiency by the end of 2002.
    It is imperative that federal dollars are properly managed 
and wisely spent. As the Inspector General, it is your job to 
audit and investigate agency management, detect fraud, waste, 
and abuse, evaluate the status of government programs, and I 
think your office has done a noteworthy job in performing these 
tasks. You come highly recommended to us from my predecessor in 
this chair, Mr. Wolf.
    We are anxious to hear from you as your insights will be 
used as a guide for us during the rest of our hearings the rest 
of this year, so there is a reason for your being the first 
person to appear before our Subcommittee.
    Before we hear from you, though, I want to yield to my 
Ranking Member, Mr. Sabo, for any remarks he might have.
    Mr. Sabo. Thank you, Mr. Chairman, and welcome in your new 
role on the Committee. I look forward to working with you.
    Mr. Mead, welcome. I look forward to hearing your comments. 
You always have many useful things to tell us.
    Thank you.

                  Inspector General Opening Statement

    Mr. Rogers. All right. Mr. Mead, if you would like to 
proceed with your opening statement? We will put your entire 
written testimony in the record, if you will summarize it for 
us. Thank you.
    Mr. Mead. Thank you, Mr. Chairman. It is an honor to appear 
before you. I would like to welcome the new Members of the 
Subcommittee, congratulate you on becoming the Chair, and also 
congratulate Chairman Wolf for his stewardship. We very much 
look forward to working with this subcommittee and continuing 
the relationship we have had in prior years.

                 OVERVIEW OF DOT MANAGEMENT CHALLENGES

    Mr. Chairman, as you pointed out, we issue every year a top 
ten management challenges report on issues facing the 
Department of Transportation, which, of course, affects us all 
because transportation is one of those areas that you live with 
every day. It immediately and directly affects everybody's 
lives. This is the report. I think you have it in your 
packages.
    I also want you to know that Secretary Mineta has given 
this subject his personal attention. I have already spent a 
good bit of time with him. In fact, before his confirmation I 
went over to the Commerce Department and briefed him on our top 
ten management challenges report.
    There are two other reports I wanted to mention before I 
summarize the highlights of this top ten report. On March 1, we 
issued our audit of DOT's fiscal year 2000 financial 
statements, which cover a budget of over $55 billion.
    Many of you may know that for fiscal year 1999 we gave the 
Department a clean opinion, but for 2000 material errors were 
made in the Federal Aviation Administration's (FAA) $17 billion 
property account: there were discrepancies of nearly half a 
billion dollars. That caused us to not issue a clean opinion 
this year and to issue what is called a qualified opinion.
    Because of the size of the FAA's account, that had a 
cascading effect throughout the entire Department of 
Transportation and led us also to issue a qualified opinion on 
the Department's financial statements. I think there is a good 
action plan in place that, if followed, will lead to a clean 
opinion next year.
    We also recently issued our statutory report on airline 
customer service, which I will refer to later in our testimony.
    I am going to run through the highlights of the top ten 
issues. I am going to combine the most important into four 
areas: transportation safety, stewardship of transportation 
funding, immediate budget issues, and aviation system 
performance. Then we can go right to Q&As, if that is what you 
wish.

                         TRANSPORTATION SAFETY

    On transportation safety, the top safety issues we see in 
the aviation area are runway incursions and operational errors. 
Everybody is talking about delays and the inconvenience 
associated with aviation congestion: Our chart shows one of the 
potential safety implications of this congestion: planes are 
coming too close together on the ground. We said that last 
year, and you can see that it has gone up to 429 runway 
incursions this year.
    [The information follows:]

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    Mr. Rogers. Tell us about runway incursions.
    Mr. Mead. A runway incursion is when planes come too close 
together on the ground, and there is a risk of a collision. 
Many of you will recall that the worst aviation tragedy in 
civil aviation history was a runway incursion in the Canary 
Islands when two 747s came together. This is one of the 
Department's primary aviation safety indicators.
    Can you put up the second chart, please?
    [The information follows:]

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    Mr. Mead. The second chart, Mr. Chairman, is on what is 
known as operational errors. They occur mostly in the air, and 
this is where air traffic controllers allow planes to lose 
their separation. 2000 was a record year for these, too.
    When we talk about the impact of congestion and the 
efficiency of the aviation system, I strongly recommend that we 
keep these two safety indicators in mind. You often do not hear 
about them because people are so focused on the delay and the 
inconvenience and so forth associated with Congestion, but 
there is a potential safety aspect, too, that should not be 
lost.
    Regarding both runway incursions and operational errors, I 
have high hopes that the numbers should decline this year, if 
there is with solid and complete follow through by FAA on plans 
it has in place.
    Another safety issue I want to touch on is the Coast 
Guard's search and rescue stations. Five hundred and fifty-four 
small boats and 4,100 crew members are used to address 39,000 
distress calls the Coast Guard gets each year. These are the 
work horses that carry out one of the Coast Guard's most 
visible missions, yet we are seeing some disturbing indicators 
that the Coast Guard needs to address.
    Ninety percent of search and rescue stations are operating 
with a staffing level that is so low personnel are required to 
work more than 80 hours a week.
    Forty percent of the personnel assigned to stations during 
the year ended June 30, 2000, arrived there directly from boot 
camp with no intervening search and rescue training. During 
fiscal 2000, 84 percent of the standard small boats assigned to 
search and rescue stations were found not ready for sea by 
Coast Guard inspection teams.
    Another safety issue I would like to touch on is 
Mexicantruck safety. We found this past year that recent increases in 
federal inspectors at the southern border correlate with a reduction in 
the number of Mexican trucks placed out of service for significant 
safety violations.
    The Mexican truckers come across, and if they get inspected 
and are placed ``out of service'' they have to go back home. 
They cannot come into the commercial zone right near the 
border. It is a big economic hit.
    There are 60 inspectors scheduled to be at Southern border 
inspection stations in 2001. I think it would probably take 
twice that to really have an impact.
    Another safety issue: implementing the Federal Motor 
Carrier Safety Administration (FMCSA). This was established by 
law a little over a year ago to focus on reducing the 5,000 
fatalities caused by motor carrier accidents each year.
    DOT needs to fill key leadership positions in FCSA to get 
that really rolling, and they also need to take a multifaceted 
approach to enforcement, which would include, shutting down in 
egregious violators. In just the past several weeks, FMCSA has 
begun to do that.
    They also, Mr. Chairman, need to employ a firm hand with 
these scams involving the issuance of fraudulent commercial 
drivers licenses. Since November, 1999, the investigations of 
fraudulent commercial drivers licenses have resulted in 
multiple indictments not in just one state, sir, but nine 
states. I am very concerned about this.
    Another safety issue is implementing the Transportation 
Recall Enhancement, Accountability, and Documentation (TREAD) 
Act, which was passed to prevent future Firestone situations. A 
lot needs to happen this year. The National Highway Traffic 
Safety Administration (NHTSA) needs to expand the information 
they use to determine if there is a defect or not. They were 
relying very heavily on consumer complaints that come in over 
the transom, and they were not getting much data from the 
manufacturers or insurance warranty claims. They were getting 
too little information too late.
    Another safety issue I would like to mention is pipeline 
safety. Pipelines are a very safe mode of transportation, but 
when there is a problem it has tragic consequences. The 
Resource and Special Programs Administration (RSPA) is working 
on various facets of pipeline safety. They are overdue on many 
of them. Among other things, mapping of the location of 
pipelines, establishing inspection frequencies, implementing 
and encouraging modern inspection techniques would go a long 
way.

                 STEWARDSHIP OF TRANSPORTATION FUNDING

    I would like to move to the stewardship of transportation 
funding. The message here is very straightforward. For the past 
several years, Congress has authorized over $230 billion going 
to highways, bridges and airports. That is a 40 percent plus up 
for highways and transit. For airports it is a 75 percent plus 
up. Last time there was a proportionate infusion of funds like 
this was during the Eisenhower-Kennedy Administration when the 
interstate was launched.
    There were a lot of scandals, embezzlements and kickbacks 
during that period. I am here to say, Mr. Chairman, that I 
think the Federal Highway Administration (FHWA), the FAA, and 
the Federal Transit Administration should emphasize a great 
deal more vigilance over today's funds to make sure this does 
not happen again.
    It is important that the FHWA and FAA see the oversight of 
federal, infrastructure funds as part of their job. They should 
not see the job as the project just getting underway, 
especially on these large mega projects. We have over 30 
projects in this country right now that exceed $1 billion each.
    I would like to mention a few indicators from our office. 
In fiscal year 2000 alone, our efforts in the area of contract 
and grant fraud led to 54 indictments, which was a 54 percent 
increase over 1999, 36 convictions, which was a 24 percent 
increase over 1999, and over $10 million in fines. Already this 
year, sir, our investigations have resulted in 25 indictments, 
ten convictions and over $34 million in fines.
    I think that we all know that last year there was a wake up 
call at the Central Artery. I do not know how you miss $1.5 
billion in costs increases, especially when you are forewarned. 
I thought that was fairly shocking and a good lesson for us as 
we embark on all of these other large mega projects.
    Full funding grant agreements in transit is another area I 
would like to mention. The TEA-21 legislation authorized about 
$10 billion for transit new starts. That money is about 
exhausted in commitments. We have about $430 million left, I 
believe.
    What has happened is FTA full funding grant agreements have 
risen from 15 approved and 13 pending last year at this time to 
28 approved and six pending today. There is really not enough 
money left to meet the full funding grant agreements that have 
already been made. I think also that FTA needs to tighten up 
the oversight that it is providing on these new starts.
    I also want to mention a word about DOT's monitoring of 
contract expenditures in general. Last year, this committee 
directed DOT to increase the use of the Defense Contract Audit 
Agency (DCAA) to improve contract management. We were very 
concerned and reported to this committee that once DOT took 
over arranging for the DCAA audits the number of such audits 
fell from about 400 in 1996 to 68 to 1999. We also found that 
DOT had more than 400 cost reimbursable contracts with 
obligations of $232 million that were overdue for closure from 
one to nine years.
    Now, our work on a diverse set of FAA acquisitions show 
that FAA also needs to strengthen its contract oversight. In 
some cases we found that sole source contractors prepared the 
independent government cost estimates for that contract, no 
estimates were prepared at all, or in cases where they were 
prepared they were ignored in favor of what the contractor said 
it would cost.

                        IMMEDIATE BUDGET ISSUES

    I would like to move to immediate budget issues. We really 
have four big budget issues coming together at once this year. 
On the Senate side, I used the analogy of the book ``The 
Perfect Storm,'' with different storm fronts coming together.
    First, Amtrak. They usually request $500 million a year or 
so, but a bond bill designed to give Amtrak $1 billion extra a 
year for capital investments did not pass the Congress last 
year, so it is on the agenda again for this year. We have a 
separate hearing coming up on Amtrak, but suffice it to say 
that as of now it is going to be very difficult for Amtrak to 
meet its statutory operating self-sufficiency mandate, and the 
railroad will not survive without a significant infusion of 
capital.
    Now, the bond bill may not pass through this committee, but 
in your deliberations on how much money to give Amtrak you have 
to take into account where the capital is going to come from 
because if they do not get any capital that railroad is going 
to cease to exist, or I do not want to imagine what level of 
service you will be getting.
    The Coast Guard. At the same time all this is happening 
with Amtrak, the Coast Guard is going to be coming in for a 
very substantial capital plus up, and it is for what is called 
the Deepwater Acquisition. That is the replacement or 
modernization of almost all Coast Guard seaborne and aviation 
assets used 50 miles from land. They are estimating about $15 
billion over 20 years: a near doubling of their capital budget 
request.
    Our third major issue is the FAA operations account. At 
some point it is becoming an affordability issue. $5.9 billion 
in 2000, $6.5 billion in 2001, going up to about $7 billion in 
2002, another half billion scheduled for 2003. Once the 
controllers got their pay deal all the other work forces, even 
including the lawyers, they wanted part of the action.
    Mr. Rogers. The lawyers?
    Mr. Mead. Yes, the lawyers.
    Mr. Rogers. The lawyers?
    Mr. Mead. The lawyers. We can go into that on the Q&As, but 
the controllers got a fairly attractive pay deal, and under 
personnel reform FAA gets to negotiate the pay packages for its 
work forces. Well, the controllers got a very substantial plus 
up, and now the other work forces are standing in line 
demanding comparable treatment.
    Now, that money, most of that money, does not come from the 
aviation trust fund. It comes from the general fund, which is 
the same place you are going to have to get the money from for 
Deepwater and the same place you are going to have to get the 
money for Amtrak.
    Also, in the next several months, sir, there are a number 
of major decisions pending on FAA acquisitions, including the 
Standard Terminal Automation Replacement System (STARS). Those 
together probably account for $2 or $3 billion.

                      AVIATION SYSTEM PERFORMANCE

    Finally, I would like to touch on aviation system 
performance, which ties into our airline customer service 
report.
    Mr. Rogers. Mr. Inspector General, before you do that, we 
have a vote on the Floor.
    Mr. Mead. I am sorry.
    Mr. Rogers. It might be a good time for us to break here. 
There is about six or seven minutes left on the vote.
    It is possible that there could be a 15 minute vote 
immediately thereafter, but if you will hold that thought, we 
will return to you briefly.
    Mr. Mead. Thank you.
    Mr. Rogers. We will stand in recess.
    [Recess.]
    Mr. Rogers. The Committee will be in order. We will resume.
    Mr. Inspector General, as you were saying?
    Mr. Mead. Actually, that was a very convenient breaking 
point because----
    Mr. Rogers. It was, was it not?
    Mr. Mead. Yes. I was just about to go to aviation system 
performance and report that we were charged by law with 
reviewing the airlines' so-called voluntary service commitments 
that they entered into after that incident in Detroit where the 
people sat on the plane for eight or nine hours and were not 
treated very well.
    That was a catalyst for Congress saying to the airlines: 
``We are going to pass a passenger bill of rights.'' The 
airlines said, ``Give us a chance to straighten out our own 
house and improve service.'' They came up with a series of 
commitments, and we reported on the airlines implementation of 
those commitments.
    We found one commitment that said, for example, we agree to 
offer you the lowest fare that is available over the phone. We 
commit to do that. We found a high level of compliance with 
that.
    Another one was that the airlines promised to hold a non-
refundable reservation for 24 hours at that fare, whichwas a 
new deal. It was not required by law. We found a high level of 
compliance with that.
    Also, the airlines agreed to increase the baggage liability 
limits from $1,250 to $2,500, and they did that. We found 
significantly larger pay outs.
    Now, where we began to find problems, though, was with 
anything associated with a delay or cancellation. For example, 
the airlines committed to keep passengers informed of delays 
and cancellations. They committed also to take care of 
something called ``essential needs'' when passengers are 
delayed on planes for an extended period of time.
    The airlines also agreed to deliver within 24 hours baggage 
to you that does not show up on arrival. In other words, if you 
show up and your bag is not there, the airlines said they would 
try their best to get it to you within 24 hours. With all of 
those we found the airlines were making an effort, but there 
were problems.
    Just to give you a sense of magnitude the problems, we 
found, for example, the flight displays at the airport were 
inaccurate about 20 percent of the time. Materially inaccurate. 
I do not mean by five or ten minutes. I mean like a half hour 
off, or the flight had been canceled, but the flight display 
did not say it was canceled.
    We also found problems with the announcements the airlines 
make. About 65 or 70 percent of the time the airlines make 
status announcements, but only about 50 percent of those were 
accurate. The announcements would be factually off base. We had 
our auditors find out exactly why the flight was delayed or 
canceled, and we would find disconnects.
    On delivering baggage, we found the airlines were trying 
fairly hard, but there were significant instances of non-
compliance. We also found that none of the commitments the 
airlines made dealt with the fundamental root cause of consumer 
dissatisfaction: delays, cancellations, and bags not showing up 
on time in the first place.
    I believe the airlines can do more on the delay and 
cancellation front on matters within their control. Let me give 
you an example. In calendar year 2000, there were over 240,000 
regularly scheduled flights that accounted for over 10,300 
flight numbers affecting 25,000,000 people that were 
chronically late or canceled at least 40 percent of the time 
during a single calendar month.
    Now, it seemed to us that it is not unreasonable to ask the 
airlines to tell you when you are booking that the flight you 
are about to book, is canceled about 15 percent of the time and 
is late by over a half hour 40 percent of the time. That just 
does not seem all that unreasonable. If you are savvy enough to 
ask the question, the airlines will tell you. But they should 
tell you without your asking, which was one of the 
recommendations we made.
    I think you know the general delay picture. About one in 
every four flights was delayed or canceled in 2000, and that 
was a record. It affected about 153,000,000 people. The average 
delay is creeping up. It is over 50 minutes. Passengers are 
likely to take the delay hit on the ground, not in the air. The 
amount of time passengers are going to spend on that plane on 
the runway has increased over 100 percent compare it to five 
years ago.
    It may be a hard pill for us all to swallow, but the fact 
is that barring a substantial reduction in the passenger loads 
on planes this summer due to the economy or whatever reason, 
Spring/Summer 2001 will be the next major crunching air travel. 
It is extremely unlikely that we are going to have new runways 
in place this summer or that FAA is going to field new 
technology by then.
    Spring/summer 2001 is right around the corner. We are 
trying to say with some sense of urgency that action is needed 
in the immediate term to prevent a repeat in 2001 of what 
happened in 2000. That is why the scheduling issue is quite 
important here.
    It is true, as the airlines say, that more runways will 
help relieve the problem. Technology will help relieve the 
problem, but many consumers want to know what is going to 
happen to me this summer and next year, so that is why we are 
pressing the immediate term.
    With that, I think I will just conclude our oral statement, 
sir.
    [The prepared statement and biography of Kenneth Mead 
follows:]

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                        AIRLINE CUSTOMER SERVICE

    Mr. Rogers. Thank you.
    As you have indicated, since the summer of 1999, there has 
been increasing concern over the number of delays. In the 
spring and summer of 1999 delays were up sharply, provoking a 
public outcry from the major airlines and some near term 
management initiatives by FAA. Then, as you said, delays were 
up again in the summer of 2000 with not only the number of 
delays increasing, but also the length of the delay and the 
number of flight cancellations.
    As you said, one in every four flights was either canceled 
or delayed, and every Member of this Subcommittee can testify 
to that, I suspect. The airlines blame the FAA. The air traffic 
controllers blame the airlines scheduling more flights than can 
be accommodated even in perfect weather. It is difficult to 
evaluate who is right and who is wrong.
    In your report last summer you said, ``A major finding of 
our work and one on which urgent attention is required is the 
absence of a system for collecting causal data and reporting a 
reasonably complete picture of the causes of delays and 
cancellations.''
    Does a system exist? If so, why not? Let me rephrase it 
succinctly. Why can we not know who is right and who is wrong 
when the blame goes from one to the other on what is the cause 
for delays and cancellations and so forth?
    Mr. Mead. There is no single system. FAA has a system where 
they track delays once FAA takes control of the plane. Until 
very recently, Mr. Chairman, that system would count the same 
flight upwards of three or four times.
    For example, you get a delay on the runway for 15 minutes. 
That is one delay. You take off. You get held up in what they 
call terminal air space, which is about 60 miles out. That 
counts as another delay. You get held up in the en route 
environment. That counts for three. Then you finally land, and 
before they release control of the plane that counts as four. 
Four delays for one flight.
    FAA would keep track of the reasons as they saw them for 
that delay. There was no linkage, though, with the delays that 
were the responsibility of the airline. We pointed that out, I 
think it was in September. The Secretary formed a task force. 
They came up with some recommendations to have a pilot program 
to fix this.
    The task force came up with a reasonable set of 
recommendations that still need to be implemented. The 
Secretary is aware of this. He asked pretty much the same 
question you did. It is a matter of following through on these 
recommendations.
    I think until we have a comprehensive custom tracking the 
causes for delays and cancellations system, we are going to 
continue to have people pointing fingers at each other about 
why we have delays and cancellations.
    Mr. Rogers. The airlines point the finger to FAA and say 
the recent audit is flawed, is inaccurate, and they are not 
going to share data with them anymore. What is your view of 
that?
    Mr. Mead. I did not know that they had said that relative 
to delays and cancellations.
    Mr. Rogers. Well, essentially I think what they said was 
that the IG's audit was flawed and that it was not a 
representative sample of the marketplace. What do you say?
    Mr. Mead. Well, first of all, it is not a statistical 
sample. There is no way that you can do a statistically valid 
sample of delays because they occur in real time. You cannot 
forecast exactly when they are going to occur and how long they 
are going to be.
    Mr. Rogers. Let me just say this. I do not have to be the 
Inspector General to tell that the airlines are screwing up. I 
mean, the delays, the cancellations that each of us experience. 
My sample is pretty damn good.
    I do not know the cause. I just know that we are not 
getting service. They can argue all they want to that this is 
not a representative sample in your audit, but I am here to say 
that I have done my own sampling, and there is a real problem.
    Mr. Mead. Sir, we watched real time 600 delays unfold over 
the country in the latter half of last year. We had an auditor 
there watching what happened, keeping track of when 
announcements were made, sometimes riding these planes. We put 
our staff through the delays, through the cancellations. They 
were watching this firsthand.
    When that gate attendant would say the flight is delayed 
because of air traffic control, our auditors would get on the 
phone. They would go up to the tower and find out exactly why 
that delay was occurring and whether it really was air traffic 
control. They also would call the airline's operations center 
when it was blamed on FAA. You would find out well, maybe it is 
a maintenance problem and it was not being stated to be a 
maintenance problem.
    I have a great deal of confidence in our work, sir. Having 
spoken with a lot of Members of Congress, they are in the same 
shoes you are. Congress is probably the top one percent of the 
population in terms of being informed of what is happening in 
the aviation system today.
    Mr. Rogers. What does your study show as the cause?
    Mr. Mead. There is a multiplicity of causes. There is no 
doubt about that. It is very difficult to quantify when you 
have over a milliondelays, and nobody is keeping track of what 
the causes are.
    I think weather is certainly a factor. As is scheduling 
more planes to depart the airport at say 9:00 a.m., than you 
can physically take off at that time. That is a problem.
    The air traffic control system is part of the problem, sir, 
but I would not let anybody tell you the story that air traffic 
control technology is going to fix it. You are going to need 
more runways to get real quantum leaps in capacity.
    No question that the demand is exceeding the capacity at 
least at the airports the airlines rely on heavily. However, 
there are a lot of airports in this country where we do not 
have a capacity problem.
    Mr. Rogers. I have noticed that it seems like the more 
likely a plane or a flight is to be canceled depends on the 
number of tickets or passengers that would be flying that 
flight.
    Did you find anything in your studies to indicate that 
airlines maybe cancel a flight when it is not fully booked in 
order to allow them to fly, knowing that they have to fly, on 
the next flight on the same airline?
    Mr. Mead. We found examples where say there were two 
flights scheduled, but only one plane was available. There was 
one plane, and there were two flights. We found examples where 
the airline would choose between the two based on the revenue 
load.
    However, but we do not have the data that specifically 
responds to the question you are asking. You are asking about 
economic cancellations. We got the same question in the Senate 
two weeks ago. We do not have the data. The Department of 
Transportation does not have the data.
    Mr. Rogers. How can we get that data?
    Mr. Mead. You would have to require it.
    Mr. Rogers. And in what fashion would we require it?
    Mr. Mead. You would try to do it directly in the law or you 
could direct the Department of Transportation to issue 
regulations.
    If you do the latter, sir, the average length of time to 
get a regulation out on anything of consequence is about 3.8 
years. I should hasten to add, Secretary Mineta was extremely 
alarmed about this, and he aims to change it, but I think it 
will take a bit of time to change.
    Mr. Rogers. Is that a form of re-regulation?
    Mr. Mead. No, I do not think it is. I think real re-
regulation, sir, is when you start prescribing fares and you 
start prescribing routes that the airlines have to fly or 
cannot fly. That is what re-regulation is.
    I think it is a bit unfair when Congress is considering 
requiring disclosures to consumers for the DOT to say oh, that 
is re-regulation.
    Mr. Rogers. If things continue as they are with the hubbing 
of flights and the loading up of the main routes, eventually 
the only flight that will exist in this country will go from 
New York to LA. All the rest of us will have to walk. Do you 
agree with that?
    Mr. Mead. Yes. I sure hope it is a long time coming, 
though.
    You know, in all seriousness about re-regulation, where it 
gets very close to the line is what is happening at La Guardia 
where they had a lottery. La Guardia cannot physically handle 
any more planes, and we are going to hold a lottery for certain 
classes of flights.
    Some people argue that gets pretty close to re-regulation, 
but, frankly, I do not know what choice you have at an airport 
like La Guardia. It is very misleading to say you are going to 
fly to La Guardia and leave at a particular time, and there are 
more flights scheduled to go there and take off than the 
airport can physically handle.
    Mr. Rogers. Well, Amtrak has a passenger problem. Maybe we 
could put wings on the trains and make them fly.
    Mr. Mead. Well, there is certainly a lot of room there. 
Twenty-one million people rode on Amtrak last year, and 
674,000,000 rode on planes, and 125,000,000 of those were the 
victims of delays and cancellations.
    Mr. Rogers. At a hearing here back in 1993, FAA 
acknowledged that no one was happy with the way we measure air 
traffic delays. In 1994, they announced a new initiative and 
their strategic plan to work with the air industry to get an 
agreement on a common definition and a common measurement of 
delays.
    Seven years later, we sit here, and we hear from you that 
we still do not have any way to measure delays, cancellations 
and the like. Why should we expect anything to change on this? 
Will we ever get to know who is causing the delays?
    Mr. Mead. I think your point is very well taken. This is 
the Appropriations Committee. People tend to respond when 
things are linked to money.
    Mr. Rogers. I can assure you this one is linked to the 
money.
    Mr. Mead. Well, I think that you will see action. I do 
hasten to add the Secretary's attitude on this is that we ought 
to be collecting that data.
    I do think the Appropriations Committee's direction would 
be very helpful ingetting that problem addressed.
    Mr. Rogers. The Air Transport Association has always said 
that the increase in delays is largely due to an antiquated and 
obsolete air traffic control system which cannot keep up with 
the growth and numbers of flights and traffic, but the FAA data 
on equipment outages does not seem to support that conclusion.
    What is your opinion about that?
    Mr. Mead. FAA is more correct on that. There is no question 
that when an outage occurs that it can bring things to a 
screeching halt, but the frequency of those outages is rare. 
You cannot fairly use the outages to explain the delays and 
cancellations.
    Mr. Rogers. ATA always says that the delay problem can be 
largely addressed by new air traffic control technologies such 
as satellite navigation. Your report says improvements are 
likely only to be incremental and that quantum leaps in 
capacity will be determined by local airports as they decide 
whether or not to build new runways.
    How much realistically can we expect to gain in capacity 
from state of the art air traffic control technology being 
developed by FAA?
    Mr. Mead. ATA is correct that using satellite navigation 
will allow you to more precisely place planes in the sky and to 
probably reduce the amount of distance that you require between 
planes and also to allow precision landing, but you need a 
place to put these planes.
    If you can only--if only 30 planes can take off an hour and 
you have 40 planes scheduled to take off an hour and you do not 
have any place to park the planes, which is the case at some of 
these airports----
    Mr. Rogers. How many commercial airports do we have?
    Mr. Mead. I do not know the exact number, but----
    Mr. Rogers. How many hub airports are there?
    Mr. Mead. Oh, probably 15. Ten or 15.
    Mr. Rogers. We have 50 major airports and 15 hub airports, 
so we have 35 airports that could hold a lot of airplanes.
    Mr. Mead. There is no doubt. My favorite is Mid-America 
Airport where the taxpayers paid about $400,000 for it as a 
reliever to Lambert Field in St. Louis. If you visit Mid-
America Airport, Mr. Chairman, you can hear birds flutter their 
wings. There is almost no traffic into that airport.
    Mr. Rogers. To what extent is the relatively new hub and 
spoke system that has developed in airline flights? Is that 
causing delays and cancellations?
    In other words, the tight scheduling that must occur 
between hub airports and the limited gates and space at hub 
airports, and yet the airlines continue to insist upon going 
just to the hub airports. When one has a problem, it ripples 
all across the country immediately.
    To what extent is the delay problem exacerbated by the hub 
and spoke system, and is that a hint of a solution?
    Mr. Mead. Probably the hub and spoke system is responsible 
for a considerable percent of the delay and cancellation 
problem. The hub and spoke system, though, also unquestionably 
results in economies of scale in terms of ticket price.
    For example, take O'Hare. When there is a weather problem 
at O'Hare, that cascades throughout the entire United States 
because you are collecting all these passengers at O'Hare who 
are outbound or inbound, and it affects flights all across the 
country.
    I would like to see the airlines try using other times of 
the day at some airports, even including Chicago. That 
technique will not work at La Guardia because La Guardia is at 
peak all the time except when it is totally shut down.
    Mr. Rogers. Well, especially during the peak hours carriers 
often schedule more flights than the airport can handle even in 
the best of weather conditions.
    The Airline Pilots Association testified to that practice 
in 1999, and I am quoting from that report. ``One needs only to 
look at the schedule departure screen at any major terminal to 
realize that this cannot possibly work even if everything goes 
right,'' so even the commercial pilots acknowledge over 
scheduling.
    Why do the airlines continue that practice, and what can we 
do to discourage that kind of practice?
    Mr. Mead. In September, in the report you referenced, sir, 
we recommended the Department develop capacity benchmarks at at 
least the top 30 airports in the country, which would describe 
by time of day how many aircraft operations an airport could 
physically handle under perfect weather conditions. I was 
amazed that they did not have that information already.
    FAA is almost ready to present the capacity benchmarks. 
They may be by the time you have the hearing for FAA. They did 
follow up on our recommendation. I have been impressed with the 
quality of the work they did.
    I am hoping that once the capacity benchmarks are public--
the airports, the airlines, the Air Transport Association, the 
FAA and the Congress and the general public will all see what 
these airports can handle and that will have an effect on the 
schedule as they compare the scheduling to what the airport can 
physically handle.
    Also in their analysis for each one of these topairports, 
FAA says what capacity improvements could be derived through various 
air traffic control techniques and modifications and how much capacity 
would be provided if there was a new runway.
    You will see from that data how much of an impact a new 
runway has versus air traffic control technology.
    Mr. Rogers. When will we have the benchmarks?
    Mr. Mead. I do not see any reason why you could not have 
them within the next two or three weeks.
    Mr. Rogers. Weeks?
    Mr. Mead. I do not see any reason why you should not have 
them.
    Mr. Rogers. Two or three weeks did you say?
    Mr. Mead. Yes, sir.
    Mr. Rogers. I mean, once you get the benchmarks and you 
determine that an airline has over scheduled or whatever, what 
are you going to do about it?
    Mr. Mead. I do not know because it will be a major move to 
say you cannot schedule so many flights in excess of what this 
airport can handle, and----
    Mr. Rogers. Who did you say could do that?
    Mr. Mead. I said the federal government could do that. It 
would be a very major, controversial move.
    However, I know firsthand, Mr. Chairman, that several 
airlines have tried. They know. They have the internal 
information to know how much that airport can handle, and I 
know I have seen them try to adjust their scheduling. The 
airlines are very afraid that if they do make adjustments, 
their competitor will step in and you will be no better off. 
Under the current law, the airlines cannot discuss among each 
other their scheduling.
    Mr. Rogers. Does the assignment of gates in effect not 
establish the capacity of an airport?
    Mr. Mead. No, the number of gates does not really correlate 
to the amount of capacity because there are lots of times 
during the day the gate might be vacant.
    To come back to your other question about what could be 
done, if the airlines are to discuss scheduling among 
themselves it would have to be done under antitrust 
supervision. One of the negative effects could be that a small 
community that does not get a lot of traffic might not be as 
profitable for an airline, so an airline would say I am just 
going to schedule the most profitable flights.
    I think you would need antitrust immunity, and it would 
have to be under antitrust supervision.
    Mr. Rogers. What authority, if any, does the local airport 
have in dictating or deciding schedules?
    Mr. Mead. Very little. Some would argue none.
    Mr. Rogers. I can tell you about one airport that obviously 
has none. Lexington, Kentucky.
    Well, others need to discuss things with you. Let me just 
say this in closing this round. On my other Subcommittee it 
took me 17 years to finally lose all confidence in one of the 
Justice Department agencies, the Immigration and Naturalization 
Service. We threw money at them, billions of dollars, to try to 
solve the problem to no avail, and I finally lost all 
confidence in that agency's ability to operate while being 
besieged.
    The FAA is being besieged with, and the airlines, a deluge, 
a flood of customers, but I will assure you of this. It will 
not take me 17 years this time to lose complete confident in an 
agency's inability to handle this kind of a problem. If they 
cannot handle it, we will find somebody that will because we 
simply cannot tolerate the kind of mismanagement, consternation 
amongst the population, inefficiencies that are generated by 
unreliable travel arrangements. That will not continue.
    If the FAA cannot oversee and force conclusions and force 
results that are positive and if the airlines are not 
cooperative in this, there will be hell to pay.
    Mr. Mead. Just an interesting----
    Mr. Rogers. Let me finish this. Consequently, last year I 
led the effort to abolish the INS, and I will renew that effort 
this year with the cooperation of the White House, and INS will 
no longer exist as we now know it.
    I do not want to see that happen to FAA, but I assure you 
if they do not solve this thing I will take the same route. I 
mean, I am talking to the choir here. I know that, but I have 
to talk to somebody.
    Mr. Mead. That is part of the job, I think.
    I think one very interesting dimension to this matter is 
FAA. Until about two, three years ago, and I have been 
following FAA for about 15 years, they really did not see this 
as their problem. They said our job is the safe transport of 
people. Safety is our number one job. Airline scheduling 
behavior is not our issue, that is the airlines. FAA will make 
sure that you get safely from Point A to B.
    What has crept into the debate, I believe, and into FAA's 
mission is a sense that FAA's mission extends not only to 
safety, but to the efficient, on time delivery of passengers 
from Point A to B.
    Now we have found that some things are not within FAA's 
control. The FAA cannot tell a local community to build a new 
runway. But, I think there is a legitimate question as to 
whether a local community shouldbe able to dictate to the FAA 
that you will provide AGC services to this community, and you will be 
held accountable for delays, even though we will not build another 
runway. There are a lot of different players involved in this.
    Mr. Rogers. At the moment, the local airports are sort of 
passive players, it seems to me, in the system. They just take 
whatever flights want to land on their field.
    However, those local taxpayers that built those runways I 
think have a certain expectation that they ought to be able to 
say that we want our property used so that we can be 
transported to such and so, so I think the local airports 
should have more authority to say where they think airplanes 
should fly that use their runway.
    Is that an unreasonable expectation?
    Mr. Mead. You know, with all respect I am not sure that 
that is a reasonable expectation because you have a place like 
Chicago, for example. Chicago needs a new runway or a new 
airport if they are going to continue to handle the capacity 
and be on time. But, if they do not want to build a new runway 
or airport, and I do not know how Chicago is going to resolve 
that, FAA cannot force a new runway or airport on them.
    Should we continue as a matter of national policy to treat 
Chicago as though it can be an ever expanding hub if Chicago is 
not willing to build a new runway or a new airport? It is 
almost a physical limitation.
    Mr. Rogers. I have way over stayed my time. Mr. Sabo, I 
yield.
    Mr. Sabo. Thank you. Let me follow up with a couple of 
questions on the same subject.
    I heard one news report last week that La Guardia 
represented something like 40 percent of the delays. Is that 
accurate?
    Mr. Mead. That represented 40 percent of the delays in 
FAA's system. It did not necessarily represent 40 percent of 
the delays nationally, and until we tackle the problem that the 
Chairman referenced earlier you will not be able to tell.
    Mr. Sabo. Okay. To what degree are the delays occurring 
during the peak traveling hours?
    Mr. Mead. Substantially. One problem is you are scheduling 
at the max or above the max during a peak hour--define it as 
4:00 in the afternoon--and you cannot take all the planes at 
that time, or there is a weather front coming through.
    Say at 4:30 you also have just as many flight scheduled. 
Well, that airport does not have time to rebound. It has no 
elasticity because it is scheduled during those peak hours to 
the very, very max, so it never has time to recover. You have 
the flights that are scheduled to leave at 4:00 leaving at 
4:30.
    Mr. Sabo. I understand that.
    Mr. Mead. It could be for any reason, but the fact is that 
the airport does not have time to recover, which is one reason 
why delays and cancellations are more pronounced at peak time 
because that is when most of these flights are scheduled.
    Mr. Sabo. So you have this over scheduled schedule, let me 
call it. How is it decided who takes off at what time, whatever 
plane gets in line?
    Mr. Mead. Essentially first come, first served, which also 
ties into this matter of how long you are going to wait on the 
runway.
    See, if you are out there and you wait for two, two and a 
half, three hours, and people say okay, we've waited long 
enough. Go back to the gate and let the people that are tired 
of waiting off and get them back in line. Getting back in line 
means getting back at the end of the line.
    Mr. Sabo. As I recall sometimes being in Europe, there they 
have slot times. Is that not accurate?
    Mr. Mead. Yes.
    Mr. Sabo. And we have decided that is something we do not 
want to do in this country?
    Mr. Mead. Generally that is so.
    Mr. Sabo. During those peak hours, if somebody that is not 
a scheduled passenger carrier decides to land or leave, they 
fit in in the same fashion as the scheduled carrier?
    Mr. Mead. I do not know. I would have to get back to you.
    Pardon me. Are you saying if somebody is not a scheduled 
carrier----
    Mr. Sabo. Yes.
    Mr. Mead [continuing]. Do they get treated the same way?
    Mr. Sabo. Yes.
    Mr. Mead. Yes, sir. Yes, sir.
    Mr. Sabo. So an airport really has no control over when 
they decide to come or go?
    Mr. Mead. No. They have control. They have control over 
gates so that if you are a scheduled carrier and you do not 
have a gate, you are going to have a heck of a time operating 
out of that airport. Generally the airports will lease gates, 
and they lease gates to particular carriers.
    Mr. Sabo. But many of the unscheduled planes do not use 
those gates. They have other facilities.
    Mr. Mead. Yes. They operate out of the general aviation 
facility.
    Mr. Sabo. And that has sort of been long-time policy that 
passenger airports are available to whomever wants to arrive 
and land at whatever hours?
    Mr. Mead. Yes.
    [The information follows:]

    Mr. Rogers. What are the capacity ``benchmarks'', why are 
they important, and when will they be approved and published by 
FAA?
    [The information follows:]
    What are the capacity ``benchmarks''?--The Federal Aviation 
Administration (FAA), is developing capacity benchmarks that 
will establish the number of flights an airport can routinely 
handle in an hour. The benchmarks are estimates of a complex 
quantity that varies widely with weather conditions, runway 
configurations, and mix of aircraft types.
    Two benchmark rates will exist for each of the Nation's 31 
busiest airports--an optimal and a reduced rate respectively 
based on good and bad weather conditions. The optimum rate is 
defined as the maximum number of aircraft an airport can 
routinely handle using visual approaches during periods of 
unlimited ceiling and visibility. The reduced rate is defined 
as the maximum number of aircraft an airport can routinely 
handle or during reduced visibility conditions when radar is 
required to provide safe separation between aircraft. This rate 
was determined based on the most commonly used runway 
configuration during adverse weather conditions, including poor 
visibility, unfavorable winds, or heavy precipitation.
    In arriving at benchmark rates, FAA considered improvements 
when appropriate to the specific airport; e.g., new runways 
(where plans were sufficiently advanced), and new technologies. 
FAA did not consider airport limitations on traffic flow caused 
by National Airspace System or nonrunway constraints, such as: 
traffic flow restrictions, runway crossings, slot controls, 
construction, or terminal airspace, taxiway and gate 
congestion.
    Why are they important?--A set of capacity benchmarks is 
essential in helping understand the true impact of airline 
scheduling practices, and what relief can realistically be 
provided by new technology, revised air traffic control (ATC) 
procedures, and runway and airport infrastructure. Until 
benchmarks are developed, we will not have clarity on what 
traffic load the ATC and airports systems can reasonably be 
expected to safely and efficiently process or whether FAA's 
modernization efforts should be expected to provide major 
relief. The Secretary, FAA, the Congress, and the airlines must 
have this information to get at the core issues. Without 
benchmarks, our ability to understand the impact of flight 
volume on flight delays and cancellations, and, in turn, to 
make informed decisions is severely constrained.
    When will they be approved and published by FAA?--FAA has 
developed benchmarks for the 31 airports but some of the 
critical airports have questions that need to be resolved. Once 
FAA obtains resolution, the benchmarks will be approved and 
published. FAA has not provided a specific date when it 
anticipates publishing the benchmarks.

                            FAA PROCUREMENTS

    Mr. Sabo. Okay. Let me continue on a different FAA 
question. I noticed a news story for purchasing the peer 
equipment for en route air traffic control that FAA is 
considering doing a non-bid contract.
    Mr. Mead. Yes, sir.
    Mr. Sabo. I am not sure what I think of that. I am open. 
History tells us that lots of the bid contracts have not worked 
that well. Is that a fair assessment?
    Mr. Mead. It sometimes seems as though that either way they 
go it does not work very well.
    Mr. Sabo. Yes. Can you tell me any judgements on why? Is it 
significantly related to, and I have had this sense for a long 
time when we ask operating agencies to make major procurements 
that they are really not equipped to do it. Not only in FAA, 
but in other agencies.
    What I hear often is that the lack of thorough planning in 
terms of deciding before you start the process of what you 
really want to be buying.
    Mr. Mead. Well, that is certainly so. Let me see if I can 
parse through the question.
    First, Congress several years ago, as you know, gave FAA 
exemptions from the procurement laws and said you can pretty 
much do what you want. Act more like a business.
    The phenomena you are describing where the notice of intent 
to provide a sole source award, FAA would point to its 
procurement reform authority as the reason for doing that.
    Now, in the last few years FAA has done a better job than 
it had been doing with acquisitions that did not involve a lot 
of software development. They are awarding contracts earlier. 
If they have to make an amendment to the contract, they are 
doing that faster.
    I can point to two major procurements. Host, which is the 
hardware in the en route centers, and the display system 
replacement, which was the scope for the controllers in the 
same facilities. Those two acquisitions were brought in roughly 
on time and roughly on budget. Neither involved extensive 
software development.
    The satellite program--they call WAAS for short--and STARS, 
which is the replacement of the software in the terminal 
facilities, both those applications involve a lot of software 
development. They are both late and they are both experiencing 
cost overruns.
    Now, in STARS, which is a $1.4 billion acquisition, FAA 
thought they were buying an off-the-shelf or mostly off-the-
shelf computer acquisition for computer software. They did not 
think they had a lot of software development. They moved along 
a couple years, and then the controllers got involved. The 
controllers should have been involved all along.
    The controllers said: we have problems with this. This is 
not compatible with the way we want to work, and we want some 
changes. So major changes were made to the STARS at the 
eleventh hour. What had been a non-developmental program became 
an intensively developmental program. That is why you are 
having the slippages.
    You mentioned the planning. A lot of human factor issues in 
STARS. They should have started way back in the beginning, and 
because they did not you are having all this slippage.
    Mr. Sabo. What is the nature of the new computing for the 
en route system? Is that mostly hardware, or does that involve 
significant software work also?
    Mr. Mead. The issue you raised about the sole source? That 
is heavily software development.
    They had replaced--you may remember with the Y2K. These 
computers were so old they could not even find people around--
they fix them.
    Mr. Sabo. They were searching for retired IBM people.
    Mr. Mead. Right. I mean, there was concern that these 
people might die, and we might not have anybody that could read 
the old code. FAA replaced the hardware. That is done.
    Mr. Sabo. Okay.
    Mr. Mead. They did that basically on time, but the 
software, the heart of it, has not been replaced
    Mr. Sabo. And that is what we are looking at replacing now?
    Mr. Mead. Yes. That is going to be--well, my guess is that 
you are looking at at least $1 billion.
    Mr. Sabo. What is the status of the planning for whatever 
that contract might be, whether it is competitive or non-
competitive?
    Mr. Mead. I think FAA knows they need to replace that 
software. If there is any issue with outages, it is a real one 
with the software for the Host computer, which is like the 
brains of the en route computer. It has to be done.
    The planning would be done. A lot of the planning would be 
done by the contractor in the proposal they make. The exact 
status now is that FAA put out a notice of intent to go sole 
source, and they have invited responses to that. They already 
got some, which I think you read about.
    Anybody else that is interested in responding to that 
acquisition proposal would have to respond I think it is by 
March 20 or March 21 to show their capability of handling that 
particular acquisition.
    Am I not answering your question?
    Mr. Sabo. No. I think you are. So in effect in manyways the 
proposal is convincing FAA that they have the capacity to do the 
planning and the designing of the software that FAA wants to buy. Is 
that accurate? Am I stating that correctly?
    Mr. Mead. Maybe I should ask one of my staff to help me on 
this one.
    Mr. Sabo. Okay.
    Mr. Mead. This is Ms. Stefani. She is our Assistant 
Inspector General for Auditing. We just issued a report on the 
Host, and I think she can probably do a better job than I of 
explaining the planning behind it.
    Ms. Stefani. On the Host program, FAA has recognized for a 
long time that they have had to replace both the hardware and 
the software. What they initially did, because of the problems 
with supportability, was look at the hardware. Recently they 
have gotten that done.
    The hardware itself, all they could do because they were 
using such an old, old system, was bring in a stop gap 
hardware. So, this new contract that FAA is talking about will 
replace not only the software and give you better capacity to 
add pre-flight equipment and new technologies to help the 
controllers make better decisions, but it will also have to 
replace the hardware again.
    IBM says the hardware that was just done will not support 
the system after 2008. So, it is a massive project. As Ken 
said, close to $1 billion, to take that old system and replace 
it completely.
    Mr. Sabo. Okay. I am curious. What does FAA tell the 
contractor?
    Ms. Stefani. In this particular case, FAA has a six stage 
approach. They said to the contractor: we need to bring this on 
in stages.
    We need to talk about replacing the different components 
that make up this Host system and rewrite the software, totally 
redo it and make sure that all the components, the hardware 
components, are replaced. Make sure that all the interfaces, 
all the data that comes in that the host processes, are done 
correctly. For example, radar data or flight information data.
    FAA has laid out what they want done in general context and 
the high level of what needs to be done and when.
    Mr. Mead. One reason--historically, I have never seen a 
software intensive acquisition in FAA that has not had fairly 
significant slippage and cost overruns.
    Mr. Sabo. Yes.
    Mr. Mead. One reason----
    Mr. Sabo. That is true of most everyone else, too.
    Mr. Mead. It is. In fairness to FAA, I mean, whether it is 
the Internal Revenue Service or the Social Security 
Administration. You tend to see this on software intensive 
developments.
    You cannot forecast the amount of computer lines of code 
that you need or how often it will have to be redone, so there 
is an inherent imprecision in these contracts. But in the end, 
there often is a dispute between the contractor and the FAA.
    The contractor says well, there is this slippage and cost 
increase because you changed your mind. You are changing the 
specification. The FAA on the other hand is saying no, we are 
not. We were relying on you to do it right. You end up getting 
in a dispute like that.
    The Host needs to be done. I think the question is whether 
it should be a competitive procurement. The jury is still out. 
We will know better when we see what other potential 
contractors say their capability is by the March 20 or March 21 
date.
    I should have mentioned Host in my testimony, Mr. Chairman, 
when I was pointing out the major budget decisions. This is 
another big acquisition decision to be faced. Although the 
outlay this coming year should not be great.
    Mr. Sabo. I would expect, and the question I am really 
trying to get at, if that is what we are doing and the major 
problem is software, how can we have some certainty that the 
description of what we want that software to do is 
comprehensive at the beginning rather than going through 
constant change and flux?
    Ms. Stefani. I do not think there is any way to do it with 
certainty. If you would write a performance spec and say I want 
to do the same thing I did before, it is still up to the 
contractor to ensure that the code they write achieves that 
result.
    Then it is up to the FAA to make sure they are monitoring, 
looking for problems and taking action if something comes up, 
and, at the same time, having a test program that will prove 
the system works and that involves the controllers--so FAA is 
sure that the human factors are addressed early and there are 
no surprises later on. It is going to be very difficult.
    Mr. Mead. Particularly on software intensive acquisitions 
where it is difficult to define in advance the precise 
specifications, I would like to see FAA use more independent 
boards to step in and examine the acquisition and the agency's 
preparedness for going forward. Truly independent boards that 
are going to tell the Administrator exactly what it is like and 
exactly what their view is.
    I think there is a real advantage in an institution like 
FAA having outside advice. That might be an approach the 
committee would wish to consider with this Host acquisition.
    Mr. Sabo. Who should be on that kind of board, people who 
are eventually using the system?
    Mr. Mead. Some of those, but also I think computer software 
experts, people that have tried to administer huge acquisitions 
in the past. Computer scientists I think would be practical.
    Mr. Sabo. I get a little nervous about them. They like to 
play experimental games and ignore the users.
    Mr. Mead. They may, but they are an independent source of 
expertise, so I would say a mix of people.
    I have not really thought through the exact composition of 
a panel for the Host, but I think it is an area that is worth 
considering.
    Mr. Sabo. Mr. Chairman, thank you.
    Mr. Rogers. Before yielding, I had a similar experience in 
my other subcommittee with the FBI, obviously who has giant 
software/hardware needs. They were attempting to develop and 
explain and outlay the needs they had for computer stuff.
    For years the cost overruns were enormous. Progress was 
practically nil until finally the director located a software 
executive out in the private sector who was an expert on 
computers and hired him away.
    In the FBI's case, of course, it had to be an in-house. It 
could not be out sourced. It had to be done in-house, but he 
found the right person out there who really was schooled in the 
private world, not in the government bureaucracy, who got him 
on track. I think that is something similar to what you are 
suggesting.
    Mr. Mead. Yes, sir. I think in the context of air traffic 
control, you would want a mix of people. You would want people 
that are truly independent, that are not going to be swayed by 
the program officials feeling that they want to go in a 
particular direction.

                             FAA STRUCTURE

    Mr. Rogers. I am not going to ask this question now. Just 
let it be previews for coming attractions. Be thinking about 
this, and I want your answer after the others have had a chance 
to ask questions.
    Should the functions of the FAA, being as complicated and 
as widespread as they are, requiring expertise from so many 
different sources, should the functions of the FAA be out 
sourced under general, broad policy directions of an FAA, but 
out sourcing most of its functions? Be thinking about that.
    Mr. Sweeney.
    Mr. Sweeney. Mr. Chairman, I now see why you are Chairman. 
That is a great question.
    Let me say I am thrilled to be here. I come from the other 
side of the world in some respects in that I was an authorizer 
last term of Congress, and you are so gracious to accept me 
without any hostility or too much hostility, and I appreciate 
that greatly.
    Mr. Mead, welcome. As an authorizer and the former Vice-
Chairman of the Aviation Committee, I have appreciated your 
work. I do want to follow up on some of the FAA capacities, and 
the Chairman's question was a great question because it in some 
respects clarifies what my first question was.
    Your staff has said that essentially there is so much 
complexity to the various functions of the FAA that there is 
not a simple solution. You know, we have the private sector 
failure in terms of our efficiencies. We have the public sector 
failure in terms of our efficiencies. You have pointed out the 
software intense programs and the incapacities of the FAA.
    We know the WAAS program is late. We know runway safety 
programs are late. We know AMASS is late. We know STARS is 
late. We know the cost accounting system is four years behind 
schedule, and that scares those of us in Congress because we 
worry that we are putting good money in to chase bad, so it is 
endemic of a real problem with the FAA.
    I will ask the question. Aside from developing independent 
boards, what other ideas would you suggest for this committee 
in terms of bringing the FAA to a greater extent of capacity?
    Mr. Mead. I have one. I do not think it would be very 
popular, but this is it.
    Let's take this cost accounting system. Congress directed 
this by law in 1996, and FAA said they would have it in place 
by 1998. I think they even hired a contractor to tell them how 
long it would take. They said 1998. Then it slipped to 1999. 
Then it slipped to 2000, and in 2000 it slipped another couple 
years.
    Why did Congress want a cost accounting system? Well, a 
cost accounting system, tells you where your areas of waste, 
high cost and, conversely, where areas of productivity and low 
cost are. This is what you really need when we are talking the 
change we are speaking of, and how to manage billions of 
dollars.
    $1.4 billion for STARS, a couple billion, plus for WAAS. We 
are talking about a new acquisition today that will be at least 
probably $1 billion. You speak of AMASS, which, as you know, 
has not only had about eight years of delay, but significant 
cost overruns.
    FAA does not have a cost accounting system yet, which we 
find very frustrating as auditors, but why do they not?Well, 
there are no consequences.
    If you look at the bar chart with the FAA's budget, you 
will see that the bar chart keeps going up every year. They get 
their money anyway. So I guess one suggestion I have is if you 
linked money to performance more then you would see some 
results.
    At the same time, I know the legislators and my boss, the 
Secretary, have responsibility to make sure the system is 
running safely and efficiently. When somebody pulls out the 
safety card and says you are having a deleterious effect on 
safety, it is pretty hard not to open the wallet.
    That is one suggestion I think would help get a handle on 
the cost and schedule, and it would have a real inspiration for 
performance. Now, FAA is working hard on the cost accounting 
system. I just think that it probably would have happened a 
little earlier if there were some consequences.
    Mr. Sweeney. What are the problems? What are they citing as 
the reasons for the delay?
    Mr. Mead. It is complex. They have to work with the unions 
because half their budget is labor. Of course, when you are 
looking at identifying areas of high cost and over half of your 
budget is labor, you want to know where you are being most 
efficient and where you are not. The way things work there, 
they have to get the security agreement of the unions. It is 
complex.
    I just think that people, when they are told there is an 
objective they must meet and there is a consequence for not 
meeting it, that provides a little more incentive than if there 
is none.
    Mr. Sweeney. What if the consequence was, going back to the 
Chairman's question, an out sourcing of those kinds of 
processes?
    Mr. Mead. Well, I think we already out source a lot at FAA. 
Most of these contracts we are speaking of are out sourced.
    If you are talking about the command and control decision 
making, I would counsel that you do that very incrementally so 
that you do not turn the entire system upside down before you 
get a taste of what it might be like to out source.
    One area we suggested you could consider is oceanic air 
traffic control. It is an environment where the airlines are 
used to paying user fees to other countries. A good bit of 
oceanic air traffic control is not part of the domestic air 
traffic control system.
    Oceanic is an area that does not affect general aviation 
that much, and where you might try the application of more 
commercialized principles. If you discern you made a mistake, 
you would be able to retreat,and you would not have turned the 
entire system upside down.
    I can tell you, sir, that there is extraordinary resistance 
to even that move. I think the controllers see that as the 
camel's nose under the tent for privatization. Congress, 
incidentally, authorized FAA to do test privatization with 
oceanic air traffic control a couple of years ago.
    Another one is the contract tower program, which is already 
in existence. I think we have about 191 contract towers out 
there. These are low level towers that do not require flight 
instruments or flight operations. One hundred and ninety 
something, and there are probably about 70 more out there that 
they could arguably expand to. But, there is extraordinary 
resistance to it for the same reason there is in oceanic.
    I would think if you wanted to out source you would want to 
do it very, very carefully and take it in pieces that you could 
manage and that you could retreat from if it did not work.
    Of course, I am always a little nervous when I hear the 
airlines are prominent among the proponents of 
commercialization, out sourcing, and privatization. I think the 
airlines need to fix their own house before they suggest taking 
over the FAA.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


                        AIRLINE CUSTOMER SERVICE

    Mr. Sweeney. Let me turn to the airlines a little bit and 
approach it from this perspective. If we cannot require 
communities to increase capacity and services, and we cannot. 
Not from here. Obviously one of the other solutions is to re-
regulate, requiring times and locations and such.
    My perspective is the hub/spoke practice just is not 
working. It does not work. It allows the airlines to simply 
further monopolize and control--the big airlines to further 
monopolize and control the system itself.
    What are the alternatives? Have there been any 
alternatives?
    Mr. Mead. I believe an alternative that will evolve will be 
the creation of subhubs, airports that currently have a good 
bit of capacity, but are not currently used as hubs. I believe 
that assuming the demand factors stay the way they are, you 
will see that develop, particularly if there is a lot of 
pressure on the scheduling front.
    If we just let the scheduling go amuck, as it has been, 
with no controls and nothing happens if the airlines continue 
to schedule the way they do--I do not think that will happen. 
But, I think there is a real possibility for the development of 
subhubs.

                                 AMTRAK

    Mr. Sweeney. Okay. One final question. I come from a region 
where the district starts 50 miles north of the city, so the 
LaGuardia issues are real. The upstate economy is significantly 
affected by some of the other issues, you know, as it relates 
to service throughout the upstate area. It has been a region of 
pain in the past. Stewart and Albany Airport serve it, so the 
viability of Amtrak is hugely important and the development of 
fast tracks and those kinds of things.
    In recognizing that you are going to have to develop a 
system that connects rail/air, road/air, et cetera, even if we 
spend more on the Amtrak capital improvements, their health 
really depends on their reducing of operating costs. Congress 
has spoken on that. Other folks have talked about that.
    In your opinion, are they on the correct path? Are they 
anywhere near where they need to be to develop the kind of 
operational self-sufficiency that they are going to need to 
turn the corner someday?
    Mr. Mead. I think Amtrak is in trouble on that front. They 
are trying hard. I have been very impressed with their 
management. They are going to face a real problem, though, with 
their capital. It becomes a very circular pattern because if 
Amtrak is not healthy from a capital point of view it is going 
to be hard for them to make any inroads on operational self-
sufficiency.
    Amtrak believes they are going to make it. In our most 
recent report we identified over $700 million in gaps in their 
business plan that need to be closed. They are trying to close 
some. Their expense lineitem is going way up and is out of 
proportion to their revenue gains they are making.
    I think they have a good management team in place there. 
Just an example of how it gets this circular effect. If you do 
not have capital to address your infrastructure and your 
rolling stock and to keep that in good repair, over time that 
begins to cause you operating problems and routine maintenance 
problems. You start spending your money on all those routine 
maintenance problems and operating problems, and they just go 
up and up and up and up. You are capital starved. That is 
probably pretty much the situation Amtrak is in.
    Mr. Sweeney. That is similar, though, to the situation with 
the FAA's capacities. If we begin to put cause and effect 
conditions on their funding, we run the risk of the same sort 
of problem, so that is the dilemma that we ultimately face 
here.
    I will yield back. Thank you, Mr. Chairman.
    Mr. Rogers. Ms. Kilpatrick.
    Ms. Kilpatrick. Thank you, Mr. Chairman. Mr. Mead, good to 
see you again.
    I am going to follow up on some of Mr. Sweeney's questions. 
You mentioned that 21,000,000,000 Americans use Amtrak or used 
it last year.
    Mr. Mead. Million.
    Ms. Kilpatrick. Million. That was my first question. And 
that according to the 1997 Amtrak Reform and Accountability 
Act, this would be their last year of funding. Is that not 
right?
    Mr. Mead. I think it is 2003. I think they are supposed to 
be self-sufficient by December 2, 2002. Is that correct? Yes.
    Ms. Kilpatrick. December 2, 2002.
    Mr. Mead. December 2, 2002. They are supposed to be making 
ends meet from an operating standpoint.
    Ms. Kilpatrick. Okay.
    Mr. Mead. Which is different from the capital.
    Ms. Kilpatrick. Right. There are two prongs here. The 
operating one, which you just said was some--what did I write 
down--$700 million gap in some part of that.
    Mr. Mead. They are going to have to close that gap in order 
to make ends meet. Yes.
    Mr. Rogers. I am told, Ms. Kilpatrick, it is December, 
2002. It is fiscal 2003.
    Ms. Kilpatrick. December, 2002, which is this year that we 
are in now, the budget year.
    Mr. Rogers. It will actually be the beginning of fiscal 
2003.
    Ms. Kilpatrick. Right, which is the budget. We are working 
on 2002 today. This funding goes to December, 2002, for Amtrak, 
so 2003, January, 2003, is when if we stay with the Act of 1997 
that they would not receive any more federal subsidies.
    Mr. Mead. That is right, except for the excess retirement, 
the excess railroad retirement. I think that is a little over 
$100 million. Under the law, you will still be able to pay 
that.
    Ms. Kilpatrick. So are they going to make it, or are we 
going to open the Act up and do some----
    Mr. Mead. I believe it is in real jeopardy, but I would not 
want to close the door on Amtrak ingenuity. We are getting very 
close to the point.
    Ms. Kilpatrick. And they will be here at some point. I am 
sure they are scheduled to give testimony.
    Mr. Mead. Oh, yes. Yes.
    Ms. Kilpatrick. But the 21,000,000 who depend on that 
source of transportation, the gloom that you have mentioned 
this morning, the gloom just in terms of them not meeting their 
target, the capital needs.
    They need an action from the Congress so they can sell 
these tax deferred bonds so they can do their capital. I am not 
sure that they are going to get that, so it seems to me they 
are very much up against the wall at the moment.
    Mr. Mead. Yes, they are up against the wall. At the same 
time, Amtrak committed to the Congress that they would be self-
sufficient from an operating standpoint in five years.
    I think some people can raise the question: why are you 
asking for bond authority before you have shown whether you are 
going to make operating self-sufficiency?
    Ms. Kilpatrick. And I am sure that question will be asked.
    Mr. Mead. Yes, but there is no question whether they get 
the money from this committee, whether they do a bond bill or 
the money comes from somewhere else, the railroad is going to 
need a sustained amount of capital in order to survive. I would 
put it in the neighborhood of $1 billion to $1.5 billion a year 
on a sustained basis.
    Ms. Kilpatrick. And we do not see that picture right now.
    Mr. Mead. No. What they are coming to this committee for a 
little over $500 million in appropriations.
    The way the bond deal works is interesting. It bypasses the 
committee totally because Amtrak issues the bonds, and the 
taxpayer gets the interest or dividend on the bond through 
their income tax return. The statesare required to put up a 20 
percent match, I think. What the states put up goes into an escrow fund 
which accrues interest.
    What states put in the escrow fund over the period of time 
of the bonds until the bonds mature accumulates enough to pay 
back the principal, so the states' money going into this escrow 
fund pays back the principal. The taxpayers take off their 
income tax return the amount of the interest or dividend. That 
is how the bond concept would work.
    Usually in bonds the person that issues the bond has to pay 
back. This bond scheme is a little different than that.
    Ms. Kilpatrick. Scheme being positive in that way? It is 
different.
    Mr. Mead. Yes. It is very different.
    Ms. Kilpatrick. Okay. So scheme did not mean necessarily 
negative?
    Mr. Mead. No.
    [The information follows:]

    Mr. Rogers. I would like your opinion on Amtrak reaching 
self-sufficiency, recognizing the one-year delay in 
implementing high-speed rail and the resulting loss in 
projected revenues. Can they do it? What do you currently see 
as the greatest obstacles to Amtrak's ability to reach 
operating self-sufficiency?
    [The information follows:]
    It is still too early to say definitively that Amtrak will 
not achieve operating self-sufficiency by 2003. Achieving its 
mandate will depend heavily on three things.
    First, Amtrak must fully implement high-speed rail in the 
Northeast Corridor. This will be a major challenge because as 
of March 2001, only 3 of 20 Acela Express trainsets have been 
put into revenue service and Amtrak has accepted only 8 of 15 
high-speed locomotives for its Acela Regional service. Amtrak 
estimates a net revenue contribution of about $180 million each 
year from its Acela services once they are fully in place.
    Second, Amtrak must fully ramp up its mail and express 
business. In its 2001 business plan, Amtrak projected total 
revenues from mail and express business to exceed $400 million 
in 2003. To accomplish this, Amtrak will have to more than 
triple the business volume it achieved in 2000. Amtrak 
currently does not have the equipment or shipping contracts in 
place to generate that level of business. Another major 
obstacle is getting approval from the freight railroads for the 
levels of services Amtrak proposes. Amtrak has been in 
negotiations for years with the freight railroads to move more 
mail and express cars over freight-owned rail lines. So far, 
Amtrak has not had much success in obtaining the needed 
agreements. These agreements are essential for Amtrak to grow 
its mail and express business to the levels projected in its 
plan.
    Third, Amtrak must close the $737 million gap from 
undefined management actions we identified in its 2000 plan. 
Almost all of these actions relate to needed expense 
reductions. Amtrak's cash operating expenses grew by 8.6 
percent in 2000 and by 11.7 percent for the first 4 months of 
2001. Yet, Amtrak's 2001 business plan projects annual growth 
in cash operating expenses between 2000 and 2003 of only about 
6 percent. Further, restricting expense growth will become 
exceedingly difficult in view of Amtrak's plans to expand 
passenger services as well as its mail and express business.
    Amtrak's attempts to achieve operating self-sufficiency are 
further complicated by its capital funding shortfalls. On one 
hand, Amtrak must invest in projects that will quickly improve 
its bottom line in order to achieve self-sufficiency. On the 
other hand, Amtrak must invest sufficient capital to support 
the continued safe and reliable operations of a national 
railroad. Amtrak has not had sufficient capital funding in 
recent years to do both. Without additional capital funding in 
the very near term, Amtrak's ability to reach self-sufficiency 
will be jeopardized, as well as its ability to continue the 
level of service necessary after 2003 to maintain its self-
sufficient status.

                          AIRLINE LABOR ISSUES

    Ms. Kilpatrick. That is the way the program operates. I do 
see a problem there. I hope that when they come or before that 
they will have a better answer to how they are going to get 
themselves up. I do not see it at the moment.
    Let me just switch. Everything that has been said about the 
airline industry, as those of us that travel twice a week in 
some form, and I see the captain and others in the room, there 
is a problem there. A major problem.
    As the Chairman said earlier, airlines are blaming the FAA. 
FAA blames the airlines. Those airports in our districts have 
no say so about what goes on, so it is really a problem that we 
are going to have to correct or the entire country will come to 
a standstill at some point.
    In my own area, it is threatened that Northwest will strike 
next week, and the President may intervene. Any comment on 
that? Is that the only airline in that shape? Do we need 
Presidential intervention?
    Mr. Mead. Well, no, it is not the only airline in that 
shape. I have my notes here. I think Delta is having problems. 
United is having problems. I know Northwest is. I am not sure 
about American. I can consult my notes here. I have a list of 
them.
    Should the President intervene? That is a judgment that the 
President is going to have to make. I think on Northwest the 
President did indicate that----
    Ms. Kilpatrick. He is certainly looking at it. He wants it 
resolved, and I think March 12, which is next week, is the D-
day I think.
    Mr. Mead. It is a very serious problem, as you know. 
Airline employees are almost critical employees. They are not 
public service, but, they almost perform the functional 
equivalent of a public service by making sure the airlines run. 
When the airlines do not run, it disrupts the entire nation.
    [The information follows:]

    Mr. Rogers. FAA has said that they expect to realize 
significant productivity gains from the controller labor 
agreement. To what extent do we see documented productivity 
gains today? What more needs to be done to realize productivity 
savings?
    [The information follows:]
    The productivity gains negotiated in the collective 
bargaining agreement between FAA and NATCA have not yet 
produced any documented savings. Through the end of FY 2000, 
FAA has incurred over $240 million in additional payroll costs 
associated with its new pay system for controllers. However, 
through the end of FY 2000, the negotiated workplace changes 
intended to offset those costs have been only partially 
implemented. Further, those changes, such as restricting the 
amount of time for union activities, did not require 
modifications to the duties or responsibilities of controllers. 
The more comprehensive changes, such as assigning controllers 
collateral duties and expending the Controller-In-Charge 
program, remained in various stages of development through the 
end of FY 2000--2 years into the 5-year agreement.
    The productivity enhancements negotiated as part of the 
agreement represent a collaborative recognition by FAA and 
NATCA that improvements to compensation and benefits must be 
integrally linked to improvements in system capacity. However, 
FAA entered into the 1998 agreement without an effective 
business strategy for maximizing the potential productivity 
gains. We found implementation of the agreement with NATCA was 
not effective because:
    --negotiated pay raises were not contingent on implementing 
productivity gains;
    --expected productivity gains were not quantified prior to 
entering into the agreement;
    --estimates of future savings did not accurately reflect 
the potential impact to operating costs; and
    --concerns about new programs were not adequately 
addressed.
    In our opinion, flexibilities of personnel reform were not 
fully utilized. To realize productivity savings, FAA must fully 
implement the remaining workplace changes and establish a 
process for periodically measuring, evaluating, and reporting 
on the costs and cost offsets associated with the NATCA 
agreement. FAA also needs to examine additional opportunities 
for increasing productivity, such as providing facility 
managers with greater authority and accountability for reducing 
costs at their location--a key tenet of personnel reform.
    Finally, FAA needs to ensure that all future agreements 
include (1) estimated savings and quantified productivity 
gains, (2) timetables for coinciding implementation of 
negotiated benefits and offsetting savings, and (3) clearly 
defined authority and accountability for meeting established 
deadlines.

                        MEXICAN DOMICILED TRUCKS

    Ms. Kilpatrick. I know we are pressed for time. Lastly for 
me, the Mexican trucks. In addition to the motor carrier 
requirements and should they meet our standards, I am always 
concerned about the influx of drugs from the Mexican border.
    I was on a drug task force here in the Congress, and we 
know that Mexico is one of the places where the interdiction is 
quite large. Are we worried about that?
    In letting the Mexican trucks in, first meeting the 
standards I hope, are the two things working together? You 
mentioned it just briefly in your comments about the motor 
carrier aspect of the trucks coming in.
    Mr. Mead. Yes. I could speak to the motor carrier aspect. I 
cannot speak, although I could get back to you, as to the drug 
aspect.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. Kilpatrick. Please do. I would appreciate it.
    Mr. Mead. I know there is a press on to open the border. We 
have found in our work that there is a strong correlation 
between the condition of those Mexican trucks coming across the 
border and the presence of an inspector at the border, which is 
to say the likelihood of being inspected at the border.
    A couple years ago I was down there at the El Paso border 
crossing, and it was incredible. They had one inspector. One 
inspector. He would stop and inspect the truck. On the 
inspection I watched, the truck's air brake did not work. That 
inspector went to a computer and wrote up the paperwork. While 
he is writing the paperwork, other trucks are going through. He 
was the only inspector there.
    Ms. Kilpatrick. This committee has in the last few years 
put a few more people on the border patrols. We need more than 
we have.
    Mr. Mead. You sure have. The truth is we need to put more 
down there. Whenever that border crossing is open there should 
be an inspector there, and it would be good to have two 
inspectors there so that when they are writing up the ticket--
--
    Ms. Kilpatrick. Someone else is watching the trucks.
    Mr. Mead. Right.
    Ms. Kilpatrick. It has to happen. We have to address that. 
Putting more people on the border is a must, inspecting the 
trucks.
    Must they meet motor carrier standards in this country if 
they are foreign trucks? Are we going to mandate?
    Mr. Mead. Yes, they do.
    Ms. Kilpatrick. Thank you very much.

                          AIRLINE LABOR ISSUES

    Mr. Mead. I can respond to your question concerning airline 
labor disputes. Northwest Airlines is the aircraft mechanics. 
Delta Airlines is theairline pilots. American Airlines is the 
flight attendants. United Airlines is the machinists and aerospace 
workers, and possibly the flight attendants.
    I think that is a pretty current list. You have five 
potential labor situations unfolding over the next several 
months.
    Mr. Rogers. We have about seven minutes before the vote. 
Would you like to proceed some now, Jim?
    Mr. Clyburn. I just want to say, Mr. Chairman, I am pleased 
to be back on the committee, back on the subcommittee.
    Mr. Rogers. We are delighted to have you.
    Mr. Clyburn. I look forward to working with you.
    Mr. Rogers. And also Mr. Sweeney is a new Member and Mrs. 
Emerson.
    Mr. Clyburn. It is good to be back. I do not want to be 
called new.
    Mr. Rogers. The once and present Member of the 
Subcommittee.
    We have a vote on the Floor, and it is the lunch hour. We 
will resume this proceeding at 2:00 p.m. Is that agreeable?
    We stand in recess.
    Mr. Rogers. The Committee will come to order.
    Mr. Mead, I trust you had a restful luncheon.
    Mr. Mead. Yes, sir.
    Mr. Rogers. Mr. Clyburn is recognized.
    Mr. Clyburn. Mr. Chairman, I was outside of the room for 
much of the testimony this morning and I am always reluctant to 
raise questions when I have not been here the whole time and so 
I am going to pass until such time as something strikes my 
fancy and I will beg for recognition at that time.

                             FAA MANAGEMENT

    Mr. Rogers. Okay. Thank you.
    Mr. Mead, FAA for many years has been criticized for weak 
management, both in modernizing the air traffic control system 
and ensuring public safety through effective regulation.
    A multitude of GAO and IG reports and several special 
commissions have made recommendations to reform either the 
structure or processes of FAA. The Government Performance and 
Results Act and the National Performance Review required 
agencies to develop effective measures of performance and hold 
officials accountable for those results.
    In 1995, the Congress freed the FAA from government-wide 
personnel and procurement rules to allow them more flexibility 
in decision making and yet many of the problems in long-range 
planning and management persist. Your ten top management 
challenges report documents several of those problems.
    When I look through your report on the top ten, it is 
striking how many of them involve management deficiencies. For 
example, the agency has not met its aviation safety goals in 
the areas of runway incursions or operational errors by 
controllers. They did not respond appropriately when 
information was received on safety defects in wiring and 
fasteners. They allowed contractors to prepare independent 
government cost estimates on acquisition programs or did not 
prepare them at all. And they have taken years and still not 
issued new safety rules in the areas of pilot fatigue, airport 
baggage screener qualifications and training, just a few 
examples from your report.
    Are there key reforms to make the quantum leap in 
management improvement at the FAA?
    Mr. Mead. Yes, sir. I think there are. To begin with, 
Congress, as you pointed, they freed FAA from many of the 
personnel rules and the procurement rules and the idea was that 
FAA would thereby become more accountable. Then several years 
later, FAA said, well, in addition to that, we need more money. 
Congress gave them more money.
    It seems to me that a key tenet of management is 
accountability and that is where FAA has fallen short. I think 
we have a remarkably safe aviation system and we move a lot of 
airplanes and a lot of passengers. But, still all the points 
you note there are absolutely correct.
    FAA tends not to hold itself accountable. In other words, 
there are not consequences for a failure to meet requirements.
    Mr. Rogers. Your predecessor as IG said bluntly, and I am 
quoting, ``The FAA tolerates poor judgment and protects bad 
management.'' She said that until the FAA holds people 
accountable for their mistakes, the agency would not improve.
    Have you seen in your investigations any indications of 
increased accountability?
    Mr. Mead. At the very top of the agency, I have seen 
increased accountability, but I think it needs to seep down to 
all levels of the agency.
    I have seen it at the very top. It is quite an 
organization, Mr. Chairman. You meet with the administrator, 
who has the best of intentions and feels accountable. The 
Administrator gives a directive and frequently it is not fully 
executed.
    Mr. Rogers. How can we correct that? What can Congress do 
to help correct that?
    Mr. Mead. I think you should lay out certain specific 
expectations, not at a highly generalized level so anybody can 
interpret them any way they want. Lay out some very firm 
expectations and link it to appropriations. I think you will 
see some results.
    Mr. Rogers. Would you be willing to prepare us a listof 
conditions that should be laid upon the agency conditioned on 
appropriations?
    [The information follows:]

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    Mr. Mead. Yes. I would be pleased to prepare something like 
that.
    Mr. Rogers. Would you write us a list of things?
    Mr. Mead. Yes.
    Mr. Rogers. I mean so that there can be no dispute about 
what is meant and we can judge results without any question as 
to whether or not we are accurate, specific guidelines that we 
expect to be done. And, if not, there will be consequences. Can 
we be that specific?
    Mr. Mead. I think we can. In my judgment, any way, Mr. 
Chairman, I do not think you want to have a list that is so 
formidable as to try to accomplish too much at once, but rather 
a manageable list of specific tasks. I think such a list can be 
crafted. We would be glad to provide it for your consideration.
    Mr. Rogers. We would appreciate that very much.
    Mr. Mead. Yes, sir. Be glad to.
    Mr. Rogers. How long would that take to do that?
    Mr. Mead. Two weeks?
    Mr. Rogers. Take three.
    Mr. Mead. Thank you.
    Mr. Rogers. I think that is a terrific suggestion, as you 
offered it. You know, I know the FAA has wonderful people in 
it, I know that they have dedication, but somehow, apparently, 
the structure precludes directives from on top making it down 
through the maze. Is that generally correct?
    Mr. Mead. Yes.
    Mr. Rogers. That is the exact same problem that I 
encountered with the INS over there in that other body. 
Wonderful people all through, but the structure just did not 
allow the leader to make things happen. The bureaucracy just 
completely thwarted the directives from on top and that is the 
biggest problem we faced over there and it sounds like this is 
a similar situation.
    Mr. Mead. I will tell you one example, I believe it is in 
our top ten report. We did an audit of airplane fasteners. 
Fasteners are like bolts or screws. They hold planes together. 
And we did an audit of their defect rate, and Hill Air Force 
Base's testing laboratory came up with a defect rate much 
higher than FAA's.
    So we called that to the attention of FAA program 
officials. It took the administrator of the FAA to direct FAA 
staff to reconcile FAA's low defect rate to Hill Air Force 
Base's higher defect rate. And these were for bolts that hold 
airplane engines together. Seems like a fairly important 
item.Something like that should not require the FAA administrator to 
prompt action. It should happen simply because it is the right thing to 
do.
    Mr. Rogers. Well, at some point in time, I am going to ask 
names and dates of individuals who are not following directions 
and are not performing their duties. I want the names. I want 
the dates. I want the name, rank and serial number.
    I am not beyond writing in the bill language that says John 
Doe shall not be paid his salary unless. I mean, I am prepared 
to do that. And if that does not work, we will take another 
step. Is that a good approach?
    Mr. Mead. I think just saying it is a good approach. I do 
not think it will take too long, sir, for that message to get 
back to FAA. And I expect sometimes just saying that will have 
an effect, but we will see.
    Mr. Rogers. We will see. We will see.
    Mr. Clyburn.
    Mr. Clyburn. Mr. Chairman, let me ask about your list.
    Will that list that the chairman is asking you to develop, 
would that be something separate and apart from the agency's 
own performance goals?
    Mr. Mead. I would be very surprised if it had anything in 
it that FAA had not already indicated needed to be done. So it 
would not be anything separate and apart. And, if it was, sir, 
we would make sure that the administrator of FAA knew that.
    Mr. Clyburn. I ask that question because it seems as if 
this whole issue of accountability seems to go to the issue of 
staff morale as well. And I notice that there seems to be 
indication that the staff itself seems not to feel that the 
accountability is there and that it may be that the agency's 
own performance goals, I guess laid out by the administrator, 
seem not to be being met. At least most people seem to feel 
that they are not.
    Mr. Mead. Yes, sir.
    Mr. Clyburn. So then it would seem to me that if you were 
to give us that kind of information, for it to have some real 
relevance to the agency, I would love to see it either track or 
in some way incorporate what the agency has laid out as its own 
goals and its own performance because I would hate for them to 
come in and say, well, we could not all of this because we were 
doing these things. So in some kind of way it seems to me that 
it ought to be incorporated.
    Mr. Mead. Yes, sir. We will be sensitive to that.
    Mr. Rogers. Well, in fact, along that line, Mr. Clyburn, in 
a recent employee survey, the staff were asked whether they 
agreed with the following question, ``Corrective actions are 
taken when employees do not meet performance standards.'' Only 
22 percent of the employees agreed with that, 51 percent 
disagreed, which makes your point.
    Mr. Clyburn. That is the whole point about that. That to me 
seems to be indicative of pretty low morale on the staff's 
part, some problem with the staff, for more than half of them 
to not think that the agency itself does not take corrective 
action.
    I come to this, this is my first elected office. I have 
spent all my life in management. And I would hate to see such 
results on a survey of any place I have ever managed.
    Mr. Rogers. What do you say about that, what I just quoted 
there? What does that tell you about the employees' idea about 
accountability?
    Mr. Mead. It suggests to me that the employees do not think 
there is much accountability and that it is bothering them.
    Mr. Rogers. Well, with your help, we want to help them 
improve their own self image.
    Mr. Mead. I think they are very well intentioned. I do 
think the time has come, though, for FAA to be held to the 
test.
    In fairness to the FAA, I think we want to make sure we do 
not throw out the baby with the bath water. We have an 
extraordinarily safe system, we move a lot of planes and a lot 
of people, there is a lot of money involved, it is a complex 
undertaking, but there is no question that there needs to be a 
lot of improvement.
    So we will be glad to give you that list, sir, in three 
weeks' time.
    Mr. Rogers. Now, other countries have privatized or changed 
into a government corporation the chores that we do with FAA 
here. Why should that to be done here? Or, should it not.
    Mr. Mead. I know there are proponents of privatizing the 
air traffic control system. I am not persuaded that is the 
right way to go. I think overall we have a good system. It 
tries to serve a lot of different constituencies, Mr. Chairman, 
including some that do not have profit as a motive. We ought to 
borrow from some private sector principles and try to apply 
them in an FAA setting.
    As I was indicating this morning, I do not think I would 
turn the entire system upside down and re-do it until we know 
what we are getting into. That is why, this morning I suggested 
you might take a manageable part of the air traffic control 
environment, and see whether these private sector principles 
work.If we do not do anything, it seems to me that we are just 
putting our heads in the sand.
    Mr. Rogers. Well, when you give us the benchmarks that we 
just discussed so that we can measure whether or not this 
agency is doing the nitty gritty things that have to be done. 
We will know whether or not there is accountability there. When 
we are given specific instances of individuals that have 
violated or not done their chores, we can take appropriate 
action. The jury is still out in my own mind about whether or 
not we can achieve FAA's mission presently constructed. That is 
my own personal view.
    Now, AIR21 required the agency to establish a chief 
operating officer for air traffic services, created an FAA 
management advisory committee, complete with an air traffic 
subcommittee, to help the administrator and secretary manage 
the agency. The COO, the chief operating officer, is allowed 
even to submit a competing budget directly to the Congress. How 
is that supposed to work in practical terms?
    Mr. Mead. On the earlier subject you raised, you said the 
jury is still out. I think the jury is still out on how is this 
going to work.
    We have the management advisory committee, which can advise 
the administrator, then we have an air traffic subcommittee 
which really does have some authority, and then you have the 
chief operating officer. We do not actually have a chief 
operating officer yet.
    We do have the management advisory committee. The air 
traffic control subcommittee, was appointed in the last month 
or two of the Clinton administration. So these things have all 
just started. We do not, as I said, have a chief operating 
officer yet, so it is hard to forecast how that will play out. 
It strikes me as a fairly cumbersome structure. But, as I said, 
let us give it a chance.
    Mr. Rogers. What is the deadline for the chief operating 
officer?
    Mr. Mead. I am not sure that the law specifies a date, but 
I think there is a certain urgency about having a COO. This law 
was passed last year and although the committees are helpful, 
you cannot rule by committee. You need someone to execute 
things. There really is a need for a COO.
    I understand FAA has a search committee. I understand OMB 
and the secretary and the administrator have placed a priority 
on it. I do not think you should have to wait much longer. My 
patience would wear thin in about a month's time.
    Mr. Rogers. Well, the secretary is going to testify here in 
about a month, is he not? And I am sure by that time he will 
have this person in place, would you not guess?
    Mr. Mead. I would hope so.
    Mr. Rogers. Likewise, in 1996, Congress gave the agency 
almost total flexibility to redesign their acquisition process. 
For example, they no longer have to follow the SBA, Small 
Business Act, or the Competition in Contracting Act in 
acquisition programs.
    In response, they reorganized their acquisition workforce 
into integrated product teams, IPTs. In audit last August, you 
said they were not working well. What makes you say that?
    Mr. Mead. We found the IPTs did not have any authority. The 
idea was that you would take people from all the different 
disciplines needed to bring home an acquisition and form an 
IPT. The IPT would make the pertinent decisions on that 
acquisition.
    We found that in many respects the right people were on the 
IPTs, but they had to report to the home organization. So you 
really did not get rid of all the smokestacks. And that has 
been one of the problems over the years at FAA. The idea of the 
integrated product team was to bring all the different 
disciplines together to accomplish the acquisition. But the 
members of the team often did not feel as though they had the 
requisite authority to bring home the bacon.
    Mr. Rogers. So have you a solution for that?
    Mr. Mead. I think you need to have the right level of 
seniority on these IPTs and you have to allow them to make the 
decisions. I understand that when it comes to budget decisions 
you cannot say, go spend anything you want. But it did strike 
me that the IPTs need more authority. And the IPTs have to live 
with that authority once it is exercised.
    I know, Mr. Chairman, that is easier said than done.
    Mr. Clyburn. Mr. Chairman?
    Mr. Rogers. Yes?

                             AIRLINE SAFETY

    Mr. Clyburn. Mr. Chairman, I want to get back to a safety 
question.
    I noticed the chart you put up this morning, what is the 
term, runway incursions, and I think in looking at your 
testimony you indicated somewhere--I saw somewhere there has 
been a 25 percent increase in these problems.
    Mr. Mead. Yes. This is a record year for runway incursions, 
where planes come too close on the ground.
    Mr. Clyburn. Right.
    Mr. Chairman, having spent my first six years in this body 
over on the authorizing committee, I tried for asignificant 
number of years and I we finally incorporated it in AIR21--of course, 
the way we do things up here sometimes, the author of legislation never 
gets the credit for it, but I am pretty proud of the fact that I was 
the original authority of the Aviation--whatever it was, the Aviation 
Safety Protection Act or something--that got incorporated in AIR21 as 
the whistleblower statute.
    That was a safety issue with me and I thought, especially 
after I think it was--I forgot the thing in the Everglades, 
that the testimony seemed to indicate--you remember the crash--
--
    Mr. Mead. ValuJet.
    Mr. Clyburn. ValuJet. All the evidence that came out in 
these various hearings seemed to be saying that there was 
something being--there is something in the cargo that should 
not have been there and people did not talk about it because no 
one felt protected, they did not want to bring the information 
forward because they do not want to lose their jobs.
    I am wondering whether or not the implementation of that 
section--well, I guess the question is have they started to 
implement that program? Are any procedures in place to 
implement the so-called whistleblower statute that would allow 
us to get some information from people as to whether or not 
there is something going on that is causing this big increase 
in runway incursions, whether or not they are not following 
their own procedures, and somebody can tell us about it.
    Mr. Mead. Let me ask my deputy to come up here. He was 
formerly the Assistant Inspector General for Investigations and 
deals directly with whistleblowers issues.
    Mr. Zinser. Yes, sir. In fact, we met with some folks who 
worked on that very type of issue with the Federal Motor 
Carrier Safety Administration. There is a similar provision in 
the motor carrier statutes for employees in the motor carrier 
industry.
    And the unusual thing about the whistleblower statute in 
AIR21 is that the Department of Labor is actually the agency 
responsible for investigating those types of allegation. So, we 
put the folks who work with motor carriers in touch with FAA. I 
believe they are working with FAA, but I am not sure any 
guidelines or operating procedures have been put in place for 
communicating to industry employees.
    Mr. Rogers. You will need to state your name for the 
record.
    Mr. Zinser. Todd Zinser, Z-i-n-s-e-r.
    Mr. Mead. He is Acting Deputy Inspector General.
    We will get back to you next week with a concrete answer to 
that.
    [The information follows:]

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    Mr. Clyburn. I am particularly interested, Mr. Chairman, in 
that section of AIR21 because I am convinced--and I am one of 
those who cannot wait until we get out of here today so I can 
jump on one of these airplanes to go back home--and I want 
somebody if they see something going wrong, I want them to feel 
free to bring it to this subcommittee's attention or to 
whomever so that we can make sure that they are going to be 
protected. I think that is why we put it in that legislation.
    It just seems to me that by now we ought to have had some 
kind of guidelines so people will feel free. I am not too sure 
they know, all of them know, that they are now protected.
    Mr. Zinser. Just the other day we spoke to somebody with 
the Allied Pilots Association. The last time I met with this 
person there were no whistleblower provisions. When I met with 
them last week, they recognized that those provisions are in 
place now and are very appreciative of that.
    Mr. Clyburn. Very good.

                        FAA PERSONNEL MANAGEMENT

    Mr. Rogers. In March of 1995, the secretary testified 
before this subcommittee that government-wide personnel systems 
were inappropriate for an agency like FAA which needs to hire 
and move people in response to aviation industry needs.
    He said ``The personnel rules make it far too difficult,'' 
he said, ``to reward good work, to deal with poor performance 
or to staff high cost, busy facilities.''
    So in response to Congress freeing FAA from OPM's personnel 
rules and the GS pay system, five years after it went into 
effect, tell us how successful the personnel reform has been in 
allowing FAA to deal with poor performance, reward good work, 
and locate personnel where they are needed.
    Mr. Mead. I know it takes some time for any reform to take 
hold, Mr. Chairman. Basically what we have seen as a result of 
personnel reform is higher salaries. And I would have to say 
also we have seen better labor-management relations, 
particularly between the controllers and top FAA management.
    I think an issue that has fallen out of personnel reform is 
accountability. Staff are getting this extra money, there ought 
to be firm expectations that you can hold people accountable 
to. And what has happened with FAA is some of the pay packages 
have been so attractive that now all the other workforces want 
to partake.
    Prior to the October 1998 NATCA agreement, controllers had 
a base salary range from $66,000 to $86,000 at the top 
facilities.
    As of January of this year, these controllers had a base 
salary range between $81,000 and $126,000. And when premium 
pays such as overtime are added, I would say 65 percent of all 
the controllers at these top facilities make between $89,000 
and $139,000.
    Since that is higher than the most senior staff of the 
Senior Executive Service, it is understandable that you would 
be getting this pressure from other workforces within FAA the 
committee can ask the administrator about that. It is very 
attractive.
    And so I think we need to begin to focus on accountability 
in personnel reform. I have not seen a lot of FAA ordering 
people to move or dismissing people for poor performance. If 
they are occurring, they have not gotten on my radar screen.
    Mr. Rogers. Well, is it true that supervisors in the air 
control system make less than the controller?
    Mr. Mead. After the NATCA agreement was signed, it was 
agreed that FAA would achieve some savings by increasing the 
ratio between supervisors and controllers, which had been seven 
controllers to one supervisor. However, they wanted to avoid 
any impact on safety from increased supervisory spans of 
control.
    On the other hand, the controllers feel that they can take 
on supervisory responsibility and I would agree, provided they 
got the appropriate training and certification. What concerns 
me is that at least one air traffic control has said facility, 
100 percent of our people will qualify to be supervisors. That 
is not treating this with the tough expectations and tough 
standards we anticipated.
    Mr. Clyburn. Well, maybe I missed something. Are you saying 
that 100 percent of all the controllers will qualify to be 
supervisors or they did something to qualify, but they were not 
actually placed in supervisory positions?
    Mr. Mead. The facility manager has indicated his intention 
of certifying all of the controllers at that facility as 
controllers in charge, which would give them supervisory 
responsibilities analogous the non-union supervisors.
    Mr. Clyburn. Now, would that then mean that--to go back to 
the chairman's question, would these people then be eligible to 
be sent around the country to be supervisors?
    Mr. Mead. Well, they would be eligible to, but you cannot 
just order them to.
    Mr. Clyburn. Well, it would seem to me--what is the reason 
for them coming out from under the act or the policy if they 
are not in some way agreeing that they are amenable to being 
transferred to where they are needed to be supervisors? I mean, 
they cannot supervise themselves.
    Mr. Mead. The controllers did not agree to be transferred 
anywhere. I know, it does not make a lot of sense. Why would 
they need all these extra supervisors in this one facility?
    Mr. Clyburn. I guess that is what I am trying to get to.
    Mr. Mead. That is why I say it sounds counter intuitive to 
me. Why would they need all these additional supervisors?
    Mr. Clyburn. I mean, who are they going to supervise? Each 
other?
    Mr. Mead. They would supervise other controllers. They 
would take turns.
    Mr. Clyburn. Well, then, they are supervising each other, 
then.
    Mr. Mead. Yes. Yes.
    Mr. Clyburn. Well, you were talking about trading off and I 
understand that, that is what I was getting to, you have a 
Monday supervisor, a Tuesday supervisor, a Wednesday 
supervisor.
    Mr. Mead. Yes, sir.
    Mr. Clyburn. So they are in fact supervising each other.
    Mr. Mead. Yes. And they are still part of the union. The 
union would be supervising the union. Union controllers would 
be supervising union controllers.
    Mr. Clyburn. Well, I guess that is one way to keep the 
salaries up. I think your original question was whether or not 
the supervisors are being paid less than the controllers and 
that is one way to make sure that the supervisors are not paid 
less.
    Mr. Mead. Yes. And there is kind of an incentive there; why 
would you want to be a non-union supervisor if you are going to 
get less money doing the same thing.
    Mr. Clyburn. That answers my question.
    Mr. Sabo. I assume you are only paid as a supervisor rate 
for the day you are a supervisor, not five days a week.
    Mr. Mead. I believe that is accurate. But you have to be 
designated as what they call the controller in charge to be 
eligible to do that one day supervising. But, when you do it, I 
think you get a 10 percent differential.
    Mr. Sabo. But I do not know that there is anything 
inherently wrong with that system.
    Mr. Mead. Well, it is certainly legal. But, a supervisor 
has to be capable of supervising. Supervisors have to go 
through training. It strikes me as strange that 100 percent of 
the workforce at this particular facility can march right in 
and say, well, now I am a supervisor.
    Mr. Sabo. That might be true.
    Mr. Mead. That is the big issue we have with it.
    Mr. Sabo. But I do not see anything inherently wrong with 
having a system where people who are doing the line work are 
occasionally the supervisors.
    Mr. Mead. Well, I do not either.
    Mr. Sabo. As a matter of fact, I think that quite often it 
might work.
    Mr. Mead. I do not have a problem with that either. My 
problem is with 100 percent of the workforce being told you can 
go supervise all the controllers at this facility.
    Mr. Clyburn. Especially if they have not had the requisite 
training.
    Mr. Mead. Yes. And our belief is that the training hoops 
that FAA agreed they would go through are in fact on paper only 
and that they are not the hoops that were anticipated.
    Mr. Wolf had a lot of intimate familiarity with this whole 
issue and before he let that program go forward, he had FAA 
reduce to writing the training requirements and certification 
requirements they would go through. I am certain that former 
chairman Wolf never envisioned 100 percent of the workforce 
being certified as controller supervisors.
    Mr. Rogers. Now, who approved that?
    Mr. Mead. The Kansas City regional manager. And we have 
raised this with the administrator of FAA. We have recommended 
that they change this. Not that they change the feature of the 
union line people supervising union line people. Just that they 
make sure the controllers are trained before they are 
designated supervisors. We are still waiting for a response.
    Mr. Rogers. Who all allows this practice now? All airports 
do not do it this way?
    Mr. Mead. So far, to the best of our knowledge, it is 
limited to that one facility.
    Mr. Rogers. Kansas City?
    Mr. Mead. Yes. I am concerned that it would spread to other 
facilities, though, because it is so attractive.
    Mr. Clyburn. Mr. Chairman, maybe I am missing----
    Mr. Rogers. We asked the administrator several months ago 
about this and she has not responded to us. That is not a good 
habit to get into.
    Mr. Mead. We wrote also and we are likewise waiting for a 
response.
    Mr. Rogers. Well, the secretary and the administrator are 
going to testify and I am sure before then they will have this 
cleared up. And I do not expect this would continue, in Kansas 
City or anywhere else.
    Mr. Mead. Yes, sir. I certainly hope not.
    Mr. Rogers. It is ridiculous. What is the top pay? What is 
the most money a controller has made, do you know?
    Mr. Mead. We believe the top paid controller receives about 
$174,000 a year.
    Mr. Rogers. $174,000?
    Mr. Mead. Yes. Now, that is----
    Mr. Rogers. Where do I apply? That is a better job than 
this one.
    Mr. Clyburn. I am going to ask for a copy of their training 
manual.
    Mr. Mead. I am sure that gentleman was a supervisor, sir.
    Mr. Rogers. We are all good at supervising, too.
    Mr. Mead. The base salary in that case would have probably 
been about $125,000.
    Mr. Rogers. So how did he make the extra 50-what thousand?
    Mr. Mead. $40,000 overtime, $4,000 Sunday pay, $5,000 night 
differential pay, $4,000 holiday pay, and $4,500 controller 
incentive pay.
    Mr. Rogers. What is his name?
    Mr. Mead. I do not know. I do not have his name here.
    Mr. Rogers. Can you get it?
    Mr. Mead. Oh, sure.
    Mr. Rogers. Well, I would like to know that gentleman or 
gentle lady. We would like to find out how good he is. So would 
you furnish the name for us and his address and phone number?
    [The information follows:]

    The name, address, and phone number of the highest paid 
controller is Hugh M. McClure, Jr. He made $174,731 in FY 2000 
and he works at the Washington Air Route Traffic Control 
Center, 825 East Market, Leesburg, VA 22075, telephone number 
703-771-3401.

    Mr. Mead. I might call him first and ask what his secret 
is.
    Mr. Clyburn. I am sure he is in Kansas City.
    Mr. Rogers. Yes, we can tell you the address. Will you get 
us that name?
    And will it be conveyed to the administrator and the 
secretary that we want to know how quickly she is going to 
dismantle the Kansas City gravy train?
    Mr. Mead. Yes.
    [The information follows:]

    As you know, in an October 2000 memorandum to the FAA 
Administrator, we urged FAA to rescind Air Traffic Services 
guidelines dated February 10, 2000, which allowed all air 
traffic controllers under the previous Controller-in-Charge 
Program to automatically become CICs under the new program. The 
guidelines were contrary to FAA's new selection process 
established to ensure that only the best-qualified air traffic 
controllers would be selected for the new CIC Program. Our 
recommendation was made in response to reports that, because of 
FAA's policy, facilities, such as the tower at Kansas City 
Airport, has selected all of its controllers for the CIC 
program.
    As of March 29, 2001, we have not received FAA's response 
to our memorandum but know that FAA did not change its policy 
and Kansas City, and other facilities selected 100 percent of 
its controllers for the new CIC program. Upon receipt of FAA's 
response, we will determine if additional actions are 
warranted.

    Mr. Rogers. I am prepared to move to another subject unless 
somebody has something else.
    Mr. Sabo. I do not on FAA. I have another subject.
    Mr. Rogers. Would you like to proceed?

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                        MEXICAN DOMICILED TRUCKS

    Mr. Sabo. Okay. I am just curious about the situation on 
the Mexican border. You made some reference to it in your 
opening comments, about I think we have 60 inspectors.
    Mr. Mead. Yes.
    Mr. Sabo. But we are looking at a very profound change from 
the status quo. Currently, as I understand it, the trucks can 
come in for only a limited period of space inside the border 
where goods are transferred and with the most recent ruling 
from the NAFTA appeal board saying we have to let the trucks in 
through the country, we are looking at potentially a huge 
influx of trucks, which I understand are an average ten years 
older than the American average fleet, a huge number of safety 
equipment problems on them, and drivers who do not meet the 
training qualifications of American drivers.
    Now, I think you were suggesting that doubling the number 
of inspectors to deal with this problem, but it just strikes me 
that will hardly dent the problem that we potentially face.
    Mr. Mead. It will not eliminate it, but it will be a good 
start. I have heard estimates that go way beyond our estimate 
of the number of inspectors required. Whenever a particular 
border crossing is open, there should be an inspector 
available. I think that will have a positive impact.
    For example, Otay Mesa is in the California crossing, south 
of San Diego. The state actually runs that one. They are very 
well staffed, and they inspect every Mexican truck coming 
through there every three months. And the so-called out-of-
service rate, when the driver has such a serious safety problem 
the inspectors will not let the truck go further, approximates 
that for truckers inside the interior United States.
    At other crossings that do not have that level of staffing, 
you find a higher out-of-service rate. At crossings where we 
have increased staffing, we find the out-of-service rate today 
is less than it was two years ago. It is not a cure-all 
certainly, but it is a good start.
    We have 60 inspectors on the southern border now, largely 
because of this committee. Two and a half years ago, we had 13.
    Mr. Sabo. But am I wrong that this is just going to bea 
massive change, though, if all of a sudden these trucks are going--what 
is the limit, 15 or 20 miles that they can come in?
    Mr. Mead. Well, sometimes it is just five and I do think it 
goes up, the commercial zone goes up to 15 and 20. They are not 
supposed to leave that.
    I think there is a lot of uncertainty as to exactly what 
kind of truck is going to be crossing the border to go into the 
interior United States. The trucks that just come across into 
the commercial zone, the drayage area, as they call it, these 
may not be trucks that will go on into the interior of the 
United States. We really do not know. We have to be prepared 
for all those exigencies. And the drivers, too. We do not want 
to underestimate the problem of the unqualified driver.
    Mr. Sabo. What are the Mexican qualifications and how do 
they differ from ours?
    Mr. Mead. When they come into the United States, I believe 
they are supposed to meet our standards.
    Mr. Sabo. How do we know that? We have, I think, a fairly 
extensive record keeping system to keep track of a driver's 
record. That equivalent does not exist in Mexico, does it?
    Mr. Mead. They are working on systems. I cannot speak to 
the exact status of them, sir. I do know they are supposed to 
show evidence of insurability. I think there are certain basic 
standards. I can get back to you with further detail on that.
    Mr. Sabo. My understanding is that it is significantly 
different.
    Mr. Mead. We will get back to you. We have staff at the 
border right now on this issue, so they will be coming back and 
they will get fresh information.
    [The information follows:]

    Negotiations between representatives from the United States 
and the government of the United Mexican States on the issue of 
driver license reciprocity culminated in a Memorandum of 
Understanding (MOU). The MOU was signed on November 21, 1991, 
by former Secretary of Transportation, Samuel K. Skinner, and 
the Mexican Secretary of Communications and Transportation. It 
provides that the parties will issue licenses for commercial 
drivers that include knowledge and skills testing as well as, 
disqualification and physical requirements of drivers. It 
should be noted that Mexican drivers must be medically examined 
every 2 years to receive and retain the Licencia Federal de 
Conductor; no separate medical card is required as in the 
United States for drivers in interstate commerce.

    Mr. Clyburn. Mr. Sabo, may I follow up on that?
    Mr. Sabo. Yes.
    Mr. Clyburn. What happens, then, if one of these truckers 
were to get involved in an accident in this country? I am one 
of those who has real problems with NAFTA anyway. I mean, what 
does that do? What happens?
    Mr. Mead. Well, if they have the requisite level of 
insurance, the same thing that would happen to you or I.
    Mr. Clyburn. Right. If they have it.
    Mr. Mead. Yes.
    Mr. Clyburn. But do we have anything in place to make that 
determination?
    Mr. Mead. When an inspection occurs, they do check for 
insurance documents. Of course, if there is no inspection, you 
have a vulnerability there.
    Mr. Sabo. What percentage of trucks are stopped for 
inspection? Do you know?
    Mr. Mead. My information is not as current as I would like. 
I can tell you that at the crossing I was at, El Paso, the 
inspector could look at about 18 of the 2,000 trucks going 
through each day. And as I was describing earlier, it was an 
odd situation they had.
    Once the inspector had identified everything that was wrong 
with a truck and he judged it had to be placed out of service, 
he had to step off the line to prepare the necessary paperwork. 
Preparing the paperwork took him almost as long as it did to 
inspect the truck. But, while he was doing the paperwork, there 
was nobody there checking any other trucks.
    The staffing pattern that we have down there ought to 
compensate for those situations. There always ought to be 
somebody inspecting the trucks. And once the truckers know that 
there is that risk, they are going to think twice about coming 
across in poor condition.
    And in terms of an appropriation outlay, it is fairly 
cheap. I think they could also do third-party contracting here.
    Mr. Clyburn. Absolutely.
    Mr. Mead. It sounds like a good opportunity, if you want to 
do some outsourcing. It just does not strike me that it would 
be an enormous sum of money, particularly for the gain.
    [The information follows:]

    Mr. Rogers. Mr. Mead, your office has done a number of 
reviews of truck safety along our southern borders and 
concluded that there was not enough federal presence to prevent 
Mexican trucks with serious safety violations from entering the 
United States. Over the past year, the number of border 
inspectors has increased significantly. Now there are about 60 
federal inspectors located in Texas, California, Arizona, and 
New Mexico. Do you believe this level is sufficient?
    [The information follows:]
    In our opinion, staffing is still inadequate. In 1998, we 
estimated that 126 additional Federal inspectors were needed 
during port operating hours. At that time there were 13 Federal 
inspectors. Since then, additional inspectors were authorized 
bringing the total to 60 Federal inspectors in FY 2001, still 
only one-half of what we estimated was needed. Our 1998 
estimate may be a conservative number. In our ongoing review, 
we are updating our estimate of the number of inspectors 
needed.
    Mr. Rogers. What needs to be done to assure that Mexican 
trucks entering the United States meet or exceed U.S. safety 
standards and requirements?
    [The information follows:]
    First, FMCSA should have a comprehensive implementation 
strategy and plan that identifies specific actions with 
completion dates. This plan should identify all resources 
needed to reasonably ensure the safety of Mexican trucks and 
include provisions for ensuring safety not only upon entry to 
the United States but also as the commercial vehicles 
transverse the United States. It is reasonable to assume that 
the plan would include an assessment of the progress that 
Mexico has made in developing, enforcing and overseeing its own 
safety system and the compatibility of Mexico's system with the 
U.S. safety regulations. Secondly, FMCSA must place the 
resources needed at the southern border to perform the safety 
inspections of the commercial vehicles and drivers that enter 
the United States.
    Mr. Rogers. In your opinion, is the Department of 
Transportation, and particularly the Federal Motor Carrier 
Safety Administration, adequately addressing these issues?
    [The information follows:]
    In our opinion, more needs to be done to address safety 
issues at the southern border. The Department and FMCSA are 
currently developing an implementation plan to address these 
safety issues. The key is to implement the plan and follow 
through with the actions to ensure that safety is not 
compromised.
    On February 7th Senator Ernest F. Hollings and 
Representative James L. Oberstar requested us to provide a 
status report on existing conditions and the conditions 
necessary to safely open the border to Mexican trucks. Specific 
areas to be addressed are staffing and inspection facilities, 
out-of-service rates, verification of registration information, 
and harmonization of safety regulations. We are responding to 
this request as part of an ongoing audit assessing FMCSA's 
readiness to implement the North American Free Trade 
Agreement's provisions and the actions needed in the near, 
intermediate, and long term to ensure the safety of commercial 
trucks and drivers entering the United States from Mexico. 
Specifically, we will:
    --Review FMCSA actions and plans for listing the moratorium 
on cross-border trucking.
    --Assess processes in place to enforce U.S. safety 
requirements on commercial vehicles entering at the U.S.-Mexico 
border.
    --Determine whether the related provisions of the Motor 
Carrier Safety Improvement Act of 1999 have been implemented 
and enforced.

                     COAST GUARD DEEPWATER PROGRAM

    Mr. Rogers. Let me quickly move you to the Coast Guard, who 
are currently designing the most ambitious and expensive 
acquisition program in the history of the department. In one 
single contract, they plan to replace or modernize their entire 
deepwater fleet, 206 aircraft, 93 ships. Three industry teams, 
I am told, are currently bidding for the contract which is 
scheduled for award in fiscal 2002. The plans call for the 
appropriation of 10 billion for this program over the next 20 
years.
    As you know, Mr. Mead, a budget is basically the statement 
of an organization's priorities. These DOT appropriations acts 
for now two years have required Coast Guard to submit a five-
year capital plan establishing its priorities and to tie those 
bottom line numbers with the OMB budget targets for those 
years.
    The Coast Guard's plan only meets the OMB budget targets by 
underfunding Deepwater, their highest priority program, by 
about $300 million a year.
    Your report recently suggests that the Coast Guard needs to 
do a better job at establishing capital investment priorities 
and continue working with OMB to reconcile their desires with 
administration budget targets.
    Why is that important and have we seen any progress?
    Mr. Mead. Well, the administration's budget will be coming 
out in a few weeks, but I do not think we have seen the long-
term progress needed.
    You may see enough progress for this year. But, the fact is 
that all the Coast Guard's numbers tend to focus on about $850 
million a year. That presumably would cover Deepwater as well 
as their other capital needs.
    That is about twice what Coast Guard has been getting. And, 
that amount of money, $850 million, is not just a one-year 
shot. It will be sustained for a long period of time. And when 
we were talking about priorities, we were saying: what if $850 
million is not affordable, how are you going to set your 
priorities?
    And it is also important because there are functions the 
Coast Guard performs in addition to Deepwater that are very 
important. I mentioned one in the testimony, the search and 
rescue operations. Another is the national distress system, 
which the Coast Guard has recognized as deficient for many 
years and is something that mariners in distress very much 
need, but it is not part of Deepwater.
    So we have to come to some understanding on what the 
priorities are going to be, what is going to be bought and 
when, and what the affordability targets are, both for this 
committee and for OMB. But to the best of my knowledge, OMB has 
not bought into a long-term number and I know the Congress has 
not.
    Mr. Rogers. Last year, you told us that their plan to award 
this 20-year, $10 billion program to one contractor would be a 
mistake and suggested the service should build in opportunities 
to obtain competition on the program throughout the whole life 
of the program.
    The Coast Guard believes they can offset the lack of 
competition by providing good incentives to the prime 
contractor. Are they still following that one-basket approach 
or have they made changes? And do you agree with what is going 
on?
    Mr. Mead. It is not clear to me. The commandant seems very 
open minded about whether they are going to go this one firm 
for 15 years approach or they are going to be more modest.
    At the staff level, though, the Coast Guard seems to be set 
on having a very long-term engagement with one prime contractor 
or one integrator. In other words, all the undertakings 50 
miles or out, whether it is in the air or on the sea, you would 
look to one contractor with subcontractors who would deliver 
it. It strikes me as a very enormous undertaking, to go to one 
contractor.
    In the planning process for this acquisition, Coast Guard 
has gone to three different consortia, each of whom hopes to 
get the long-term Deepwater contract.
    I think there are a lot of questions about whether Coast 
Guard should engage should engage one firm for this amount of 
money for that period of time. And, I would say things are just 
as unsettled now on the long-term procurement strategy as they 
were a year ago. So the thing is moving along.
    Mr. Rogers. Their draft acquisition plan for Deepwater does 
not set program cost goals or design to cost targets. Instead, 
apparently their strategy is to minimize overall total 
ownership costs, but ownership costs may well depend on factors 
outside the contractor's control such as Coast Guard training, 
maintenance practices and operating practices. How will they 
control costs in this program if they have not established 
specific cost targets for each asset during the design and 
building phases?
    Mr. Mead. They will not be able to until they do that. That 
is the straight answer to that question.
    Mr. Rogers. Do you see them doing that?
    Mr. Mead. Well, I would certainly hope that would be done 
before Coast Guard launches this program. That is an important 
point because that is a test you hold FAA to. When Congress 
asks FAA for life cycle program costs one of its expectations 
is that it will get that type of information.
    Mr. Rogers. By the time of contract award, the Coast Guard 
will have spent almost four years designing and competing the 
Deepwater program. They have asked industry to construct the 
program which makes the optimistic assumption that the agency's 
capital budget will be doubled and that the higher amount will 
be sustained in the budget process for at least the next decade 
without interruption. Their acquisition strategy suggests that 
the prime contract might have to be terminated if in any single 
year of the contract the appropriation is significantly less 
than what is called for under the contract.
    Would you say that is a fairly high risk strategy on their 
part?
    Mr. Mead. Yes. I would ask Tom Howard to join me at the 
table, sir. He is the deputy assistant inspector general that 
handles our marine programs. He oversees the Coast Guard 
directly and he follows this program very closely.
    Mr. Howard. Yes, sir. We do see a risk in that approach. 
Absolutely.
    Mr. Rogers. Would you care to elaborate? What makes you say 
that?
    Mr. Howard. Sir, the idea is that in a couple of months the 
Coast Guard is going to select one of the contractors' 
proposals and use that to build their request for proposal. 
Once that contract is awarded and Coast Guard starts with the 
system integrator, the idea of changing a few years down the 
road seems high risk to us because these teams have been formed 
specifically to address this Deepwater proposal.
    Two or three years down the road, those teams may no longer 
be together. So, if the systems integrator who wins, has his 
contract terminated for any reason, there is no likelihood that 
those other teams will be available to bid for that contract 
later on.
    Mr. Mead. If Coast Guard put all its eggs in the basket of 
a team approach with one contractor leading this thing for 15 
years--you are going to be counting on this firm to be the 
leader for an enormous part of the Coast Guard's mission, 
everything 50 miles and out.
    Now, what happens if that leader in whom the Coast Guard 
put so much faith, unravels for whatever reason? What is the 
Coast Guard's backup or default strategy?
    That is my primary question to say nothing of what happens 
if the leader is okay but one of the subcontractors unravels. 
At least in that event Coast Guard has the leader to go back to 
and say: you are the primary, you are responsible for bringing 
this home no matter what. But it strikes me as a very large 
part of the Coast Guard's mission to entrust to one contractor.
    Mr. Rogers. Now, we have already appropriated over $100 
million for the planning and design.
    Mr. Mead. Yes.
    Mr. Rogers. In a few weeks, the president is expected to 
submit a budget request for the initial acquisition of ships 
and aircraft. Are the justification documents in place at this 
time to support moving forward in that vein?
    Mr. Howard. No, sir. We have not seen those as yet.
    Mr. Rogers. Should we demand from the Coast Guard those 
documents before we provide the first year funding?
    Mr. Howard. Yes, sir. We recommended that last year. We 
also recommended that if Coast Guard cannot produce the 
justification documents they at a minimum use information 
available from the contractors to develop cost estimates.
    There is no detailed or accurate cost estimate for what 
this project is going to cost. The figures that have been used, 
the 10 to 15 billion dollars, are basically planning estimates.

          COAST GUARD SMALL BOAT STATIONS AND COMMAND CENTERS

    Mr. Rogers. All right. Now, switching to small boat 
stations and command centers, for many years the Coast Guard 
has known of serious readiness and staffing problems at small 
boat stations. For example, in 1989, the Coast Guard completed 
the station staffing study which showed severe staffing 
shortages at the stations. Little or nothing was done about 
that.
    The current staffing standard calls for personnel at these 
stations to work a 68-hour work week. The Coast Guard has never 
met that standard. The work week, I am told, is over 80 hours 
per week.
    NTSB's investigation into the fatal sinking of the sailboat 
Morning Dew in Charleston Harbor in 1998 brought many of the 
deficiencies to light. Last year, we requested you to 
thoroughly evaluate the readiness posture of the boat stations. 
I know the report has not been finalized, but can you give us a 
little bit about that?
    Mr. Mead. Yes, sir.
    And, Tom, you may wish to amplify.
    I think you raise this in a very good context. Was it the 
Morning Dew?
    Mr. Rogers. Morning Dew.
    Mr. Mead. The Morning Dew incident, I think it was a South 
Carolina one. You asked earlier, Mr. Chairman, about the 
priorities. Very integral in the Morning Dew incident was the 
absence of a good national distress system, which has been 
delayed. That is not part of Deepwater and you probably want to 
make sure the appropriate priority is assigned to that.
    Now, I will go right to the question. I was very surprised 
at the indicators so far on this program, both as to equipment 
readiness and personnel readiness.
    Personnel, their work hours are very long. You mentioned 
the 68-hour week. What we found was in excess of 80-hour week.
    Training, it is unusual in the service to go directly from 
boot camp to a permanent duty station. Usually, there is some 
intermediate stop like training school. There is no training 
school for about 40 percent of the sailors on these small 
boats. And the condition of the boats, by the Coast Guard's own 
inspection 84 percent, are not ready for sea. So clearly for a 
mission that accounts for about 12 percent of the Coast Guard's 
budget, this needs some attention.
    Usually, these search and rescue stations, are staffed by 
enlisted people, E-1 to chief petty officer, E-9. These are not 
big cruisers and cutters and big stations. Maybe it is not 
flashy, but I characterize it as kind of one of the big 
workhorses of the Coast Guard's mission.
    Mr. Rogers. Well, I mean, these are some of the personnel 
that we strap into a powerful boat and send them offshore in 
rolling seas and all sorts of perfect storms to save boaters in 
distress in the middle of the night or in the fog. Do we even 
know whether or not they can swim?
    Mr. Mead. That is a good question.
    Mr. Rogers. Do we know?
    Mr. Howard. The requirements are pretty minimum, sir, in 
terms of what is required for swimming. Not probably what you 
would expect.
    Mr. Rogers. And what about the condition of the utility 
boats, life boats, other assets that they use?
    Mr. Howard. Mr. Mead mentioned the inspection. The Coast 
Guard has stand teams compare the condition of boats to Coast 
Guard standards.
    What they have found on average for the two primary boats 
used in the search and rescue missions is that 84 percent of 
the time they are determined to be not ready for sea. These are 
for a variety of reasons, including things from cracked 
windshields to fixtures that are not watertight, to engines 
that will not operate at the full RPMs, all things that could 
make search and rescue in good conditions dangerous and in 
rough seas could make them even more dangerous.
    Mr. Rogers. So have they requested money to begin replacing 
those boats or fixing them?
    Mr. Howard. No, sir. Some of the boats, the motor life 
boats, are in fact relatively new boats. The utility boat, 
which is a little bit larger, Coast Guard has not requested 
money to start replacing these. And these are similar to the 
Deepwater assets in that they are approaching the end of their 
useful life.
    Many of these boats are 20 years or older, generally 
estimated to have a useful life of about 30 years. So the Coast 
Guard needs to be looking to replace the boats or do something 
to extend their useful life.
    Mr. Rogers. Now, after the Morning Dew accident, the Coast 
Guard said they would undertake an immediate review of staffing 
at these centers and they last year acknowledged the study's 
conclusion that 109 additional personnel were needed, but went 
on to say when they advised the committee in the hearing 
record, ``The Coast Guard does not believe additional operation 
center staffing is practical in fiscal year 2001 and has not 
requested any be provided.''
    Why is that?
    Mr. Mead. Well, I do not know unless they feel that 
Deepwater is more important. I mean, they may see themselves 
operating under a budget constraint and figure, well, we have 
to cut priorities. So, they cut priorities in this way. I think 
what we are raising here is this is a very important component 
of the Coast Guard's mission. We all know that.
    You ask the average American what the Coast Guard does for 
a living and they will say search and rescue, probably that 
will be one of the first things they say. We are dealing with a 
central mission here and I do not know, but I would suggest 
that is a question of how you align your priorities.
    Mr. Rogers. Well, could it be that there is not much 
attention paid because these are just enlisted people?
    Mr. Mead. Well, there are only enlisted people on here. I 
do not know how I would exactly respond to that, though.
    Mr. Howard. I do not quite know either, sir.
    Mr. Mead. You do not see any admirals on these ships.
    Mr. Rogers. How many more people are needed, do you think, 
to bring both the boat stations and the command centers up to 
an adequate level?
    Mr. Howard. It is difficult to say because the shortages, 
the numbers have ranged quite a bit. The Coast Guard has 
reported numbers as high as double as what theycurrently have 
at these stations.
    Mr. Rogers. Which is what?
    Mr. Howard. About 4,100 currently at the stations. There 
have been studies saying shortages are as much as double that, 
but obviously the optimum level would probably be something 
less than double.
    Mr. Mead. And, also, I think, you know, staffing of any 
enterprise, if you do too much of a plus-up you cannot handle 
it and you cannot wean the people into your workforce in a 
prudent way. And we have one other stumbling block here. The 
staff needs to have some intermediate training and so the Coast 
Guard has to set up a training school. I would suggest that if 
the Coast Guard gave you a number of 100 last year, maybe that 
is the place to start.
    Mr. Rogers. One hundred nine.
    Mr. Mead. One hundred nine.
    Mr. Rogers. Well, as you said, these centers and stations 
are largely staffed by enlisted personnel and sometimes when 
the leadership makes resource allocation decisions these voices 
are not heard. Is that accurate, do you think?
    Mr. Mead. Well, I was in the Navy, which is different than 
the Coast Guard. But, I think it is fair to say that there is a 
different class between enlisted and officer. Having been 
enlisted, I feel pretty certain that my response there is 
correct.
    Mr. Rogers. Does anybody want to weigh in on this 
conversation?
    [The information follows:]

    Mr. Rogers. Mr. Mead, almost two-thirds of the servicemen 
initially assigned to small boat stations go there right out of 
boot camp. What training have they received at the time they 
report for duty, and is this adequate for them to do their job?
    [The information follows:]
    Before reporting to small boat stations, boot camp recruits 
receive general instruction in water survival, shipboard fire-
fighting, small arms training, first aid and CPR, as well as a 
general Coast Guard military orientation. They are not, 
however, given the training to prepare them to perform specific 
small boat station duties. In our view, personnel assigned to 
small boat stations should be required to undergo additional 
seamanship, boat handling, station watchkeeping, and law 
enforcement training prior to their arrival at a station. This 
would significantly decrease the amount of time needed to 
familiarize, train, and integrate personnel into day-to-day 
station operations.
    Mr. Rogers. Don't the other military services send their 
boot camp graduates to trade school before sending them to a 
duty station? Why doesn't the Coast Guard follow this practice?
    [The information follows:]
    The other military services send the majority of their boot 
camp graduates directly to trade school before sending them to 
their fist duty station. For example, the Navy sends 80 percent 
of its boot camp graduates directly to trade school. Coast 
Guard only sends 10 percent of its boot camp graduates directly 
to trade school. Coast Guard provides trade school training for 
20 of its 21 enlisted job specialities but its schools lack the 
capacity to provide training immediately after boot camp. 
However, there is no trade school for boatswain mates, the 
largest job category at search and rescue stations. For this 
position, the Coast Guard currently relies on-the-job training. 
The Coast Guard plans to establish a formal trade school for 
its boatswain's mates during FY 2002.
    Mr. Rogers. After the Morning Dew brought to light the 
staffing problems at command centers, the Coast Guard said they 
would undertake an immediate review of staffing at these 
centers. Last year, the Coast Guard acknowledged the study's 
conclusion that 109 additional personnel were needed. In last 
year's conference report, we strongly encouraged the Coast 
Guard to hire these 109 additional staff. Do you know how many 
additional positions have been filled?
    [The information follows:]
    These positions have not been filled. Coast Guard has 
requested 50 additional personnel in its FY 2002 budget 
submission. Coast Guard plans to request the remaining 59 
positions as part of its FY 2003 and FY 2004 budget 
submissions.

    [No response.]

                        AMTRAK SELF-SUFFICIENCY

    Mr. Rogers. If not, we will move to Amtrak.
    In January of this year, you released your ten management 
challenges facing DOT and you said ``Obtaining operating self-
sufficiency by the statutory 2003 date largely depends on 
Amtrak's ability to close a $737 million gap in projected cost 
savings and revenues which Amtrak pledged to achieve through 
undefined management actions; and deliver and generate revenues 
from all 20 trainsets planned for high speed service in the 
Northeast Corridor.''
    Since that report, Amtrack issued its 20-year strategic 
business plan and identified actions to reduce its losses in 
growth revenues. These actions included operating efficiencies, 
procurement improvements and fleet management.
    Are these actions well enough defined to believe that 
Amtrak could significantly reduce that $737 million gap between 
savings and revenues in the next two years?
    Mr. Mead. I think the direct answer to that question is no, 
not yet. They have made an effort to better specify what about 
$400 million of them are. But, being in a plan and happening 
are two different things. And this has sort of been the story 
over the past couple of years. Amtrak puts something in their 
plan. It sounds good. Once it gets defined, then there is a 
question of delivering on it.
    Mr. Rogers. In the past years, you have been optimistic 
that they would be able to achieve glide path. I detect a 
little more pessimism. Is that correct?
    Mr. Mead. Yes.
    Mr. Rogers. How much more?
    Mr. Mead. I am becoming very concerned. I would not 
characterize myself as optimistic last time, it is just that 
members of the committee would say: we have been appropriating 
dollars to Amtrak for a lot longer than you have been here and 
we have heard this before. I have been impressed with Amtrak's 
management, sir. I have been impressed with the way they have 
related to us. But, increasingly I have less hope they are 
going to make their operational self-sufficiency date.
    Mr. Rogers. Well, as you know, TEA21 and AIR21 mandates 
about 85 percent of transportation funds are guaranteed, which 
undermines congressional flexibility to found other important 
non-guaranteed programs like Amtrak, FAA, Coast Guard.
    If Amtrak's funding is held at the glide path level, as 
requested by the administration, instead of the $955 million 
requested by Amtrak, what impact would that have on the 
railroad's ability to reach operational self-sufficiency and 
meet its current service requirements?
    Mr. Mead. Well, if they do not get anything else, from 
their bond bill or other options, much will depend on how 
Congress decides to score it. If you score it at the current 
outlay level of 40 or 50 percent, Amtrak is not going to make 
it. If you score it around 90 percent, 100 percent, Amtrak 
could, I think, fumble along for another year.
    Congress has to reach closure on the capital issue very 
soon.
    Mr. Rogers. If that does not come about, what does that 
portend?
    Mr. Mead. A decision is going to have to be made about what 
to do with Amtrak. Amtrak is just introducing, as you know, 
high speed rail in the Northeast Corridor. I think a lot of 
people hope that that works well. I certainly do because we are 
always referring to these other countries having high speed 
rail. I hope the Northeast Corridor operation is successful.
    But if Congress does not deal with Amtrak's capital 
situation, what you are going to have is, I think, a big move 
to chop up the national network. Some people will probably 
suggest that the Northeast Corridor ought to be a separate 
unit. On the Senate side, this line of questioning came to us a 
couple of weeks ago.
    What has held Amtrak together over the years, and the 
reason why you have the Northeast Corridor and the reason you 
have high speed rail is because Congress has kind of expected a 
national network. It has been congresspeople from outside the 
Northeast Corridor that have kept Amtrak going for as long as 
it has. It certainly is not just the congresspeople from the 
Northeast Corridor. But if you take the national network away 
from all these other jurisdictions, what interest do they have 
in the Northeast Corridor?
    Those are the essential tensions that I see. Amtrak is in a 
position now where they are capital starved. Those are the 
facts, regardless of whether you are a supporter of Amtrak or 
not. Amtrak is capital starved and it has crept into the life 
blood of the railroad. Amtrak will not be able to survive 
without a capital infusion.
    Mr. Rogers. Questions?
    Mr. Sabo. Does the Northeast Corridor pay for itself in 
operations at this point?
    Mr. Mead. In operations? It probably does in operations. 
Capital wise, no.
    Mr. Sabo. No, I know that it does not any place.
    Mr. Mead. No.
    Mr. Sabo. Do any of the other lines operate close to the 
black?
    Mr. Mead. I do not think so. I think there is one in 
California that does fairly well. Other than that, I do not 
think there is one. Amtrak has a lot of these commuter 
contracts where Amtrak is the operator of the commuter rail 
line. Amtrak actually hauls more people under contract on these 
commuter rail contracts than they do on Amtrak, the passenger 
railroad. Those commuter contracts are profitable for Amtrak.
    Another fact a lot of people do not realize is the 
percentage of revenue Amtrak gets from things that have nothing 
to do with passenger rail service has been increasing over the 
past few years.
    Mr. Sabo. They were talking about some express mail.
    Mr. Mead. Right.
    Mr. Sabo. Is that working? Are they making money on it?
    Mr. Mead. They are doing reasonably well on it. Yes, sir. I 
know we are having a hearing on Amtrak in a week or two. It has 
been very instructive to me to watch Amtrak. The history over 
the years and how they got put on this glide path to 
operational self-sufficiency. There seems to be a fair level of 
support in the Congress for this bond bill. I think a lot of 
people believe they are going to be getting a high speed rail 
corridor in their neighborhood. I counsel everybody to say, 
well, high speed rail is very, very expensive. If you want an 
example of the price tag, just look at the Northeast Corridor.
    Mr. Sabo. How much have we spent in the Northeast Corridor 
on capital?
    Mr. Mead. Oh, well over a billion.
    Mark, do you know?
    This is Mark Dayton. He is our deputy assistant inspector 
general, responsible for rail and for the delay work for 
aviation.
    Mr. Dayton. I do not have the exact number, but in terms of 
the 20 train sets for the high speed rail, that is about $800 
million to $900 million. The electrification north of New 
Haven, that is about $700 million. But, then there has been 
other work, so I would say it is probably close to $2 billion 
at least.
    Mr. Mead. And you will also hear people propose that the 
ground infrastructure in the Northeast Corridor, which is owned 
by Amtrak, could be taken over by others. But, you cannot 
forget the life safety needs in those tunnels underneath New 
York. We have been very lucky, very fortunate.

                  FEDERAL MOTOR CARRIER SAFETY PROGRAM

    Mr. Rogers. Let me quickly switch you now to motor 
carriers.
    Mr. Mead. Yes, sir.
    Mr. Rogers. In 1999, we passed the Motor Carrier Safety 
Improvement Act, established the Federal Motor Carrier Safety 
Administration. They opened their doors on January 1, 2000.
    You have reportedly said that this agency has been stuck in 
neutral since its inception and only occasionally gets into 
first gear.
    Is that a fairly accurate statement?
    Mr. Mead. I probably was a bit harsh in that statement. 
What I was referring to was two things and I think most people 
would agree that they are important things.
    Motor Carriers is never going to have as many resources as 
it would like to inspect truckers and trucks as often as they 
would like. They have to leverage resources. You leverage 
resources by showing what you can do with the resources you 
have. When you have egregious offenders that are flagrantly 
violating the safety laws, you ought to shut these operators 
down. I was referring to that.
    The second was the leadership. We have not had leadership 
in the last year at the very top, at least full-time 
leadership. I understand it takes a long time to get things 
people nominated and through the Senate, and FMCSA has only 
been around for a year. But, the fact is we do not have an 
administrator now and we do not have a deputy administrator.
    They have been moving the SES positions around. I am not 
sure that the individual who was in charge of enforcement is in 
charge of enforcement this week. A couple of positions got 
filled in the last days of the Clinton administration. So I was 
speaking of the leadership and flexing the muscles that 
Congress gave them to shut down egregious offenders.
    And while I am on that, Mr. Chairman, I want to come back 
to these commercial driver license scams. We have a real 
problem. We have indictments and convictions in nine different 
states involving lots of truck drivers and that needs to be 
tightened up this year.
    If I was writing up an expectations list for that Federal 
Motor Carrier Safety Administration, that would be one of the 
items that is on it.
    It is shocking what we are seeing with some of these 
commercial driver licenses. People simply buy them.
    Mr. Rogers. How soon can you get that to us, those 
conditions?
    Mr. Mead. Three weeks.
    Mr. Rogers. Three weeks would be great.
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    Mr. Mead. You know, I mentioned the outright sale of 
licenses, we found one case, Mr. Chairman, the examiner noticed 
that people kept looking at their watches during the exam. We 
found out that on each rivet on the watchband, you would find a 
number of dots and those dots would correspond to choice A, B, 
C, D, or E. For example, rivet one was for question one and if 
you had two little dots, then that meant the answer was B. And 
all these people were looking at their watches.
    Fortunately there was a good examiner, who said what is 
going on here, and we found this was a scam.
    So anyway----
    Mr. Rogers. Well, get us that list.
    Mr. Mead. We will.
    Mr. Sabo. If you were one off, you would really be in 
trouble.
    Mr. Mead. Yes. You would flunk it.
    Mr. Rogers. Of course, the goal is to reduce commercial 
vehicle accidents and fatalities. Over the past three years, 
the number of fatalities has remained fairly constant, 5355 in 
1997, 5374 in 1998, 5362 in 1999. Large truck injuries have 
increased to 142,000.
    The 1999 goal of reducing truck-related injuries to 
126,000, fatalities to 4988 were not achieved.
    Can we achieve the goal of reducing injuries and fatalities 
by 50 percent over ten years, as Secretary Slater said we 
could?
    Mr. Mead. Doubtful. Very doubtful. I understand the spirit 
in which those goals were set. We are going to have to take a 
lot more forceful action if we are going to get it down by that 
much. There are 5000 fatalities a year now. That means we would 
have to cut that in half in ten years, in an industry that is 
growing by leaps and bounds.
    I have some numbers here for you. 10.1 million commercial 
drivers, over 560,000 motor carrier firms. Of that number, 
425,000 carriers have no motor carrier safety rating; 9900 
carriers are out there with an unsatisfactory safety rating. 
Pretty powerful numbers.
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            FEDERAL HIGHWAY ADMINISTRATION FUNDING OVERSIGHT

    Mr. Rogers. TEA21 increased highway and transit funding by 
over 40 percent, guarantees the majority of that funding. For 
example, in 1997, the highway obligation limit was 18 billion; 
for fiscal 2001, it is 29.6 billion.
    I remember reading about it, the last time we shoved money 
out the door this quickly was in the 1950s. The interstate 
program.
    Mr. Mead. Late 1950s, yes, early 1960s.
    Mr. Rogers. And we had a lot of fraud and abuse of that 
system back then. Can we expect that this time?
    Mr. Mead. I believe so. I quoted in my statement some 
indicators we see. I think the experience with the central 
artery last year, which was not fraud, but it certainly was 
material non-disclosure. The Federal Highway Administration 
needs to swing back to oversight of funds. There basically are 
a lot of engineers at FHWA and they look at the engineering 
aspects of a project.
    I am suggesting, Mr. Chairman, that the Federal Highway 
Administration needs to have made very clear to them that 
oversight of federal funds is part of their mission. Sometimes 
I think they feel we write the checks to the states and 
oversight is their job. But on these big projects, as the 
central artery shows, that is not how the general public takes 
it.
    Mr. Rogers. How are they equipped or ill equipped to 
oversee an audit of the expenditures of monies?
    Mr. Mead. Not very well. I am not sure that until last year 
that they really saw it as part of their job.
    Did you know that until three or four years ago the FHWA 
could not tell you how much a project was going to cost? But 
Congress passed a law that said for these expensive projects 
there has to be a financial plan that shows what the schedule 
is, where the states are going to get the money to pay their 
share, and why they think it is going to cost what it does. 
This was new to FHWA.
    And I just believe that FHWA needs to equip itself for 
oversight and that is part of the deal that went along with the 
extra money. That applies to the states as well, they are the 
front line. Some of the states have cut back on their 
oversight.
    Mr. Rogers. If you were going to improve oversight, what 
three steps would you take?
    Mr. Mead. Well, the first step I would take would be to 
make very clear my expectations that your responsibilities 
extend not only to making sure that the projects are designed 
well, but also that the money is spent properly and efficiently 
and in accordance with law and that the projects go through an 
audit.
    Secondly, I would make sure that the requirements that came 
out in the last administration for the oversight of mega 
projects are implemented.
    Thirdly, I would make sure that the states have oversight 
units. They used to years ago. It is like a pendulum. After the 
problems with the interstate, there was a lot of oversight. 
Then over the years, I think it was relaxed.
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                 TRANSIT FULL FUNDING GRANT AGREEMENTS

    Mr. Rogers. The Federal Transit Administration has entered 
into 13 new full funding grant agreements that would commit us 
to about $3.4 billion in expenditures over the life of the 
projects. Do you believe any of these projects have been 
approved too early?
    Mr. Mead. I am concerned that some may have. I would like 
to get back to you with a definitive answer. I think there is a 
real rush, Mr. Chairman, where they want to get their full 
funding grant agreement, so oftentimes the projects forward an 
estimate to FTA. They say here it is, here is how much it is 
going to cost, please approve this. And it gets approved--
before the project design has been completed.
    A few months later, FTA finds out it has approved the thing 
and it is going to cost two or three times as much as the 
original estimate. And it is pretty upsetting.
    So I will get back to you on a more definitive answer. As 
you know, you have asked us to look at several specific transit 
projects.
    We are concerned that some of these are getting approved 
prematurely, before all the homework has been done. It commits 
the Federal Government and then what are you supposed to do? If 
you have a half-built transit system and the projects comes in 
and says it is going to cost more, are you going to say no?
    [The information follows:]

    The pressure to enter into grant agreements in the early 
stages of project development almost always originates with the 
FTA grantee. FTA executes a limited number of new grant 
agreement for new starts projects every year. Because 
competition for approval is intense, a few transit authorities 
have submitted project applications before they had reliable 
cost estimates. On two projects we reviewed, the Tren Urbano 
Rail Transit Project and the South Boston Piers Transitway, FTA 
approved grant agreements very early in the design stage; and 
both experienced significant cost increases in the hundred of 
millions.
    To avoid this problem, suggestions have been put forth to 
require the grantees not to submit applications for full 
funding grant agreements until their designs were much more 
complete (50 percent). However, delaying grant approval until 
the design is 50 percent complete could make using a design-
build contracting method more difficult. Under this method, one 
contractor is selected to both design and construct a project.

    Mr. Rogers. Well, you are exactly right. And I have the 
feeling that there is just hardly any rules at all that govern 
how we go about entering into these very binding agreements 
that obligate the locals to pay their money irrespective of 
what we do during the course of the project. It is unfair to 
them and it is not good business. We cannot pay for them all.
    Mr. Mead. No. I feel for the Committee because under the 
current rules, the feds will pay 80 percent of these projects 
and the state or the transit property will pay the other 20 
percent. The projects come in phases to you. They call them 
MOS-1, 2 and 3, like minimum operating segment 1.
    And minimum operating segment 1, they come in, they say, 
well, this is going to cost $1 billion and we are only asking 
from the feds, say, $500 million. Under the 80/20 rule, you 
say, well, that is pretty good. The Federal Government dos not 
have to put up the 80 percent, the locals are putting up 50 
percent and the Federal Government is putting up 50 percent.
    Then a few years down the road, the locals come in again 
ready for MOS-2 and ask the Federal Government for $1 billion?
    And you say wait a minute, how much more are you going to 
put in?
    And they say no more.
    And you say, well, why not?
    And they say, well, because you have not contributed your 
80 percent yet.
    And it ends up costing the Federal Government more and 
more. So I am advocating we take a more holistic look at these 
transit projects from the very beginning. That we say what is 
it that you are going to build in the foreseeable future. That 
is the way we want to look at it. I also recommend that the 80/
20 rule be re-examined, that we do a reality check on the 80/20 
rule.
    Mr. Rogers. Well, I think you have said in the past that of 
these projects that have experienced big cost overruns, big 
time delays, scope changes or other problems have typically 
entered into the full funding grant agreement process too 
early, before adequate design parameters have been established. 
I think that is essentially what you have said.
    Mr. Mead. Yes. For example, I believe L.A. Metro, now is on 
the right track, but it was very, very painful in the 
beginning. Several years ago, we had to scrap about half of 
this project because the locality did not have any money to pay 
for it. It had been approved as part of a full funding grant 
agreement before people had an awareness that there were not 
sufficient local funds and it was going to cost more.
    Mr. Rogers. Would Seattle be a typical case in point of 
this difficulty?
    Mr. Mead. We are currently examining Seattle. Seattle is 
one of those projects that was approved late in the day on 
January 19th.
    Mr. Rogers. Well, according to the FTA's grant agreement, 
no outstanding issue should remain at the time an agreement is 
executed.
    Mr. Mead. Well, there are outstanding issues remaining.
    Mr. Rogers. Yes. There are a lot of outstanding issues.
    Mr. Mead. That particular project, when you consider the 
total size of it, is very close to if not most costly transit 
project in the United States.
    Mr. Rogers. Well, we cannot find out.
    Mr. Mead. We will find out for you.
    [The information follows:]

    The January 19, 2001 full funding grant agreement for the 
Seattle Central Link Light Rail Project (Project) anticipated a 
total project cost of $2.6 billion of which the Federal share 
is $500 million. While we have not completed our audit of the 
Project, we have observed cost increases of over $1 billion 
since the full funding grant agreement was sent to Congress for 
review. We also observed that a number of issues were left 
unresolved prior to awarding the grant agreement that could 
further impact the cost, funding or schedule of the Project. We 
currently plan to complete our audit of the Seattle Central 
Link light rail project in the fourth quarter of Fiscal Year 
2001.

    Mr. Rogers. Okay. I appreciate that very much.
    Do you have anything to add?
    Mr. Sabo. I am curious if you have looked at the rail mod 
program at all and how that is working.
    Mr. Mead. No, sir. We have not. Do you believe we should?
    Mr. Sabo. Well, in reality, we spend as much on railmod 
every year as we do on new starts. And it sort of flows as an automatic 
entitlement. I often have members from areas that get significant rail 
mod money telling me there is nothing in the bill for them because 
there may not be an earmark, but it flows automatically.
    And what I also notice is that increasingly we are 
beginning to have lines that clearly would seem to be eligible 
for rail money, mod money, also applying for new start money. 
Maybe that is appropriate, but I really do not know if 
communities even submit plans on how rail mod money is going to 
be spent. You know, it is there every year, it automatically 
flows by authorizing law and flows by formula and it is as 
large as new start and we get very little information about 
what happens.
    Mr. Mead. Maybe it is a good idea for us to examine that 
this coming year.
    Mr. Sabo. I would take a look at it. I have no idea what 
FTA gets.
    Mr. Mead. We will stop by, if it is okay with you, to see 
you once we scope it out. It may be an area worth examining.
    Mr. Sabo. Thank you.
    [The information follows:]

    Fixed guideway modernization is one of three categories of 
FTA's capital investment grants. A fixed guideway refers to any 
transit service that uses exclusive or controlled rights-of-way 
or rails, entirely or in part. The term includes heavy rail, 
commuter rail, light rail, trolleybus, aerial tramway, inclined 
plane, cable car, automated guideway transit, ferryboats, that 
portion of motor bus service operated on exclusive or 
controlled rights-of-way, and high-occupancy-vehicle (HOV) 
lanes. Section 5309(m) of the Federal Transit Act specifies 
that of the amounts made available for capital investment 
grants, 40 percent is to be used for fixed guideway 
modernization, 40 percent is for new fixed guideways or 
extensions (New Starts) and 20 percent is for bus purchase, 
replacement and facilities. In the last 3 years, the majority 
of our audits concentrated on New Starts. OIG plans to examine 
the fixed guideway modernization program with an eye to 
determining the effectiveness of the modernization expenditures 
on transit service improvements.
    Mr. Rogers. Another problem identified by your office is a 
lack of standardization in financial plans among transit 
projects with full funding grant agreements. Last year, your 
office testified that FTA needed to develop good criteria as to 
what a finance plan must contain when the project is initiated, 
including identifying what the project is going to cost and 
where the funding will come from; analyzing where the risks 
areas are; developing cost mitigation plans if there are cost 
increases or revenues shortfalls; and ensuring that there is a 
continual process by which these plans are updated. Has FTA 
made any progress in developing uniform financial plan 
guidelines and implementing your recommendation? If so, which 
projects have notable financial plans and which do not?
    [The information follows:]
    FTA has made progress in developing uniform financial plan 
guidelines. In June 2000, FTA issued ``Guidance For Transit 
Financial Plans.'' This document defines the content and scope 
of a financial plan and accomplishes the objectives of the 
legislative mandate to develop uniform financial plan guidance. 
It provides a model format and detailed examples of the 
elements of a complete and concise financial plan. The document 
also describes good practice in financial planning that is 
applicable to all transit agencies. FTA's guidance for 
financial plans also addresses the concerns we highlighted in 
our March 28, 2000 testimony regarding how financial and 
economic assumptions and project cost estimates have been 
derived; how the resulting forecasts of capital and operating 
costs of the proposed project fit into the agency-wide capital 
and operating plans; whether funds have been committed to the 
project, how the revenue forecasts are developed; and finally 
how capital and operating plans impact projected agency cash 
flow.
    Mr. Rogers. Project and financial oversight is funded by a 
draw down from the formula programs. Because of the number of 
new full funding grant agreements and mature projects within 
the fixed guideway modernization program, FTA may not have 
sufficient resources in fiscal year 2002 to adequately monitor 
all of these projects. What do you believe is the estimated 
shortfall? If FTA does not have sufficient resources to monitor 
all these projects, what impact will this have on the program?
    [The information follows:]
    To fund its oversight, FTA receives a fixed percentage of 
\3/4\ of one percent of New Starts appropriations. Although the 
number of approved projects increased by 86 percent (from 15 to 
28) in FY 2001, there has not been a corresponding increase in 
funding for oversight. For example, in FY 2000 FTA received 
$7.35 million for program management oversight, while in FY 
2001 FTA expects to receive $7.94 million, an 8 percent 
increase. FTA is currently working to identify the funding 
shortfall for project management oversight that may occur in FY 
2002 and beyond.
    FTA estimates a shortfall of $5 million in the amount 
needed for oversight. The increased number of full funding 
grant agreements in the past year is unprecedented. Since FTA's 
oversight is funded by a fixed percentage of New Starts 
appropriations; increasing the number of projects can have the 
effect of decreasing the oversight on each individual project. 
Further, oversight must cover all the pending, proposed, 
approved, and closing grant agreements. For example, projects 
that do not receive new starts appropriations receives no 
oversight funding. Nonetheless, they may still have oversight 
requirements, for such things as preliminary engineering, 
construction wind-up, finalizing outstanding claims, and grant 
close out.

                             AIRLINE SAFETY

    Mr. Rogers. Now, we have to hurry back here and finish, but 
I want to get back briefly to FAA.
    The Government Performance and Results Act required 
agencies to establish measurable performance goals which can be 
tracked each year. In FAA's air traffic service, two important 
safety goals, as you indicated at first, are the number of 
operational errors committed by controllers and the number of 
runway incursions at the airports.
    In both of these cases, FAA continues to miss its goals by 
wide margins. In the case of operational errors, they recently 
signed a memorandum of agreement with the controllers' union 
which eliminates many of these errors by calling them technical 
violations. NTSB has expressed concern about that.
    Who do you agree with on that?
    Mr. Mead. Some aspects of NTSB's concerns are very well 
taken. I agree that if you have a five-mile separation 
requirement and the planes are 4.9 miles apart, that is quite 
different than planes being one mile apart.
    On the other hand, the FAA's criteria equally weights two 
planes at the same altitude traveling at 500 miles an hour away 
from each other with a separation of 4.9 miles to two planes 
flying toward each other at 500 miles an hour with a 4.9 mile 
separation.
    It seems to me that when two planes are heading at each 
other at that speed losing separation is fairly serious. That 
should not be regarded as a mere technical violation. But I can 
understand when it is going the other way. And that was one of 
NTSB's points.
    Do you know, Mr. Chairman, that until we issued our report 
on this, the FAA was not evaluating operational errors 
according to seriousness and quantifying them? We just has this 
gross number 1100-something, what was up on the chart. It 
seemed to us that they needed to proceed with a much greater 
sense of urgency.
    So the basic answer to your question is yes, I think some 
of NTSB's concerns were quite legitimate. I hope FAA responds 
positively.
    I am happy to report FAA tells us they have fixed another 
operational error issue, recommended FAA keep tapes on these 
operational errors for longer than the 15 days they were 
keeping them. After 15 days, they were getting rid of them or 
reusing them.
    We said you ought to keep them until you have analyzed 
them.
    FAA wrote back and they said they did not have any storage 
space.
    I was going to rent the storage space for them.
    And Ms. Garvey, she was just as surprised as I was, and so 
FAA has committed to keeping the tapes of operational errors 
for 45 days.
    Mr. Rogers. When FAA's personnel management reforms were 
supposed to eliminate a large percent of its air traffic 
supervisors, replace them with regular controllers as we have 
talked today, controller in charge, has that perhaps 
contributed to the increase in operational errors that we are 
seeing?
    Mr. Mead. It is claimed to have by the managers. It could 
have. I do not have any evidence of that.
    Mr. Rogers. Do you have any operational error records out 
of the Kansas City Airport? What do they show?
    Mr. Mead. I do not know offhand, sir. I would have to get 
back to you.
    Mr. Rogers. It would be interesting to see that, because 
that is where we have all of these controllers controlling each 
other.
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    Mr. Rogers. Last year, FAA held a national runway safety 
summit where the agency pledged to combat the rising number of 
runway incursions and yet the errors continue to rise.
    In your judgment, why are these incursions increasing?
    Mr. Mead. Well, one reason, of course, is strictly 
logistical, there are more planes on the ground.
    In terms of getting a handle on them, FAA is at this time 
moving out much more vigorously. For a number of years, they 
had a plan. Actually, Mr. Chairman, they had two or three 
plans. Each plan was pretty good, but they all lacked follow 
through. The administrator is now personally overseeing FAA 
efforts to get a grip on runway incursions.
    It will require local action plans, though, because runway 
incursions are inherently local. It will also require 
technology.
    [The information follows:]

    Mr. Rogers. The Government Performance and Results Act 
(GPRA) required agencies to establish measurable performance 
goals, which can be tracked each year. In FAA's air traffic 
service, two important safety goals are the number of 
operational errors committed by controllers and the number of 
runway incursions at our nation's airports. In both of these 
cases, FAA continues to miss its goals by wide margins. In the 
case of operational errors, the agency recently signed a 
memorandum of agreement with the controllers union which 
eliminates many of these errors by reclassifying them as 
``technical violations''. The National Transportation Safety 
Board has expressed concern over this MOU. Do you agree with 
FAA's action?
    [The information follows:]
    We do not agree with FAA's actions. Our concern, like that 
expressed by the National Transportation Safety Board, is that 
the memorandum of agreement does not take into account the 
safety risk of each operational error. For example, operational 
errors involving two aircraft that are heading toward each 
other are high risk even if the aircraft maintain 80 percent of 
the required separation. Under the memorandum of agreement, 
controllers will be allowed to have an unlimited number of 
``technical violations'' without any management action, even if 
the incidents present a serious safety risk.
    We discussed our concerns with FAA and NATCA and have been 
advised that they plan to implement a new system to rate the 
severity (safety risk) of each operational error by April 30, 
2001. At that time, FAA plans to train or discipline 
controllers based on the severity of every incident, which 
should address our concerns. ``Technical violations'' will 
still be recorded as operational errors and included in FAA's 
overall numbers for determining whether it has met its 
performance goal for operational errors.

    Mr. Mead. I do not believe I mentioned it in my oral 
statement, but a principal technology is called AMASS. It gives 
controllers alerts of potential collision situations. AMASS is 
eight or nine years behind schedule. FAA is saying the first 
AMASS site is going to be operational this June or July. That 
will be on the list I give you in three weeks. That is very 
essential.
    Mr. Rogers. Your report raises a number of disturbing 
issues about FAA's aggressiveness in overseeing airlines and 
aircraft manufacturers, you call it a systemic weakness in the 
procedures, and the hearing into the crash of the Alaska flight 
revealed a number of weaknesses in FAA's oversight of that 
airline.
    Would you say that FAA is not aggressive enough in safety 
oversight, particularly of manufacturers?
    Mr. Mead. Yes, I have seen instances of that. I think FAA 
has gotten better in its oversight of the airlines. Of course, 
you can never be good enough in this business.
    There are two areas, though, I believe FAA could really 
improve upon, must improve upon. One is when a safety problem 
comes to their attention, it ought to percolate up to the right 
command level and something ought to be done about it. Some 
type of attention should be paid to it.
    In both the cable example and the fastener example, which 
we were discussing earlier, there is no reason that the issue 
should go on for a year or longer. There is no reason why we 
should have a New York Times article and then we take 
corrective action following the article. It begins to appear as 
though you are more reactive than proactive.
    Also, in FAA's current oversight program, there have been 
some problems recently reported in Time Magazine that stem, I 
think, not from a lack of good intentions but a lack of good 
training for the people doing the inspection, a lack of good 
inspection guidelines. But overall, I think FAA is better today 
than they were several years ago on that front.
    Mr. Rogers. Why does it take them so long to issue final 
safety rules? I mean, one example, the attempt to revive the 
current regulations on flight crew duty and rest time. NTSB has 
recommended changes in those rules since at least 1989, 
includes a reduction in pilot fatigue in their most wanted 
transportation safety improvements. But in a letter to this 
Committee two months ago, you told us thatalthough they have 
been working since 1994 on new standards, they have been unsuccessful 
in issuing a final rule.
    Has industry opposition killed that change or what is the 
matter?
    Mr. Mead. Industry opposition has certainly affected the 
pace at which it has moved. Absolutely.
    I think, Mr. Chairman, on a lot of important things in 
life, you are not going to make everybody happy. And if you try 
and make everybody happy, you are going to wait a long time. 
That rule is an example of that precept.
    Let me give you one other example while we are on 
rulemaking. Flight operations quality assurance. Shortly after 
I became Inspector General and Ms. Garvey became the 
administrator, the two of us talked about the importance of 
moving that rule forward. This rule has the airlines put 
sophisticated black boxes in their planes that measures 
hundreds and hundreds of parameters of a flight. The boxes give 
you information you would never get from an inspection. Very 
sophisticated information.
    And the issue was, well, what happens if this sophisticated 
black box records information that shows that the aircraft was 
being operated in a non-compliant manner? Will you prosecute 
the pilot or whoever was responsible?
    And the proposal was, well, no, why would you? You would 
not get this information otherwise anyway.
    So FAA drafted up a rule, it actually cleared, I believe, 
the Department of Transportation, and now it needs the help of 
the Justice Department, and probably the Office of Management 
and Budget. And this one single rule would move the envelope of 
aviation safety forward several miles with the stroke of a pen.
    I sit before you today, though, three-and-a-half years 
after Ms. Garvey and I had that conversation and I cannot show 
you that rule. The reasons for that rule's delay are quite 
different from the one about the pilots.
    Mr. Rogers. What is the reason?
    Mr. Mead. On the pilot one?
    Mr. Rogers. No, on this one.
    Mr. Mead. On this one? It is because the agencies of the 
federal government cannot agree with each other. When you put 
down in a rule that you are not going to prosecute somebody or 
take enforcement action against somebody, that is a big thing 
for the Justice Department. But that is a rulemaking that I 
would encourage the subcommittee to do what it can to push it 
forward.
    Mr. Rogers. The one you have just talked about.
    Mr. Mead. Yes, sir. And you would be amazed. You could have 
a pilot, the administrator of FAA, the airlines, another union 
group, and the mechanics union people sitting here. They all 
would agree we should move this rule forward. And yet there it 
sits.
    Mr. Rogers. Who is the main blocker, Justice?
    Mr. Mead. I believe so.
    Mr. Rogers. What department?
    Mr. Mead. And I do not mean to be pejorative at all in 
that. I do not know.
    Mr. Rogers. What division of Justice is dealing with it?
    Mr. Mead. I can find out for you, sir. I do not know 
exactly.
    Mr. Rogers. Okay.
    Marty, do you have anything further?
    Mr. Sabo. No.
    [The information follows:]

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    Mr. Rogers. Mr. Inspector General, we thank you for your 
day-long activities up here. We have kept you long and we have 
worked you hard and we apologize for that, but you are so 
helpful to us.
    We continue to look to you for education and for helping 
find out shortcomings within this very, very important agency. 
There is no agency, I cannot think of any right off, that has 
as much to do with the public safety as this one does. Your 
efforts have been stellar and we appreciate it very much.
    So keep us posted and we want you to know that the phones 
work two ways. We want to hear from you and we look forward to 
your assistance in helping us make accountability a way of 
life.
    Mr. Mead. Thank you, Mr. Chairman.
    Mr. Rogers. Thank you.
    We are adjourned.

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                                            Wednesday, May 2, 2001.

                      DEPARTMENT OF TRANSPORTATION

                            U.S. COAST GUARD

                                WITNESS

ADMIRAL JAMES M. LOY, U.S. COAST GUARD, U.S. DEPARTMENT OF 
    TRANSPORTATION

                            Opening Remarks

    Mr. Rogers. The Subcommittee will be in order.
    This afternoon the Subcommittee will receive testimony on 
the U.S. Coast Guard's budget request for fiscal year 2002. 
That request totals $5 billion, a 12 percent increase over the 
current fiscal year. That is the largest requested increase of 
any major DOT agency.
    The request includes a six percent increase in the 
service's operating budget, and a 59 percent increase in the 
capital budget. That capital increase is largely due, of 
course, to the deepwater program which is scheduled to enter 
production next year.
    The Subcommittee values greatly the dedication and courage 
of the Coast Guard and we will do all that we can to make sure 
that you have the resources to conduct important missions.
    True to our mission, though, we will ask the same tough 
questions today about performance and efficiency that we have 
asked the other departmental agencies to ensure that the 
taxpayers' dollars are stretched as far as possible. We want to 
make sure that administrative expenses are held in check and 
allow the maximum amount of resources to be put into the field 
to produce services for the public. We want to make sure that 
the deepwater program, the largest acquisition program in DOT's 
history, is ready to move into production to protect against 
unnecessary and costly disruptions later.

                          SMALL BOAT STATIONS

    But before we get into those questions I hope we can focus 
some attention today on one particular mission area of the 
Coast Guard where improvements are urgently needed. This deals 
with the status and readiness of our nation's small boat 
stations.
    The small boat stations and the command centers which 
receive mayday calls are the backbone of our nation's maritime 
rescue capability. When we think of the Coast Guard we often 
visualize a boat or an aircraft and rolling seas, coming to the 
aid of a sinking sailboat or fishing vessel.
    But despite their importance in the search and rescue 
effort, according to the Coast Guard's own studies and DOT's 
Inspector General, the boat stations are woefully understaffed, 
poorly equipped, and inadequately trained. Routine 80 hour work 
weeks lead to chronic fatigue. This in turn is leading to 
mistakes. Man overboard incidents involving Coast Guard 
personnel are up dramatically, as are vessel groundings. 
Mistakes made in the fatal Morning Dew sailboat accident 
recently resulted in a $19 million judgment against the Coast 
Guard.
    So there are real consequences from fatigue and 
understaffing, and the young men and women at our country's 
small boat stations deal with them every day.
    I know the Commandant is committed to working on this 
problem. Last fall he issued a Commandant's Instruction to try 
to address the fatigue issue and there is an increase of $5.5 
million in next year's budget request for improvements.
    Although these are good signs, much more needs to be done 
and I would hope that within a 12 percent increase overall we 
can do a little more to address that issue.
    So we would like to go into some of these problems today, 
Mr. Commandant, Admiral, to see if we cannot bring a little 
faster help to the Coast Guard men and women who themselves are 
bringing fast help to others in distress.

                              Introduction

    We would like to welcome before the Subcommittee the 
Commandant of the U.S. Coast Guard, Admiral James M. Loy. 
Admiral Loy has been in this position for three years now, 
having been named as the 21st Commandant in May of 1998.
    Admiral, we will be happy to enter your entire statement 
into the record without objection, and we will welcome your 
oral summary of that testimony.
    First, let me recognize the gentleman from Minnesota, Mr. 
Sabo, for any opening comments he would like to make.
    Mr. Sabo. Thank you, Mr. Chairman. Admiral Loy, we welcome 
you to the committee, congratulate you on your good work, and 
look forward to hearing your comments.
    Mr. Rogers. And let me recognize the chairman of the full 
committee, Mr. Young, for any comments he would care to make.
    Mr. Young. Mr. Chairman, thank you very much. I want to 
join in the welcome to Admiral Loy and those officers and 
personnel with him today.
    Mr. Chairman, I have the honor of representing a community 
that is the home to three Coast Guard stations. One is an air 
station that I believe is the largest air station in the United 
States Coast Guard; another sea station that has large areas of 
responsibility; and one of the small boat stations that you 
just mentioned in your opening comment.
    I must tell you that having the opportunity to visit with 
the men and women who man these three stations, and having had 
a chance to visit with Admiral Loy and others who are deployed 
outside of the continental United States, they do a really good 
job, and they do it with less than most agencies of the federal 
government have to deal with.
    We are losing two cutters out of our base in St. Petersburg 
because of a lack of money, lack of funding to keep an adequate 
crew.
    This is not a problem for the Coast Guard, it is a problem 
for the people that they serve.
    We have some rough weather in the Gulf of Mexico on 
occasion, and when you see all the other boats hightailing it 
for shore and to the safety of the bays, you see the Coast 
Guard boats and the Coast Guard ships on the way out to care 
for those who are out there who are in distress.
    Add that to the drug interdiction programs--a 
tremendoussuccess story that the Coast Guard has developed in drug 
interdiction which is so important to especially our kids.
    But something that many people do not know, when America 
goes to war, when America goes to places like Kosovo or Bosnia, 
somewhere across the oceans, the Coast Guard goes as well. They 
are on station, they are part of the military activity. They 
have been underfunded for so long that we have a lot of 
catching up to do, and I am hopeful, Admiral, and I know that 
the President has recommended an increase in your budget; I 
know that the budget committee in the House and the Senate both 
have a number that is substantially over and above, so maybe we 
will be able to work that out for you.
    But I am really happy to have you here, and I am happy to 
be here as a supporter of the Coast Guard and one who 
recognizes the difficulties that the Coast Guard has in 
performing its function. And the difficulties are not 
dedication, not bravery, not valor, but lack of funding to 
provide all of the operations accounts that are necessary, to 
provide the capital accounts, the refurbishing of the 
equipment, the old equipment. So I am here as a very strong 
supporter of the United States Coast Guard.
    Mr. Chairman, I thank you for the opportunity to make that 
statement.
    Mr. Rogers. Thank you, Mr. Chairman.
    Admiral Loy, the floor is yours.

                      Coast Guard Opening Remarks

    Admiral Loy. Thank you, Mr. Chairman, and welcome, sir, as 
our new chairman to the subcommittee. It is a delight to appear 
before you today and the distinguished members of the 
committee.
    It is a pleasure to discuss the Coast Guard's fiscal year 
2000 budget request and its impact, and as you all point out so 
correctly, on the essential services which is where we need to 
put our emphasis as we provide those to America on a daily 
basis.
    Mr. Chairman, I continue to be inspired, literally, by the 
daily evidence of dedication, patriotism, sense of public 
service inherent in our Coast Guard men and women--active duty, 
reservists, civilians and auxiliarists. These are men and women 
who continually demonstrate their commitment to saving lives 
and property at sea, to protecting our natural environment, and 
safeguarding the national security of our great nation.
    Maintaining their focus around the clock, frequently in 
very difficult situations under extreme pressure, Coast Guard 
sailors and airmen and marine safety professionals and support 
personnel have compiled an impressive list of accomplishments 
for America over this past year.
    Coast Guard men and women responded with poise and vigor 
when 34 crew members stranded aboard the foundering cruise ship 
Sea Breeze, some 250 miles offshore, called for help. Their 
helicopter was buffeted with 65 knot winds, and that sinking 
ship was pounded by 25 foot seas. Yet all were returned to the 
shore safely.
    Coast Guard personnel succeeded in preventing major 
ecological disasters in the wake of oil tanker groundings off 
the Mississippi delta and even in the Galapagos Islands in 
Ecuador.
    They facilitated the safe passage over two billion tons of 
freight, 3.3 billion barrels of oil, and 134 million passengers 
through our marine transportation system this past year.
    And as Chairman Young has pointed out, as one of the 
nation's five armed services, we deployed quickly our port 
security units to the Arabian Gulf in the aftermath of the USS 
Cole incident to provide force protection and to prototype 
whether or not that could be a niche mission for the Coast 
Guard in the future for the Navy and the Military Sealift 
Command.
    In addition to providing security abroad, Coast Guard men 
and women protected the maritime borders of our homeland by 
preventing more than 4,000 undocumented migrants from reaching 
our shores and interdicting drug smuggling vessels such as the 
Forever My Friend which was carrying nearly 20,000 pounds of 
cocaine destined for the streets and playgrounds of America.
    I have a tremendous sense of pride in what Coast Guard men 
and women have accomplished this past year. However, I continue 
to be concerned with our ability to maintain that performance 
now and into the coming decades.
    Despite the dedicated and hard work that men and women of 
the Coast Guard perform daily, we continue to be challenged to 
maintain our performance levels. Aging assets, spare parts 
shortfalls and inexperienced work forces are issues that 
continue to cause me concern.

                               READINESS

    Last fall the small boat lowering system's aft davit on the 
58 year old cutter Storis broke into pieces and nine Coast 
Guard personnel were dumped into the freezing, very rough 
waters of the Bering Sea. Fortunately, all were recovered, many 
of them actually incapacitated by the cold, unable to help 
themselves out of the water and in imminent danger of 
succumbing to hypothermia.
    As the Storis was recovering its personnel the fishing 
vessel that they were about to board got away. It was illegally 
poaching in our waters across the maritime boundary line with 
Russia. That is one job that we did not get done.
    The Storis incident provides a stark illustration of the 
often harsh environments Coast Guard units operate in, and the 
need for us to maintain proper readiness if we are to 
accomplish this array of assigned work that America has given 
us.
    Mr. Chairman, the President's fiscal year 2002 budget 
focuses on three basic themes for the Coast Guard. Specifically 
the requested budget will help to restore our service's 
readiness, to shape the future of the Coast Guard, and to 
continue what has become an evident transformation of our 
service into the 21st Century.
    We have made noteworthy progress over the last several 
years toward the goal of restoring our readiness.
    My number one pledge to this committee two years ago was to 
rebuild the Coast Guard work force. Our exceptional recruiting 
efforts for officer and enlisted accessions are paying off. 
Last year I was able to report to the committee that the 
reserve force was up to complement, and this year I am pleased 
to report that the active duty enlisted work force is back to 
its authorized strength for the first time since 1994--due in 
no small measure to the support provided by this committee.
    We still have skill and seniority gaps, but the petty 
officer shortage has been cut in half, and in addition the 
civilian work force is benefitting from its most successful 
recruiting year ever.
    But work force is just one facet of readiness. To 
completely restore service readiness, we must continue our 
multi-year phased approach to ensure that Coast Guard operating 
and support units are properly staffed, trained, equipped, and 
then maintained over time.
    The President's budget request helps make progress along 
that path. It will provide for important personnel initiatives 
that will assist us in recruiting and retaining the people we 
need to conduct Coast Guard missions.
    The President's budget will annualize the fiscal year 2001 
pay raise, and the mandatory military entitlements introduced 
with the National Defense Authorization Act of 2001. It will 
provide a fiscal year 2002 pay raise--4.6 percent for military; 
3.6 percent for civilians--improve health care, and continue 
vital recruitment and retention initiatives.
    In addition to maintaining a viable work force, the 
President's budget provides much needed funding for aviation 
spare parts. It covers increasing fuel and energy costs and 
provides funding to operate those new assets that we were able 
to acquire in fiscal 2001. Those include three new buoy 
tenders, 10 new coastal patrol boats, and 20 new motor life 
boats. These were all brought in to replace the antiquated 
assets of our coastal inventory of the past.
    The President's budget also addresses our readiness 
concerns at search and rescue command centers and stations by 
increasing staffing to alleviate previously identified 
personnel fatigue and quality of life issues.
    But the strongest statement in the President's request is 
that we step boldly into the modernization of the Coast Guard's 
operational capability, and I am sure we will discuss this 
thoroughly in the course of the hearing, Mr. Chairman, so let 
me make just a point or two, if I may.

                           LONG TERM PROJECTS

    First, the National Distress and Response System 
Modernization Project and the Integrated Deepwater System 
Projects are absolutely crucial to the future of our 
organization. ND&RSMP will connect the coastal asset inventory 
into a safe, efficient and effective force nationwide with no 
gaps in coverage. It deserves the attention of each of us to 
ensure we move smartly and methodically to complete the 
prototype, execute the testing and evaluation of appropriate, 
and then potentially accelerate the installation.
    Second, the Integrated Deepwater System is, very simply, 
the future of offshore Coast Guard capability. Aging 
infrastructure puts both mission and Coast Guard people at 
risk. We have worked diligently now for three and a half years 
to bring the Integrated Deepwater System to this point. We have 
examined failed projects diligently to find out why they 
failed. We have examined successful projects to find out why 
they succeeded. We have requested and received reviews and 
scrutiny from constructive critics who helped us design what I 
truly believe to be the best acquisition strategy and prepared 
the best RFP possible, scheduled to go on the street on the 
15th of June.
    Again, I look forward to a good, thorough discussion as you 
indicated in your opening remarks, Mr. Chairman. But the bottom 
line is this.

                         OFFSHORE CAPABILITIES

    Our offshore capability is waning and it is waning at an 
accelerating pace. I need three things from this Congress as 
requested by the President in his budget request: $338 million; 
the ability to hold this project time line to award that 
contract in the second quarter of fiscal 2002; and support for 
the prime system integrator with whom I will personally enter 
into a public/private to deliver the planes and ships that we 
need to serve America offshore for the next 40 or more years.
    Lastly, Mr. Chairman, this budget offers the beginning of a 
transformation from the old to the new. The operating expense 
budget as you have mentioned, reflects a six percent increase 
from enacted 2001. I hope to show you in our discussions today 
that we need to break this downward spiral of spending ever-
increasing amounts of money on our older assets, seemingly just 
entering or emerging each year from one liquidity crunch that 
bears the seeds of the next one.
    This budget acknowledges that temporary operational 
adjustments will likely be necessary. In order to pay mandatory 
bills, to bring on and use the new assets procured last year, 
and live within the budgeted targets, old assetstoo costly to 
sustain are offered in this budget for decommissioning. And I am ready, 
sir, to discuss that with you as well.
    Mr. Chairman, very simply, each morning when I wake up I 
have two goals. First, get the job done that America asks us to 
do through the tremendous young Americans that are out there 
doing it. And secondly, to train and equip Coast Guard 
professionals so they can do it and do it safely.
    Our past performance and our pride are the foundations for 
future excellence and I will hold that up against anyone to 
compare.
    Coasties will always read their orders; they will always go 
out in the storm; and they will always excel. They always have, 
and they always will. Our task together, Mr. Chairman and 
members of the committee, is to ensure that they have what they 
need so that not only can they go out, but that they can return 
safely.
    Thank you, Mr. Chairman, and I look forward to your 
questions.
    [The prepared statement and biography of Admiral Loy 
follow:]

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    Mr. Rogers. Thank you, Admiral, for the statement.
    Let me again say all of us on this panel salute you and 
your staff for leading a great organization. We are all proud 
of the Coast Guard, proud of the work that you do, and want to 
be helpful in any constructive way that we can. So the 
questions that we have are meant to be in a constructive way.
    Let me touch quickly on the search and rescue readiness 
questions that I mentioned in my statement. That is the small 
boat stations.

                    SMALL BOAT STATION STAFF LEVELS

    For many years now internal and external studies have shown 
serious understaffing at those stations. Most recently an IG, 
Inspector General, review of staffing levels for 55 stations 
found that one-third of the positions were either empty or 
filled by personnel not certified to perform boat crew or 
coxswain duties. One in five stations had less than 60 percent 
of authorized staff available to perform search and rescue 
related missions.
    As a result of those shortages, the average work week at 
the small boat stations is in excess of 80 hours a week--
greatly exceeding the Coast Guard's 68 hour standard work week. 
Most of those who actually go to sea report even longer work 
weeks--87 to 88 hours per week. And in a Coast Guard survey in 
1999, personnel at the stations reported they averaged five and 
a half hours per day for eating and sleeping combined.
    And as I mentioned in my statement, according to Coast 
Guard studies, long hours and fatigue lead to lost time due to 
illness, injury, lower retention levels for trained personnel, 
and it also increases the likelihood of accidents.
    Since 1998 small boat mishaps have increased by 225 
percent. In 1999 there was a three-fold increase in vessel 
groundings and man overboard cases. The Center for Naval 
Analysis concluded in 1999, ``It is plausible that personnel 
operating under these conditions will be more likely to make 
mistakes that could cost lives or lead to injury.''
    In October of this year past, the Coast Guard issued a 
Commandant Instruction mandating minimum crew rest times. It 
requires stations to ensure 10 hours of crew rest in every 24 
hour duty period, and 10 hours of rest before assuming duty. 
And those stations that cannot meet those requirements have to 
issue a crew fatigue message to district and headquarters 
officials.
    But when the IG checked recently, they told us that they 
found no records of such messages being kept, either at the 
field level or at headquarters.
    So tell me what you are doing and what can be done to 
decrease the number of hours that station personnel are on duty 
and to increase the rest times?
    Admiral Loy. Thank you, Mr. Chairman, and this is an issue 
that is of great consequence to me.
    I think an awful lot of our challenge can be laid at the 
feet of the personnel shortfalls that we have experienced over 
the course of that window of time, so to speak, between 1998 
and just this past year. That, of course, is the time where the 
IG was auditing those stations as well.
    If in fact a personnel allowance list at any given station 
is not filled, obviously there is a behavioral instinct on the 
part of that officer in charge, that commander, and even those 
young people at that station to fill the void. We need to guard 
against that when it takes the shape of fatigue, overwork, 
under rest, and the kinds of things that you were just 
describing.
    That is precisely, sir, why when I took this job in 1998 we 
set out on the course of refilling the work force so that the 
body count was right at all of these stations and virtually 
everywhere else in the Coast Guard as well.
    As I indicated in my opening comments, I am delighted to 
report that as of this year we have been successful in terms of 
refilling that authorized force.
    But when you bring on a new seaman and you let go, as we 
have unfortunately experienced in this last several years with 
the robust economy, an experienced E-6 or an experienced E-5. 
The experience drain that you end up with in the organization 
is something that we have to significantly deal with.
    A couple of comments, however.
    First of all, with respect to the 80 hour work weeks or so. 
Actually, a fully allotted station chooses that particular 
numbering process so as to have a port and starboard duty 
section array that offers them what they call sliding weekends, 
such that they are able to spend more time with their families 
on choice weekends through the course of the month.
    Integral to that 80 hour work week, however, must be 
adequate rest so as to again guard against the things that you 
were describing in your question.
    We have in this budget, as you know, a request for 
additional staffing for our command centers associated in the 
immediate aftermath of the investigations conducted in the wake 
of the Morning Dew case and look forward to those approved 
billets being filled such that the watch stander fatigue issue 
will go away. That is very much what we want to have occur.

                          PERSONNEL ALLOWANCES

    Mr. Rogers. Well, as I understand it, you only request 51 
additional staff years in that request. It seems to me that 
that is sort of a drop in the bucket compared to what is 
needed. Is that generally true?
    Admiral Loy. Our thought, sir, is that the first order of 
business is to make an assessment as to whether or not those 
personnel allowance lists are adequate to the tasking was ask 
of those stations. And frankly, at this point we feel that that 
is adequate.
    The focus of what we are trying to get accomplished with 
additional staffing goes to functionality that we are putting 
at those places. For example, last year the committee approved 
and we have now filled positions associated with our surfmen 
billets out in the Pacific Northwest. Very difficult, 
challenging stations at several of the rivers with bars 
associated with them that make those stations particularly 
challenging. Some 58 positions were offered last year to 
augment stations to deal specifically with that.
    A second order of business last year was the 24 positions 
associated with where we are placing a 47 foot motor life boat, 
a much more complex vessel, as a replacement for a 41 foot 
utility boat. We are placing along with it--the adequate 
staffing and the OE expenses, the operating expenses necessary 
to do that well.
    The issue associated with a significant number of the young 
people showing up at a life boat station to be trained on the 
job is I think a paradigm that has existed in our service for 
approaching 100 years. So it is not unlikely that a young man 
or woman coming out of boot camp will go directly to a life 
boat station and enter into what I will call a very formal, if 
not a schoolhouse, a very formal qualification and 
certification program before they will ever be allowed to serve 
as a coxswain, serve as a mechanic, serve as a boat crewman 
even, on one of the vessels that actually deploy for a mission.
    So the training program, although sir it is not, as I say, 
in a set of schoolhouses, it is classically focused on 
precisely that station, the challenges of that station, the 
geography of that station, so they know it well at the other 
end of the day.
    Mr. Rogers. How many more positions would you need to get 
to the 68 hour work week standard that has been set?
    Admiral Loy. I do not have that number off the top of my 
head, sir, but I will be glad to do the analytical work going 
backwards from about 80 to 68 and offer that to you.
    Mr. Rogers. One study said that you would need 2,300 more 
people just to meet that 68 hour work week standard. Is that an 
unreasonable figure, do you think?
    Admiral Loy. No, sir. I do not think that is an 
unreasonable figure at all.
    Mr. Rogers. That would be a huge increase over your current 
staffing which I think is around what, 4,100 or so?
    Admiral Loy. Yes, sir.
    Mr. Rogers. What kind of dollar figure would that amount 
to?
    Admiral Loy. It would be simply 2,000 times the standard 
personnel cost. That is a figure easily derived and offered to 
you, sir.
    Mr. Rogers. Well if you need 2,300 more just to get to the 
68 hour work week and you are only requesting 51 staff years, 
that truly is a drop in the bucket is it not?
    Admiral Loy. Yes, sir.
    Mr. Rogers. Well, there is clearly a linkage between the 
shortage of staff and the 80 hour work week. Do you see any 
linkage between the long work week and the increasing 
groundings, men overboard, and other mishaps?
    Admiral Loy. Sir, there is no doubt that a crew pressed to 
its limits will find itself tested, and we are watching those 
red flags of concern. I have reported those elements of 
readiness as a concern over the course of the last three years 
as I have testified here.
    Mr. Rogers. You issued a Commandant's Instruction last 
October establishing minimum crew rest requirements at the boat 
stations. Do they have the budget resources to carry that out?
    Admiral Loy. The budget resources to carry out, I am trying 
to make a connection between budget resources and a mandated 
rest period. What we are really talking about is the other 14 
hours, if you will, of any given day, and do we have the 
resources in those 14 hours to get the work done.
    Mr. Rogers. Well, do you have the staff necessary to allow 
that 10 hour break?
    Admiral Loy. I think we do, sir, now that we have refilled 
the work stations. Now that we have refilled those stations by 
body count. We would now very much be able to, inside the 
parameter of even an 80 hour work week, guarantee probably 14 
or 15 hours of rest associated with a given day.
    Mr. Rogers. The IG auditors tell us that there are no crew 
fatigue notices either at the field level or headquarters. Do 
you know why that is not being done?
    Admiral Loy. No, I do not. I do know that we have 
undertaken a significant analytical effort as it relates to 
understanding fatigue, and of course the Secretary has 
championed that at the departmental level for all of the modes 
in Department of Transportation.
    We have some excellent work with respect to understanding 
fatigue. As to whether or not there are notices posted at 
various stations, I think there probably are not.
    Mr. Rogers. I will come back to the small boat station 
question a bit later and I will yield to Mr. Sabo.
    Mr. Sabo. Mr. Chairman, if the big Chairman has time 
commitments and needs to leave, I----
    Mr. Young. I am okay.

                     LONG RANGE PROGRAM: DEEPWATER

    Mr. Sabo. You are okay? Okay.
    Mr. Chairman, I have some questions for the record.
    I am trying to understand what happens with your long range 
program and deepwater capability, its demands on the budget. 
And as I understand, that is going to have an escalating 
acquisition cost beyond what we are looking at this year into 
the future, and I am not sure what the other demands are that 
relate, particularly search and rescue. I assume our icebreaker 
for the Great Lakes gets built, and that project is over at 
some point.
    But I follow somewhat what goes on in all our discussions, 
projected budgets, and I see sort of tight dollars in the years 
ahead for discretionary funding. So I am just curious what you 
are looking at as long range procurement costs and total, not 
just deepwater but other acquisition needs you have, and its 
relationship to operations.
    I am not sure one can be looking at six or ten percent 
growth figures each year as one looks into the near future.
    Admiral Loy. No, sir. We have had a very clearly 
established planning factor of about $500 million a year to 
built out deepwater--that is in 1998 dollars of course--to 
build out deepwater over the course of the next----
    Mr. Sabo. Is that in actual dollars? Or is it----
    Admiral Loy. That is 1998 dollars inflated annually.
    Mr. Sabo. So it would be inflated.
    Admiral Loy. Yes, sir.
    We have worked diligently with both the Department of 
Transportation and with OMB. To go directly to your two 
questions, sir, we do believe that even with the existent out 
year marks that OMB projects for us in the acquisition account, 
our AC&I account, that we will be able to deal comfortably with 
the anticipated build out of the deepwater project and not 
jeopardize any of our other major efforts. Because clearly, 
although deepwater is an enormously important project for the 
Coast Guard, so is ND&RSMP, this National Distress and Response 
System Modernization Project. So, this year, is the requirement 
to finish out the buy on the two final buoy tenders in the 
build that Marinette Marine up in Wisconsin is building for us.

                         GREAT LAKES ICEBREAKER

    And as it relates to the Great Lakes icebreaker, your 
particular question, the monies for the Great Lakes icebreaker, 
$110 million was appropriated last year in the MILCON 
supplemental, so we have worked very diligently over the last 
several years to sort of, if you will, clear the decks for 
deepwater in 2002 and the out years by focusing on the 
opportunities as they came by to fund many of those programs 
before we got to 2002.
    Of course last year the GLIB, the Great Lakes Icebreaker, 
was in the President's request and was funded in the 
supplemental. It is not reflected, if you will, in the 59 
percent figure that the Chairman used to open the hearing.
    But the reality is we are, we think we are in good shape. 
What is very interesting is the way the OMB marks have sort of 
been converging towards the obvious need forthcoming, that they 
see forthcoming as it relates to a significant project for the 
Coast Guard.
    For example, in 2000 our fiscal year 2003 mark was about 
$545 million. In 2001 our fiscal 2003 mark was about $526 
million. And in fiscal year 2002, our fiscal year 2003 mark now 
leaps to $673 million.
    So the projection from the Office of Management and Budget 
is acknowledging the very question you asked, sir. We need to 
be very careful about looking to the out year funding 
requirements that will be generated by this project, and 
anticipate them very well as we prepare our annual and our five 
year capital investment plan.

                         DEEPWATER PROCUREMENT

    Mr. Sabo. You are entering a different type of procurement 
process.
    Admiral Loy. We are, sir.
    Mr. Sabo. It sounds like sort of a design and build option 
that we use some other places. I am not sure it is exactly the 
same. But I am curious how that will work. Obviously you may 
start with assumptions on what is going to be, and as I 
understand it is a 15 year process.
    Admiral Loy. Yes, sir.
    Mr. Sabo. And I assume that you or the contractor will come 
to judgments along the way that some things should be 
different.
    Admiral Loy. Many of those judgments I am sure will enter 
into the dialogue along the way.
    Mr. Sabo. How will you make those adjustments, and how will 
you not be sort of held hostage to one contractor?
    Admiral Loy. Yes, sir. I understand.
    The reality is this. I believe that the notion of a prime 
with a number of subordinates, for the value the prime brings 
vis-a-vis integration capability, is virtually a prototype of 
the way many acquisition projects will go for the federal 
government in the future.
    As I mentioned in my opening statement, sir, we scrubbed 
very hard, I suppose there is no need to identify, but a number 
of federal projects that had gone awry recently, with the idea 
in mind to find out why did they go awry. Someone was very 
confident at the point that they were requesting monies for 
those projects, someone on some committee was convinced that 
they were the right thing to do, and away they went but somehow 
failed two, three, four, five years down the road. Why did that 
occur?
    One of the things that we found that was in common with 
many of those failed projects was the assumption that within 
the federal establishment of those respective agencies the 
skill set, the competency existed to do the integration 
necessary for a very complex buy that they were trying to get 
at for their respective agency.
    We also looked at projects of the last couple of years that 
have been enormously successful and tried to figure out why 
that was the case.
    Where we found the best common ground was where we had 
control associated with the government and whichever agency was 
owning the project; and we had, as necessary, a public/private 
partnership that reflected the skills and competency of, in our 
case, what would be a prime integrator. And of course the three 
companies that are leading the three consortia, the teams that 
are competing for our project, are world class. They are the 
very best in the world.

                            PRIME INTEGRATOR

    Mr. Sabo. I think I know what you mean by prime integrator, 
but why do you not define it so we make sure that what I think 
it is----
    Admiral Loy. Yes, sir.
    What we will do, sir, in the acquisition strategy that we 
have built, and we have built this acquisition strategy with 
great outreach to an awful lot of people who challenged it, who 
wondered about it, and who asked very good penetrating 
questions about it, and we believe that we have the answers to 
those questions so as to be able to press on.
    But the bottom line will be a public/private partnership 
that the Coast Guard would enter in with the winning 
integrator, and thereafter, over the course of five year 
segments, each reviewed on an annual basis, we would renew that 
association if performance dictated that they were going in the 
direction that we wanted them to go.
    What are they going to be doing? They are going to be doing 
what we would otherwise have to be doing ourselves--buying 
ships and planes and sensors and whatever leasing arrangements 
with satellites or UAVs or whatever might be the very best 
package of assets to do the Coast Guard's job in the future, 
and optimize them from several parameters: operational 
effectiveness, total ownership cost as a good stewardship nod 
appropriately to the American taxpayers who are going to be 
paying for all of this, the managerial capability that they 
have, and the capacity to absorb technological adjustments or 
other adjustments along the way.
    For example, if in 2008 Mr. Rogers says to whoever the 
Commandant is sitting here, we are not interested in you doing 
migrant interdiction any more, or drugs any more, or search and 
rescue any more--but if he says that I am sure the Commandant 
is going to get up and leave. But the point at issue here is 
this arrangement will absorb changes in mission, reasonable 
changes in funding levels, technical changes in capability that 
need introduced into the project along the way. All of those 
questions have been recognized carefully and designed into the 
acquisition strategy, and designed into the RFP that we will 
put on the street on the 15th of June.
    We owe you, sir, more insight to that. And as I chatted 
with Chairman Rogers yesterday, I would be honored to offer a 
proprietary brief in terms of the real insides of what we have 
at this particular point of time in our ongoing negotiations 
with the three consortia so that the committee is fully aware 
that this is not about a relationship with a system integrator. 
This is about getting the ships and planes and sensors in a 
coordinated fashion that will best serve the United States 
Coast Guard to get its work done for America out to the next 40 
years.
    Mr. Sabo. Will the integrator do any of the actual 
construction or----
    Admiral Loy. Potentially so. It is a matter of who is the 
winner. Of course I cannot go there, so to speak, as we speak 
today. But for example, SAIC is one of the leading integrators, 
is one of the leads on one of the consortia. They would be 
obviously less inclined to be actually cutting steel and 
building anything that would Lockheed/Martin or Boeing as the 
other two integrators at the top of their consortia teams.
    So I think that is the answer to your question. But as I 
indicated earlier, I think because of the importance of this 
not only to us as an organization to best be able to do our 
work in the future, but to the comfort zone that thecommittee 
must have, that we are stepping off and doing the right thing at the 
right time. Such a brief I think is enormously important to you.
    Mr. Sabo. Thank you. Much obliged.
    Mr. Rogers. Thank you, Mr. Sabo. We will come back.
    And before yielding, let me say, Admiral, that we will 
accept your offer to do a briefing in detail on deep water. As 
many members of the subcommittee and staff that would like to 
be a part of that, we will do that in an informal way.
    Admiral Loy. Certainly.
    Mr. Rogers. We will work out a time with you to do just 
that. Because as has been said, this is the biggest acquisition 
in awhile.
    Admiral Loy. Yes, sir. And I understand your interest, and 
it is a vivid interest of mine. This is something that we 
absolutely must get right and we must press on this year.
    Mr. Rogers. Chairman Young.

                        CONTRACTOR RELATIONSHIP

    Mr. Young. Mr. Chairman, thank you very much.
    Admiral, just a quick followup on Mr. Sabo's questions 
about deepwater.
    You have had an excellent relationship with one of your 
builders that builds your buoy tenders and----
    Admiral Loy. Certainly.
    Mr. Young. They are usually there ahead of schedule and 
under budget, at least from what I have been told.
    Admiral Loy. Yes, sir. I would offer that is a nice offer 
you make me to answer that question, sir. Because it offers me 
the chance to share with the committee not in a braggadocio 
sense, but in a simple factual reality sense that the Coast 
Guard's management of the acquisition projects we have 
undertaken over the course of the last decade has been in fact 
recognized as being the best in government.
    The project that the Chairman mentions is our buoy tender 
project, both coastal and seagoing, with Marinette Marine in 
Wisconsin. We are asking in this budget for the funds, $70 
million, for the last two of those buoy tenders. They have in 
fact been under time, under budget, and total 100 percent 
performance. You do not get any better than that in terms of 
public project management and we are very proud of that.
    I can say the same thing for our coastal patrol boat 
project. I can say the same thing for our motor life boat 
project with Textron down in New Orleans.
    So we have in fact been recognized as an organization that 
takes acquisition projects enormously seriously, and does them 
very well--Whether it is the evidence offered by the Government 
Executive Maxwell School Review of Agencies last year, which as 
you might recall, in fact at this committee hearing last year I 
remember Chairman Wolf paging through the magazine on that 
occasion, and we were delighted that he found the Coast Guard 
page and saw the straight A's across the board. That is the 
nature of preparation, if you will, for this project, as well 
as execution as reflected by those projects in the immediate 
past.
    Mr. Young. Admiral, I brought up that issue to ask the 
following question. Will that company or any other company that 
you alluded to be teamed with SAIC or with Lockheed or with 
Boeing on the deepwater project?
    Admiral Loy. They are members of one of the consortia. Yes, 
sir.

            NATIONAL DEFENSE AUTHORIZATION ACT REQUIREMENTS

    Mr. Young. I want to go to a question on the 2002 budget, 
but before I do, I take advantage of your presence here to talk 
about the 2001 budget.
    The National Defense Authorization Act gave you certain 
mandates that applied not only to the other four services but 
also to the Coast Guard that caused you some additional 
expenses. However, your appropriations bill had already passed 
and become law prior to the NDAA.
    Admiral Loy. Yes, sir.
    Mr. Young. What is your shortfall? Based on the 
requirements given you by the National Defense Authorization 
Act, what are your shortfalls for the 2001 budget?
    Admiral Loy. Sir, we have registered with the department, 
supported by the department over at the Office of Management 
and Budget a request that addresses those very issues. I think 
the number on the request that sits in OMB at the moment is 
$112 million.
    You describe the reality very well. It was a sequencing 
issue for us last year, and it is the classic mechanical 
connectivity between what happens in terms of decision making 
in the HASC and the SASC and what actually happens in the 
deliberations, if you will, of the Transportation Committee.
    The Transportation Committee last year, enormously 
efficient in its work, got the appropriation out and signed by 
the President early in the game of the 13 appropriation bills.
    Then thereafter we got the exposure associated with NDAA. 
These are things which by Title 37 I have no choice as to 
whether or not I am going to pay those entitlements to my 
people, nor frankly, do I want the choice. I want absolutely to 
be recognized--not me, I want my sailors and airmen to be 
recognized for exactly what they are--peers of all those guys 
in the other four services in DOD.
    So when the NDAA offered increased entitlements associated 
with housing and health care, that translated to an exposure 
that I then had to go to the base to find, unless there would 
be some forthcoming addition to the appropriation to do that.
    As a result of living within the appropriation and living 
within the quarterly apportionment that was offered to me from 
OMB, I literally have been required to slow theorganization 
down to save the expenditures of fuel monies, et al, anticipating, I 
would hope, finally being bailed out, if you will, at some point along 
the way. But that is the issue, sir, for 2001.

                    FISCAL YEAR 2002 BUDGET REQUEST

    Mr. Young. Well I am going to go to 2002 on a similar 
subject.
    I mentioned earlier that the Senate and House Budget 
Committees both have recommended adding $250 million above the 
President's budget request for the Coast Guard.
    Admiral Loy. Yes, sir.
    Mr. Young. So I assume that would be in the budget 
resolution that we finally vote on maybe as early as tomorrow.
    The problem is they did not give us any extra, that extra 
$250 million on the top number. So when I sit down to try to 
determine how do I allocate the 302A number into 302Bs, I will 
do the best I can to provide that, but tell us, for our record, 
if we can provide that additional $250 million what it is that 
you will be able to accomplish with that money.
    Admiral Loy. Yes, sir.
    This is an enormously important question for us.
    First of all, I am delighted that the education effort that 
we have undertaken, both with committee members here and myself 
and many others, to have reflected in the budget resolution for 
I think probably the very first time in history a recognition 
of need for our organization by name in the budget resolution.
    The first thing that I would do, sir, would be to 
anticipate what might happen with NDAA 2002. And we have----
    Mr. Young. I thought there might be a connection.
    Admiral Loy. Yes, sir.
    One of the things that we have learned vividly is that the 
new President is not too keen on supplementals, and I for one 
endorse that 100 percent.
    But the challenge that it represents, of course, is that we 
get it right the first time and therefore do not have the need 
to come back for additional funding later.
    So my first order of business would be to recognize an 
awful lot of discussion as to whether or not the civilian pay 
raise of 3.6 will leap to 4.6. There has been lots of 
discussion in and around the Pentagon and in papers that even 
the military pay raise might be heightened itself. And to 
whatever degree we have stayed closer to the Pentagon to 
understand what might be the request of NDAA 2002, we have an 
exposure of probably about $80 million associated with what 
might happen as those things play out on the Hill this year.
    So my first order of business would be to buy that future 
into 2002 if those additional monies were made available.
    The next thing I would do would be buy back the operational 
level of activity for the organization. As submitted in the 
President's budget we are going to be down somewhere about 20 
percent or so from the 1999 levels of activity as explained 
thoroughly in the President's budget. I would make an effort to 
restore that operational level because that service is to the 
American public.
    The next thing I would go toward would be the restoration 
of my maintenance accounts which has in fact been this bow wave 
we have been pushing forward and forward and forward for the 
last several years.
    Those would certainly be among the most important things 
that I would pay attention to, sir, with those additional 
monies.
    And thereafter, as I mentioned in my opening statement, 
there are specific decommissionings as it relates to assets in 
order to begin this transformation process I described that 
would obviously be perfect targets to be bought back and made 
part of the productive organization.
    Mr. Young. Admiral, thank you very much for being here 
today. I hope that you have an opportunity to tell all of your 
Coasties how much we appreciate what they do, the risks they 
take, the lives they save, the drug interdiction programs, the 
going to war part of their responsibilities. I think they need 
to know that somebody really knows them and appreciates them. 
So if you will pass that on for me I would appreciate that.
    Admiral Loy. It will be my honor, sir. And thank you very 
much for being here.
    Mr. Young. Thank you, Mr. Chairman.

                           DRUG INTERDICTION

    Mr. Rogers. Thank you, Mr. Chairman.
    Ms. Kilpatrick.
    Ms. Kilpatrick. Thank you, Mr. Chairman. Admiral, good 
afternoon.
    Admiral Loy. Good afternoon.
    Ms. Kilpatrick. I am from Michigan, and I have about really 
50 miles of coast that separates Michigan from Canada, and we 
have a Coast Guard station in our district. I appreciate the 
work that they do.
    Admiral Loy. Thank you.
    Ms. Kilpatrick. They are overworked.
    The 80 hours that you mention is real. The shortages in the 
staffing is real. And this Committee would like to help you 
with that. I think the Chairman mentioned some 2,300 more staff 
is needed just to bring you up to what would be needed but not 
necessarily optimal, and I hope that we can help you with that.
    It amazes me the strength that the leaders come in to stay 
within the numbers that they are given, even though you know in 
your own everyday operation that those numbers may be far less 
than what you actually need to do your job and the mission that 
this Congress holds you responsible for.
    Interdiction is where I want to go.
    Secretary Minetta sat right where you are sitting last 
week, talked about the need for your operation to have more 
staffing, more dollars to carry out that. You did not meet the 
target that the agency set, I think it was 13 percent for 2000, 
and you came in somewhere around 10 percent.
    Admiral Loy. About 10.6.
    Ms. Kilpatrick. And I did not hear in your priority, as 
Chairman Young asked, and it is only 250 that has been 
proposed, and as Chairman Young mentioned the bottom line has 
not been increased, which means you have to change dollars 
within those lines.
    How will you get to that? And is that 13 percent something 
you are shooting for for 2002? Do you have the resources to do 
what is necessary to interdict--And I know they always say oh, 
Kilpatrick, Michigan is not a problem. It is that southern 
border that we care about. Well, as long as we say that they 
will keep slipping them in in Michigan.
    Admiral Loy. The reality is wherever they get in, they will 
find a way to Michigan.
    Ms. Kilpatrick. Right. And they are there, and across 
America as a matter of fact.
    Admiral Loy. Sadly so.
    Ms. Kilpatrick. What plans do you have? You have not asked 
for more. How are you going to do that?
    Admiral Loy. The reality, Ms. Kilpatrick, is this. The 
numbers you are quoting in terms of what we are responsible for 
is our puzzle piece of the overall United States 
counternarcotics plan. We are responsible for non-commercial 
maritime transit of those poisons from the source countries in 
South America, primarily Colombia, across the transit zone--
both the Eastern Pacific and the Caribbean--on their way to the 
United States.
    Our challenge, which we developed with the Office of 
National Drug Control Policy over the last several years, was 
that by the time 2002 rolled around we should be making as our 
goal, 18.7 percent seizure rate of those drugs that are 
crossing the transit zone. Looking to an out year goal in 2007 
of 28.7 percent of whatever is being transited to actually be 
seized by Coast Guard driven capability in the transit zone.
    As you said, over the course of this past year we got to 
about 10.6--short of the 13 percent which is an interim goal on 
the way to next year's five year step.
    We began this five years ago, in 1997.
    In terms of recognizing what for 2002 we would be taking 
out of the budget as presented, without the opportunity as 
Chairman Young was describing, to find more monies, we would 
frankly be reducing our offshore capability by somewhere around 
20 or 25 percent. That means that----
    There are good things going on other than just plain 
hardware on the water. We are doing much better with respect to 
intelligence fusion and products that are available tactically 
to our commanders in the field so that they can be much more 
productive when they are actually out there.
    So it is not a direct equation where if I have 20 percent 
fewer hulls and aircraft hours on the job that we will have 20 
or so percent less productivity.
    Ms. Kilpatrick. Because technology is available we can do 
much more than that.
    Admiral Loy. You bet. Yes, ma'am.
    But the reality is, if we end up not being able to put as 
much into the game, we will get less productivity out of the 
game.

                           PERSONNEL BILLETS

    Ms. Kilpatrick. Along the same line, I read that you have, 
in something I read last night, that you have about 100, I call 
them stations, but I think I read billets or something in your 
remarks, something other than Coast Guard stations around the 
world, and that represents about 100 staff in various 
activities that do Coast Guard deployment overseas.
    Admiral Loy. Uh huh.
    Ms. Kilpatrick. You mentioned your decommissions that you 
are doing here.
    Admiral Loy. Uh huh.
    Ms. Kilpatrick. I am trying to see the correlations. They 
are overseas and I know they need to be in certain places. We 
also need them on our borders here.
    How do you determine what stays overseas as you cut here? 
What is the correlation?
    Admiral Loy. That is a really terrific question I wrestle 
with all the time.
    What I have been able to have as a guidance document with 
respect to that is just within the last year, at the tail end 
of 1999, an interagency task force reviewed the roles and 
missions of the United States Coast Guard very, very thoroughly 
as a prelude for support that we would enjoy then from the 
department and from the Office of Management and Budget for the 
deep water project.
    And internal to that report they took every mission that we 
have, scrubbed it to the bone, and said to themselves is this 
something that the nation is going to need done in 2025 or so? 
Is the Coast Guard the right organization to do that function 
all the way across that 25 years or so? And the conclusion they 
came to was that our current portfolio of responsibilities that 
we have inherited from the Congress and from executive orders 
over time will all remain. And if anything, most of those 
challenges will have this kind of a trend line in terms of a 
need for more Coast Guard before there is a need for less Coast 
Guard into the future.
    So it is very difficult for me then to prioritize within 
what might be referred to as an engagement activity in the 
interest of national security overseas, offshore drug 
enforcement, offshore fisheries enforcement, offshore migrant 
enforcement, or coastal environmental protection, or licensing 
and documentation of commercial assets, or many of the millions 
of other things that we do.
    One thing we have always prioritized at the top of that 
list, and that is search and rescue and the safety of our own 
people.
    So as I formed five guiding principles that we used to 
determine which things we would offer, so to speak, in terms of 
savings to put into the budget mark, it was guided by things 
like number one, safety--and search and rescue will be 
inviolate. We will not reduce our capability in that regard.
    Secondly, we will not do away with any mission in total 
because we just had them revalidated for us in the interagency 
task force.
    Another thought was good stewardship of the taxpayers' 
dollar. If there is a way to err, let's err on the side of 
something that does not involve good stewardship of the 
taxpayers' dollar.
    Lastly, to have a conscious notion about the imminence of 
the deepwater project and the assets that we will be getting 
there. If we can find those that are aging, that we are 
throwing sort of good money after bad--You might recall last 
year at this hearing, I had as a sort of a training aid a piece 
of a stringer that was cut out of the Coast Guard cutter 
Durable, just to display the rot within that particular medium 
endurance cutter's hull. I thought it was a pretty dramatic 
statement about the condition of that ship, and of course 
Durable was one of the two 210s that we are now offering for 
saving.
    But it is hard to prioritize other than the obvious. The 
obvious, of course, in our instance, in our visceral reaction 
is always search and rescue and personal safety.
    Ms. Kilpatrick. I too appreciate the work that you do. I 
expect you need many more resources. You need a more modernized 
fleet, and I know that is a phase in period that happens, it is 
not an overnight thing.
    Admiral Loy. Yes, ma'am.
    Ms. Kilpatrick. I think this committee is prepared to 
support those needs that you have.
    I have a few more questions that I would submit for the 
record and ask that you respond to them in a timely manner.
    Admiral Loy. I'd be honored to.
    Ms. Kilpatrick. And thank you very much.
    Thank you, Mr. Chairman.
    Mr. Rogers. Thank you, Ms. Kilpatrick.
    Chairman Callahan.
    Mr. Callahan. Thank you, Mr. Chairman.
    Admiral, I never cease to be amazed at you military type 
people who follow lock-step behind your leadership and your 
Commander-in-Chief, in your case the Secretary of 
Transportation and the President of the United States. But in 
other military requests that come before our various 
committees, even though they will admit privately that there is 
an inadequate request on the part of the administration for 
adequately funding the Coast Guard or the U.S. Army, they just 
go lock-step walking behind these leaders, even though they 
disagree with them. And I am not going to publicly ask you to 
disagree with the Secretary or the President, no more than I am 
going to ask the Secretary of the Army to disagree with the 
President on his request for the Corps of Engineers.
    But I sometimes wonder as a military person, if you were to 
have to lead your people into battle and the administration 
told you they were not going to give you a sufficient number of 
bullets to adequately protect your people, would you tell them 
to go on into that battle knowing full well that you were 
putting your men in jeopardy?
    Maybe that is an unfair question, Admiral. I will not ask 
you to answer that because I know what your answer would be. 
No, you would not jeopardize your----
    Admiral Loy. Absolutely not.
    Mr. Callahan. And neither would any of the other military 
leaders.
    Admiral Loy. I would offer them the point. [Laughter]
    Mr. Callahan. Yeah.
    But what we are seeing here, once again, I have been 
harping since I have been on this committee about the 
priorities of the Coast Guard, and certainly our search and 
rescue, drug interdiction, defense of our boundaries and 
shores, navigation, marine safety are your priorities.
    Admiral Loy. Yes, sir.

                    MARINE ENVIRONMENTAL PROTECTION

    Mr. Callahan. Yet you say in your chart here that you are 
going to spend 16 percent, $563 million, on living marine 
resources, along with 11 percent for marine environmental 
protection.
    Now I realize that these are part of your charged duties, 
but I just cannot fathom the reason why the Coast Guard some 
day doesn't say to the National Marine Fisheries that you are 
not the meter maid of the National Marine Fisheries agency. I 
mean these square heads with pointed toed shoes sit down there 
in Tampa and dream up rules and regulations, huh?
    Mr. Young. You are getting close. [Laughter]
    Mr. Callahan. That is their only merit, Mr. Chairman, is 
the fact that they are located there.
    But they dream up any ridiculous rule and regulation andfax 
you their rule, their determination--not laws passed by this Congress 
but they are going to say that you cannot have a snapper that is longer 
than 14 inches long on the boat. And they just fax this to you. Then 
you evidently send out this message to your members and say go out and 
enforce these laws.
    I just wonder if indeed drug interdiction, search and 
rescue, acquisition should not take priority over these asinine 
rules that are promulgated by a bunch of square headed 
bureaucrats that dream up these rules and regulations.
    I have been urging you and your predecessors to come to 
this Congress and to tell us what you need to have an effective 
drug interdiction operation, what you need for defense 
readiness, what you need for ice operations, search and rescue, 
aids to navigation, and marine safety, and let us give you that 
money in a lock box situation saying spend this money here, 
have an effective program.
    And then come and say to the Congress, how we need money to 
enforce these stupid regulations that the National Marine 
Fisheries are coming up with, and making you game wardens for 
some unelected federal bureaucrat to--And I just wonder why in 
the world you will not come and tell us what your priorities 
are.
    This Congress loves the Coast Guard. This Chairman has done 
more for the Coast Guard since he has been Chairman of the full 
committee than even Bob Livingston who loved the Coast Guard. 
Hal Rogers has no Coast Guard operations to make any real 
significant district in Kentucky, but he has indicated a 
willingness to be generous to you and to support what you are 
doing.
    I just find it difficult to continue to say that 16 percent 
of your budget is going to go to living marine resources, 11 
percent to marine environmental protection, and yet tell us 
that you do not have enough money to have a fully effective 
drug interdiction program, that your acquisition monies are 
deficient to a degree even though we have done pretty well with 
you this year, and the administration has. But I just wonder 
why you guys do not prioritize your needs to the Congress. If 
the Congress wants to give you whatever you request for drug 
interdiction, for marine safety, for aid to navigation, search 
and rescue, and acquisition, that is fine. But why not circle 
out this part of enforcing the rules and regulations of another 
agency that is unbridled?
    Why do you not break these out and let us determine what we 
will give you with respect to your priority?
    Admiral Loy. Sir, thank you for the question, sir.
    First let me say that the 17 percent is driven largely not 
by small boat activity and patrol boat activity in the Gulf, 
Mr. Callahan, as you know, but by the requirements of the Grand 
Banks, the requirements of the Bering Sea and the Gulf of 
Alaska where only pretty substantial cutters have to go to do 
the work there.
    I, first of all, am very strongly of the mind that sort of 
at the global level what we are messing around with here is a 
potentially renewable source of protein for a growing global 
population that we had better, as people, sort out how we are 
best going to deal with the management necessary to allow it to 
stay renewable.
    We have just sadly watched too many instances, like on the 
Grand Banks. When I was a boarding officer on vessels out 
there, it was all about haddock and cod and yellow flounder and 
pretty good eating stuff. What is out there now is the same 
biomass but it is probably what we used to call trash fish.
    The issues associated with the maritime boundary line and 
the poaching that clearly is taking place daily as we speak 
with Korean, with Russian, with Japanese, with Taiwanese 
fishermen in the Bearing Sea are very real, and those are where 
the dollars add up to in terms of the commitment to that 17 
percent.
    Sir, as it relates to our challenge to enforce the 
management plans generated by either the regional councils or 
NMFS here in Washington and the Commerce Department, I have 
made a concerted effort first, to do two things. One, to try to 
have a Coast Guard person knowledgeable in the business at 
those council meetings when they are dreaming up management 
plans. If in fact enforceability is an issue, I want that at 
the table when they are contemplating the plans, not after they 
have dreamed it up and as you suggest, sort of thrown it over 
the threshold and asked us to enforce it.
    Obviously, whether it is by executive order or by 
legislation from the Congress, if there are elements of that 
particular mission that the committee or the Congress as a 
whole would rather see the Coast Guard not doing any longer, I 
leave that to your discretion.
    But I think the general business of fisheries enforcement 
is enormously important to our nation, and we should----
    Mr. Callahan. Admiral, that is my point.
    The fact is you do not discriminate or separate. You come 
to us and ask for this money and you make the decision of 
distribution. But if you were to ask this Congress to 
prioritize for you, that you needed another $100 million for 
search and rescue, another $100 million for drug interdiction, 
and you asked the Congress to fund individually the 
appropriation for these areas, I think you would find that the 
Congress would be totally supportive of drug interdiction, aids 
to navigation, search and rescue, and that if indeed they 
wanted to give you more money, then the Congress could make 
that decision if you would break it down.
    I know that we are not going to resolve this today, and I 
once again appreciate----
    Admiral Loy. I understand, sir.
    Mr. Callahan [continuing]. The many contributions that your 
agency does for, in my district. But I live on the water, but 
Hal Rogers does not live on the water. He lives on a body of 
water, but it is not a big body of water. [Laughter.]
    And I want to help you.
    Admiral Loy. Thank you, sir.
    Mr. Callahan. But I cannot help you if you say that 
measuring the size of a fish on a Sunday afternoon from a poor 
guy sitting out there off the coast of Alabama is taking money 
away from drug interdiction--That is not right. Until you break 
it out, it is never going to be resolved.
    But we do appreciate all the contributions that you make 
and your Coasties make in Alabama, and all of America.
    Admiral Loy. Thank you, sir.
    Mr. Callahan. Thank you, Mr. Chairman.
    Mr. Rogers. Thank you, Chairman Callahan.
    We may not have snapper, but we have awfully good striper 
bass. And it is----
    Mr. Callahan. The Coast Guard, Mr. Chairman, does not come 
out there measuring those fish in that lake. [Laughter.]
    Admiral Loy. I will make a note of that.
    Mr. Rogers. Mr. Clyburn.

      NATIONAL DISTRESS AND RESPONSE SYSTEM MODERNIZATION PROJECT

    Mr. Clyburn. Thank you, Mr. Chairman. Thank you so much, 
Admiral, for being here.
    I am from South Carolina and I do live on the water, and we 
do have some pretty good bass fishing there around Lake Marion, 
but I am more concerned about Charleston which is in my 
district, and as you probably know because of recent 
experiences regarding the Morning Dew I am particularly 
concerned about training.
    I think the last time at a recent hearing, I think we were 
in session at the time that case came back. And I am 
particularly concerned about training, as to whether or not 
there is a sufficient commitment, fiscal commitment to 
training.
    Do you think there is?
    Admiral Loy. Sir, let me retrace, if I can, the days to a 
degree since the Morning Dew case because it was certainly an 
eye opener for all of us. An absolute tragedy that we all never 
want to see recur.
    I have spent an awful lot of personal time and directed 
staff time associated with the aftermath of Morning Dew since 
the incident, and really in the several years leading up to it, 
even today.
    The first order of business is to acknowledge that had--Let 
me answer your question this way.
    Had the National Distress and Response System Modernization 
Project results been in place when the Morning Dew approached 
the Charleston jetty, I am relatively confident that I could 
tell you eyeball to eyeball that we would not have lost those 
people that night.
    Now you have to break down the several pieces associated 
with why I think I am confident at being able to say that.
    The excellent investigation aftermath provided to us by 
NTSB pointed out several functional capabilities that should 
have been present there and were not. On an interim measure we 
have in fact now provided those functional capabilities to 
those command centers around the Coast Guard. It had everything 
to do with the ability to play back the tape that the watch 
standard thought he heard. It was the ability to enhance the 
quality of that transmission so we could really pick out the 
mayday that was in the middle of what was to him a garbled 
statement. It is about the capacity to have a direction finding 
position so that a line of bearing was known on the occasion of 
the incoming radio transmission. And it has to do with an 
adequate staffing level. So the discussion that we have already 
held with respect to fatigue entered, potentially entered that 
watch standing situation in Charleston that night as well.
    So in the budget this year we are asking for 109 new 
positions to augment the staffing at critical command centers 
around the organization so that the standard becomes a 12 hour 
watch, not a 24 hour watch. That is an enormous step in the 
right direction I believe.
    The National Distress and Response System Modernization 
Project, we are all frustrated with the time it appears to be 
taking in order to get from design to testing and evaluation to 
prototype to actual installation around the country. But we are 
going to get there. This budget requests an additional $42 
million to press on with that project, to get it in 2002 to the 
point that we have the prototype, that we have tested it, that 
we have evaluated it, and that we can get on with the business 
of potentially in 2003 and the out years, of accelerating its 
installation by providing the dollars necessary to do that. And 
I clearly sense, not only from you, sir, Mr. Clyburn, but from 
all the members of the committee, that that is something that 
you are very much interested in doing.
    So we will be aggressive as we offer our budget request in 
2003 and if necessary 2004 with respect to potentially being 
able to accelerate installation.
    I have scrubbed this thing to the bone as it relates to 
being able to accelerate the design work on the system. And I 
think we have done about as much with that as we can.
    One of the things that is very interesting is this listof 
capabilities that we are asking the bidders on the ND&RSMP project to 
integrate together, and it is precisely those things that were offered 
by NTSB in their observations in the wake of the incident--It is not 
about archiving, it is about enhanced playback, it is about position 
localization, it is about our own unit tracking.
    And of course we had our own tragedy associated with the 
loss of two young Coast Guardsmen in Niagara here in the last 
several months, and had ND&RSMP been at that particular control 
station we would not have lost those two young Coast Guard 
sailors either, because our own unit tracking as a part of the 
system would have been there, and as the people left to go 
search for our own unit, which inadvertently took them up the 
river instead of down the river to where they actually were, a 
couple of miles out into Lake Ontario, we would have known 
where they were and we would have gone to the right place.
    My goal, Mr. Clyburn, at the other end of the day, and will 
be the goal I assure you of successor Commandants, is to take 
the search out of search and rescue. We need to take the search 
out of search and rescue. Electronically, and if you will, 
technologically today we are truly able to do that, and we need 
to be about the business of making that happen.
    Mr. Clyburn. Thank you very much, Admiral.
    Thank you, Mr. Chairman.

                    STANDARDIZATION TEAM INSPECTIONS

    Mr. Rogers. Thank you, Mr. Clyburn.
    Let me stay briefly with you on the small boat station 
question and deal with equipment for a little while.
    The Coast Guard standardization team inspections are 
finding over 80 percent of the SAR boats are not ready for sea. 
What does that high failure rate mean to you?
    Admiral Loy. First of all, sir, we are working pretty hard 
with the IG to make sure we understand what they were observing 
and how they were reporting it and providing factual 
information back with an effort to really reason whether or not 
that--What does that 84 percent mean.
    For example, my guess is it means this. The stand team goes 
to a station on the first day, they are looking for, very 
aggressively, as they should, they are looking for every little 
thing that might be wrong about a boat, about the doctrine of 
the station, about the people there, and what have you.
    Their goal is by the time they depart two or three days 
later, that they have pulled those numbers where they want 
them, where they want them to be--up at the 95 or the 98 or the 
100 percent level.
    It is very similar to when a major cutter, pick a Coast 
Guard cutter, goes off for its annual or biannual training 
experience with the Navy training teams, we show up and 
anticipate fully that we are going to be scrubbed to the bone. 
And every little conceivable thing found wrong will be 
identified. Our goal being to establish a progress potential 
that by the end of two weeks we have in fact become a cohesive 
team, we have put all the markings on the bulkheads where they 
belong, and we leave that experience fully capable.
    It is sort of like taking your car for its annual state 
inspection. You drive it in, perfectly capable that it was safe 
getting there and it is going to be perfectly capable of 
getting home, yet that inspector finds those one or two or 
three things that----

                            MOTOR LIFE BOATS

    Mr. Rogers. Well, I mean the failure of water tight 
closures is not an insignificant thing. Seventy-nine percent of 
the motor life boats inspected, the water tight closures did 
not seal properly. Of course that is a significant problem 
because these boats are designed to roll over and self-right in 
heavy surf. That is not an insignificant problem.
    Admiral Loy. That is not at all.
    Mr. Rogers. Four out of five of the boats do not have water 
tight closure seal rates.
    Admiral Loy. I am very concerned about that, sir. Four out 
of five is not even close to where we want to be. If anything, 
we want five out of five, in the other direction.
    Mr. Rogers. The inspection teams also are finding that over 
90 percent of the new 47 foot motor life boats are failing 
inspections, and why should that be? These are all less than 
five years old, are they not?
    Admiral Loy. They are. Yes, sir. And I do not have an 
answer for you, sir, other than in the tone of the inspection 
which is what I was attempting to describe and not trying to 
dismiss the importance of what your question offered--I will 
personally go back and take stock of that, sir.

                   PERSONNEL EXPERIENCE AND KNOWLEDGE

    Mr. Rogers. In their reports, the Coast Guard inspection 
team leaders attribute the equipment problems that they are 
discovering to small boat station staff who they say often lack 
the necessary time and knowledge to identify and respond to 
equipment problems.
    Can you dispute that?
    Admiral Loy. Sir, we have a relatively intense layered 
organization effort that we undertake with respect to that. 
Certainly the group overlooking any given small life boat 
station has much more capability associated with it and should 
very much be about the business of going out and validating the 
well being of the boats at the stations that belong to their 
group. They have the engineering, seniority and capability 
there to do that well.
    So if in fact the numbers that you are suggesting are real, 
and that is what I am trying to validate carefully with the IG, 
you can believe that I will absolutely make sure that is 
corrected.

                          5-YEAR CAPITAL PLAN

    Mr. Rogers. What was the Coast Guard's rationale for 
removing the funding for small boat replacement from the five 
year capital plan?
    Admiral Loy. Postal Service assume we are talking about the 
41 foot utility boat, sir.
    Mr. Rogers. That is correct.
    Admiral Loy. It is what I would call the last decision that 
we have to make with respect to our coastal inventory and its 
transformation from the old to the new. This is the situation, 
though, that we now find.
    We bought, or will have bought by the time we buy them out 
117 47 foot motor life boats. Thirty-seven of those will go and 
replace 41 footers, where 41 footers used to be.
    At the same time we have, due to the Congress' generosity, 
procured 50 of the 87 foot patrol boats, replacing 32 82 
footers that are gradually being decommissioned. The points 
being in both instances that there is more capability being 
placed in places that used to have total dependence on the 41 
footer and its capacity.
    So we are looking very carefully at, once the buildout has 
taken place with the 47 footer replacement, are we better off 
going away from a steel hulled utility boat like the 41 footer 
of the past, toward perhaps a hard foam RHIV, safe boat, a 
Zodiac? The kind of assets that are currently available to us 
that produce speed and hold on to capability that will equalize 
what the old inventory of 41 footers used to do for us.
    So that is a decision, sir, yet to be taken, and my guess 
is over the course of a two or three year window we will have 
come to the conclusion about what we should do to replace the 
41 footer.

                           SEARCH AND RESCUE

    Mr. Rogers. On the SAR budget, according to your 
performance plan you rescued 82.7 percent of mariners in 
imminent danger in the year 2000, which is remarkable. But 
having said that, that is still the lowest level since 1993. 
Your goal was 85 percent.
    Admiral Loy. Eight-five, uh huh.
    Mr. Rogers. And you did that in the year 2000 with ten 
percent less--I'm sorry. your 2002 budget estimates say that 
the Coast Guard will spend ten percent less on search and 
rescue in 2002 than you did in 2000. In 2000 you spent $455 
million. Yet you are only asking $407 million for 2002. And the 
goal was not met in 2000.
    How can you justify that?
    Admiral Loy. Principally, sir, the other very important 
fact to hold on to is the continuing decreasing number of lives 
lost in the maritime environment overall. Despite what has 
often been described as a virtual explosion in the recreational 
boating business wherein one would portend, as was the case 12 
years ago when we were up at the 1500 level of lives lost, we 
have gradually been able to continue to watch that tragic 
number, albeit still the second highest number related to lives 
lost in transportation. It is decreasing every year.
    We are seeing wonderful technology find its way into the 
business which allows people to count on not having the kinds 
of troubles that they have had in the past. So what I am saying 
sir is I am not sure we can make as direct a correlation 
between the two numbers as you are offering, as we should.
    Obviously our goal is to not lose any lives in the maritime 
sector, but I do not know that that is literally possible at 
the other end of the day. So our challenge is to take advantage 
of technology anywhere we can. ND&RSMP is a huge statement in 
the right direction because once on-line it will clearly make a 
significant difference for us in reducing those numbers of 
lives lost, and frankly, also, to reduce the dollars required 
for the SAR program because if we know exactly where we are, we 
do not have to spend an awful lot of time and fuel in searching 
for them. We will go directly to where they are.

                     SMALL BOAT STATION MANAGEMENT

    Mr. Rogers. Let me quote to you something that was 
published about 18 months ago that was in the Naval Institute 
Proceedings, the publication.
    A former senior chief in the Coast Guard was quoted in that 
publication as follows. ``Small boat station officers in charge 
or commanding officers feel they are ignored by the chain of 
command, especially in Coast Guard headquarters. . . . All the 
risks inherent in small boat operations are taken by the 
enlisted force, while all the policies affecting their lives 
and the lives of civilians on the water are set by an officer 
corps with little experience in the field. . . . Even this 
flawed system could work if Coast Guard senior leaders would 
listen to those in the field, but this doesn't seem to be 
happening.''
    Would you respond to that for us?
    Admiral Loy. Yes, sir. I am happy to respond to it.
    I do not know--First of all, I would need to talk with 
Senior Chief X, whoever he may be, from the standpoint of truly 
making sure he knows that he has an opportunity to put on the 
table his concerns or her concerns as the case might be.
    I think we are enormously responsive. There is no one in 
our organization that has a greater regard for the chief petty 
officers of our organization than do I. And largely he is 
describing an officer in charge network that is made up of 
certainly at least E-6s and likely E-7s, 8's or 9's who are, in 
fact, most of the officers in charge of our stations.
    Mr. Chairman, I can tell you I have personally beenbailed 
out by those guys, not only as a young officer very wet behind the ears 
learning my trade on major cutters at sea, but time and time again. 
Perhaps the most compelling counselor I have is Master Chief Petty 
Officer Patton who is my Master Chief Petty Officer of the Coast Guard.
    So I sort of bridle at the inference that Coast Guard 
officers who have been raised by and now lead with great, great 
dignity the enlisted force of our organization, the notion that 
simply because there is not an awful lot of billets for 
officers at life boat stations, that we ignore their well 
being.
    What I can assure you is that in all of the key positions, 
whether it is the search and rescue desk at the district 
officer or the area office or in the program offices in Coast 
Guard headquarters, the people are there because they have been 
groomed in that world work through the course of their 
experience in the Coast Guard.
    So maybe one easy example. If you look at the 47 footer. If 
you look at the 47 footer, it is what it is. Because we went 
and asked boatswain mates and enginemen what ought that vessel 
be. There are a number, I could give you countless examples, 
but let me give you one easy one.
    If you look at a 47 footer it has a scooped out work deck 
on each side that allows you to work at the water's edge in 
terms of getting people out of the water. That is not a 
Lieutenant Commander's idea or a Captain's idea, let alone an 
Admiral's idea. That is a boatswain mate's idea because we 
brought in the boatswain mates and said help us design this 
platform based on what you know to be a better way to do 
business.
    So I bridle at the notion that we are anything but 100 
percent concerned as to the wellbeing of our people.
    Mr. Rogers. I wanted to give you the chance to say that.
    Admiral Loy. Thank you, sir.

                        DEEPWATER PROGRAM COSTS

    Mr. Rogers. Now back to deepwater program.
    We are asking the contractors to design a system which 
exceeds OMB budget targets by almost a half billion dollars in 
the first five years alone. That poses somewhat of a risk for 
the program because it is not every year that they or we, 
perhaps, would be able to meet that very ambitious schedule 
which could lead to some real problems along the way.
    How do you see that?
    Admiral Loy. Sir, we have been very much in contact with, 
counseled by, included--the Office of Management and Budget 
thinking, not only in terms of the political establishment of 
the last administration but already the new one, and certainly 
the career staff that bridges for us over there.
    The planning factor of $500 million inflated from 1998 
dollars over the course of the foreseeable future is precisely 
what they have agreed with us is the right planning factor to 
continue down the road of the deepwater project.
    I am not about, sir, to sit here and even suggest to you 
that this is a risk-free project and it is going to be a piece 
of cake for us to get it right. This is an enormously complex 
undertaking that we are about to embark on.
    I am absolutely confident, as I watch the out year marks 
converge toward the need of the year, the need of the now year, 
that in the minds of those very good analysts in OMB who are 
helping us understand what it is that can be set aside for this 
project across the foreseeable future, that we will be where we 
need to be as each year goes by.
    Beyond that, I would also offer that there is flexibility 
designed into the strategy, the acquisition strategy, to absorb 
fluctuations up or down.
    One thing I would offer, Mr. Chairman, I went back to the 
1960's and the early 1970's with a view toward when we did this 
the last time what did the profile of acquisition budgets look 
like over the course of the time say from 1960 to 1975, when 
last we purchased those things that are now wearing out. And 
you see in those budgets horrible spikes, up and down, and up 
and down, which was the manner in which apparently, my memory 
is not serving me well back in the mid 1960's, but apparently 
the combination of presidential requests at the time and the 
actions of the committees at the time were all over the map as 
it related to the spikes necessary to procure those particular 
assets then.
    That was another lesson that we took from that experience, 
to try to level the planning factors associated with this 
project so that they will be clear, expected, planned on, and 
able to be worked around as we go forward, and I am very 
confident that we can do that.
    Mr. Rogers. The IG and GAO are a little nervous, I guess, 
about the method about which you are going about this. You call 
it, whatever you call it, an integrator, or a----
    Admiral Loy. Prime system integrator, yes, sir.
    Mr. Rogers. Prime system integrator or whatever. It is 
still a winner take all. One person wins the bid and gets the 
contract, one company.
    Admiral Loy. Of the three integrators. Clearly there is 
opportunity for members of the respective consortia to become 
part of the winning team should that be the thoughtful thing to 
do as defined by the Coast Guard and the integrator on down the 
line.
    Mr. Rogers. Well, yeah----
    Admiral Loy. But of the three integrators, you are right, 
sir.
    Mr. Rogers. That is fine. And during thetime of this 
contract which is very long, 15, 20 years----
    Admiral Loy. At least 15 in terms of the production and 
then the logistics piece of it which is frankly maybe the most 
complex piece of the whole project, going out to 30 years.
    Mr. Rogers. The point is that it is a very long period of 
time with a single source, if you will, a monopoly type 
situation.
    During that period of time you are going to have some mid-
course corrections that need to be made. You would not be a 
contract unless you had that.
    You are going to be put into a monopoly situation with this 
single contractor where your bargaining power may not be as 
good as it might be otherwise.
    Do you see a problem?
    Admiral Loy. No, sir. That is clearly one of the questions 
that we have scrubbed as hard as we possibly can.
    Let me offer first, Sir, that I think I need to take 
umbrage, not umbrage, but at least challenge the use of the 
word monopoly because that is probably a much stronger word 
than would define the relationship between the Coast Guard and 
the winning prime contractor.
    First of all, we need to understand these three companies. 
These are giants of industry in our country and literally as 
reflected in the world. So the notion that, which has been 
expressed, was one of the things that you need to be careful 
about is what happens if a prime goes under, or what happens if 
one of the subcontractors goes under. How do you deal with that 
in terms of the design acquisition strategy of the future?
    Sir, we are very confident that the control features of the 
contract with respect to the prime will clearly let the Coast 
Guard stay in charge and utilize the integration skill sets of 
competencies of the prime over the course of the five year 
window initially. And based on performance, a renewal of that 
five year term for four additional terms out to 25 years.
    So it is not a monopoly as it relates to poor performance. 
If the prime is not performing well we would interrupt the 
contract, fire the prime, and compete for a new one.
    Mr. Rogers. Of course most of the work will be done by 
subcontractors, I assume, primarily shipyards and aircraft 
manufacturers and so forth.
    Admiral Loy. Correct, sir.
    Mr. Rogers. Normally you deal with those people, the Coast 
Guard directly.
    Admiral Loy. Yes, sir.
    Mr. Rogers. You are going to have an intermediary here in 
this case, the prime contractor, through whom you assumedly 
would have to deal to talk with that subcontractor or sub-
subcontractor. Is that a problem, do you think?
    Admiral Loy. The partnership will not be a problem. We are 
going to collocate people physically. The offices in what we 
call the PROs will have prime membership there as well as Coast 
Guard membership there. If there is a problem or if there is a 
cost schedule or performance issue associated with the sub, the 
Coast Guard and the prime will get together and hold them 
accountable.
    But the ultimate responsibility under the contract will be 
that the risk and the responsibility is borne by the prime. 
That is the beauty for the government.
    If there is a sub that gets in trouble, it is the prime's 
challenge to get that sub straightened out and/or replace them 
in the due course of the buildout of the contract.
    Mr. Rogers. Once we sign onto this long term project, and 
it is a lot of dollars, and it is going to take a lot of annual 
dollars to fuel that contract.
    Admiral Loy. Yes, sir.
    Mr. Rogers. The pressure is going to come one of these days 
when we have short monies up here, the pressure is going to 
come to take the contract money first and take it out of 
operations and maintenance or whatever of the Coast Guard.
    How can we ensure that we are not going to create a monster 
here that will eat us alive?
    Admiral Loy. We have designed, again, sir, a wonderful 
question offered by both the IG and GAO and the department and 
OMB over the course of the last two and a half years as we have 
been building this acquisition strategy, and we have designed 
into that strategy off ramps as necessary that leaves the Coast 
Guard the control features necessary to do what the government 
would have us do.
    On an annual basis, first of all as I indicated earlier, 
sir, with the proprietary brief we will be able to give you 
total insight as to what is going to be procured by each of the 
three consortia, and we will do that in the brief that we spoke 
about earlier.
    Thereafter, each budget year the Coast Guard will request 
specific ships, planes, sensors associated with the contract; 
the department will review that; OMB will review that as part 
of the President's request; and the Congress will have its 
ultimate opportunity to appropriate against that package of 
requests.
    So the control features of both A-11 and the current 
acquisition world of OMB, and the control features of being 
concerned about good stewardship of the taxpayers' dollar, has 
been built directly into the acquisition strategy. And again, 
sir, we will make every effort to show you that in no uncertain 
terms so you are comfortable.
    Mr. Rogers. You are asking $338 million for deepwater next 
year.
    Admiral Loy. Yes, sir.

                           DEEPWATER FUNDING

    Mr. Rogers. The first year of the acquisition contract. 
That is the largest single acquisition request in the whole 
department.
    What specifically would that money be used for next year?
    Admiral Loy. That is really part of the proprietary brief, 
sir, which I would be reluctant to discuss in open hearing. But 
I look forward to offering you a direct answer to that question 
in an informal, private briefing.
    Mr. Rogers. Fair enough.
    Do you have anything further, Mr. Sabo?
    Mr. Sabo. Just, Mr. Chairman, a quick followup.
    Of the $338 million--I assume that the contract you award 
is for X amount of dollars to the integrator which buys no 
ships, no boats----
    Admiral Loy. Oh, absolutely not, sir. The $338 million, as 
I indicated----
    Mr. Sabo. No, no. Not the $338 million. The contract--The 
decision you come to in March, you will award one of these 
three companies the right to be----
    Admiral Loy. The prime.
    Mr. Sabo. Yeah. The integrator. I assume that is for a 
given amount of money to serve in that role, which buys 
services.
    Admiral Loy. Good question.
    My guess is, these guys are not in this for the money. 
These guys are in this to prove the prototype that will serve 
them well when big DOD contracts are being discussed in the out 
years.
    The issue here is they are probably in, I will say around 
$15 million they will realize. I was going to say it is loose 
change, that's a wrong--That is an awful lot of money.
    But the reality is the proving of the prototype for what 
will naturally in my mind, in my thinking, become relatively 
standard acquisition strategy for the future----
    We just had, and Mr. Chairman, I will mention this to you 
as well, sir. We just had a very good meeting the day before 
yesterday in my offices with David Walker from the GAO and 
Gietta Hecker, his lead person on the constructive criticism of 
the project that we have got from GAO; likewise Ken Meede and 
Tom Howard from the IG's office.
    The challenge there was for literally at the front 
principal level to make sure that we continue the partnering 
associated with criticism and good input to us to make sure we 
continue to do the right thing. Because we not only have built 
the strategy but executed the strategy on down the road.
    As it relates to the $338 million, to that one prime in 
March of 2002 that will be the winner, what I am trying to 
understand sir is--That is correct. One prime will be the 
winner. And I am trying to understand the question behind that.
    Mr. Sabo. Let me see if I can phrase it another way. That 
initial bid, I would assume, to become the prime integrator 
does not include we are going to buy this number of boats, we 
are going to buy this number of airplanes----
    Admiral Loy. Absolutely it does. Absolutely it does. You 
will have total visibility of every ship, boat, airplane, UAV, 
leased time on a satellite or whatever might be the conceptual 
proposal that that consortia is bringing to the table.
    Mr. Sabo. Yeah, it is their view of what is going to 
happen. But I would assume that you then make a different 
judgment of how the money is going to be spent for the balance 
of the fiscal year, the $338 million.
    Admiral Loy. We will be able to show you that totally in 
the proprietary brief, sir.
    One of the things we have done with this, it has been a 
pretty open book relationship over time. Pretty open book 
relationship over time. We probably have 80 to 85 percent of 
the total proposal that we are already very well aware of, and 
that is what we will share with you in the proprietary brief.
    You will have a proposal A, B, and C, each of which you 
will have total visibility of what that prime would do not only 
for this upcoming year, but for the build out of the program. 
And sequentially over time we will fill in the blanks year by 
year by year.
    Mr. Rogers. We want to spend some time with you in private 
session on the contract.
    Admiral Loy. Yes, sir.
    Mr. Rogers. And the concept, and we will have more 
questions informally at that time.
    We have a vote on the Floor now and we have to conclude our 
hearing.
    We will have some questions for the record we hope you can 
respond to.
    Admiral Loy. I'm honored to do that, sir.
    Mr. Rogers. And Admiral, we thank you for your time and 
appearance here today, and that of your staff. We want you to 
know that we are boosters of the Coast Guard. We think this 
branch of service is doing a wonderful job and gets less 
recognition than it deserves.
    So God speed to you.
    Admiral Loy. Thank you very much, Mr. Chairman.
    Mr. Rogers. The hearing is adjourned.


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                           W I T N E S S E S

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                                                                   Page
Dayton, M.R......................................................   611
Howard, T.J......................................................   611
Jacquez, Administrator A.S.......................................  1077
Loy, Admiral J.M.................................................   793
Mead, K.M........................................................   611
Mineta, Hon. N.Y.................................................     1
Stefani, Alexis..................................................   611
Zinser, T.J......................................................   611


                               I N D E X

                              ----------                              --
--------

   Architectural and Transportation Barriers Compliance Board (ATBCB)

                                                                   Page
Acoustics........................................................  1131
Administrative Services..........................................  1143
Advisory Committees..............................................  1142
Architectural Barriers Act Compliance and Enforcement Cases......  1134
Budget Request...................................................  1135
Codes and Standards:
    Acoustical Society of America (ASA)/ANSI Working Group on 
      Classroom Acoustics, Committee S-12, Noise.............1124, 1131
    American National Standards Institute (ANSI) A117 Committee..  1123
    American Society of Mechanical Engineers (ASME) A18 Platform 
      Lift and Stairway Chairlift Committee......................  1123
    ANSI/NSPI-1 Standard for Public Swimming Pools...............  1124
    International Code Council (ICC), International Building Code 
      (IBC)......................................................  1123
    National Committee on Uniform Traffic Control Devices........  1125
    NSPI/WWA-9 Standard for Aquatic Recreation Facilities........  1124
Coordination With DOT Modal Administrations......................  1140
Employee Awards..................................................  1143
On-Board and Planned FTES........................................  1139
Passenger Vessels................................................  1127
Personnel Costs..................................................  1142
Proposed and Final Rules.........................................  1139
Research.........................................................  1132
Rulemakings......................................................  1126
Training/Travel Costs............................................  1141

     Office of Inspector General, U.S. Department of Transportation

House Testimony..................................................   672
    Airline Customer Service.....................................   672
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   672
        Mr. Sabo and Inspector General Mead Questions and Answers   679
        Mr. Sweeney and Inspector General Mead Questions and 
          Answers................................................   691
    Airline Labor Issues.........................................   694
        Mr. Clyburn and Inspector General Mead Questions and 
          Answers................................................   695
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   695
            Federal Aviation Administration and National Air 
              Traffic Controllers Association Productivity Gains 
              in the Collective Bargaining Agreement.............   695
        Ms. Kilpatrick and Inspector General Mead Questions and 
          Answers................................................   694
    Airline Safety...............................................   709
        Mr. Clyburn and Inspector General Mead Questions and 
          Answers................................................   709
        Mr. Clyburn and Mr. Zinser, Acting Deputy Inspector 
          General Questions and Answers..........................   710
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   756
            Kansas City International Airport Operational Errors.   758
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   710
            Federal Aviation Administration Implementation of the 
              Whistleblower Protection Program...................   711
            Federal Aviation Administration's Memorandum of 
              Agreement with Controller Union That Reclassified 
              Operational Errors As Technical Violations.........   759
            Flight Operations Quality Assurance Rule.............   762
            Reasons Federal Aviation Administration takes so long 
              to issue Aviation Safety Rules.....................   763
            Regulation on Flight Crew Duty and Rest Time.........   764
    Amtrak.......................................................   691
        Mr. Rogers, Chairman, Follow-up Questions and Answers 
          Opinion on Amtrak Reaching Self-Sufficiency............   693
        Mr. Sweeney and Inspector General Mead Questions and 
          Answers................................................   691
        Ms. Kilpatrick and Inspector General Mead Questions and 
          Answers................................................   692
    Amtrak Self-Sufficiency......................................   729
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   730
        Mr. Sabo and Mr. Dayton, Deputy Assistant Inspector 
          General, Audit, Questions and Answers..................   732
        Mr. Sabo and Inspector General Mead Questions and Answers   731
    Coast Guard Deepwater Program................................   723
        Mr. Rogers, Chairman and Inspector General Mead Follow-up 
          Questions and Answers..................................   724
        Mr. Rogers, Chairman and Mr. Howard, Deputy Assistant 
          Inspector General for Audit, Questions and Answers.....   725
        Mr. Sabo and Mr. Dayton, Deputy Assistant Inspector 
          General, Audit, Questions and Answers..................   732
    Coat Guard Small Boat Stations and Command Centers...........   726
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   726
        Mr. Rogers, Chairman and Mr. Howard, Deputy Assistant 
          Inspector General for Audit, Questions.................   725
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   729
            Training for Small Boat Station Servicemen...........   729
    Federal Aviation Administration Management...................   698
        Mr. Clyburn and Inspector General Mead Questions and 
          Answers................................................   707
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   698
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   707
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   699
            FAA Expectations List................................   700
    Federal Aviation Administration Personnel Management.........   713
        Mr. Clyburn and Inspector General Mead Questions and 
          Answers................................................   714
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   713
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   715
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   716
            Controller-In-Charge Problem.........................   719
            Controller Pay Issues................................   720
            FAA Labor Union Organizing...........................   718
            Kansas City Gravy Train--DOT Secretary Response To 
              Problem............................................   717
            Top Paid Controller..................................   716
        Mr. Sabo and Inspector General Mead Questions and Answers   715
    Federal Aviation Administration Procurements.................   680
        Mr. Sabo and Inspector General Mead Questions and Answers   680
        Mr. Sabo and Ms. Stefani, Assistant Inspector General for 
          Auditing, Questions and Answers........................   682
    Federal Aviation Administration Structure....................   684
        Mr. Rogers, Chairman, Questions and Answers..............   687
        Mr. Sweeney and Inspector General Mead Questions and 
          Answers................................................   684
    Federal Highway Administration Funding Oversight.............   742
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   742
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   743
            Combating Fraud and Waste in the Federal Highway 
              Administration Program.............................   747
            Federal Highway Administration and the Department's 
              Actions to Improve Oversight Of Large Dollar 
              Highway Projects...................................   751
            Federal Highway Administration Specialized Staff For 
              Large Dollar Projects..............................   751
            Three steps to Improve Federal Highway 
              Administrations' Oversight.........................   743
            Why Fraud is Growing in Federal Highway 
              Administration Programs............................   750
    Federal Motor Carrier Safety Program.........................   732
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   732
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   732
            Federal Motor Carrier Safety Administration Achieving 
              Goals Set by Secretary Slater......................   738
            Federal Motor Carrier Safety Administration 
              Expectations List..................................   734
            Federal Motor Carrier Safety Administration First 
              Year Focus.........................................   738
    Mexican Domiciled Trucks.....................................   695
        Mr. Clyburn and Inspector General Mead Questions and 
          Answers................................................   722
        Mr. Rogers, Chairman, Follow-up Questions and Answers....   723
        Truck Inspectors--Insufficient level.....................   723
        Mr. Sabo and Inspector General Mead Questions and Answers   721
        Ms. Kilpatrick and Inspector General Mead Questions and 
          Answers................................................   695
    Transit Full Funding Grant Agreements........................   753
        Mr. Rogers, Chairman and Inspector General Mead Questions 
          and Answers............................................   753
        Mr. Sabo and Inspector General Mead Questions and Answers   754
Inspector General's Opening Statement............................   612
    Overview of DOT Management Challenges........................   612
        Aviation System Performance..............................   620
        Immediate Budget Issues..................................   619
        Stewardship of Transportation Funding....................   618
        Transportation Safety....................................   613
            Runway Incursions....................................   614
            Operational Errors FY 1996-2000......................   616
Kenneth M. Mead, Inspector General Biography.....................   670
Management Oversight Issues, Inspector General Mead's statement..   623
    Summary of Immediate Issues Facing DOT.......................   625
        Aviation System Performance..............................   648
            Developing a Multifaceted Approach to Addressing 
              Capacity Constraints...............................   649
            Improving Aviation Customer Service..................   651
            Making Federal Aviation Administration Accountable as 
              a Results-Based Organization.......................   648
        Immediate Budget Issues..................................   641
            Addressing Amtrak's Financial Viability..............   646
            Controlling Federal Aviation Administration's 
              Operating Costs....................................   641
            Implementing a Cost Accounting System at the Federal 
              Aviation Administration............................   643
            Justifying and Reconciling Coast Guard Capital 
              Investment Requirements............................   645
              Justifying FY 2002 Budget Request for Deepwater....   646
              Justifying FY 2002 Budget Request for the Natl. 
                Distress and Response System Modernization 
                Project..........................................   646
            Managing Multi-Billion Dollar Federal Aviation 
              Administration System Acquisitions.................   644
              Oceanic Air Traffic Control........................   645
              Standard Terminal Automation Replacement System 
                (STARS)..........................................   644
              Wide Area Augmentation System (WAAS)...............   644
        Stewardship of Transportation Funding....................   635
            Fighting Fraud.......................................   635
            Implementing New Infrastructure Grant Oversight 
              Requirements.......................................   638
            Monitoring Control Expenditures......................   640
            Streamlining Process Requirements, While Respecting 
              Protection Laws....................................   635
        Transportation Safety....................................   627
            Coast Guard Search and Rescue Program................   630
            Federal Motor Carrier Safety Administration..........   632
            Oversight of Mexican Truck Safety....................   631
            Pipeline Safety Issues...............................   633
            Runway Incursions....................................   627
            TREAD Act............................................   632
Mr. Rogers Opening Remarks.......................................   611
Questions for the Record from Chairman Rogers to the Office of 
  Inspector General..............................................   766
    Attrition Rate...............................................   771
        Why higher than other DOT Modal Administrations..........   771
    Average Hiring Time for New Staff............................   772
    Budget Request to Office of the Secretary and Office Of 
      Management and Budget......................................   771
    Average Time between Draft and Final Report Issuance--FY 2000   788
    Average Time to Complete OIG Program Audits--FY 1998-1999....   788
    Average Time to Complete OIG Program Audits--FY 2000.........   787
    Chief Financial Officers Act Requirements....................   781
    Comparison of OIG President's Budget Requested by Agency.....   780
    Costs to Audit Financial Statements..........................   782
    DOT OIG Listing of 20 Most Staff-Intensive Audits Completed 
      in FY 2000.................................................   789
    DOT OIG Listing of 20 Most Staff-Intensive Audits Completed 
      in FY 2001.................................................   790
    Field Offices, Locations and Number of Staff FY 2001-2002....   769
    Funding for Travel in FY 2000 and 2001.......................   791
    Funding Requested for Travel in FY 2002......................   791
    FTE Staff Performing Audits 2000-2002........................   766
    General Services Administration Rental Costs.................   778
    Inspector General Immediate Office Staff Listing.............   768
    OIG Annual Budgetary Increases by Fiscal year 1992-2002......   779
    OIB Authorized FTE by Fiscal Year 1995-2002..................   767
    OIG Operating Costs..........................................   776
    Ongoing and Planned Audit Assignments........................   783
    Memorandum of Understanding with National Transportation 
      Safety Board...............................................   770
    SES Bonuses and Awards, and Non-SES Merit Pay................   775
    SES Travel Expenditures since January 1, 2001 to DATE........   792
    Specialty Areas that IG Lacks Staffing Depth.................   772
        Problems with Timeliness of Reports of Issuance Of 
          Recommendations........................................   774
Transportation Management Challenges Report......................   656
    Amtrak Financial Viability and Modernization.................   667
    Aviation Safety..............................................   657
    Aviation System Capacity and Air Traffic Control 
      Modernization..............................................   661
    Coast Guard Capital Acquisition Budget.......................   664
    Computer Security............................................   666
    Departmental Business Practices..............................   668
    Maritime Administration's Ship Disposal Program..............   668
    Surface and Airport Infrastructure...........................   663
    Surface Transportation Safety................................   659
    Transportation Security......................................   666

             Saint Lawrence Seaway Development Corporation

2000:
    Montreal-Lake Ontario Section Traffic........................  1117
    Navigation Season Overview...................................  1082
    U.S. Port Traffic Through the Seaway System..................  1116
2000 Montreal-Lake Ontario Section Traffic.......................  1117
2000 Navigation Season Overview..................................  1082
2000 U.S. Port Traffic Through the Seaway System.................  1116
AIS/GPS Project..................................................  1077
Binational Internet Web Site.....................................  1080
Budget:
    Request for FY 2002..........................................  1083
    FY 2002 Estimate.............................................  1081
Budget Request for FY 2002.......................................  1083
Canadian:
    Laker Cargo--Total System and St. Lawrence River.............  1120
    Toll Increases...............................................  1097
Canadian Laker Cargo--Total System and St. Lawrence River........  1120
Canadian Toll Increases..........................................  1097
Capital:
    Equipment and Projects.......................................  1085
    FY 2002 Plan Summary and Project Descriptions................  1104
    Plan.........................................................  1104
Capital Equipment and Projects...................................  1085
Capital Plan.....................................................  1104
Communications, Utilities, and Travel............................  1090
Emergency Reserve Account........................................  1095
FY 2002:
    Budget Estimate..............................................  1081
    Budget Request...............................................  1083
    Capital Plan Summary and Project Descriptions................  1104
FY 2002 Budget Estimate..........................................  1081
FY 2002 Capital Plan Summary and Project Descriptions............  1104
Foreign-Flag Vessel Inspections..................................  1078
Global Positioning System........................................  1109
Great Lakes Seaway System Commercial Navigation Improvement Study  1081
Harbor Maintenance Trust Fund....................................  1094
Impact of NAFTA on Seaway Traffic................................  1092
International Seaway Tonnage.....................................  1119
ISO 9002 Certification...........................................  1078
Opening and Closing Dates........................................  1109
Performance-Based Organization...................................  1083
Reprogrammings...................................................  1121
Revenues.........................................................  1102
Seaway:
    2000 Montreal-Lake Ontario Section Traffic...................  1117
    2000 U.S. Port Traffic.......................................  1116
    Commerical Navigation Improvement Study......................  1081
    Impact of NAFTA on Traffic...................................  1092
    International Tonnage........................................  1119
    Lock Availability............................................  1078
    Lock Improvements............................................  1080
    Statistics...................................................  1114
    System Tonnage...............................................  1093
    Traffic Trends...............................................  1093
Seaway Lock Availability.........................................  1078
Seaway Lock Improvements.........................................  1080
Seaway Statistics................................................  1114
Seaway System Tonnage............................................  1093
Seaway Traffic Trends............................................  1093
SLSDC:
    Authorized FTEs and On-Board Strength........................  1110
    Balance Sheet................................................  1103
    Eligible Employees for Retirement over Next 10 Years.........  1112
    Estimated Other Services.....................................  1114
    Non-Federal Revenues.........................................  1091
    Revenue Balance..............................................  1095
    Revenue Sources..............................................  1102
SLSDC Authorized FTEs and On-Board Strength......................  1110
SLSDC Balance Sheet..............................................  1103
SLSDC Eligible Employees for Retirement over Next 10 Years.......  1112
SLSDC Estimated Other Services...................................  1114
SLSDC Non-Federal Revenues.......................................  1091
SLSDC Reserve Balance............................................  1095
SLSDC Reserve Sources............................................  1102
Staffing.........................................................  1110
Statement by Administrator Albert S. Jacquez.....................  1077
System:
    2000 U.S. Port Traffic Through the Seaway....................  1116
    Canadian Laker Cargo Total...................................  1120
    Commerical Navigation Improvement Study......................  1081
    Global Positioning...........................................  1109
    Seaway Tonnage...............................................  1093
Trade:
    Development Initiatives......................................  1079
    Missions.....................................................  1098
Trade Development Initiatives....................................  1079
Trade Missions...................................................  1098
Traffic:
    2000 U.S. Port Through the Seaway............................  1116
    2000 Montreal-Lake Ontario Section...........................  1117
    Impact of NAFTA on Seaway....................................  1092
    Seaway Trends................................................  1093
Waterways Strategic Issues Forum.................................  1081

 Secretary, U.S. Department of Transportation, Office of the Secretary

Access to Air Traffic Control System.............................    42
Accessibility for America........................................   381
Accessibility of Commuter Aircraft...............................   422
Acquisition Reform...............................................   332
Agency Streamlining Plans........................................   491
Aircraft Noise Exposure..........................................   332
Airline Consumer Complaints......................................   388
Airline Consumer Rights Protection...............................   377
Airline Delay Hearings...........................................    17
Airline Schedules................................................    33
Airline Traffic Incentives.......................................    37
Airport Arrivals and Departure Priorities........................    68
Airport Capacity.................................................    30
Airport Project Management.......................................    36
Alternative Dispute Resolution...................................   372
AMTRAK..........................................................50, 185
Antitrust Protection.............................................    57
Assistant Secretary for Administration.........................389, 510
Automated DOT Rulemaking System..................................   430
Automated Staffing and Work Force Planning Forecasting Systems...   391
Automotive Work Force Training...................................   420
Average Grades in Salaries and Expense Account...................   584
Aviation Consumer Accessibility..................................   376
Aviation Delays.................................................29, 175
    Aviation Choke Points........................................19, 32
    Dispersal of Flights.........................................    34
Aviation National Interest and Local Perspective.................    98
Aviation Product Certification Process Improvements..............    43
Biography of Secretary Norman Y. Mineta..........................    15
Board of Contract Appeals, Department of Transportation..........   587
Budget Office Travel.............................................   481
Bus and Job Access Formula Funding...............................65, 73
Capacity Benchmarks..............................................    39
Civil Aviation Security Screening................................   331
Coast Guard Closures and Decommissionings........................63, 72
    Service Reductions...........................................    72
Coast Guard Drug Seizure.........................................    57
Coast Guard Forfeiture Funds.....................................    53
Coast Guard Funding..............................................    58
Computer Pay Rates...............................................   408
Consumer Rights Protection--Aviation Matters.....................   373
Contract Tower Program...........................................    27
    Sugar Land Airport, TX.......................................    27
Cost to Reconstruct Urban Interstates............................    97
Deepwater Acquisition Program....................................    81
Department of Transportation Authorized Positions FY 2000-2002...   487
Department of Transportation FY 2000 Performance Report/FY 2002 
  Performance Plan...............................................   109
    DOT Strategic Plan...........................................   109
    Performance Goals--Economic Growth.........................193, 304
        Commercial Shipbuilding................................197, 305
        Disadvantaged and Women-Owned Business Contracting.....201, 306
        International Air Service..............................196, 304
        Transit Service........................................206, 307
        Transportation and Education......................199, 305, 336
    Performance Goals--Human and Natural Environment...........203, 307
        Aircraft Noise Exposure................................221, 312
        DOT Facility Cleanup...................................214, 309
        Environmental Justice..................................216, 310
        Fisheries Protection...................................212, 309
        Greenhouse Gas Emissions...............................220, 311
        Maritime Oil Spills...............................223, 313, 608
        Mobile Source Emissions................................218, 311
        Pipeline Hazardous Materials Spills....................225, 314
        Transit Ridership......................................208, 307
        Wetland Protection and recovery........................210, 308
    Performance Goals--Mobility................................156, 290
        Access to Jobs....................................192, 303, 607
        Airport Capacity and En Route Efficiency Improveme172, 295, 296
        All Weather Access to Airports.........................178, 298
        AMTRAK Ridership.......................................185, 301
        Appalachian Highway System.............................191, 303
        Aviation Delay.........................................175, 297
        Bus and Rail Transit Fleet Condition...................165, 292
        Domestic Icebreaking...................................182, 299
        Essential Air Service (EAS)......55, 83, 89, 302, 329, 341, 607
        Highway Bridge Condition...............................161, 290
        Highway Congestion.....................................167, 292
        Highway Pavement Condition.............................159, 290
        Impediments to Port Commerce...........................174, 297
        Intelligent Transportation Systems Integration.........170, 294
        Maritime Navigation....................................183, 300
        Runway Pavement Condition..............................163, 291
        St. Lawrence Seaway Lock Availability..................180, 299
        Transportation Accessibility...........................187, 301
    Performance Goals--National Security.......................227, 315
        Aviation Security......................................230, 315
        Critical Transportation Infrastructure Protection......232, 315
        DOD Designated Port Facilities.........................239, 318
        Drug Interdiction......................................243, 320
        Energy Efficiency......................................251, 323
        Mariner Availability...................................238, 317
        Maritime Boundary Incursions...........................247, 322
        Migrant Interdiction...................................245, 321
        Military Readiness.....................................235, 316
        Ready Reserve Force (RRF) Activation...................241, 319
        Regional Stability.....................................249, 322
        Sealift Capacity.......................................237, 317
    Performance Goals--Organizational Excellence...............253, 324
        Customer Satisfaction..................................255, 324
        Employee Satisfaction..................................257, 325
        Organizational Performance and Productivity............259, 325
        Performance Measurement, Verification and Validation...266, 328
    Performance Goals--Safety..................................115, 271
        Air Carrier Fatal Accident Rate........................140, 285
        Air Traffic Operational Errors.........................148, 287
        Alcohol-Related Highway Fatalities.....................123, 274
        General Aviation Fatal Accidents.......................143, 286
        Hazardous Materials Incidents..........................154, 289
        Highway-Rail Grade Crossing Accidents..................150, 288
        Highway Fatality and Injury Rates......................120, 272
        Large Truck-Related Fatalities and Injuries............125, 275
        Mariner Rescue.........................................130, 278
        Passenger Vessel Fatalities............................132, 281
        Pipeline Failures......................................151, 289
        Rail Fatality Rate.....................................134, 283
        Recreational Boating Fatalities........................128, 277
        Runway Incursions......................................145, 287
        Seat Belt Use..........................................138, 284
        Transit Fatality and Injury Rates......................136, 284
Department Office of Civil Rights................................   398
DHL Airfreight License...........................................    50
Differences in Scoring Between CBO and DOT.......................   605
Docket Management System.........................................   429
DOT Advisory Committees..........................................   595
DOT Personnel Savings............................................   490
DOT Political Appointees.........................................   555
    OST Political Appointees...................................553, 556
Elimination of Substandard Vessels--Port State Control (Coast 
  Guard).........................................................   330
Employee Performance Awards......................................   552
Environmental Review Process.....................................    40
Environmental Streamlining Report................................    61
Essential Air Service (EAS).............55, 83, 189, 302, 329, 341, 607
Estimated Funding for SES Bonus Awards...........................   551
FAA Cost Accounting System.......................................    54
Federal Motor Carrier Safety Administration......................   385
Federal Motor Vehicle Safety Standards...........................    90
Federal Radionavigation Plan.....................................   427
Federal Transit Administration (FTA).............................   386
Federal Unified Carrier Registration Program.....................    41
Federally Funded Maritime Education and Training (MARAD).........   336
FHWA Project Management and Oversight............................    73
Flight Schedules.................................................    49
Formula-Based Funding Proposal for Buses and Job Access Programs.    73
FTE--Aviation Matters............................................   509
FY 1999 Billings Non-DOT Clients.................................   437
FY 2000 Billings Non-DOT Clients.................................   440
FY 2001 Billings Non-DOT Clients.................................   444
FY 2001 and FY 2002 Planned Space Reductions.....................   452
FY 2002 Proposed OST Staffing Changes............................   494
    Staffing in the Immediate Office of the Secretary............   497
    Staffing in the Office of Intermodalism......................   516
    Staffing in the Office of Public Affairs.....................   500
    Staffing in the Office of the Assistant Secretary for 
      Administration.............................................   510
    Staffing in the Office of the Assistant Secretary for 
      Aviation and International Affairs.........................   501
    Staffing in the Office of the Assistant Secretary for 
      Governmental Affairs.......................................   499
    Staffing in the Office of the Assistant Secretary for 
      Transportation Policy......................................   514
    Staffing in the Office of the Chief Information Officer......   513
    Staffing in the Office of the Deputy Secretary...............   498
    Staffing in the Office of the General Counsel................   505
Graduated CDL System.............................................60, 88
GSA Rental Payments..............................................   450
Highway Cost Allocation (FHWA)...................................   333
Highway Safety Funding...........................................    87
Highway Trust Funds..............................................    92
    Allocation of Transit Funds..................................    93
    States Contribution..........................................    92
Immediate Office of the Deputy Secretary..................367, 469, 498
Immediate Office of the Secretary.........................365, 467, 497
International Aviation Liberalization: Transatlantic Deregulation 
  and the Alliance Network Effect (Office of the Secretary)......   226
Invasive Species.................................................   424
Longer Combination Vehicles (LCV)................................   100
Maritime Security Program (MSP)..................................   326
Minority Business Resource Center (MBRC) Loan Program............   407
Motor Vehicle Retrofit Authority.................................    91
NAFTA/Border Issues........................................46, 412, 428
    Border Opening and Truck Safety..............................46, 76
    Federal and State Coordination of Border Issues..............    96
    Motor Carrier Hours of Service...............................47, 84
    Motor Carrier Inspections....................................    48
    Truck Inspection Facilities..................................    79
    Truck Safety.................................................46, 76
Navigation Aid Mix Systems Analysis (Coast Guard)................   331
New DOT Political Positions......................................   577
New Freedom Initiative (NFI)...........................61, 84, 422, 423
New Positions....................................................   362
New Programs and Program Terminations, FY 2002...................   609
New York Metro Area Telework Study...............................   421
Number of Airline Consumer Complaints............................   378
Office of Drug and Alcohol Policy and Compliance.................   497
Office of General Counsel--New Positions.........................   370
Office of Intelligence and Security..............................   384
Office of Intermodalism..........................................   364
Office of the Chief Information Officer...................369, 470, 505
Opening Remarks/Statements:
    Chairman Rogers..............................................1, 341
        Airline Delays...........................................     2
        Coast Guard..............................................     1
        Resource Management......................................     2
        Transportation Budget Trends.............................     2
    Secretary Mineta.............................................  3, 6
        Environment..............................................    12
        Mobility and capacity...................................4, 8, 9
        National Security........................................ 4, 13
        Resource management......................................    10
        Safety...................................................  3, 7
OST Clerical/Professional Table..................................   582
OST Headquarters Space...........................................   585
OST Staffing.....................................................   485
Pay and Non-Pay COLAS............................................   600
    Pay Raise and Inflation......................................   602
Personal Flotation Devices.......................................   331
Political/Career Employee Ratio..................................   578
Position Descriptions--Aviation Matters..........................   509
Programs Requiring Authorizing Legislation.......................   603
Questions for the Record:
    Chairman Rogers.............................................70, 341
    Congresssman Aderholt........................................    90
    Congresssman Callahan........................................    88
    Congresssman Emerson.........................................    61
    Congresssman Olver...........................................   100
    Congresssman Sweeney.........................................    52
    Congresssman Tiahrt..........................................    39
    Congresssman Granger.........................................    92
Railroad Infrastructure Policy...................................    52
Reception and Representation...................................363, 586
Regulating Flights at Airports...................................    61
Reimbursable Positions...........................................   361
Revised Schedule for FY 2001 Program Evaluations.................   337
Safe Communities Demonstration Projects (NHTSA)..................   335
Salaries and Expenses............................................   358
    Reimbursables................................................   590
    Reimbursables Comparison.....................................   594
Salt Lake City Winter Olympic Games............................419, 456
Senior Executive Bonus Recipients................................   517
Single State Insurance Registration..............................    42
Special Winter Olympics..........................................   418
State Initiatives to Reduce Fatal Truck Crashes (FMCSA)..........   334
Statewide Transportation Planning................................    60
Stewart Airport, NY..............................................    48
Surface Transportation Board.....................................   569
Table of Normal Cost Percentages.................................   599
Task Force on Airline Delays.....................................    19
    Noise Mitigation Research....................................    21
    Noise Mitigation Spending....................................    22
    Reasons for Airline Delays...................................    20
Transfer of Border/Corridor Funds................................    53
Transit Capital Investment.......................................    23
    Detroit Transit Project......................................    59
    Houston Light Rail Project...................................    26
    Seattle Central Light Rail Project...........................    24
Transit Funding..................................................28, 58
Transit New Starts...............................................    52
    Railroad Track Rehabilitation, H.R. 1020.....................    52
Transportation Administrative Service Center (TASC)..............   432
    TASC Staffing by Activity....................................   448
Transportation of Things.........................................   480
Transportation Planning, Research and Development....412, 417, 426, 428
Travel Expenses...........................................460, 461, 478
    Foreign Travel Report........................................   467
        Immediate Office of the Secretary........................   467
        Office of General Council................................   470
        Office of the Assistant Secretary for Aviation and 
          International Affairs..................................   472
        Office of the Assistant Secretary for Transportation 
          Policy.................................................   476
        Office of the Associate Deputy Secretary and Director of 
          Intermodalism..........................................   477
        Office of the Deputy Secretary...........................   469
    Overseas Travel..............................................   467
Truck Weight Limitations.........................................   101
User Fees........................................................   431
Vacant DOT Political Positions...................................   571
Voluntary Intermodal Sealift (VISA)..............................   336
Workplace Improvement Initiatives................................   393

                       United States Coast Guard

41-Foot UTB Fleet................................................  1031
5-Year Capital Plan..............................................   824
Acquisition, Construction, and Improvement:
    $1 Million Unobligated.......................................   946
    Funded Personnel.............................................   967
    Minor AC&I Information Technology Projects...................  1050
    Unobligated Balance..........................................   940
Aids to Navigation Projects......................................   964
Airborne Use of Force Funding....................................   878
Alameda, CA:
    Design Status................................................   963
    Status of Permits............................................   963
Alaskan Fisheries LE Resources...................................   882
Arctic and Antarctic Icebreaker Fees.............................   837
Asset Retirement:
    Criteria.....................................................   999
    Deferred Commissioning.......................................   998
Asset Sales:
    Collections Expected.........................................   939
    Offsetting Collections.......................................   940
Aviation Parts Sustainment.......................................  1037
    Aviation Parts Sustainment--OE vs. AC&I......................  1036
Ballast Water Management:
    Activities...................................................   898
    Program......................................................   898
Biography of Adm. James M. Loy, Commandant, U.S. Coast Guard.....   804
Boat Crew:
    Qualifications...............................................   923
    Utilization..................................................   909
Boating Safety:
    Grant Program Data...........................................   985
    Spending Data................................................   982
    State Match Data.............................................   979
Bonuses and Awards...............................................   858
Budget:
    Counterdrug..................................................   876
    FY02 Request.................................................   813
    Growth by Mission............................................   869
C-130J Acquisition:
    Siting.......................................................   958
    FY01 Carryover...............................................   959
    FY02 Funding.................................................   958
    Outyear Funding..............................................   957
    Procurement and Commissioning Status.........................   957
    Training System Study........................................  1036
C-37A C&C Aircraft:
    Aircraft Trade-In Status.....................................   956
    Procurement Status and Delivery Estimate.....................   956
Capital Investment Plan..........................................  1030
Change in Military/Civilian Mix: FY02............................   839
Clothing Maintenance Allowance...................................  1018
Coast Guard/NTSB MOU:
    Clarificatioin...............................................   886
    Revision schedule............................................   885
Coast Guard Personnel Command:
    Budget.......................................................   873
    Staffing.....................................................   872
Coastal Patrol Boat: Waterfall Schedule..........................   949
Command Center Study:
    Executive Summary............................................  1040
    Training Deficiencies........................................  1046
Command Centers Recapitalization Funding.........................  1039
CONUS COLA:
    Addition/Deletion of CONUS COLA Locations: FY02..............   856
    Addition/Deletion of CONUS COLA Locations....................   855
DEEPWATER:
    Contractor Relationship......................................   811
    DEEPWATER, NDRS, GLIB: Critical Paths........................  1059
    DEEPWATER, NDRS, GLIB: Minimizing Risk.......................  1055
    Funding......................................................   829
    Long Range Program...........................................   808
    Long Term Projects...........................................   796
    Prime Integrator.............................................   810
    Procurement..................................................   809
    Program Cuts.................................................   826
Drug Interdiction................................................   814
Excessed Properties..............................................   938
    Proceeds.....................................................   939
Fuel and Energy:
    Costs Assumptions............................................   860
    Costs........................................................   860
Great Lakes Icebreaker...........................................   809
    AC&I Cost Estimate...........................................   954
    Acquisition Funding..........................................   954
    Acquisition Schedule.........................................   953
    DEEPWATER, NDRS, GLIB: Critical Paths........................  1059
    DEEPWATER, NDRS, GLIB: Minimizing Risk.......................  1055
    Mackinaw Operations and Maintenance Costs....................   901
Hawaii Rainbow Communications System:
    Benefits.....................................................  1048
    Contract.....................................................  1048
    Funding Responsibility.......................................  1047
    Status of Eng Design.........................................  1048
Housing Projects.................................................   965
Introduction of Adm. James M. Loy, Commandant, U.S. Coast Guard..   794
Long Term Projects...............................................   796
Marine Environmental Protection..................................   818
Medical:
    Anticipated Inflation for Medical Costs......................  1003
    Comparable Medical Cost Rate of Increase.....................  1006
    Enhancements to TRICARE......................................  1006
    Projected Healthcare Cost....................................   859
Motor Life Boats.................................................   823
MSO/Station Cleveland Relocation.................................   966
    Award........................................................   966
National Defense Authorization Act Requirements..................   812
National Distress and Response Systems Modernization Project.....   820
    Concept Exploration Proposals................................  1070
    Concept Exploration..........................................  1070
    Estimated Project Funding Profile............................   960
    Full Implementation..........................................  1071
    Long Term Projects...........................................   796
    NDRSMP.......................................................   908
    Phase II Award...............................................  1071
    Project Estimate.............................................  1038
Offshore Capabilities............................................   798
Opening Remarks by Adm. James M. Loy, Commandant, U.S. Coast 
  Guard..........................................................   795
Opening Remarks by Chairman Rogers...............................   793
Personnel and Allowances:
    68-Hour Work Week Staffing Requirement.......................  1022
    Active Duty Accessions and Workforce Strengths...............   841
    Allowances...................................................   806
    Basic Military Compensation..................................   847
    Billets......................................................   816
    Commandant and Vice Commandant Staffs........................   893
    Comparison in Military/Civilian Mix to Other military 
      Services...................................................   840
    Comparison of DOD CONUS COLA: FY02...........................   856
    Comparison of Senior Executive Services Bonuses: FY01-02.....   858
    District Offices--Authorized Billet Levels...................   872
    Drop-in Reserve-End Strength.................................  1051
    Enlist/Re-enlist bonuses/Career Continuation Pay.............  1015
    Experience and Knowledge.....................................   823
    FTP to FTE mismatches........................................  1035
    Headquarter Positions and Offices Affected...................  1032
    Headquarters Administration: Total Assigned Billets..........   886
    High Attrition Rates for Non-Aviators Officers...............  1011
    Officer to Enlisted Personnel Ratio..........................  1009
    Pay Raise Increase...........................................   841
    Pay Raises Breakdown: FY02...................................   852
    Personnel assigned to Cutters and Air Stations...............   859
    Personnel Resoruces--AC&I Appropriations.....................   971
    Personnel Resources: PRO Personnel...........................   975
Readiness........................................................   796
Search and Rescue................................................   824
    Capabilities Enhancement Project Specifics...................  1038
    Station Work Week............................................  1022
Small Boat Stations..............................................   793
    Levels.......................................................   805
    Management...................................................   825
    Standardized Team Inspections................................   822
Shore Facility:
    Survey and Design............................................   961
    Operation and Maintenance....................................   870
Questions for the Record (QFRs) from Chairman Rogers:
    41-FOOT UTB Fleet............................................  1031
    68-Hour Work Week Staffing Requirement.......................  1022
    AC&I Funded Personnel........................................   967
    AC&I: $1 Million Unobligated.................................   946
    AC&I: Unobligated Balance....................................   940
    Active Duty Accessions and Workforce Strength................   841
    Addition/Deletion of CONUS COLA Locations: FY02..............   856
    Addition/Deletion of CONUS COLA Locations....................   855
    Aids to Navigation Projects..................................   964
    Airborne Use of Force Funding................................   878
    Alameda, CA Design Status....................................   963
    Alameda, CA Status of Permits................................   963
    Alaskan Fisheries LE Resources...............................   882
    Anticipated Inflation for Medical Costs......................  1003
    Appropriated Funds Support for CGEX..........................   864
    Appropriated Funds Support for MWR Program...................   864
    Arctic and Antarctic Icebreaker Fees.........................   837
    Asset Retirement Criteria....................................   999
    Asset Retirement/Deferred Commissioning......................   998
    Asset Sales Collection; Expected.............................   939
    Asset Sales: Offsetting Collections..........................   940
    Average Total Earned Compensation............................   850
    Aviation Parts Sustainment--OE vs. PC&I......................  1036
    Aviation Parts Sustainment...................................  1037
    Ballast Water Management Activities..........................   898
    Ballast Water Management Program.............................   898
    Battery Recovery Program.....................................   990
    Boat Crew Qualifications.....................................   923
    Boat Crew Utilization........................................   909
    Boating Safety and State Match Data..........................   979
    Boating Safety Spending Data.................................   982
    Boating Safety: Grant Program Data...........................   985
    Bonuses and Awards...........................................   858
    Budget: Coast Guard CounterDrug..............................   876
    Budget: Growth by Mission....................................   959
    C-130J Acquisition: FY01 Carryover...........................   959
    C-130J Acquisition: FY02 Funding.............................   959
    C-130J Acquisition: Outyear Funding..........................   957
    C-130J Acquisition: Procurement and Commissioning Status.....   957
    C-130J Acquisition: Training System Study....................  1036
    C-130J Siting................................................   958
    C-37A C&C Aircraft: Aircraft Trade-In Status.................   958
    C-37A C&C Aircraft: Procurement Status and Delivery Estimate.   956
    Capital Investment Plan......................................  1030
    CG/NTSB MOU: Clarification...................................   886
    CG/NTSB MOU: Revision schedule...............................   885
    CG Counterdrug Budget........................................   879
    CG Personnel Command Budget..................................   873
    CG Personnel Command Staffing................................   872
    Change in Military/Civilian Mix: FY02........................   839
    Clothing Maintenance Allowance...............................  1018
    Coast Guard Housing Projects.................................   965
    Coast Guard Officer to Enlisted Personnel Ratio..............  1009
    Coast Guard Using DOT's ITOP Contract Vehicle................  1002
    Coastal Patrol Board: Waterfall Schedule.....................   949
    Command Center Study Executive Summary.......................  1040
    Command Center Study Training Deficiencies...................  1046
    Command Centers Recapitalization Funding.....................  1039
    Commandant and Vice Commandant Staffs........................   893
    Comparable Medical Cost Rate of Increase.....................  1006
    Comparison In Military/Civilian Mix To Other Military 
      Services...................................................   840
    Comparison of DOD CONUS COLA: FY02...........................   856
    Comparison Of FY99-00 Performance Results....................   997
    Compensation Elements of the NDA Act 2001....................  1018
    Comparison of Senior Executive Services Bonuses: FY01-02.....   858
    Costs Associated with Congressional Trips....................  1001
    Crew Fatigue Notice Requirements.............................  1023
    Crew Rest Requirements.......................................  1023
    Decommissions................................................  1032
    Difference in FY01-02 FECA/UCX Cost Difference...............  1008
    Difference in FY01-02 FECA/UCX Costs.........................  1009
    Difference in FY01-02 Recruiting Costs.......................  1008
    Direct Annual Mission Cost at CG Academy.....................  1020
    Direction-Finding Capability.................................   907
    District Offices--Authorized Billet Levels...................   872
    Documenting HCFA estimates...................................  1004
    Drop in FECA/UCX Payments: FY01..............................   863
    Drop in Reserve-End-Strength.................................  1051
    Drug Seizures Per Aircraft/Vessel Operating Hour.............   876
    Enhancements to TRICARE......................................  1006
    Enlist/Re-enlist bonuses/Career Continuation Pay.............  1015
    Environmental Compliance and Restoration under $500,000 each.   986
    Environmental Compliance and Restoration.....................   989
    Environmental Diplomacy Funds................................   884
    Estimated Housing Program Savings............................   864
    Excessed Properties: Proceeds................................   939
    Excessed Properties..........................................   938
    Fatigue at Coast Guard Field Units...........................   994
    Fixed and Stable Fuel Prices for FY02........................   862
    Fleet Operating Costs FY00-FY02..............................   871
    Foreign Fishing Vessel Incursions............................   883
    Formal Training Requirement..................................  1024
    Franchise Fund Use: FY02 and FY01............................   832
    FTP to FTE Mismatches........................................  1035
    Fuel and Energy Costs Assumptions............................   860
    Fuel and Energy Costs........................................   860
    Funding Breakdown for HQ Units FY00-02.......................   901
    Funding for CONUS COLA: FY 02................................   853
    Funding of New SARA Positions................................  1021
    Funding Support for the MAWR Program.........................   865
    Funding to Operate 3 additional CPBs.........................  1034
    FY00-05 Capital Investment Plan..............................   925
    FY02 Rent Request............................................   897
    FY02-06 Capital Investment Plan..............................   930
    Great Lakes Icebreaker: AC&I Cost Estimate...................   954
    Great Lakes Icebreaker: Acquisition Funding..................   954
    Great Lakes Icebreaker: Acquisition Schedule.................   953
    GSA Rental Costs.............................................   897
    Hawaii Rainbow Comms System--Benefits........................  1048
    Hawaii Rainbow Comms System--Contract........................  1048
    Hawaii Rainbow Comms System--Funding Responsibility..........  1047
    Hawaii Rainbow Comms System--Status of Eng Design............  1048
    HCFA estimates at variance with the Bureau of Labor 
      Statistics.................................................  1004
    Headquarters Positions and Offices Affected..................  1032
    Headquarters Administration: Total Assigned Billets..........   886
    HCFA estimates at variance to commodities/prescription drugs.  1005
    High Attrition Rates for Non-Aviators Officers...............  1011
    Highway Bridges Funding......................................   978
    HITRON-10: Use force Disabling Fire..........................   878
    Home Heating and Electrical Bills Costs......................   863
    Homeports of 3 additional CPBs...............................  1034
    Ice Operations Cost..........................................  1001
    IMISS and MTS................................................   905
    Impact of Low Test Scores On ``Man-Overboard'' Incidents.....  1026
    Incentives to attract and Retain Personnel...................  1016
    Increasing Contract Costs Base Amount........................  1017
    Increasing Contract Costs....................................  1017
    Initiatives to Improve Coxswain Test Scores..................  1028
    Installation of Direction-Finding Equipment..................   906
    Is Tonnage Fee a User Fee?...................................   905
    Large Increase In Fuel and Energy Costs......................  1033
    Locations Eligible for CONUS COLA............................   853
    Mackinaw Operations and Maintenance Costs....................   901
    Military/Civilian Mix: FE 98-02..............................   839
    Minimum Swimming Requirement.................................  1025
    Minor AC&I Information Technology Projects...................  1050
    Motor Lifeboat: REA Settlement Status........................   955
    MSO/Station Cleveland Relocation/Contract Award..............   966
    MSO/Station Cleveland Relocation.............................   966
    National Distress and Response System Modernization Project..   908
    National Performance Review Supervisory ratio goals..........  1010
    NDRSMP: Estimated Project Funding Profile....................   960
    NDRSMP: Project Estimate.....................................  1038
    Niagra Mishap................................................   921
    Not Ready for Sea Rates......................................  1028
    Not Ready for Sea Rates of 47' MLBs..........................  1029
    ONE DOT initiatives..........................................   896
    Operations and Maintenance for Training Facilities for CG 
      Reserves...................................................   994
    OSLTF--Emergency Fund........................................   992
    OSLTF--Payment of Claims.....................................   991
    Other Miscellaneous Agencies FY 2001 and 2002................   833
    Other Miscellaneous Services.................................   875
    Other Services Obligations FY02..............................   874
    Other Services Obligations...................................   873
    Out-of-Pocket Expenses for Housing Costs.....................  1007
    Overseas Billets.............................................  1020
    Pass/Fail Standards for Coxswains............................  1027
    Passenger Vessel Safety Risk Mitigation......................  1035
    PAWSS estimated costs for FY02...............................  1037
    Pay Raise Increase...........................................   841
    Pay Raises Breakdown: FY02...................................   852
    Performance Goals--Goals Attained FY 2000....................   995
    Performance Goals--Goals Not Attained FY 2000................   996
    Personnel assigned to Cutters and Air Stations...............   859
    Personnel Resources--AC&I Appropriations.....................   971
    Personnel Resources: PRO Personnel...........................   975
    Point of Likely Fuel Increase for FY01.......................   862
    Polar Icebreaking Reimbursements.............................   836
    Ports and Waterways Safety System: Project Breakdown.........   959
    Proficiency Funding..........................................   925
    Programmed Operating Standards Leveling......................  1033
    Projected Health Care Cost...................................   859
    Proposed Asset Retirements Funded with 1999 C/N Supplemental.  1000
    Public Affairs Field Staff...................................   896
    Public Affairs Headquarters Staff............................   895
    Raise Career Sea Pay.........................................  1012
    Reduction of HITRON-10 Funding...............................  1031
    Regular Military Compensation Tables.........................   843
    Request for Reserves in Parity...............................  1050
    Reserve-End Strength.........................................  1021
    RHI Mishap Prevention........................................   922
    Rise in Civilian Attrition Rates.............................  1013
    SAR Capabilities Enhancement Project Specifics...............  1038
    SAR Station Work Week........................................  1022
    SCBA Replacement Project.....................................  1049
    Seagoing Buoy Tenders........................................  1002
    Senior Executive Services Bonuses: FY00-01...................   857
    Shore Facilities Survey and Design...........................   961
    Shore Facility Operation and Maintenance.....................   870
    Small Boat Station Coxswain Test Scores......................  1026
    Standardizing Non-Standard Boats.............................   924
    Status of Bridges............................................   975
    Status of Sidney Lanier Bridge, GA...........................   978
    Sufficiency of Officer-Aviator Attrition Rates...............  1014
    Surface Search Radar: AC&I Carryover.........................   955
    TASC: FY02 Breakdown of Services.............................   831
    Tonnage Duty Fee: Assessment and Availability................   905
    Total MWR Support From Appropriated Funds....................   865
    Totals of Pay Increases from Career Sea Pay..................  1014
    Transit Subsidy Benefit Program Request: FY02................   851
    Unanticipated Increase in Fuel Costs FY01....................   861
    Unobligated Boating Safety Grants............................   986
    USCG Research and Development Center (R&DC): Operating Costs.   993
    User Fees: Letter to Committee Chairman......................   903
    US-Russia Maritime Boundary..................................   883
    UTB Engine Service Life......................................  1031
    Vessel Incidents at Small Boat Stations: Last 5 Years........   922
    VHF Distress Communication Systems...........................   908
    VTS operation and maintenance costs for FY99-02..............   866
    Wage Grade Payroll Cost......................................  1007
    Wallop-Breaux Trust Fund Initiative..........................   983
Questions for the Record (QFRs) from Representative Sabo:
    Current Operating Hours Comparison...........................  1053
    Impact of Operating Hours on Performance.....................  1053
    Impact of Operating Hours on SAR/Cocaine Interdiction........  1054
    Operating Temp Comparison....................................  1052
    Operating Tempo Comparison FY02/FY00.........................  1055
    President Bush's 2% budget reduction in CG Personnel.........  1051
    Small Boat Station Staffing..................................  1052
Questions for the Record (QFRs) from Representative Obey:
    Aircraft Reductions and DEEPWATER............................  1058
    Bankrupt Contractor Without Bonding, Use of use..............  1059
    Contractor Assurance Bonding.................................  1057
    DEEPWATER, NDRS, GLIB: Critical Paths........................  1059
    DEEPWATER, NDRS, GLIB: Minimizing Risk.......................  1055
    Major Procurement Cost Estimates.............................  1061
Questions for the Record (QFRs) from Representative Callahan:
    Boatracs versus Cellular Phone Cost Comparison...............  1067
    Communication Abilities......................................  1068
    Communication Deficiencies...................................  1068
    Communication Difficulties...................................  1069
    Communications Check Intervals...............................  1070
    Conclusions of Boatracs system Evaluation....................  1066
    Evaluation of Boatracs System................................  1066
    Interim Communication Systems................................  1067
    Interim Internal Communications System Contingency Timeline..  1071
    Interim Internal Communications System.......................  1065
    LORAN Funding and Project Breakdown..........................  1073
    LORAN Outsourcing............................................  1074
    LORAN-C Transmitter Contract Award...........................  1075
    NDRSMP: Concept Exploration Proposals........................  1070
    NDRSMP: Concept Exploration..................................  1070
    NDRSMP: Full Implementation..................................  1071
    NDRSMP: Phase II Award.......................................  1071
    Reliable Communications System Delays........................  1069
    Requests for Internal Communications Systems.................  1065
    Response to House Report on Boatracs System..................  1062
Written Statement of Adm. James M. Loy, Commandant, U.S. Coast 
  Guard..........................................................   799

                                
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