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



 
                             EPA ELEVATION
=======================================================================

                                HEARINGS

                               before the

                 SUBCOMMITTEE ON ENERGY POLICY, NATURAL
                    RESOURCES AND REGULATORY AFFAIRS

                                 of the

                              COMMITTEE ON
                           GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS

                       FIRST AND SECOND SESSIONS

                               __________

             SEPTEMBER 21, 2001; MARCH 21 AND JULY 16, 2002

                               __________

                           Serial No. 107-135

                               __________

       Printed for the use of the Committee on Government Reform


  Available via the World Wide Web: http://www.gpo.gov/congress/house
                      http://www.house.gov/reform






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                     COMMITTEE ON GOVERNMENT REFORM

                     DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York         HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland       TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut       MAJOR R. OWENS, New York
ILEANA ROS-LEHTINEN, Florida         EDOLPHUS TOWNS, New York
JOHN M. McHUGH, New York             PAUL E. KANJORSKI, Pennsylvania
STEPHEN HORN, California             PATSY T. MINK, Hawaii
JOHN L. MICA, Florida                CAROLYN B. MALONEY, New York
THOMAS M. DAVIS, Virginia            ELEANOR HOLMES NORTON, Washington, 
MARK E. SOUDER, Indiana                  DC
STEVEN C. LaTOURETTE, Ohio           ELIJAH E. CUMMINGS, Maryland
BOB BARR, Georgia                    DENNIS J. KUCINICH, Ohio
DAN MILLER, Florida                  ROD R. BLAGOJEVICH, Illinois
DOUG OSE, California                 DANNY K. DAVIS, Illinois
RON LEWIS, Kentucky                  JOHN F. TIERNEY, Massachusetts
JO ANN DAVIS, Virginia               JIM TURNER, Texas
TODD RUSSELL PLATTS, Pennsylvania    THOMAS H. ALLEN, Maine
DAVE WELDON, Florida                 JANICE D. SCHAKOWSKY, Illinois
CHRIS CANNON, Utah                   WM. LACY CLAY, Missouri
ADAM H. PUTNAM, Florida              DIANE E. WATSON, California
C.L. ``BUTCH'' OTTER, Idaho          STEPHEN F. LYNCH, Massachusetts
EDWARD L. SCHROCK, Virginia                      ------
JOHN J. DUNCAN, Jr., Tennessee       BERNARD SANDERS, Vermont 
JOHN SULLIVAN, Oklahoma                  (Independent)


                      Kevin Binger, Staff Director
                 Daniel R. Moll, Deputy Staff Director
                     James C. Wilson, Chief Counsel
                     Robert A. Briggs, Chief Clerk
                 Phil Schiliro, Minority Staff Director

Subcommittee on Energy Policy, Natural Resources and Regulatory Affairs

                     DOUG OSE, California, Chairman
C.L. ``BUTCH'' OTTER, Idaho          JOHN F. TIERNEY, Massachusetts
CHRISTOPHER SHAYS, Connecticut       TOM LANTOS, California
JOHN M. McHUGH, New York             EDOLPHUS TOWNS, New York
STEVEN C. LaTOURETTE, Ohio           PATSY T. MINK, Hawaii
CHRIS CANNON, Utah                   DENNIS J. KUCINICH, Ohio
JOHN J. DUNCAN, Jr., Tennessee       ROD R. BLAGOJEVICH, Illinois
JOHN SULLIVAN, Oklahoma

                               Ex Officio

DAN BURTON, Indiana                  HENRY A. WAXMAN, California
                       Dan Skopec, Staff Director
               Jonathan Tolman, Professional Staff Member
                         Allison Freeman, Clerk
                 Elizabeth Mundinger, Minority Counsel
                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    September 21, 2001...........................................     1
    March 21, 2002...............................................    95
    July 16, 2002................................................   199
Statement of:
    Boehlert, Hon. Sherwood L., a Representative in Congress from 
      the State of New York......................................     4
    Davies, J. Clarence, senior fellow, Resources for the Future; 
      Janet L. Norwood, fellow, National Academy of Public 
      Administration; Robert W. Hahn, director, AEI-Brookings 
      Joint Center for Regulatory Affairs; and Janice Mazurek, 
      director, Center for Innovation and the Environment, 
      Progressive Policy Institute...............................    36
    Ehlers, Hon. Vernon J., a Representative in Congress from the 
      State of Michigan..........................................    25
    Futrell, J. William, president, Environmental Law Institute; 
      William Kovacs, vice president, Environment and Regulatory 
      Affairs, U.S. Chamber of Commerce; and Wesley Warren, 
      senior fellow for environmental economics, Natural 
      Resources Defense Council..................................   248
    Horn, Hon. Stephen, a Representative in Congress from the 
      State of California........................................     9
    Studders, Karen A., commissioner, Minnesota Pollution Control 
      Agency; and Jane T. Nishida, secretary, Maryland Department 
      of the Environment.........................................   164
    Tinsley, Nikki, Inspector General, U.S. Environmental 
      Protection Agency; and John Stephenson, Director, Natural 
      Resources and Environment, General Accounting Office.......   100
    Whitman, Christine Todd, Administrator, Environmental 
      Protection Agency; and James Connaughton, chairman, Council 
      on Environmental Quality...................................   222
Letters, statements, etc., submitted for the record by:
    Boehlert, Hon. Sherwood L., a Representative in Congress from 
      the State of New York, prepared statement of...............     7
    Connaughton, James, chairman, Council on Environmental 
      Quality, prepared statement of.............................   229
    Davies, J. Clarence, senior fellow, Resources for the Future, 
      prepared statement of......................................    39
    Ehlers, Hon. Vernon J., a Representative in Congress from the 
      State of Michigan, prepared statement of...................    27
    Futrell, J. William, president, Environmental Law Institute, 
      prepared statement of......................................   250
    Hahn, Robert W., director, AEI-Brookings Joint Center for 
      Regulatory Affairs, prepared statement of..................    61
    Horn, Hon. Stephen, a Representative in Congress from the 
      State of California:
        Organization manual......................................    31
        Prepared statement of....................................    10
    Kovacs, William, vice president, Environment and Regulatory 
      Affairs, U.S. Chamber of Commerce, prepared statement of...   261
    Mazurek, Janice, director, Center for Innovation and the 
      Environment, Progressive Policy Institute, prepared 
      statement of...............................................    74
    Nishida, Jane T., secretary, Maryland Department of the 
      Environment, prepared statement of.........................   179
    Norwood, Janet L., fellow, National Academy of Public 
      Administration, prepared statement of......................    52
    Ose, Hon. Doug, a Representative in Congress from the State 
      of California, prepared statements of..................2, 98, 202
    Otter, Hon. C.L. ``Butch'', a Representative in Congress from 
      the State of Idaho:
        Letter dated December 20, 2001...........................   162
        Prepared statement of....................................   144
    Stephenson, John, Director, Natural Resources and 
      Environment, General Accounting Office, prepared statement 
      of.........................................................   127
    Studders, Karen A., commissioner, Minnesota Pollution Control 
      Agency, prepared statement of..............................   168
    Sullivan, Hon. John, a Representative in Congress from the 
      State of Oklahoma, prepared statement of...................   317
    Tierney, Hon. John F., a Representative in Congress from the 
      State of Massachusetts, prepared statement of..............   208
    Tinsley, Nikki, Inspector General, U.S. Environmental 
      Protection Agency, prepared statement of...................   103
    Warren, Wesley, senior fellow for environmental economics, 
      Natural Resources Defense Council, prepared statement of...   288
    Waxman, Hon. Henry A., a Representative in Congress from the 
      State of California, prepared statement of.................   216
    Whitman, Christine Todd, Administrator, Environmental 
      Protection Agency, prepared statement of...................   224


         EPA ELEVATION: CREATING A NEW CABINET LEVEL DEPARTMENT

                              ----------                              


                       FRIDAY, SEPTEMBER 21, 2001

                  House of Representatives,
  Subcommittee on Energy Policy, Natural Resources 
                            and Regulatory Affairs,
                            Committee on Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 9:45 a.m., in 
room 2247, Rayburn House Office Building, Hon. Doug Ose 
(chairman of the subcommittee) presiding.
    Present: Representatives Ose, Otter, Cannon, Duncan, 
Tierney, and Kucinich.
    Staff present: Dan Skopec, staff director; Barbara Kahlow, 
deputy staff director; Jonathan Tolman, professional staff 
member; Regina McAllister, clerk; Elizabeth Mundinger and 
Alexandra Teitz, minority counsels; and Earley Green, minority 
assistant clerk.
    Mr. Ose. The hearing will come to order. Committee, good 
morning everyone. In the interest of time, I want to submit my 
statement for the record.
    [The prepared statement of Hon. Doug Ose follows:]
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    Mr. Ose. Mr. Tierney.
    Mr. Tierney. I also would like to submit a statement for 
the record and ask that it be kept open for submission of 
relevant materials.
    Mr. Ose. Without objection.
    Mr. Tierney. And then basically give my apologies to the 
three witnesses. We are dealing with the airline bill and I 
have to get over to another meeting. So I will certainly read 
your testimony and I appreciate the work that you have done and 
appreciate your understanding.
    Mr. Ose. I would like to welcome our colleagues this 
morning, Mr. Boehlert of New York, Mr. Horn of California and 
Mr. Ehlers of Michigan.
    We are going to hear first from Mr. Boehlert, who is the 
chairman of the Science Committee and has been a veteran of 
efforts to elevate EPA to Cabinet level, going back more than a 
decade.
    Then we will hear from Mr. Horn, who is chairman of the 
Subcommittee on Government Efficiency, Financial Management and 
Intergovernmental Relations, and quite literally one of the 
busiest chairmen in Congress. He is a one-man academy of 
experts on government structure and management.
    And finally, we are going to hear from Mr. Ehlers, who is 
not only chairman of the Subcommittee on Environment, 
Technology and Standards, but is also a physicist by training. 
He definitely improves the collective scientific wisdom of 
Congress by his very presence.
    Mr. Boehlert.

  STATEMENT OF HON. SHERWOOD L. BOEHLERT, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF NEW YORK

    Mr. Boehlert. Thank you, Mr. Chairman. I want to thank 
Chairman Burton and the Democrat leadership of the committee 
for helping make possible today's hearing. Based on its name 
alone, this subcommittee must be one of the busiest in 
Congress. Energy Policy, Natural Resources and Regulatory 
Affairs cover just about every hot issue under the sun, 
actually including the sun.
    But I am not here to talk about solar power, although I'd 
be delighted to, and I recognize your time constraints in the 
press of other priorities both international and domestic, so 
I'll try to be brief. That can be a challenge, given the 
importance of the subject and my long and often tortuous 
legislative experience with the effort dating back to 1988. But 
you know the issues and the importance of EPA's mission, so 
I'll get right to the point.
    And actually there are three points:
    No. 1: Congress should elevate EPA to the Cabinet level 
status it deserves and needs. Now is the time and this is the 
place to do what is long overdue. What does the United States 
have in common with Monaco, Libya, Panama, Peru and five other 
countries? These are the holdouts that, for whatever reason, 
have chosen not to make their primary environmental agencies 
Cabinet level departments. Every other major country has done 
so. Today, more than ever before, we need to make EPA an 
official member of the President's Cabinet.
    This has nothing to do with the stature or capability of 
Governor Whitman, who I think is doing a tremendous job. 
Instead, it is a question of timing and national and global 
conditions. Environmental issues are becoming more complex, 
more international and more global. This statement is even 
truer today than it was when I made it before the Senate 
Governmental Affairs Committee just 2 months ago; climate 
change, widespread toxic pollution, both chemical and 
biological, and invasive species are obvious examples. The 
House Science Committee, which I am privileged to chair, is 
looking precisely at such issues. There are also growing 
complexities involving natural resource damages and 
environmental challenges among other Federal agencies, such as 
the Department of Energy and the Department of Defense.
    No. 2: Don't be tempted by other environmental side issues 
or controversies. Based on my previous experience with Cabinet 
level legislation, I cannot overemphasize the importance of 
staying focused. Let us not forget the lessons of 1993 and 1994 
when elevation bills addressed wide-ranging and controversial 
issues and became magnets for further controversy. The effort 
ultimately failed. Republicans, Democrats, conservatives, and 
liberals alike recognized what all of us should recognize 
today: Only a straightforward, clean elevation bill can make it 
through the process. That has been the message I have been 
receiving from the administration--and they re-emphasized that 
again just yesterday--and many in Congress and I believe they 
are right.
    Many issues confront EPA. Some of these are organizational 
in nature. Some are left over from previous administrations and 
some are brand new. Some can be addressed administratively. 
Many should be addressed through congressional oversight. Mr. 
Horn, the distinguished chairman of the Subcommittee on 
Government Efficiency, Financial Management and 
Intergovernmental Relations, and a good friend of mine and a 
resource to this Congress, knows this. His expertise in history 
and government and his appreciation for environmental 
protection have served the Congress and the Nation well over 
the years. I look forward to working with him on an EPA 
elevation bill as well as his particular legislation. The 
secret to success, I believe, will be for Congress to keep this 
bill clean and simple, while at the same time, encouraging 
oversight hearings on other legitimate issues and action on 
separate and discrete bills by appropriate committees.
    And the third and final point, Mr. Chairman: H.R. 2438 and 
H.R. 64 should continue to move on parallel but separate 
tracks. Mr. Chairman, I strongly support Mr. Ehlers' bill, H.R. 
64, which would strengthen science at EPA by, among other 
things, establishing a Deputy Administrator for Science and 
Technology. The bill is pending before our Science Committee 
and I anticipate full committee approval very soon, perhaps as 
early as the week after next. While it is not the subject of 
this hearing, I appreciate the opportunity to comment on its 
importance and conventional connection to H.R. 2438. Based on 
committee jurisdictions and recognizing the preferences of the 
administration, I would urge your subcommittee not to try to 
attach H.R. 64 or provisions from H.R. 64 to H.R. 2438.
    In addition, we continue to have discussions with the 
administration about H.R. 64 and how its provisions might be 
implemented by and integrated within a new Department of 
Environmental Protection. For the time being, it continues to 
make sense to move these legislative initiatives on separate 
tracks.
    Thank you, Mr. Chairman. I hope markup of a clean, 
bipartisan bill, once again let me stress, supported by the 
administration as a clean bill will follow very soon. I am 
confident that with your help and the bipartisan support of the 
committee and full committee, as well as the continued support 
of the administration, we can make this important effort a 
success.
    Mr. Ose. Thank you, Mr. Boehlert.
    [The prepared statement of Hon. Sherwood L. Boehlert 
follows:]
[GRAPHIC] [TIFF OMITTED] 82666.003

[GRAPHIC] [TIFF OMITTED] 82666.004

    Mr. Ose. Mr. Horn.

 STATEMENT OF HON. STEPHEN HORN, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Horn. Thank you, Mr. Chairman. It is good to see you in 
charge of this subcommittee, and I leave to you and the 
subcommittee what pieces you think make common sense. I am 
delighted to be here with my two colleagues with whom I have 
great esteem, and that is Mr. Boehlert and Mr. Ehlers.
    And let me just say a couple of points. It is clear, 
although we have been committed to environmental protection 
since 1970 with the establishment of the Agency, the priority 
of that commitment has been the subject of reinterpretation 
with each new administration because EPA has not had a 
permanent seat at the Cabinet. With the increasing need to 
protect the environment across borders and the increasingly 
complicated nature of environmental protection, we must elevate 
the existing Agency to a department. In having this discussion, 
we should take it as an opportunity to provide effective 
oversight and review many areas of our environmental 
operations.
    Our legislation does this. Two areas of continuing concern: 
First, despite the implementation of the Government Performance 
and Results Act, which the General Accounting Office has had 
great concerns about, the current Agency and we also have 
problems with them on information management, collection, 
coordination, computer security, and they remain real 
challenges for the EPA--and I hope that during the course of 
debating whether to elevate the existing EPA to a Cabinet level 
department, we will focus significant attention to information 
management processes and resources within the current Agency to 
ensure that our environmental information is reliable and of 
the highest quality.
    Second, we must ensure that the best practice management 
aids and sound environmental decisions will be the result. Most 
notably, that includes using risk assessment to understand the 
benefits to be achieved by proposed regulations and the costs 
that will necessarily be borne to meet those objectives--risk 
assignment and assessment as it was originally proposed by our 
colleagues, Representatives Thurman and Mica back in 1993-1994, 
and it is included in my legislation. It has been 
controversial. However, as a critical management tool, it would 
enable our environmental regulators to begin the process of 
setting achievable program objectives and methodologies to 
measure our progress toward achieving environmental goals.
    The inability of the existing EPA to establish risk-based 
program priorities is a deficiency that has been recently noted 
by the General Accounting Office and the EPA's Inspector 
General, and requiring risk assessment as part of the 
regulatory process will do much to resolve this.
    I end these comments here and I submit a long statement for 
the record, Mr. Chairman, if I might. And thank you for holding 
this hearing this morning. I will be happy to have any 
questions.
    Mr. Ose. Thank you, Mr. Chairman.
    [The prepared statement of Hon. Stephen Horn follows:]
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    Mr. Ose. Mr. Ehlers.

    STATEMENT OF HON. VERNON J. EHLERS, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Mr. Ehlers. Thank you, Mr. Chairman. It is good to see you 
in that seat. I would like to speak about H.R. 64, a bill that 
I sponsored. You of course heard testimony about addressing the 
global issues from the previous two witnesses. I am speaking 
about just one specific aspect, and that is how we can improve 
the science in the EPA.
    I appreciate this opportunity to discuss the different ways 
to elevate the EPA to Cabinet level and also want to present my 
thoughts about reforms the EPA should undertake immediately 
regarding use of science and technology in the regulatory 
process. As co-sponsor of Chairman Boehlert's legislation, I 
certainly echo his comments today. I fully support its passage 
and hope the Government Reform Committee will quickly move it 
to the House floor.
    Environmental policy is one of those rare issues that 
literally affects every single American every single day of 
their lives. Clean air, clean water, clean land certainly are 
no less important than agriculture, education, transportation 
and interior issues dealt with by some of the other 14 Cabinet 
level departments. The EPA should be recognized for the 
important role they play in Americans' daily lives.
    In my view, one of the key issues surrounding this debate 
is how should Congress address some fundamental regulatory 
process changes that the EPA needs to make. Certainly if this 
Agency is to become a Cabinet level department, it needs to be 
held to the highest standards of process. I believe that the 
most fundamental reform the EPA needs to make to the regulatory 
process is to strengthen the role that science plays in the 
Agency's decisionmaking process.
    As many members are aware, I introduced H.R. 64, which the 
Science Committee is reviewing, because I believe the Agency 
needs a new Deputy Administrator for Science and Technology to 
oversee the vast and complex scientific mission of the Agency. 
It is essential that science infuse the entire regulatory 
process, from initial concept to final regulation, if we are to 
have good science-based regulations.
    Let me address the intent of my legislation before I 
discuss its relevance to the other bills discussed here. 
Numerous times I have heard my colleagues and the scientific 
community and the business community and the public say, what 
we really want is the use of sound science at the EPA. Everyone 
agrees that regulatory decisions made by the EPA should be 
based on the best possible scientific research. However, many 
institutions, citizens and groups believe that decisionmaking 
at the EPA can be improved by a greater integration of science 
into the process.
    Many different studies have documented the need for 
strengthening science at the EPA. The most recent of these was 
issued by the National Research Council in September of last 
year. The two primary recommendations of that report were to 
establish a new Deputy Administrator for Science and Technology 
at the EPA and to set a fixed term for the existing Assistant 
Administrator for the Office of Research and Development. These 
changes would elevate the role of science in the decisionmaking 
process at the Agency as well as provide more stability to 
existing research efforts being conducted inside of the Agency.
    Both of these charges are captured in H.R. 64, which I have 
introduced to ensure that science informs and infuses the 
regulatory work of the EPA. This legislation also builds on the 
review of our National Science Policy that I prepared in 1998 
for the House Science Committee and which was adopted by the 
House of Representatives in the 105th Congress. The 
recommendation in that report that received the most favorable 
response was that science be used differently in the regulatory 
and judicial processes. It should not be used in an adversarial 
fashion in the courts and should not be used as a mere adjunct 
to the regulatory system. Rather, science should be used at the 
beginning, middle, and end of an agency's decisionmaking 
process.
    Science can help us make informed decisions about the 
relative risks of a threat, whether or not we need to address 
it, and about how to allocate resources to address the threat. 
The Environment, Technology, and Standards Subcommittee, which 
I chair, has unanimously passed this bill out and it is 
expected to come before the full committee in the first week of 
October or soon thereafter, and I certainly hope that it will 
soon reach the floor of the House.
    I might also mention this legislation that I have 
introduced, H.R. 64, is supported by the Science Advisory Board 
of the EPA. And I have received numerous letters from 
professional scientific associations and from business groups 
and environmental groups supporting the passage of this bill.
    I currently support the dual track strategy of moving the 
elevation bill through the Government Reform Committee and also 
H.R. 64 through the House Science Committee. I believe both 
approaches should be taken. I hope that my bill, H.R. 64, will 
pass into law, and that would, I think, make a strong case for 
including it in the departmental--I'm sorry, the departmental 
portfolio that the Agency will have once it becomes a Cabinet 
level department. But I also am aware of the legislative 
history, so I was trying to address too many issues, and an 
elevation bill likely dooms the effort. So I believe this is 
the best way to move H.R. 64 through the process quickly. And 
once we get it through the House, we can assess how we can 
combine the two bills.
    I also want to say that because we have a new 
administration at the other end of Pennsylvania Avenue, we have 
a golden opportunity to improve the operation of the EPA, and 
we are looking forward to working with you and your colleagues 
as well as Chairman Boehlert and Chairman Horn and the 
administration and other interested parties to bring about 
these important changes by passing the bills that are before 
us. I thank you for your time and consideration.
    [The prepared statement of Hon. Vernon J. Ehlers follows:]
    [GRAPHIC] [TIFF OMITTED] 82666.020
    
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    Mr. Otter [presiding]. Thank you very much, Congressman 
Ehlers. The Chair has been made aware that Members of this 
panel have to--are maybe even 3 minutes late for another 
meeting. Could you give the Chair some sort of an expression of 
the time that you can spend here with us?
    Mr. Boehlert. I'm fine. I have been on this for 10 years.
    Mr. Otter. Mr. Horn.
    Mr. Horn. I have to go to the Transportation Aviation also, 
but I can stay for 10 minutes certainly.
    Mr. Otter. Then I would like to start off.
    Mr. Horn, your bill also embraces several of the ideas on 
science that Mr. Ehlers' bill does. How do you feel about Mr. 
Ehlers' bill?
    Mr. Horn. I think it is very worthwhile. If we can't get 
more things in there, that is certainly very useful and I would 
support that.
    Mr. Otter. Mr. Boehlert.
    Mr. Boehlert. I'm a co-sponsor, and we're moving that 
through my Science Committee. I think it is very important that 
we have science-based decisionmaking. That's why I have 
strongly endorsed, and Dr. Ehlers I think agrees with this, 
moving forward on a parallel track. The history indicates--we 
have been through this in 1993 and 1994. Everybody talks about 
elevating EPA to Cabinet level status. Incidentally, I might 
add that the President and the administration are fully 
supportive of my bill and fully supportive of the concept of a 
clean bill. That does not address the separate legislation 
introduced by Dr. Horn and Dr. Ehlers. I am enthusiastic about 
working with them in partnership; but the fact of the matter 
is, if we want to do what we all have talked about for a long, 
long time, we have to avoid attaching anything else that will 
open up this bill to delay any unnecessary lengthy debate. I 
fully support and am enthusiastic of my support of Dr. Ehlers' 
bill and we are moving that on a fast track through the Science 
Committee. But let me stress, it should go on a parallel track. 
EPA elevation must be a clean bill, or we will repeat what we 
have been through before. And I don't want to do that and 
neither does the President.
    Mr. Otter. Mr. Boehlert, I have several questions about the 
elevation bill. It has been my experience, at least in 
business, that you can have only a certain critical mass, I 
should say, of people reporting to you in order to do an 
effective job, or a couple of things happen. No. 1, you 
diminish the opportunities for those that are truly important 
to the committee or to the people that are reporting to you. 
Some of the criticism that I have at least heard on the 
elevation of any agency--not just EPA, any additional agency--
is that to the extent that you increase the numbers in the 
Cabinet room, No. 1, you decrease the administration's focus on 
other critical functions of government. And I understand it is 
arguable, you know, where you elevate EPA according to military 
defense and these kinds of things. But what would you offer as 
an argument against those who would say, the more people you 
put in that room, the less effective each of them are going to 
be?
    Mr. Boehlert. First of all, I would point out that you 
don't add anyone to that room. The Administrator of EPA is 
already designated by the President of the United States as a 
member of the Cabinet. She has a seat at the table. She has a 
seat at the table only at the sufferance of this President. The 
next President may view it differently.
    Second, this Administrator is given Cabinet level status by 
the President. But in reality, she is in a subordinate position 
when she represents the U.S.' interests abroad. For example, 
she travels to international conferences dealing with very 
sensitive subjects on the environment. She is not at a 
ministerial level or a Cabinet level officially, so she is 
dealing from a subordinate position as she is in dealing with 
the other members of the President's Cabinet. So the President 
already has the Administrator reporting directly to him. The 
President is enthusiastic in support of this elevation. I think 
the time is long overdue that we do this.
    Mr. Otter. And what about diminishing the focus that the 
President would have on other areas of government?
    Mr. Boehlert. It won't diminish the focus because he 
already has a focus.
    Mr. Otter. I understand that. But given the nature of an 
invited position as opposed to an endowed position, I think 
that would change the focus considerably, don't you?
    Mr. Boehlert. The focus is what the President chooses it to 
be, and he has indicated his intention to give the proper 
attention and focus to the environment. The American people 
expect us to protect the air we breathe and water we drink. 
They expect us to give premier importance to the top official 
in this country dealing with the environment. They expect the 
President to have the top environmental official at his side as 
he makes important decisions. And the President has indicated 
that is exactly what he wants. So he is on the same wavelength 
as the American people.
    We are not adding any expense or a name change on the door. 
We are not even adding a new chair. They are kind of expensive. 
You have had the privilege of sitting down there, so have I, 
down at the Cabinet room. The same chair will be there. The 
same occupant will be there, only with a different title, 
demonstrating in very tangible form that this President, this 
administration, this government, gives the highest priority to 
environmental concerns.
    Mr. Otter. Thank you. Mr. Cannon.
    Mr. Cannon. In deference to your time, I have one quick 
question. How do you deal with the Council on Environmental 
Quality in your bill? Do you change that?
    Mr. Boehlert. Don't change that at all.
    Mr. Otter. Thank you very much. We appreciate your 
attention, and we appreciate your extending your time here so 
we could ask these questions.
    Mr. Horn. Mr. Chairman, if I might put in the record the 
Organization Manual as it pertains now to the Environmental 
Protection Agency.
    Mr. Otter. Without objection, so ordered.
    [The information referred to follows:]
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    Mr. Otter. Our second panel this morning is in this order: 
Dr. J. Clarence Davies, senior fellow, Resources for the 
Future; Dr. Janet L. Norwood, fellow, from the National Academy 
of Public Administration; Dr. Robert W. Hahn, the director of 
the AEI-Brookings Joint Center for Regulatory Affairs; and 
Janice Mazurek, director, Center for Innovation and Environment 
Progressive Policy Institute.
    If you would please take your positions at the table. If I 
could ask you to please stand and raise your right hands. We do 
swear our witnesses here. Sometimes we swear at them.
    [Witnesses sworn.]
    Mr. Otter. Being the vice chairman, I don't always get an 
opportunity to explain all the rules and regulations, but I 
have listened to Chairman Ose give them enough times that I do 
know that we are limited to 5 minutes, and we want to give 
everybody an opportunity to discuss particular topics and their 
feelings about this legislation, but also want to give an 
opportunity to those of us who are sitting on the committee to 
ask sufficient questions in order to brief ourselves on the 
issue and on the legislation. So if you pay a little attention 
to the light in front of you, green is you are on ``go.'' And 
when it hits white, you have about 45 seconds. And when it hits 
red, if you're not in the process of summing--we would like to 
sum up.
    Dr. Davies.

STATEMENTS OF J. CLARENCE DAVIES, SENIOR FELLOW, RESOURCES FOR 
   THE FUTURE; JANET L. NORWOOD, FELLOW, NATIONAL ACADEMY OF 
PUBLIC ADMINISTRATION; ROBERT W. HAHN, DIRECTOR, AEI-BROOKINGS 
   JOINT CENTER FOR REGULATORY AFFAIRS; AND JANICE MAZUREK, 
     DIRECTOR, CENTER FOR INNOVATION AND THE ENVIRONMENT, 
                  PROGRESSIVE POLICY INSTITUTE

    Dr. Davies. Thank you, Mr. Chairman. I appreciate the 
opportunity to be here. Let me start by saying that my views 
are simply my personal views. Resources----
    Mr. Otter. Could I get you to pull that mic just a little 
closer to you.
    Dr. Davies. Is that better?
    Mr. Otter. That is much better. And I would warn everybody 
who is not involved in the conversation that the mics are hot 
all the time, so you want to be careful what you say. Dr. 
Davies.
    Dr. Davies. Resources for the Future is a research 
organization so it does not take positions on policy matters, 
so my views are only my personal views. I want to make that 
clear in the beginning. But I have had a longstanding 
involvement in the subject of this hearing. I more than 30 
years ago coauthored the reorganization plan that created EPA 
in the first place. And at the time of the events that Mr. Horn 
referred to of the previous consideration of Cabinet 
legislation, I was the Assistant Administrator for Policy in 
EPA and therefore had a fairly active role in those 
considerations.
    I share the view expressed by the members of the previous 
panel that elevation of EPA to Cabinet level is long overdue. 
As I guess Mr. Boehlert mentioned, we are one of the few 
countries in the world that does not have a Cabinet level 
environment department. Environment is a major fundamental and 
permanent responsibility of the Federal Government and its 
importance should be recognized in organizational terms. 
Furthermore, it is important internationally to send a signal 
that we consider environment to be a Cabinet level 
responsibility. I guess to be more precise, it is important 
that we erase the negative signal that we give repeatedly in 
the international arena by having environment occupy a lower 
level within the Federal bureaucracy.
    Let me in this context just mention that in terms of span 
of control of the President the concern that you raised, Mr. 
Chairman, a few minutes ago, I really do not think that is a 
serious concern. As mentioned by Mr. Horn or Mr. Boehlert, the 
Administrator of EPA is already at the table in the Cabinet. 
The Cabinet is not a decisionmaking body and therefore, the 
number there is not really all that relevant. And in terms of 
reporting to the President, I can put on my political science 
hat and say that there are Cabinet level positions which 
Presidents have ignored and other positions which are not 
Cabinet level, like National Security Advisor, for example, 
which the President pays a good deal of attention to. It is not 
unusual, for example, for Republican Presidents, let's say, 
never to see their Secretary of Labor in anything other than a 
formal Cabinet meeting. So span of control does not have the 
same kind of relevance, I think, that it does in the private 
sector.
    I am very sympathetic to Mr. Boehlert's urging that we do a 
simple, clean elevation without any additional provisions. 
Nevertheless, I think there are a number of things that at 
least this committee should consider adding onto the 
legislation; and perhaps my hope would be at least that a 
number of them would be noncontroversial and, therefore, would 
not subject the elevation to the same kind of jeopardy that 
concerns Mr. Boehlert. I don't know. It is a serious concern. 
No doubt about that.
    I go into details in my testimony on the various items that 
I think could be usefully considered in the context of a 
Cabinet bill: A mission statement for the Agency. EPA has never 
had a mission statement, and I think it would help in a number 
of contexts if it did have a mission statement.
    Integration across media. There is no policy area more 
fragmented than pollution control. Jan Mazurek and I have 
spelled out some of the details of that in a book which I have 
given to staff. And you are not going to remedy that in the 
context of Cabinet legislation, but I think it could be 
considered that some kind of commission, some kind of 
extraordinary body, could be convened to review the statutory 
authorities administered by the Agency and ways which that 
could be made into a more integrated whole.
    Better science has been touched upon. And I subscribe to 
the notion of a Deputy or an Under Secretary for Science in the 
Agency. I think that would be useful. I think there may be 
other steps that could be done to improve science within the 
Agency. Better data, I suspect Janet Norwood is going to deal 
with. But Bureau of Environmental Statistics is badly needed, 
in my view, and the Office of Information which has been set up 
by Mrs. Whitman is not an adequate substitute for that; in 
fact, may detract from that in some way. So I think we still 
need a Bureau of Environmental Statistics, and it is a 
neglected function but an important one.
    Program evaluation and economic analysis, which I think Mr. 
Horn's bill deals with, I'm not sure I fully agree with the way 
it deals with it, but it does address it and addresses it in 
important ways.
    Statutory basis for innovation. The Agency is running a 
number of pilot projects--XCEL, CSI, so on--without any 
statutory authority whatsoever. And I think there is general 
agreement across party lines and so on that kind of 
experimentation is useful, constructive, and needed, but it is 
very handicapped by not having any statutory basis----
    Mr. Otter. Could I get you to wrap up?
    Dr. Davies. And finally, the international role, which I 
think would be helpful to mention. I don't think the 
legislation should become some kind of Christmas tree, but the 
things I have mentioned are important and worth doing. They are 
appropriate for Cabinet legislation and I think they should be 
relatively noncontroversial if framed in the right way.
    Mr. Otter. Thank you.
    [The prepared statement of Dr. Davies follows:]
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    Mr. Otter. Dr. Norwood.
    Dr. Norwood. Thank you very much. I appreciate the 
opportunity to be here and to tell you a little bit about some 
of the work that the National Academy of Public Administration 
has been doing. My background is mainly in statistical policy, 
having been Commissioner of Labor Statistics for 13\1/2\ years, 
and I am now doing a great deal of work on promoting scientific 
development in a variety of areas, including the environment. I 
was a member of all three NAPA panels, which studies were 
completed in 1995, 1997 and then 2000. These three reports 
reviewed the entire operations, the internal structure and 
implementation strategies as well as the manner in which 
intergovernmental relations in EPA were handled.
    A number of recommendations were made, and I'd be happy to 
discuss those with the committee at a later time. I was given 
three questions by the subcommittee staff, and I would like to 
focus my attention on those.
    The first was: Can EPA improve its effectiveness? I believe 
that we found in the three academy reports that it would be 
wise for EPA to focus on a few of the most important basic 
problems, using its energy, resources and innovation to address 
the problems of smog, water pollution and greenhouse gases.
    As Terry said, we believe very strongly that the Congress 
and EPA should work together to develop legislation to permit 
EPA to move across environmental media. The stovepipe kind of 
organization today and the way in which money and resources 
need to be spent is really counterproductive. We believe that 
EPA should have an effective system to collect objective and 
scientific data, and I will get back to that.
    Does EPA need structural changes? The most important is in 
the statistical area. On the question of EPA elevation to 
status as a Cabinet agency, we really didn't consider that. But 
I can tell you my personal view, which is that elevation to 
Cabinet status would certainly increase EPA's importance in the 
public arena, and especially internationally, and provide its 
Administrator with a better chance of getting attention.
    But I think it's important to point out that Cabinet status 
will not solve all of EPA's problems. We have to remember that 
there are a significant group of Cabinet agencies--State 
Department, Transportation, Energy, Agriculture, Labor and 
there are more--who are also involved in environmental issues. 
And the lines of jurisdiction among these agencies, and between 
them and the EPA, need clarification when Congress considers 
legislation on the status of EPA in our government.
    I believe that EPA needs to be a scientific agency, and 
that to be successful, any scientific agency must have an 
adequate system of information that is objective. I would hope 
that any bill which creates Cabinet status for EPA would take 
account of the need for an independent Bureau of Statistics 
within EPA, which is headed by a Presidentially appointed 
professional with a fixed term of office. We have those models 
in other parts of the government and they have worked 
extremely.
    There is no way that EPA will be able to go ahead with 
innovative programs, with changing the way it relates to States 
and local areas and to business unless it has a system of 
scientific information that is objective and goes across all of 
its media, that can be used to evaluate the effectiveness of 
the work that is being done as further devolution occurs.
    I'd be glad to answer any questions.
    Mr. Otter. Thank you very much.
    [The prepared statement of Ms. Norwood follows:]
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    Mr. Otter. Dr. Hahn.
    Dr. Hahn. Thank you very much, Mr. Chairman. I didn't get 
three questions to answer and I was instructed to think outside 
the box a little, so I will try to do this. First I want to say 
that the formal remarks I would like to submit for the record 
were coauthored with my colleague, Randall Lutter, at the AEI-
Brookings Joint Center.
    Mr. Otter. Without objection.
    Dr. Hahn. Since we are short on time, let me make two key 
points, and then focus on my recommendations. The first point 
is that EPA should not be elevated to Cabinet status without 
very serious thought. Once an agency is granted Cabinet status, 
it is very unlikely in our lifetime to lose that status.
    The second point is that we ought to address several 
defects in both Federal environmental policy and the policy 
process. EPA, as you probably know, accounts for the lion's 
share of environmental, health, and safety regulations. We can 
estimate that in several ways, but it is on the order of three-
quarters.
    One of the fundamental problems of any mission-oriented 
agency--and this was pointed out by Justice Stephen Breyer in a 
very good book called Breaking the Vicious Circle--is that it 
tends to have tunnel vision. Bureaucrats tend to focus on their 
particular problem. We as economists think that environmental 
policy is a very important problem, but we ought to think very 
carefully about weighing the benefits and costs of any 
individual policy before we move forward. After all, at the end 
of the day, EPA is primarily in the business of making 
regulations.
    Some studies at the Joint Center suggest that EPA does not 
always carefully examine the benefits and costs of its 
policies. Using the government's numbers, quantifiable benefits 
fall short of quantifiable costs in almost half of the 
regulations we examined over about a 15-year period.
    Let me turn briefly to our recommendations. We ought to 
think carefully about requiring the Administrator to weigh 
benefits and costs or at least, not precluding the 
Administrator or the Cabinet Secretary from considering 
benefits and costs. Many of our current laws preclude that, as 
Dr. Davies and several others have noted.
    We think that Congress should require that regulatory 
impact analyses, and other supporting documents are available 
on the Internet prior to the regulatory review process. That's 
It's a matter of promoting transparency.
    We believe each of these regulatory impact analyses should 
include a good executive summary, which should be standardized 
and include things that you normally would think would be 
included in an executive summary, but frequently aren't in 
these analyses; things like information on cost, benefits and 
whether the best estimate of quantifiable benefits exceeds 
costs.
    We also believe that Congress should set up a separate 
Office of Policy Analysis, much in the spirit of some of the 
same suggestions that Dr. Davies and Dr. Norwood made about 
science, that is responsible for doing all policy analyses. You 
might be surprised to know that most of the policy analyses are 
now overseen by divisions or departments within EPA, like Air 
and Water, that have an interest in promoting regulation in 
that area. We think that a separate office would help minimize 
conflict of interest.
    We also think that Congress should require EPA to adhere to 
standard principles of economic analysis such as the OMB 
economic guidelines, and we have strong evidence that they 
don't.
    One or two more and I'll stop. We think the Congress should 
shift control of scientific peer review of key EPA studies away 
from the Agency, again because of the problem of tunnel vision, 
to a different governmental body such as the NAS or perhaps an 
independent group within the Agency, if, in fact, it can be 
independent.
    And, finally, as part of the decision to elevate EPA to 
Cabinet status, we think you should consider seriously funding 
the independent regulatory oversight body within GAO that you 
authorized under the Truth in Regulating Act.
    In conclusion, we believe the decision to elevate EPA to 
Cabinet status is a very important one. We think it should be 
accompanied by careful consideration of ways in which you can 
improve both environmental policy and make the process of 
environmental policy more transparent.
    Mr. Otter. Thank you, Dr. Hahn.
    [The prepared statement of Dr. Hahn follows:]
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    Mr. Otter. Dr. Mazurek.
    Ms. Mazurek. I'm the only non-doctor on the panel. Thank 
you for giving me an opportunity to speak on a subject that has 
been close to my heart since I staffed the first NAPA panel on 
EPA in 1994. My main message today is twofold. The Progressive 
Policy Institute strongly supports the elevation of EPA to 
Cabinet level status. But our view is that elevation alone is 
insufficient to reorient the Agency toward what we think are 
important new environmental challenges of the 21st century. And 
some Members of Congress have already designed a blueprint to 
do just that.
    In November 1999, Representatives Dooley, Tauscher, 
Boehlert and Greenwood introduced an early work in progress 
version of what is referred to as the second generation 
Environmental Improvement Act, H.R. 3448. We use the term 
``second generation'' to distinguish this approach from the 
landmark laws and regulations that were expanded by Congress in 
the sixties and seventies.
    Unlike first generation approaches, second generation 
measures place a premium on measuring success by changes in 
real environmental conditions, and they also stress improved 
environmental accountability, more public participation and 
systemwide change.
    I would urge the committee to at least consider the 
principles contained in 3448 as Cabinet elevation efforts move 
forward. And let me tell you why. We think that EPA has done a 
commendable job addressing some of the problems first 
generation laws were designed to address: smoke from 
smokestacks, effluent from wastewater treatment facilities.
    But we are now faced with a new set of environmental 
challenges that are very, very different from those first 
recognized in the sixties and seventies. Whereas the first 
generation of environmental problems came from highly visible, 
easy to pinpoint sources, some of today's problems are largely 
invisible, at least here on the ground, such as global warming. 
Others come from small, diffused, hard-to-pinpoint sources that 
are difficult to identify, track, and regulate: homes, cars, 
dry cleaners, farm fields, and parking lots.
    To meet these new and emerging challenges to human health 
and the environment in a manner that's effective and efficient, 
EPA must be provided with what we are referring to as a legal 
space to design, implement, and evaluate innovative 
environmental management practices. And the second generation 
bill, at least in its discussion draft form, I think lays out 
kind of a road map to do just that.
    It does so in two ways. First, it's designed to develop 
more timely, accurate, and more precise information on 
environmental conditions and environmental performance by 
industries and other regulated sources. As Terry and I found in 
our book, monitoring networks and data methods are woefully 
inadequate in this country, not only to tell us about current 
environmental conditions, but future environmental challenges. 
The Agency under the Clinton Administration made some important 
strides in at least beginning to improve how it manages 
information. And we believe that Representative Horn's bill 
contains measures that would take those gains even further.
    But the second generation bill would provide incentives to 
industries and States not only to modernize how they report 
information, but also how they monitor and measure 
environmental performance. Once EPA has better information 
systems in place to identify new threats, it needs the legal 
means to test out new ways to address them while upholding the 
strong environmental standards that were put into place by 
first generation laws.
    The second generation bill would provide regulators with 
the ability to pursue a broad array of experiments without 
having to perform Houdini-like contortions on existing rules, 
as Project XL demonstrated under the previous administration. 
So, greenhouse gases, intersection of land use, and water 
quality are just a few examples of what a second generation 
approach might address.
    And to summarize, we think that a Cabinet elevation law 
that considers second generation principles would let 
government and business systematically find out what incentives 
for better environmental performance actually work, before 
enshrining them in difficult-to-change first generation laws. 
Thanks.
    [The prepared statement of Ms. Mazurek follows:]
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    Mr. Otter. Thank you very much. I appreciate once again all 
of you being here, and your opinions on the legislation that we 
have under consideration. I guess I have some general questions 
for all four of you, but I also have some specific questions. 
And let me just say from my perspective, so you'll know sort of 
where my questions are coming from, in the West--and I'm from 
Idaho--in the West there probably isn't a Federal agency that 
is more hated or distrusted than the Environmental Protection 
Agency. And I say that, having been the Lieutenant Governor of 
Idaho for 16 years and watched as the agencies marched into 
Idaho and took over massive areas of Idaho and usurped a lot of 
State authority and State responsibilities. But anyway, the 
feeling generally is that the EPA has declared martial law on 
the environment in the United States. And subsequently, not 
unlike most martial--and I happened to be in the Luzon region 
of the Philippines when Ferdinand Marcos declared martial law 
in the Philippines, and it was not a pretty sight--all manner 
of individual and civil rights and Constitutional rights, 
private property, were set aside. And they were set aside by 
those folks that came in with the full power of government to 
do what they wanted to do, without rhyme or reason, suspending 
in many cases the due process and suspending in many cases many 
civil liberties.
    Most of the civil liberties that we happen to talk about in 
terms of the EPA are search and seizure, of reports that we 
hear from all the time from industries; assumptions of guilt, 
rather than assumptions of innocence and then proving guilt. 
And so I believe really that a lot of people in the West would 
be very, very encouraged about elevating the position of EPA 
Administrator to Cabinet level, so long as they had the same 
responsibilities as, say, any of the other agencies there to 
respect private property, to respect the protections under the 
Bill of Rights and the Constitution.
    So with that in mind, I guess I will start with Mr. Hahn. 
Mr. Hahn, much of what you said really falls in line with under 
an ombudsman. And an ombudsman, when we finally got him into 
Idaho in the Silver Valley--and the interesting thing there as 
I think you probably know the history, the EPA came into the 
Silver Valley 17 years ago, saying they could clean it up in 3 
years for $28 million. That was $280 million ago, and they are 
14 years over their time budget. When we kept asking for 
reports and some kind of responsibility for what was going on, 
we met a brick wall. And we also met Agency privilege.
    And as you know, many of the Agency privileges are pretty 
extensive for the EPA. No other government agency that I know 
of, including the FBI, has those kinds of privileges. Anyway, 
we finally did get the attention and we got the ombudsman to 
come in. And the ombudsman found a great deal of waste, a great 
deal of misinformation, a total lack of peer review. And then 
the EPA Administrator under the last administration de-funded 
the ombudsman and fired him for the report.
    So what kind of protection, if we go to the GAO or if we 
establish peer review and establish an ombudsman with any kind 
of strength, what kind of protection, other than a separate 
agency, can you possibly offer somebody who would be a 
``whistle blower'' on the EPA?
    Dr. Hahn. I am not sure I am the best person to answer that 
question. I am not a lawyer. I think the more general question 
you raise about agency powers is a very, very important one. If 
the Federal Government has a very prominent role, as it now 
does in setting air standards and water standards, we at least 
ought to put analytical checks on that power by not having the 
same group that makes the regulations also do the analysis.
    Mr. Otter. You're right. Our feeling is that King George 
III never had it so good. He made the law, he decided who broke 
the law, and decided what the punishment was.
    Dr. Norwood, how about on independence of the oversight, 
how do you feel about that?
    Dr. Norwood. Well, I feel very strongly that there's no way 
that EPA can continue to work in this whole field without 
having better approaches to finding what is successful, what is 
not, and accountability; accountability to the people of the 
country, to the government, and accountability to the States 
and localities. In the NAPA reports, we went into considerable 
length about the way in which EPA should work with States, 
localities, with business, and with all the stakeholders. Very 
clearly, they need to do that. And we have made a number of 
recommendations about that--the more they do that, they still 
have even more of a responsibility to be accountable for 
environmental improvement. And so they need to be able to have 
the scientific information as well as the statistical 
information to be able to judge whether something has been 
successful or not and whether this devolution is working.
    The only way, it seems to me, that can be done is by 
restructuring completely the so-called information systems that 
the Agency now has. I know that they have made some strides. I 
would not say that they are very large strides. There is a need 
for a place within EPA that is somewhat independent; that is, 
having a person heading it with a fixed term of office.
    I was Commissioner of Labor and Statistics for a very long 
time. I had a fixed term of office. We did things and said 
things and published things that the President didn't like, 
sometimes the Secretary didn't like. We tried to work with 
them, of course. But basically, we felt we had a scientific 
responsibility to the public to use our expertise to explain 
things as objectively as we could. And I think that EPA is 
lacking that.
    I do think that many of the innovations that they have 
attempted--and we had something like 17 teams of experts, 
researchers, examining each of those. I think that many of 
those innovations probably were successful. But before 
undertaking a program, one should determine in advance how you 
are going to determine whether it was successful or 
unsuccessful and what kind of information you're going to need 
in order to do that.
    And this needs to be a cooperative effort. There's no way 
the national government can develop all the data that is 
needed. A lot of the data comes from business. A lot of the 
work has to be done by business. A lot has to be done by States 
and localities. So it needs to be a really cooperative effort. 
There are a lot of examples in the Federal Government of that 
sort of effort, and I think it can be done here.
    Mr. Otter. Dr. Davies.
    Dr. Davies. I recognize, Mr. Chairman, that the kind of 
picture of the Agency you are painting is widespread, 
especially in the West. It sounds to me like the kinds of 
problems you are delineating are problems for the courts, and 
they are not going to be significantly remedied by most of the 
things that we have suggested here on this panel or elsewhere.
    Mr. Otter. I didn't understand. They are problems of the 
courts?
    Dr. Davies. When you talk about civil liberties and 
property rights, the best data in the world isn't going to 
remedy that if it's a problem. That's what we have courts in 
this country for, and that's where the remedy lies for those 
kinds of difficulties.
    Having said that, I agree with both Dr. Hahn and Dr. 
Norwood that an independent capacity to deal with policy 
analysis, with economic data, with environmental data, with 
science and peer review, that all of those things could 
significantly improve the Agency's performance and 
effectiveness. And so, you know, I think those are very 
valuable suggestions, that I am very sympathetic to them.
    Mr. Otter. I would only point out, getting back to the 
point that Dr. Hahn made, that many of the rules and 
regulations were promulgated by the Environmental Protection 
Agency, and some of those are relative to evidence offered in 
cases of whether or not a person was polluting, whether or not 
there was a crime, a breaking of a law committed.
    I have become familiar personally with some cases, but as a 
representative of 650,000 people in a district that has 87,000 
miles of streambank, 119 municipal water systems or more, at 
least 119 sewer systems, 650,000 people that work on the 
watershed, there isn't almost any activity, whether it's 
recreating or professional working or private property 
ownership, that they can do without in some way finding 
themselves coming in conflict with a rule or regulation that 
probably, in all good intentions, was promulgated for a 
situation that may be east of the Mississippi and north of the 
Mason-Dixon line.
    Unfortunately, the application of that law is on 87,000 
miles of streambank, you know, and so what happens is we've 
lost confidence. We've lost confidence in an Agency which we 
hoped was going to come and help us with some of our 
environmental problems. And they haven't helped. In fact, they 
have been adversarial and they've--as Jefferson said, harassed 
our people and eaten out their substance. And that's the 
problem that we're having.
    Dr. Hahn.
    Dr. Hahn. I have come in contact with many folks, as you 
have, who have suggested there are lots of regulations like 
that. And we have to recognize that Congress at some level 
deserves a large part of the blame for that through the laws 
that it passes that, to some extent, empower the Agency to do 
these things. Now, the Agency may have a different view of how 
to implement these laws than the initial legislators, but 
Congress deserves the blame. So if we are going to clean up the 
process at some point, we have to go back to the organic 
statutes, and there I think Dr. Davies and Ms. Mazurek have 
made some good suggestions, as others have.
    You really have to make some fundamental decisions about 
how you want to organize this Agency and what you view as its 
function. Should it be going after the top health-based 
environmental priorities, or should it be going after 
everything, even if it presents, arguably, no risk from a 
scientific point of view.
    Mr. Otter. I can tell you, Dr. Hahn, that our problems 
manifest themselves from each generation. As I indicated 
earlier, in my 16 years as Lieutenant Governor, many other 
agencies also marched into the State. OSHA was one of those. 
OSHA told us that environmentally, health wise, we had to 
remove all the asbestos from all our schools. We took books and 
decided to go with 6 and 7-year-old textbooks where the covers 
were falling off. We let classrooms, although safely, but 
really not very comfortable to be in, degenerate because we 
spent tens of millions of dollars removing asbestos. And once 
we got it all removed and finally sighed relief, then they 
found one more building that had asbestos in it. And they said, 
listen, it's not necessary to remove it. All you got to do is 
paint it over, you can seal it in. And we spent all that money.
    Now we come on with the EPA in the Silver Valley of Idaho, 
and they say in 3 years and for $28 million, we can clean this 
place up. Here we are, 17 years later, 10 times that much 
money, and they found out when they were transporting all that 
dirt from the site of the high levels of lead to the dump site, 
that they didn't water down the trucks. So now all the yards 
are contaminated. All the tops of the buildings where the dust 
settled are contaminated. What we did was we spread the 
contamination. And these people were there to help.
    We don't need any more help like that. We have gone from 
9,000 miners to none. We shut down 32 lumber mills in Idaho, 
most of them for environmental considerations, because they 
said we don't want you cutting trees off the watershed. And 
this was a rule that was made, I am sure, with good intentions. 
But what happened, we shut down 32 lumber mills. What happened 
was then 880,000 acres burnt up and all that silt and all that 
watershed is being washed into the salmon recovery areas. So 
now we've got a bigger problem.
    The first thing before we elevate, before we change, before 
we come in with a whole new matrix of what we're going to do, I 
think we've got to get confidence back into the system that 
says we really need this, we really need this help. And I think 
people are willing to be convinced of that, but I don't think 
elevating it to the President's Cabinet level is going to do 
that.
    Chairman Ose.
    Mr. Ose [presiding]. Thank you, Mr. Vice Chairman. I 
appreciate you standing in for me. I want to delve in a little 
bit. I regret I missed the statements that you made, but I did 
read your testimony and written statements. And it seems to me 
that there's a consistent comment there that the simple 
elevation to Cabinet level does not address the underlying 
problem. We heard this morning from Mr. Boehlert, Mr. Horn, and 
Mr. Ehlers about how do we move what's called a clean bill 
forward.
    I'd be curious how you would do each approach addressing 
the systemic needs that we've identified. For instance, Dr. 
Davies, in your testimony you had seven suggestions, and the 
others of you had specific suggestions. How do we incorporate 
those in this process? Are we well advised to go forward with 
what's a clean bill as, say, Mr. Boehlert may have described 
it, or do we need to incorporate these other changes?
    Dr. Davies. Well, I am very sympathetic, as I said in my 
testimony, I think when you were out of the room, to Mr. 
Boehlert's concern about having a clean bill and the political 
dangers of putting too many things into Cabinet elevation. 
There is also the question of committee jurisdiction, which is 
a mystery that I have long since ceased to try and understand. 
But I think my hope would be that at least most of the subjects 
that I suggested or that others on the panel have suggested or 
that are in Mr. Horn's bill, could be fashioned in such a way 
that would generate broad support and basically not be 
controversial.
    There clearly are controversial things which I think would 
kill the bill. And there's also no question that the more you 
put in there, the more vulnerable you are to attack from 
somebody or, you know, some kind of concern. But I think as 
illustrated by this panel and at least by my knowledge of where 
different groups are coming from and where the two parties are 
coming from, there is very broad support for most of the kinds 
of things that I mentioned in my testimony and which, you know, 
other members of this panel suggested.
    Mr. Ose. Dr. Norwood, in particular with your background at 
BLS and the like, it seems to me like the issue of metrics, how 
do we measure progress is a fundamental issue here. How do we 
go about focusing on that specifically?
    Dr. Norwood. Well, I think that we have to recognize that 
there are problems in the science. We don't really have answers 
to everything. I think that's part of the difficulty that you 
were talking about before. So we need to have a scientific 
involvement in the development of the kind of information that 
is needed as support for what EPA does. And I believe that can 
be done within the Agency if there is a place to make it clear 
when the head of that particular part of the Agency has certain 
scientific qualifications. That's been done in other agencies 
and it has worked quite well.
    The other part is the measurement. You have to decide first 
what you're going to measure and you need to do that before you 
go out and tell people all the great things you're going to do. 
You need to figure out if you're going to start something new, 
whether or not you're going to measure it and how you're going 
to measure it, and then you need to develop the data.
    Most importantly, EPA has got to be an Agency, as we've 
indicated in all three of the NAPA reports, which works closely 
with all of the stakeholders--with the States, with the 
localities and with business, and sometimes uses business 
techniques. There are many of them that we've recommended be 
used. But the basic legislation that created EPA and under 
which it operates is somewhat stultifying, because it is very 
difficult and almost impossible to move across media. When you 
get to the organization of a regional office, for example, 
which really has to deal with the localities, everything is 
coordinated there and yet the stovepipes within EPA, which are 
partly the result of the legislation passed by Congress, makes 
that extremely difficult.
    Mr. Ose. Is the vehicle that allows--is this legislation 
the vehicle that allows us to try to fix some of those?
    Dr. Norwood. You know, you are much more skilled at 
legislation than I. My experience has been, however, that if 
these things are not in some way indicated in the legislation, 
then they don't happen. And that's what would worry me. I 
pointed out, for example, the problem of all the interactions 
of all of the agencies in the Federal Government, and the 
problem of determining who is in charge of the environment in 
the U.S. Government.
    Mr. Ose. I can't remember which of your testimonies, but 
they had the mediums, and then the geographical areas, and 
everybody was in charge, so nobody was in charge.
    Dr. Norwood. And then we have a lot of departments in the 
U.S. Government who have legitimate areas that they are 
interested in. But I think that there needs to be a lot of 
sifting out of that. There need to be strong changes in the 
management of EPA as well. That would not be a part of 
legislation, although if there is to be a Bureau of 
Environmental Statistics, it has to be part of the legislation; 
otherwise it's not going to happen.
    Mr. Ose. Let me ask all of the panelists, one of the 
suggestions, particularly Mr. Ehlers' bill, was to appoint a 
Deputy Assistant for Science and Technology, I think is what he 
referred to. Would that address the need of providing some 
bridge between the scientific side and the regulatory side? 
Again, I don't remember which one of your testimonies said it, 
but one of the points was that the folks who are at EPA largely 
are regulators and not scientists.
    Dr. Norwood. Dr. Hahn is the one who discussed that. I just 
wanted to make one comment, and that is that I have been doing 
a great deal of work lately at the National Academy of Sciences 
as well, and I think there is a need for outside people, but 
there does have to be a scientific group within EPA as well, in 
my opinion. Now I defer to someone who knows much more about 
this than I.
    Dr. Hahn. In answer to your question about whether you 
should send this bill up now, clean, or with other things, 
that's obviously your decision. I don't see a great urgency to 
elevating EPA to Cabinet status. I could think of advantages 
and disadvantages, given that I think the four of us at this 
table who come out of an academic background think there are 
many things broken in the area of Federal environmental policy 
that fundamentally need fixing, as they say.
    Mr. Ose. Of a structural nature or otherwise?
    Dr. Hahn. I don't know what structure is, but as Dr. 
Norwood pointed out and Dr. Davies pointed out, you've got 
many, many statutes governing this Agency. You've got a real 
problem now in terms of the way people view the authority of 
EPA.
    Congressman Otter made a point about his district with 
respect to asbestos removal. I can tell you that's not an 
isolated example from my experience. As I pointed out earlier--
and Justice Breyer pointed out in his book EPA suffers from 
``tunnel vision.'' It only looks at the environment. It doesn't 
worry about those 800 workers who were displaced and sometimes 
it doesn't even think about whether there is a better way to 
achieve the same or better environmental outcome at lower 
costs.
    We need to rectify that by, one, you need to think about 
what powers you want to give to the Agency and how you want to 
give the Agency those powers, in one statute or several 
statutes. And then, what kind of information it uses to make 
decisions. I think Dr. Norwood pointed out that there are real 
problems with the nature of the information base that's 
developed now. The Agency has an intrinsic bias. We have 
different suggestions for how to address that bias.
    Mr. Ose. I don't want to exclude our fourth panelist here.
    Ms. Mazurek. Well, with respect to the point on achieving 
the same environmental outcome at lower costs, which was 
alluded to, I think in Congressman Otter's point initially, the 
1994 NAPA report and study after study after study during the 
1990's, including some of the statements that were made by the 
prior administration, was that if EPA can find a cleaner, 
cheaper, smarter way, it should be given the authority to do 
so. And it tried to do that in number of experiments, including 
the common sense initiative, Project XL, place-based ecosystem 
management, and all of those initiatives faltered, 
paradoxically perhaps, because EPA didn't have the authority to 
give flexibilities to companies, States and localities who 
really could deliver superior environmental performance.
    That's why my predecessor, Debra Knopman, working with a 
bipartisan group in Congress, put together the second 
generation discussion draft, because it would enable those 
kinds of measures; and also recognizing that the cornerstone, 
the backbone, to innovation is information that tells us 
whether or not these results are actually superior to what 
would have been achieved in the absence of the experimental 
programs.
    And again, a number of these initiatives during the 
nineties faltered because, A, as Dr. Norwood pointed out, we 
didn't put the program evaluation measures in place before 
those programs were actually launched; and B, there was a lack 
of will and ability and resources, just financial resources on 
the part of the Agency, to actually verify that these programs 
were delivering superior environmental results.
    Mr. Ose. I need to give my vice chairman some time. I have 
some questions that I am going to go through here in the second 
round, and I'm going to ask each of you to provide input on 
them. But, Mr. Otter for 10 minutes.
    Mr. Otter. Thank you, Mr. Chairman. I am not going to take 
all that time, but I do just have a couple of questions. I have 
heard the lack of resources part of the problems as you have 
just said, Ms. Mazurek. And I wonder if it's the lack of 
resources, or do we need to redirect resources within the 
Agency, and maybe we need a third party, as has been suggested 
by other members of the panel, because I don't know if it was a 
scientific or a statistically proven report or not, but one of 
the reports that we received in Idaho was that 12 cents out of 
every dollar being spent in the EPA was actually being spent on 
something other than cleaning up the environment; that for the 
bounce for their buck that the taxpayers thought they should be 
getting, if 88 cents is being spent on administration or has 
been the case in court, then rather than directing new 
resources, maybe this restructuring that my chairman mentioned, 
Dr. Hahn, has to do with focusing the EPA, as Dr. Norwood 
suggested, on the greenhouse gases, on the nonsource pollution. 
And I apologize, I wrote them down, They are in my notes now. 
But those focuses then invite the locales in. They invite the 
State agencies.
    Quite frankly, I have to tell you that we have a DEQ in 
Idaho, Department of Environmental Quality, and I think every 
one of those people in that Agency care a hell of a lot more 
about the environment in Idaho than any EPA Administrator that 
comes whipping through from some other State or from some other 
locale. Quite frankly, I really believe that. Or any group of 
administrators back here that manifest their desires in rules 
and regulations that they ship out for us to implement. I think 
my Governor probably cares more about the environment in the 
State of Idaho than, quite frankly, the President of the United 
States. But we have taken them out of the equation.
    Dr. Norwood. I think it's important to recognize that there 
have been some initiatives at EPA to put them back. And the 
latest Academy report called ``Environment.gov'' does review a 
whole series of them. The important thing is that there are 
problems in the legislation which require certain enforcement 
activities. There are difficulties, as I've said, across media. 
So Congress bears some of the responsibility for this, I think.
    I think that what we're seeing in government generally is a 
devolution to State and local areas, but there has to be 
accountability. And so we need to have both, really. And I 
think we can.
    I have had some experience at the very local level, in a 
small town where we have a home on a big lake, and we've been 
very active, my husband and I, trying to keep that water clean. 
I can understand the problems that the town, a very small town, 
about 800 people, has with the regulation both at the State and 
at the national level. But EPA has made a number of attempts to 
change that environment. It needs to do more. And we have made 
a number of recommendations.
    Mr. Otter. Just one more, perhaps a statement, but I would 
invite anybody to respond to this. One of the things that I 
really see lacking in our national environmental policy is a 
lack of accountability by government agencies themselves. You 
know, we hear stories all the time about developers that either 
were fined $250,000 or they go to jail because they didn't 
follow certain environmental regulations, Army Corps of 
Engineers, wetlands laws or those kinds of things; polluters 
that dumped pollution into rivers, you know. And the companies 
have to now go back years later and make amends for those.
    Yet, when I was in the full committee the other day, I 
asked the Army Corps of Engineers and I asked the EPA and said, 
``We caught you dumping 200,000 gallons a day of slop into the 
Potomac River.'' We caught the Army Corps of Engineers--the EPA 
caught them--and I said, ``Who went to jail?'' Well, we come to 
find out that government agencies are exempt. The very teeth 
that we needed into the law to make the private property owner 
and the industry and the States obey the law, we absence 
ourselves from ``accountability,'' I think was your word, Dr. 
Norwood.
    And so before I would go to any kind of a restructuring, 
certainly I want the general of the Army Corps of Engineers to 
go to jail, just like I want the CEO of some corporation to go 
to jail, or the Governor, if they violate some environmental 
law. Then I think we truly do have accountability.
    Dr. Hahn, I invite comment on that.
    Dr. Hahn. There's a problem there. And I'm happy with equal 
treatment of the Government and the private sector. I like that 
idea. The problem is: if you own any establishment that is 
producing anything, you are probably violating some 
environmental law. It may be a very gray area. I have been a 
consultant to several companies in which sometimes they simply 
can't figure out whether they are in complianced.
    So I think it's a real good idea to think about limiting 
the powers of EPA and having the agency focus on the most 
important issues. You mentioned some that some of the other 
panelists raised and recognize that this isn't 1970. We are in 
a new century now, and the States have changed dramatically in 
their capability for addressing environmental problems in a 
creative and intelligent way. And a lot of that should be 
recognized in any sort of statutory changes you make.
    Mr. Otter. Would you agree though, Dr. Hahn, that any law 
that we make offering penalty or persecution or whatever for 
violators should also be applied to the government agencies?
    Dr. Hahn. I think so.
    Mr. Ose. Is pollution any worse, no matter whose hand it 
comes from?
    Dr. Hahn. That's correct.
    Dr. Davies. You have to deal with the congressional 
language on sovereign immunity.
    Dr. Norwood. But there is a more important issue, and that 
is that if Congress passes legislation requiring certain kinds 
of enforcement, then the problem may be the legislation. In 
EPA's case, there are some problems with its legislation, and 
so it cannot do some of the things that you and I and other 
people would like it to do. So in a way, Congress also has to 
be held accountable, if you excuse my saying that.
    Mr. Otter. Send Mr. Boehlert to jail.
    Mr. Ose. No, we won't. Dr. Davies.
    Dr. Davies. There are fundamental problems with the 
statutes that EPA administers. And I think some of them are 
spelled out in the book that Jan Mazurek and I wrote. Janet 
Norwood's point about the stovepipe structure and the 
fragmentation of the programs, that is the most fundamental 
problem in my view. I have given to committee staff something 
that I wrote sort out of desperation, because everybody said 
you couldn't pull these statutory authorities together. And out 
of desperation, I tried to do it. Whether I succeeded or not is 
another question, but you can take a look and see. In any case, 
I don't think you can deal with Cabinet legislation. I mean, 
trying to integrate the statutes that the Agency administers 
raises every single question of environmental policy that has 
ever been raised. And it is a tremendously complicated task and 
it's not something that could be undertaken in this context, 
frankly. It's too bad, but I don't think it can.
    I think you can take an initial step, as I suggested, by 
setting up some kind of commission or select joint committee or 
some body to start that process rolling, because it is badly 
needed, but you couldn't do it within the legislation.
    If I can just make one other quick point in response to Mr. 
Otter's comments, without denying anything you said, it is hard 
to find Federal programs that are more decentralized to the 
States than the programs that EPA administers. The two key 
functions are permitting and enforcement. Something on the 
order of 80 to 90 percent of the permitting is done by State 
agencies, and something on the order of 90 to 95 percent of the 
enforcement is done by State agencies. So it is tremendously 
centralized now and I think that has just to be kept in mind.
    Mr. Otter. Could I have a followup on that, Mr. Chairman? 
To Mr. Davies, can the EPA override any of those enforcement or 
permit agreements?
    Dr. Davies. Yes.
    Mr. Otter. Can they override every one of them?
    Dr. Davies. Well, no. There are some where it can and some 
where it can't; but typically it can, yes. But it is not a 
frequent occurrence.
    Mr. Otter. As long as you're doing it our way, then you're 
safe?
    Dr. Davies. Yeah.
    Mr. Ose. I want to go back to some specific questions I 
have for all of you. There's not going to be any problem here. 
You have all the time you want.
    Dr. Davies, I followed your discussion about how EPA was 
originally crafted. It was a reorganization rather than the 
manner in which Cabinet departments are typically created. So I 
am probably going to followup with some questions to you about 
that.
    I think Dr. Norwood has reemphasized that also about the 
structural nature of what created EPA that leads to many of our 
challenges today. I don't know whether or not Mr. Boehlert's 
bill or Mr. Horn's bill or Mr. Ehlers' bill becomes the vehicle 
we use. I am just not at that point yet. But I do want to get a 
clear understanding of that if we move forward with this 
legislation, what aspects of science need to be strengthened at 
the Agency? For instance, do we need to specifically address 
peer review issues of decisions? Do we need more basic 
research? I think, Dr. Norwood, you talked about targeted 
research. Do we need more of that? Does anybody have any 
feedback on that?
    Dr. Norwood. Well, I believe that the legislation that 
creates EPA as a Cabinet agency probably has to say that it 
will have certain officials in it, particularly if they are 
Presidential appointments; that usually is in law. And I think 
that an Office of Scientific Research and a Bureau of 
Environmental Statistics ought to be a part of that.
    Mr. Ose. So you would like have the Cabinet Secretary, and 
then underneath you would have what effectively are deputy 
secretaries, but there would be the Office of Research, office 
of X, office of Y, office of Z kind of thing?
    Dr. Norwood. I'm not sure exactly what the structure would 
be, but in the statistics field, which I'm much more familiar 
with, you should have--and in several cases, we do have in 
several agencies, a Presidentially appointed head of the bureau 
or whatever you want to call it, of statistics. And you have a 
fixed term of office for that individual, which means that he 
or she reports directly to the Secretary, doesn't have to go 
through a lot of other people and has the independence that 
comes with having a fixed term of office. For the data system, 
I think that's terribly important.
    Mr. Ose. Dr. Hahn.
    Dr. Hahn. I basically agree with Dr. Norwood that's a 
really important first step. But until you include the policy 
analysis in a way that it's independent from the development of 
regulations, you're not going to get the kind of unbiased 
information and accountability you need.
    That's why I argued in my testimony that we ought to have 
only one Office of Policy Analysis developing policy, as 
opposed to having it analyzed by parts of the Agency that are 
actually making the regulations.
    Dr. Davies. Just on a couple of points. I mean, science in 
EPA is a very complicated topic. And it's not that they don't 
do science. Probably something in the order of 20 to 30 percent 
of the personnel in EPA are scientists of some kind. And a fair 
number of those people are doing science.
    Peer review to me--and here, I guess, Dr. Hahn, I disagree 
a little bit; I don't think that's a major problem. The Science 
Advisory Board of EPA is a pretty sophisticated, elaborate 
operation. It is a much better outside science review operation 
than most other agencies have, which is not to say it couldn't 
be improved. And they have recently run into some problems in 
terms of conflict-of-interest questions, and that is certainly 
an area in which improvement is warranted. But to me, in the 
hierarchy of problems, peer review of EPA science is not, 
frankly, high on the list.
    As Dr. Norwood said, part of the problem is just that a lot 
of the science isn't there. You need to develop the basic 
science. But part of the problem is also making the EPA science 
program more rational. As I indicated in my written testimony, 
the problem here is that the Office of Research and 
Development, which in theory is the research arm of the Agency, 
really only does about half the research, and nobody knows for 
sure what the percentage is. But a significant part of the 
research is done under the auspices of the individual program 
offices, Air, Water, Hazardous Waste and so forth. Those 
research efforts of the program offices are not coordinated 
with the research done in EPA labs and by the Office of 
Research and Development. So you've got a fundamental internal 
problem of harnessing the resources that are there now to 
better serve the needs.
    Mr. Ose. You're suggesting that there is some redundancy 
perhaps?
    Dr. Davies. I don't know whether it's redundancy. Yeah, 
there probably is some, but redundancy is less of a problem 
than the inability to focus on what the most important problems 
are.
    Mr. Ose. I think your words were ``blinders'' and ``tunnel 
vision.''
    Dr. Davies. No way of mobilizing the resources that are 
there to focus on the things that are important.
    Ms. Mazurek. That's not a problem only with EPA. I mean to 
illustrate, California EPA had this recent problem with 
something that we know as MTBE. And what happened there was 
that the air office did the risk assessment when they 
considered it as an additive in fuel, but the air office had no 
way of talking to the water office and so the risk assessment 
was never actually undertaken to determine what would happen if 
this leaked from gasoline storage tanks into the groundwater. 
And now we have a big cleanup mess on our hands out in 
California as a result of this. But again, this gets back to 
the media-specific fragmented nature of the statutes, more than 
a question of redundancy.
    Dr. Hahn. Can I offer a personal anecdote as one who was on 
the White House drafting team for the Clean Air Act Amendments 
of 1990? I think there is a big problem in getting independent 
science amd tjere os a big problem of getting independent 
science heard. When we were developing the Clean Air Act, there 
was a section of the Clean Air Act that dealt with air toxics 
legislation. Now, when you say the words ``air toxics,'' 
everyone gets worried because no one wants to have arsenic in 
their drinking water, for example. But all of us are going to 
have some arsenic in our drinking water. We can't remove it 
all.
    The problem was that the scientists that I spoke with at 
EPA in private conversation, when I called them from the 
Council of Economic Advisors, told me that air toxics was a 
very, very low risk problem. They were not allowed to say that 
publicly. They had analyses suggesting that. They were not 
allowed to say that publicly or their jobs would have been on 
the line.
    This was a question you raised earlier with respect to the 
ombudsman. That information should have entered into the public 
policy discussion before Congress developed the air toxics part 
of the Clean Air Act, and it wasn't.
    Mr. Ose. Dr. Norwood.
    Dr. Norwood. I do think there is need for an independent 
scientific group. I believe it should be inside EPA because 
otherwise I don't think it would really get to the people that 
it needs to. But there does need to be some kind of protection 
of that group, of its scientific capabilities and its 
objectivity.
    I should say that part of the problem is that we talk about 
risk assessment, we talk about all the economic analyses that 
we should make, with the assumption that all the data are there 
and that every model works perfectly. I spent some time 
recently on the board of directors of a very large bank, 
chairing the board's committee on risk assessment. And I'll 
tell you that I learned a lot about the practical world and how 
it is important to have a scientific approach, but that it 
doesn't come quite so easily, so we have to work with that.
    Mr. Ose. That leads directly to the next subject I want to 
discuss, and that has to do with the stovepipe nature of the 
manner in which the Agency currently works. You've all 
recognized sometimes these issues cut across a number of 
stovepipes. If we're looking at this in an ideal world, so to 
speak, and we are considering legislation, what sort of a 
functional structure should we have to deal with these cross-
cutting environmental issues? Clearly an independent scientific 
body to review the information is useful.
    I think, Dr. Hahn, you suggested separating scientific 
review from regulatory action. Are there other such 
suggestions?
    Dr. Davies. You could organize the Agency totally along 
functional lines and it would be a much better, more rational 
organization than currently exists. The difficulty comes from 
the disconnect between the way the Agency is organized in terms 
of offices and the statutory responsibilities it has; if that 
disconnect becomes too great, then nothing is going to happen 
and then everything will just grind to a halt, because when you 
say whose responsibility is it to carry out the Clean Air Act, 
you won't be able to find where it is.
    Mr. Ose. So your suggestion in that regard is go back to 
the legislative underpinnings and fix them?
    Dr. Davies. You have to at least make some progress fixing 
the statutes before you can change the organization of the 
Agency.
    Mr. Ose. When we fix the statutes, what do we need to do? I 
mean, that's the question. Do we need to define the structure 
or need to be somewhat more generic and allow the folks who do 
the executive branch to define the structure?
    Dr. Davies. I mean, if I understand your question, what in 
my mind the most basic thing you have to do is stop dealing 
with environmental problems in a fragmented fashion, which is 
what the statutes now do. I mean, most of the major problems we 
have aren't just their problems. They aren't just water 
problems. They aren't just hazardous waste dump problems. They 
cut across a lot of different lines. The environment is one 
single whole. On things like climate change, on things like 
acid rain, and on things like stratospheric ozone depletion, on 
nonpoint sources, almost any major current problem that you 
name, the way the statutes are written is inadequate to deal 
with the problem because it doesn't recognize the 
interrelationships. And so that's what you have to do.
    Mr. Ose. Just following up on that, if we had a question 
dealing with water, under the Clean Water Act, we'd treat it a 
certain way now. And arguably, we wouldn't know who was in 
charge. How do we change that so that we know somebody is in 
charge? We say that you are now the Under Secretary for Water?
    Dr. Davies. You could do that. That is one option, just to 
go all the way in that direction. That would not be my 
preferred option.
    Mr. Ose. What would be your preferred option?
    Dr. Davies. You have 200 pages in response to that.
    Mr. Ose. Briefly.
    Dr. Davies. Briefly, you would have to both do the statutes 
and the internal organization of EPA on a functional basis. So 
you would have somebody in charge of standards setting. You 
would have somebody in charge of enforcement. You would have 
somebody in charge of planning, somebody in charge of policy 
and economic analysis and so on. That's how you would organize 
things. So you would pinpoint responsibility by the nature of 
the function rather than by the segment or the physical 
environment or the focus of where the pollution is and so on.
    Mr. Ose. Do the rest of the panelists concur?
    Dr. Norwood. I am not sure that I do completely, but I 
don't know as much about this as Terry does. But what I would 
like to say is that I have a strong belief, having been in 
government a long time, that organizational structure can be 
very important, but that it doesn't necessarily get you where 
you want to go; because it's really the informal structure 
within an agency that counts a great deal.
    However, having said that, the problem with the EPA 
legislation is that it prevents the Agency from thinking 
broadly and from using its resources broadly. And yet, the 
States don't think that separately. They don't have those 
stovepipes. So when you get to a regional office, it's 
ridiculous to organize a regional office along separate, media 
lines because they have to deal with people who are dealing 
across media lines in the States or localities. You don't have 
the luxury of having individual offices there.
    That is just one kind of thing. There is the question of 
how they're doing work with some of the innovations that they 
attempted. We dealt with that in this last report, the 
restrictions on enforcement that were either in the law or 
interpreted as being in the law, prevented them from doing many 
of the things which we, at least at the Academy, felt they 
should be doing to improve relations and improve the 
environment.
    Mr. Ose. Dr. Hahn. Ms. Mazurek.
    Ms. Mazurek. If I may just sort of followup on Dr. 
Norwood's point. Under the innovations programs that she 
mentioned, they found that the enforcement provisions, or just 
the statutes themselves, were the tripping-up point. So while 
ultimately I share Terry's vision of where the Agency needs to 
go, there are some interim measures, if one prefers the Lynn 
Bloom muddling-through kind of approach, and that's what the 
second generation proposal was designed to do, to provide legal 
space to do cross-media approaches and to test out innovative 
experiments, all the while simultaneously collecting 
information that starts to tell you what these new emerging 
priorities are, and then giving the Agency the authority to 
experiment with different ways structurally of addressing them.
    Dr. Hahn. Well, again thinking outside the box, right now 
EPA really isn't responsible in any sort of meaningful way for 
showing that it has enhanced the environment of either----
    Mr. Ose. Accountable or responsible?
    Dr. Hahn. Accountable--I'm sorry, good point--for showing 
that its actions have actually improved the environment. One 
way of writing the statute, and I haven't gone through the 200 
page exercise that Terry has done, is to say OK fellows, we 
think you should be thinking about reducing risks in a way that 
saves lives or life years of Americans or citizens of the 
world. And we are willing to give you access to private sector 
resources on the order of X, because effectively when EPA 
regulates, it takes money out of consumers' pockets. And we 
want to see in 5 years' or 10 years' time that you have 
actually made a significant difference based on an independent 
policy review.
    I don't think that is going to happen, but that is one way 
of getting accountability. It is just some food for thought. I 
think it could happen in a limited area as a pilot project.
    Dr. Davies. If I could make one very quick point. I mean, 
that's absolutely necessary. We are so far away from that, that 
as Jan and I point out in the book, you can't tell whether 
water quality in this country has gotten better or worse over 
the last several decades because the data isn't good enough to 
answer that question.
    Mr. Ose. Mr. Otter. OK, I will continue then. Dr. Hahn, I 
want to go back to your comments, and Dr. Davies--in fact, 
everybody here. There is no base line is what you're saying. 
And there is no attempt to keep the baseline or the updates 
current for analytical purposes. Does that go back to the 
underlying statute, the reorganization of it, or is that just 
practice, managerial practice. I don't have a problem pointing 
the finger at us if we're the root cause. Is it that we're not 
watching? What do we need to do better, or what can we do 
organizationally to establish the performance measures and then 
make them work?
    Dr. Davies. Three things, I think. Better data, better 
analysis, and Congress asking the questions that will force the 
Agency to take those things seriously.
    Dr. Norwood is talking mostly about data on environmental 
conditions, and I think that is essential. Dr. Hahn is talking 
mostly about economic analysis and economic information, and 
that's necessary, too. So we need to be a little careful when 
we are talking about different kinds of information, but they 
all go to the question of holding the Agency accountable and 
having some kind of defensible, scientifically valid evidence, 
independently arrived at to some degree, as to whether the job 
is getting done.
    Dr. Norwood. And it's important to recognize that a lot of 
the information has got to be done cooperatively with States, 
localities, and with the business community. There's no way 
that the Federal Government can create all of that information. 
It needs to get the information in large part from a lot of the 
players in the system. And that means that it has to be certain 
that there is a consistent system of definitions, the way in 
which the data are collected, the quality of the data. And 
there's none of that as of now in this system.
    I should say that there are a number of models in the 
Federal Government system of very good cooperative Federal, 
State, and even local data cooperative systems. I think it can 
be done.
    Mr. Ose. Where are those models? For instance, where's the 
template that we can at least go and examine?
    Dr. Norwood. Well, certainly the place that I am most 
familiar with, the Bureau of Labor Statistics, has had a 
Federal-State cooperative program in developing information on 
employment hours and earnings with the States since 1917. And 
it means that they work together cooperatively. The Federal 
Government pays some moneys to the States because the Federal 
Government needs these data. The States supply money because 
they want to do other things. The Federal Government helps to 
keep these units in the States separate and independent from 
politics.
    I used to spend a lot of time talking to Governors about 
the importance of that when I was there. I think there are 
examples, different kinds of examples, in agriculture and in 
education and other places. The important point is that you 
can't put too big a burden on the respondents, on the people 
who have the data. You can't have all different jurisdictions 
asking them for the same information. And it has to be 
consistent across all of these areas.
    I've done a little book on the Federal statistical system 
and its need for reorganization, which I have yet succeeded in 
getting passed. And one of the chapters in it is on Federal-
State cooperation, which I think is tremendously important. The 
Feds have a lot to learn in that, however, because it has to be 
cooperative and it has to meet the needs of both those at lower 
levels of government and business and the Federal Government. 
It can't just be a one-way street.
    Mr. Ose. Dr. Hahn, Ms. Mazurek, any feedback? I want to 
thank the panelists for coming today. This has been 
enlightening, to say the least. We are going to consider what 
type of legislation to put forward. And obviously, we have--we 
have the full range, if you will. The record from this hearing 
will be left open for 2 weeks. We may have some followup 
questions that we would like to send each of you in writing. We 
would appreciate your cooperation in the response.
    I want to thank you all for coming today. Like I said, this 
has been enlightening and I do appreciate it. I may end up 
calling you independently and just talking. So if you will 
grant me that permission, I may very well followup. We stand 
adjourned.
    [Whereupon, at 11:45 a.m., the subcommittee was adjourned.]


         EPA CABINET ELEVATION--FEDERAL AND STATE AGENCY VIEWS

                              ----------                              


                        THURSDAY, MARCH 21, 2002

                  House of Representatives,
  Subcommittee on Energy Policy, Natural Resources 
                            and Regulatory Affairs,
                            Committee on Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 9:30 a.m., in 
room 2154, Rayburn House Office Building, Hon. Doug Ose 
(chairman of the subcommittee) presiding.
    Present: Representatives Ose, Otter, LaTourette, Mink and 
Kucinich.
    Staff present: Dan Skopec, staff director; Barbara Kahlow, 
deputy staff director; Jonathan Tolman, professional staff 
member; Allison Freeman, clerk; Yier Shi, press secretary; 
Elizabeth Mundinger and Alexandra Teitz, minority counsels; and 
Jean Gosa, minority assistant clerk.
    Mr. Ose. Good morning. Welcome to our hearing. I want to 
recognize a quorum with the attendance of Mr. LaTourette.
    The issue of elevating the Environmental Protection Agency 
to cabinet level status has been around since the agency was 
created in 1970. In the years since its inception, Congress has 
passed numerous environmental statutes expanding the 
jurisdiction of the EPA. As its jurisdiction has expanded, the 
agency has grown as well. Today more than 18,000 employees work 
at EPA and it has an annual budget of $7\1/2\ billion. It is 
important to note that elevating EPA to a cabinet level 
department will not in and of itself change the agency's size, 
jurisdiction or effectiveness. The act of creating a new 
cabinet level department is largely symbolic, but how and why 
Congress elevates the EPA to a cabinet level department may 
fundamentally affect not only how the EPA operates, but also 
perceptions of the agency and the importance of environmental 
issues.
    Two bills have been referred to this subcommittee to 
elevate EPA to a cabinet level department, H.R. 2438, 
introduced by Representative Sherry Boehlert of New York, and 
H.R. 2694, introduced by Representative Stephen Horn of 
California. The two bills take significantly different 
approaches. One offers no reforms to the agency, and the other 
offers a multitude of reforms to the agency.
    The principal question facing our subcommittee at this 
hearing is what, if any, reform should Congress explore in the 
process of elevating EPA to a cabinet level department.
    When EPA was created in 1970, this country faced widespread 
and daunting environmental challenges. We have made great 
progress in the cleanup of large industrial pollution that 
plagued our Nation 30 years ago. Today, however, we face new 
environmental challenges, more complex and intractable 
environmental concerns.
    Last week the USGS, U.S. Geological Survey, released a 
report on various chemicals in our rivers and streams, 
chemicals like caffeine, which come not from some giant 
caffeine manufacturing plant but from the coffee, tea and soda 
that we drink every day. Are tiny amounts of chemicals such as 
caffeine in our waterway a problem? How big of a problem is 
this compared to our other environmental problems? What, if 
any, resources should we devote to solving it?
    These are the types of questions that will face EPA in the 
coming decades. I would point out that it was the Geological 
Survey and not EPA that produced this study, which in itself 
raises questions about the role of EPA in dealing with the 
environmental problems we face as a Nation.
    At our first hearing in September, we heard from the 
sponsors of the elevation bills. In addition, a number of 
policymakers from the academic community testified about the 
need for reform at EPA. Having heard from people who view the 
agency from arm's length, today we want to hear from those 
dealing with the agency on a more regular basis.
    Our witnesses today bring with them a wealth of knowledge 
about EPA and environmental policy. EPA's Inspector General and 
the General Accounting Office have spent countless hours 
reviewing, analyzing and auditing EPA's programs.
    Hopefully, their expertise will shed some light on the 
organizational and management challenges that EPA faces and 
what sorts of changes need to occur at EPA to ensure that it 
can achieve its mission.
    After our first hearing, several Members of Congress wrote 
me expressing concern about problems with EPA, citing numerous 
GAO reports and urging me to address these issues. I have read 
many of those reports. I am pleased that we could have the GAO 
here today to focus on those subjects.
    The other dramatic change that has occurred since EPA's 
inception is the emergence of State agencies in protecting the 
environment. Most of our major environmental laws are delegated 
in some fashion to the States. In addition, States spend most 
of the public money committed to environmental protection. For 
instance, in fiscal year 2000, the States spent just over 
$13\1/2\ billion on environmental and natural resource 
protection, which is about double the entire budget of the EPA.
    State agencies have emerged as not only the workhorses of 
environmental protection but also innovative leaders. States 
are on the cutting edge of solving the complex environmental 
problems that we face today. Unfortunately, and we'll hear more 
about this today, their innovative ideas often run into 
obstacles, some of which originate at EPA.
    Hopefully, today's hearing will shed some light on the 
experience that State agencies have had in attempting to 
overcome these obstacles and what lessons Congress should take 
from those experiences as we consider elevating EPA.
    [The prepared statement of Hon. Doug Ose follows:]
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    Mr. Ose. Joining us today on our first panel are the 
Honorable Nikki Tinsley, who is the Inspector General for the 
EPA. Good morning. Also John Stephenson, who is the Director of 
Natural Resources and the Environment for the U.S. General 
Accounting Office. Good morning.
    Now, in this committee we typically swear in our witnesses, 
and we're going to conform to that norm this morning. So if 
you'd both rise.
    And we have others who might provide counsel.
    [Witnesses sworn.]
    Mr. Ose. Let the record show that all the witnesses 
answered in the affirmative. Now our typical approach here, as 
you may well know, is that we recognize the witnesses for 5 
minutes each to summarize their testimony, which we have 
received and we will enter into the record and I have read, and 
I even have a marked-up copy to ask questions from. So Ms. 
Tinsley, you are first for 5 minutes.

     STATEMENTS OF NIKKI TINSLEY, INSPECTOR GENERAL, U.S. 
ENVIRONMENTAL PROTECTION AGENCY; AND JOHN STEPHENSON, DIRECTOR, 
  NATURAL RESOURCES AND ENVIRONMENT, GENERAL ACCOUNTING OFFICE

    Ms. Tinsley. Well, good morning. I'm happy to be here to 
testify and share information on EPA's top 10 management 
challenges. Not surprisingly, these challenges overlap areas in 
the President's management agenda. I'm going to highlight today 
the challenges that are particularly important to EPA working 
with States.
    One challenge that EPA faces is linking its environmental 
and human health mission with its corporate management 
responsibilities. This challenge relates to three of the 
President's management agenda items, linking budget and 
performance, improved financial management, and competitive 
outsourcing.
    EPA can be viewed as a business whose primary product is 
delivering improved environmental and human health protection 
to the public, its investors, at a reasonable cost. For EPA to 
show its investors that it is a company worthy of investing in, 
it needs to address regional, State, and local priorities as it 
develops environmental and human health goals and defines how 
it will measure and report its accomplishments.
    Further, the investors and Agency managers need to know the 
cost of activities and resulting environmental and human health 
protections in order to judge EPA's overall performance. 
Without detailed information on what is working and at what 
cost, Agency management cannot make informed decisions on how 
to best deploy its resources to achieve results and the 
investors cannot assess the success of their investment.
    EPA is the leader in its progress in integrating its budget 
and accounting structure with the Government Performance and 
Results Act architecture and accounting for costs by goal and 
objective. But EPA needs to improve its cost accounting system 
and processes so Agency managers have useful, consistent, 
timely, and reliable information on the cost of carrying out 
programs.
    The Agency has output data on activities, but it has little 
data to measure environmental outcomes and results.
    Another challenge that EPA faces relates to information 
resources management, which is closely linked to e-government. 
In many respects, sound IRM practices establish the foundation 
for enabling e-government. Our audits of EPA programs often 
have a component relating to environmental data information 
systems, and we frequently find deficiencies within these 
systems. Today most States have information systems based upon 
State needs to support their environmental programs. EPA and 
States often apply different definitions within their 
information systems, and sometimes collect and input different 
kinds of data. As a result, States and EPA report inconsistent 
data, incomplete data, or obsolete data.
    Recent audit work on EPA's systems identified problems in 
EPA's enforcement, Superfund and water programs, and we 
illustrated problems in inconsistent, incomplete, and obsolete 
data. EPA is developing an information exchange network that 
will support efforts for States and EPA to share information, 
and EPA is working with the Environmental Council of States to 
identify and develop data standards that will ensure 
consistency in data reporting.
    Unfortunately, right now the States get to decide whether 
or not they want to adopt these standards. If the exchange 
network is to work effectively, applying the data standards 
cannot be voluntary.
    EPA is also working to produce its first State of the 
Environment Report to be issued in the fall of this year. The 
purpose of this environmental report card is to inform the 
public on EPA's progress in protecting the environment and 
human health. This initiative will actually give the Agency its 
next opportunity to honestly evaluate its data collection 
processes, quality, and costs.
    A third management challenge relates to the President's 
management agenda item on human capital management. EPA 
recognizes that one of its biggest challenges over the next 
several years is the creation and implementation of a work 
force planning strategy that addresses skill gaps in its 
current work force, particularly competencies related to 
leadership, information management, science, and technical 
skills.
    These skills gaps will intensify over the next 5 years as 
about half of EPA's scientific and senior managers are eligible 
to retire. These gaps can be addressed in part through employee 
development. The need for training has been highlighted in a 
number of our audit reports and in reviews by GAO and the 
National Academy of Public Administration.
    Our work shows that a lack of training for EPA employees 
has hindered the Agency's ability to work effectively with 
States, and that EPA needed to better train managers to oversee 
assistance programs and to lead in a results and accountability 
oriented culture.
    Assistance agreements constitute approximately half of 
EPA's budget and are the primary vehicles through which EPA 
delivers environmental and human health protection. It is 
important that EPA and the public receive what the Agency has 
paid for. Our recent audit work of EPA's assistance agreements 
disclosed that some recipients did not have adequate financial 
and interim controls to ensure Federal funds were properly 
managed. As a result, EPA has limited assurance that grant 
funds are used in accordance with work plans and met negotiated 
environmental targets. Last May we reported that the Agency did 
not have a policy for competitively awarding discretionary 
assistance funds totaling over $1.3 billion annually. EPA 
depends heavily on States to fund and implement national 
programs as well as most environmental data. Our work shows 
problems with EPA and States working together to accomplish 
environmental goals.
    Mr. Ose. Ms. Tinsley, if I might, we have this entire 
statement for the record.
    Ms. Tinsley. OK.
    Mr. Ose. If you could summarize here briefly. I know we've 
got another page and a half on your testimony.
    Ms. Tinsley. How about if I just jump to the part on 
elevation?
    Mr. Ose. That would be fine.
    Ms. Tinsley. Which is--I was actually getting there. In 
addition to having to work with State partners, EPA also relies 
on a host of other Federal departments and agencies to 
accomplish its mission. Right now EPA's budget represents only 
20 percent of the Nation's environmental and natural resource 
programs. Our office has been working with other Federal IGs to 
develop an inventory of Federal environmental programs and we 
have identified more than 300 environmentally related programs 
managed by other Federal agencies. Because of that, the broad 
breadth of these programs, we think it is important that EPA 
sit at the table as a full partner with the other Federal 
agencies, and so we support the elevation.
    [The prepared statement of Ms. Tinsley follows:]
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    Mr. Ose. Thank you. We appreciate your summary.
    Mr. Stephenson for 5 minutes, if you would, please.
    Mr. Stephenson. Thank you. Good morning, Mr. Chairman. I am 
pleased to be here today to discuss GAO's views on providing 
EPA cabinet level status and to also point out some of the 
major management challenges that the Agency must address 
regardless of whether it becomes a cabinet level department or 
not. Some of these views are going to sound very similar to 
what you just heard from Ms. Tinsley, so I will be very brief.
    While ultimately it is up to the Congress and the President 
to decide, we believe that there is merit to elevating EPA to a 
cabinet level department. Since EPA was created in 1970, its 
responsibilities have grown enormously. Its mission, to protect 
human health and the environment, has become increasingly 
significant with the Nation's understanding of environmental 
problems. Today, EPA's mission, size, and scope of 
responsibilities place it on a par with many cabinet level 
departments.
    Its 18,000 employees and $7\1/2\ billion budget make it 
larger or about the same size as the Departments of Labor, VA, 
HUD, Energy, Education, State, Interior, and Commerce. Other 
factors, although less quantifiable, include the highly 
significant environmental problems to be addressed, the need 
for environmental policy to be on equal footing with the 
domestic policies of other cabinet departments, and the need 
for international cooperation in formulating long-term 
policies.
    The United States is the only major industrialized Nation 
in the world without cabinet level status for environmental 
issues. Regardless of its status as a department or Agency, 
there are longstanding fundamental management challenges that 
EPA needs to address. I'll highlight three of these.
    First, EPA must address the challenge of strategic human 
capital management. Simply stated, that means having the right 
people with the appropriate skills where they are needed. Last 
October we reported that EPA had not done sufficient work force 
planning and analysis to determine the number of staff and the 
appropriate skill mix needed to carry out its mission. We also 
noted that the number of enforcement staff available to oversee 
State-implemented programs varied significantly among EPA's 10 
regions, raising questions about whether enforcement may be 
more rigorous in some States than others. EPA has initiated 
actions to address our concerns, and we are doing followup work 
to assess this and other management challenges at EPA.
    Second, EPA needs better scientific environmental 
information. Such information is essential if EPA is to 
establish priorities for its programs that reflect risk to 
human health and the environment, something we all believe it 
should strive to do. This type of information is also needed to 
identify and respond to emerging problems before significant 
damage is done to the environment, damage that directly affects 
human health and costs hundreds of billions of dollars a year 
to correct.
    While EPA annually collects vast amounts of data, much of 
it is incomplete, inaccurate, and not well integrated. As a 
result, it is not useful information to credibly assess risk 
and establish corresponding risk reduction strategies.
    Further, the lack of credible data has been a roadblock to 
EPA's efforts to develop a comprehensive set of environmental 
measures and indicators needed to evaluate the success of its 
programs.
    And finally, I would like to highlight an area I will call 
regulatory innovation. Under the existing Federal approach, 
EPA, under various environmental statutes, prescribes 
regulations with which States, localities, and private 
companies must comply. This approach, commonly referred to as 
command control, has resulted in significant progress in some 
areas, but is increasingly being criticized for being costly, 
inflexible, and ineffective in addressing some of the Nation's 
most pressing environmental problems.
    In recent years, EPA has encouraged wider use of innovative 
regulatory strategies that could streamline the environmental 
requirements, but our work has shown that EPA has had limited 
success in implementing such strategies.
    This is due in large part to a strict interpretation of the 
existing regulations. Legislative changes are needed to 
overcome this barrier, changes that would give EPA broad 
statutory authority or a ``safe legal harbor'' for allowing 
States and others to pursue innovative approaches in carrying 
out environmental statutes. Of course, EPA would also need to 
develop the environmental indicators I alluded to earlier to 
assure that the new approaches are doing a better job than the 
command and control approaches they replace.
    That concludes my statement. I would be happy to take any 
questions.
    [The prepared statement of Mr. Stephenson follows:]
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    Mr. Ose. Thank you, Mr. Stephenson. We have reviewed both 
of your statements in writing, and we appreciate you attending 
this morning.
    We do have some questions that we need a little expansion 
on. Ms. Tinsley, in your testimony, you talk about the 
information resources management issue. You stated that the 
result of the current system has been that States and EPA 
report inconsistent data, incomplete data, or obsolete data, I 
think those are your words, and your testimony suggests that 
EPA is not currently capable of monitoring environmental 
activities or comparing progress across the Nation. Is this 
primarily a problem of data not existing or a problem of how 
data is managed?
    Ms. Tinsley. It's both. First of all, I guess if you think 
about starting with the end in mind, the Agency and its 
partners, both in the States and also its partners in industry, 
has never decided what kind of information it needs to really 
address whether or not the environment is safe and what kind of 
indicators it actually wants to use. I think through this 
environmental report card, the agency may get there by default.
    And second, you have the data standards kind of issue that 
I talked about. Unless people decide what level of quality they 
want in the data and then gather data using methods that 
provide that quality, they will have a problem as far as using 
that data to make decisions about what to do next.
    Mr. Ose. Are you suggesting that the programs themselves 
lack prioritization within their objectives?
    Ms. Tinsley. Yes, and it is difficult to assign your 
priorities if you do not know what is working, if you do not 
know where your problems are and what is working to address 
them.
    Mr. Ose. Do you know what the priorities of the EPA are?
    Ms. Tinsley. Well, I know from a mission standpoint what 
they are. They are to protect the human health and the 
environment.
    Mr. Ose. But for instance, they do not have a top 10?
    Ms. Tinsley. They have their 10 organizational goals, 
several of which include the media programs.
    Mr. Ose. Well, I noticed--I do not know if it was your 
testimony or Mr. Stephenson's testimony or a couple of the 
other witnesses--that one of the standards by which EPA judges 
its effectiveness is the number of regulations it issues, 
rather than an empirical reduction in pollution in, say, the 
Mississippi River.
    Ms. Tinsley. If you were designing an environmental program 
to be effective, you would have that kind of interim step. That 
is an outcome. But then you would want to have some means of 
measuring whether or not issuing your regulation really had an 
effect on the environment down the road. Right now it is 
difficult for EPA to measure the impact of a particular 
regulation or a particular output. You almost have to start 
when you design a program to determine what environmental 
impact you want to create, and then sort of back in to how you 
are going to do that, and then evaluate throughout the process 
to make sure that your hypothesis, if you will, is working.
    Mr. Ose. Do the States have this data? Are the States 
suffering from the same problem that the EPA seems to be 
suffering from, in terms of the available data to evaluate 
their efforts?
    Ms. Tinsley. Well, much of EPA's data comes from the 
States, and States gather the data that they need to implement 
their program. In many respects States are ahead of EPA in 
gathering data, but what States decide they need differs on a 
State-by-State basis. So we do not have a coordinated approach 
to this, and to the Agency's credit they are trying to address 
that problem, but has not fully addressed it at this time.
    Mr. Ose. Well, how do we get from where we are to where we 
want to be? And I'll tell you what my primary concern is. If we 
look at individual permits, like, let's say Doug Ose 
Manufacturing Plant gets a permit for the issuance of such-and-
such effluent and then John Smith gets one and Susie Jones and 
whatever, you do not have any measurement of the aggregate 
impact. You only have a measurement of the piecemeal impact. Is 
that one of the problems here?
    Ms. Tinsley. Yes, it is.
    Mr. Ose. So, if you will, the methodology is flawed? Is 
that what you are saying?
    Ms. Tinsley. I do not think that as they've thought about 
how they're going to do their work, they've stepped back and 
done it from a big-picture standpoint. I mean, the issue that 
you talked about, if you were talking perhaps about an NPDES 
permit, you know, would relate to Total Maximum Daily Loads, 
and how much pollution are you going to put in your stream, and 
what are you going to use your stream for--are you going to use 
it for swimming and fishing and drinking water--and then how 
would you decide what's coming into the stream based on the 
permits, as well as all the other uses, for example, farm and 
agricultural runoff and that kind of thing. Then how and where 
are you going to measure to make sure that you're taking care 
of your stream, and then how are you going to regulate all the 
people who are polluting the stream with some degree of 
fairness? And many times this--well, always this is an issue 
that goes beyond the boundaries of EPA. I mean, this is surely 
a big issue to States, but then you also have the agricultural 
community and a number of other players at the Federal level.
    Mr. Ose. All right. My time is expired. I recognize the 
gentleman from Idaho for 5 minutes.
    Mr. Otter. Thank you, Mr. Chairman. My apologies to both 
you and to the members of the panel for being tardy this 
morning. I was at school. That's why I was tardy here instead 
of being tardy there. But I did have an opening statement and, 
Mr. Chairman, without objection, I'd like to submit that for 
the record.
    Mr. Ose. Hearing none, so ordered.
    [The prepared statement of Hon. C.L. ``Butch'' Otter 
follows:]
[GRAPHIC] [TIFF OMITTED] 82666.100

[GRAPHIC] [TIFF OMITTED] 82666.101

    Mr. Otter. I do have a series of questions, but there was 
something in response to the chairman's question Ms. Tinsley, 
you indicated that you weren't quite sure that when a program 
was set up, you weren't quite sure of all the data that was 
going to go in. Yet in your written testimony that I read last 
night, almost everything that comes out of the EPA is outbased-
intended. In other words, you already decide what the target is 
and hopefully that is clear water and clean air, and then all 
of the programs that you put in place hope to get us from 
wherever it is now in the status of level of pollution to 
usable, drinkable, swimmable, fishable. So I'm curious as to 
the conflict I see between your written testimony and your 
response to the chairman's question that you weren't quite sure 
what the outcome was going to be, so you had to put certain 
laws in place to see if the laws were effective in cleaning it 
up. If most of our science or most of our intent here, our 
mission, is out-based--in other words, we have a target here, 
and the target is clean water and clean air and cleaning up 
solid waste--does that create a conflict for you? It creates 
one for me. It seems to beg the question here.
    Ms. Tinsley. I'm not sure I'm clear on what your question 
is.
    Mr. Otter. I'm not sure I am either. I think the chairman's 
question was relative to setting standards or putting certain 
legal requirements and regulations in place, and your response 
to that was that you weren't quite sure what the outcome was 
going to be, and so in the transition, things had to be changed 
or something.
    Ms. Tinsley. No. What I'm saying is right now the Agency 
doesn't have a means always of measuring what the outcome is 
once it puts a regulation in place. If you think about, for 
example, compliance assistance versus enforcement activities on 
the Agency's part, right now the Agency doesn't have a system 
where it would know whether it works better to spend its 
limited resources helping industries learn how to comply with 
regulations or does it work better to go out and do enforcement 
activities and punish them? You know, how are you going to best 
use your limited resources to get the result that you're after?
    Mr. Otter. And what has been the result? What has worked 
the best?
    Ms. Tinsley. The Agency does not know at this time which 
works best. See, you have to remember, I'm representing sort of 
the outside view on what's happening at the Agency.
    Mr. Otter. I understand.
    Ms. Tinsley. Right now the agency doesn't have good systems 
to show what works best, which approach works best. No doubt, 
both approaches work, but when do you use one versus the other 
one?
    Mr. Otter. And which is the most productive? In 30 years, 
having punished a lot of people in 30 years, having encouraged 
a lot of people to do good things, we do not know which works 
best? In 30 years?
    Ms. Tinsley. Not that I'm aware of, no.
    Mr. Stephenson. Could I add my 2 cents worth on this issue? 
Part of the problem is that the performance measures that EPA 
has set for itself are, as the chairman noted, largely 
activity-based and not outcome-based. The Administrator right 
now has an initiative to create some environmental indicators. 
We do not know much about that yet. It's supposed to be a major 
element of a report card that she's going to issue in the fall. 
That may be a step in the right direction, but the data itself 
on which the indicators are based originate in the States and 
are problematic, too. First, there isn't enough environmental 
monitoring to get good data. The data quality varies 
significantly from State to State just like on the waters data 
base for polluted waters, States report information very 
differently from State to State. So if that sort of bad or 
mixed data is rolled up at the EPA level, it still isn't going 
to be very useful. So it's a long-term problem that needs to be 
corrected, and right now EPA's data bases for air, water, and 
waste cleanup are not integrated, and the data that originate 
within the States may be flawed depending upon the State they 
come from. It's a big problem and we've got to resolve it 
before we can get to deciding priorities or where the taxpayer 
dollars should be spent for environmental cleanup and pollution 
control.
    Mr. Otter. Well, Mr. Chairman, my time is up, and we really 
didn't get on to the issue. I hope we'll----
    Mr. Ose. We'll have another round. We'll have as many 
rounds as you like.
    Mr. Kucinich for 5 minutes.
    Mr. Kucinich. I thank the gentleman. To the witnesses, the 
two EPA elevation bills that have been introduced into the 
House take vastly different approaches. The bill that was 
introduced by Representative Boehlert is a clean bill that 
elevates the Agency, and the bill introduced by Representative 
Horn includes a number of additional provisions, some of which, 
as you know, are controversial.
    Do you have any particular view or recommendations that you 
could provide at this time that would suggest whether we pass a 
clean bill or a bill that also changes the organization and the 
responsibilities of the EPA? Maybe Ms. Tinsley could start.
    Ms. Tinsley. We haven't done any work to analyze the two 
bills, but my personal perception is that it would be better to 
have a clean bill, just because it provides wider latitude for 
the agency to work with its partners to make decisions. If 
there were going to be some requirements in the bill, I would 
hope that they would be outcome-based and where you would let 
the people who have to solve the problems work together to 
solve those problems as opposed to trying to tell them how to 
solve them.
    Mr. Kucinich. Mr. Stephenson.
    Mr. Stephenson. I'm going to stay politically correct and 
in the middle on this issue, but you guys are the experts on 
what works and what doesn't. The past attempts to elevate EPA 
have failed----
    Mr. Ose. I want to remind Mr. Stephenson, you're under oath 
here.
    Mr. Kucinich. I was going to ask the Chair to do that. 
Thank you.
    Mr. Stephenson. We were sworn in. The past history, as you 
all know well, the 1993 bill, failed in large part because of a 
minor amendment that the House couldn't agree to, so I think 
history has shown that a clean bill probably would work better 
and would be easier to pass, but I wouldn't want to let go of 
some of the management issues that need to be addressed. We 
think they need to be addressed regardless of the status of 
EPA, whether it's a cabinet level department or an agency.
    Mr. Kucinich. I thank the gentleman. I think you testified 
that you disagreed with the recommendation of the EPA to cut 
about 270 staff positions from Federal enforcement activities. 
Is that right?
    Mr. Stephenson. Our conclusion was that EPA didn't have the 
data to support that decision. We called for a work force 
analysis of the enforcement office.
    Mr. Kucinich. Has that been completed, by the way?
    Mr. Stephenson. I do not know. We have some ongoing work 
looking at the 2003 budget to determine whether----
    Mr. Kucinich. Are you going to continue to recommend that 
they delay cuts to Federal enforcement until this analysis is 
completed?
    Mr. Stephenson. That would be our recommendation, yes.
    Mr. Kucinich. Now this year the President again has 
recommended cuts to Federal enforcement at the EPA and at other 
agencies and, of course, this is after Enron and when we had 
the SEC fail to uncover Enron's accounting practices. Now the 
GAO recently found that part of the problem was that the SEC 
did not have sufficient staff, and although the President has 
recommended the increase in funding for the SEC, has 
recommended deep cuts in Federal enforcement at the EPA and 
numerous agencies or entities charged with ensuring compliance 
with civil rights laws and laws that protect our workers. So 
I'm concerned about this trend away from enforcement, that it 
would only encourage further violations, and could end up at a 
high price for safety, health, civil rights.
    Mr. Stephenson. Well a lot of the implementation of 
environmental law is being pushed on to the States, and so in 
theory the States would need more resources. EPA would need 
less, but that is oversimplified. EPA's role would change from 
one of direct enforcement to assistance to the States in 
implementing environmental law.
    Mr. Kucinich. I'd like to quickly move to these questions 
about measuring EPA performance, that focusing on performance 
measures could lead to cuts in funding for complicated but 
important areas like the environment or global warming, because 
it's difficult to be able to assess what kind of success you're 
having in those areas. So we could end up redirecting our 
resources to either less dire problems or even less successful 
programs, because we can measure the success of those programs. 
I mean, how do you look at that in terms of, you know, trying 
to measure performance standards of certain areas that are big 
picture versus small picture?
    Mr. Stephenson. There's not an easy solution. The results 
of our environmental efforts are often long term. Sometimes it 
takes 20 or 30 years to determine whether our programs for 
cleaning up water actually result in fewer cancer deaths, for 
example. So I do not have a simple solution.
    Mr. Kucinich. OK. Thanks, Mr. Chairman.
    Ms. Tinsley. Can I respond to that just a little bit? I 
really think that----
    Mr. Kucinich. Mr. Chairman?
    Mr. Ose. I'd be happy to allow the response.
    Ms. Tinsley. I think that it's important that EPA and its 
partners sit down and develop a strategy to do just that, 
because if we do not ever decide what is important to measure 
and how we're going to measure it, then 30 years from now we 
still won't know what works and what doesn't work.
    Mr. Kucinich. I thank the Chair. Thank you.
    Mr. Ose. I thank the gentleman. Mr. Stephenson, the GAO has 
issued several reports in recent years, from 1995 onwards. It 
just seems to be a constant delivery pattern, for which we're 
appreciative, by the way.
    Mr. Stephenson. That's good.
    Mr. Ose. On the environmental information that's available 
at EPA. Does the GAO feel that EPA is capable of effectively 
monitoring the environment and comparing progress across the 
Nation?
    Mr. Stephenson. In a word, no. As I mentioned earlier, they 
do not have the data--they do not have accurate data in the 
form they need it and integrated well enough, not only within 
EPA, but among all of the other data bases available in the 
other agencies. Federal environmental data in general have not 
been integrated in such a manner to be useful in setting 
priorities for environmental programs.
    Mr. Ose. Let me back up. I always like to use the phrase 
``flying blind.'' Are you saying we're flying blind after 30 
years?
    Mr. Stephenson. The way EPA has grown, as you know, is 
throuigh regulations in each of the media, in air, water, waste 
cleanup, and so forth. There's never been an attempt to 
integrate priorities across those programs. So in effect, EPA's 
managers do not know how effective their programs are. I think 
that's a fair conclusion.
    Mr. Ose. Is it fair to say that might lead to a situation 
where we focus on one particular pollutant in the environment, 
which has a nominal impact, to the exclusion of another 
pollutant, which could have a very significant impact?
    Mr. Stephenson. That's a fair conclusion.
    Mr. Ose. Does that possibility exist?
    Mr. Stephenson. That possibility exists until managers have 
better data to measure the effectiveness of their programs.
    Mr. Ose. Right. Now, this issue of incomplete, 
inconsistent, or obsolete data, which I believe you've both 
testified to, could you give me, Mr. Stephenson, some specific 
examples of incomplete, inconsistent, or obsolete data that EPA 
currently collects?
    Mr. Stephenson. The one I mentioned earlier is the most 
often cited example. In the water area, States list their 
waters as polluted or not, but they all adhere to very 
different criteria and standards in doing that. This leads to 
shared waters across State lines being listed as polluted in 
one State and not polluted in the other, and beyond that the 
standards that each State adheres to in creating their data 
bases vary greatly. Some States have data integrity laws and 
their data is very good, and others do not. So it's a very 
mixed bag, and therefore it is very useless in managing an 
overall program like clean water.
    Mr. Ose. Let me make sure I understand the consequence of 
that. If you've got one State that designated a water as 
polluted because its standards specify X and the river flows 
across the State line and another State decides that its 
standard is Y and under Y the river is not polluted, you have 
Americans subject to two very different----
    Mr. Stephenson. Exactly.
    Mr. Ose [continuing]. Due processes of law.
    Mr. Stephenson. Exactly.
    Mr. Ose. Ms. Tinsley, do you have any specific examples of 
inconsistent, inaccurate, or obsolete data?
    Ms. Tinsley. I do.
    Mr. Ose. Can you share them with us?
    Ms. Tinsley. I will add a little bit to John's water 
example results in a fish advisory in one State and not in 
another, and they share the same body of water.
    Mr. Ose. What State?
    Ms. Tinsley. I think it was Tennessee, and who was the 
other? I'd have to look. We reported on it this year in one of 
our audit reports where we actually had that situation, where 
it was Tennessee on one side of the Mississippi River, and 
who's--I do not remember who is----
    Mr. Ose. Arkansas?
    Ms. Tinsley. Yes. It was Arkansas, as a matter of fact, but 
that's not the only example. Some of the other things that 
we've found, we recently issued an audit report on the quality 
of enforcement and compliance data stored in EPA's docket 
system, and EPA uses that to estimate the amount of pollutants 
reduced as a result of environmental actions, and the data was 
incomplete and the Agency was making management decisions using 
it.
    Mr. Ose. I actually think your testimony is that the 
information generated from the docket analysis is in large part 
speculative without any empirical background. So they're just 
making it up out of the--I do not--I mean, those are just my 
words. They aren't yours, but, you know----
    Ms. Tinsley. I do not think that they would say that they'd 
make it up.
    Mr. Ose. Do they have any empirical data behind these 
docket conclusions?
    Ms. Tinsley. I would assume that initially it was based on 
some kind of scientific analysis. We did some other work on 
enforcement where the Agency actually reports in its GPRA 
report the results of compliance and enforcement actions, but 
what we found was that the Agency never followed up to find out 
if the companies actually did come into compliance. The 
companies promised to come into compliance. EPA reports it as 
an accomplishment, but as a matter of policy, did not go back 
and followup to see whether or not the companies really came 
into compliance.
    EPA's Superfund system also has problems. The CERCLIS 
system is what it is called, and it measures what's going on in 
the Superfund program, and what we found was many times the 
Agency information about what States were doing on non-national 
priority list sites wasn't even included in the system. So the 
Agency was making decisions without complete information.
    Mr. Ose. The gentleman from Idaho.
    Mr. Otter. Thank you, Mr. Chairman. I want to mention that 
actually there's one other bill by Mr. Ehlers that has also 
been advanced, and that should be the subject, if I'm correct 
here, Mr. Chairman, also of our discussions here this morning.
    Mr. Ose. Mr. Ehlers' bill is part and parcel of this 
discussion.
    Mr. Otter. And I think his bill, along with much of the 
testimony that you two--although I didn't listen to your verbal 
testimony this morning, I did read what you had submitted, that 
the Environmental Protection Agency itself is fraught with lots 
of problems, lack of standards, lack of follow-through, lack of 
goal-oriented programs that are verified later on, 30 years of 
not knowing whether or not punishment or the stick or the 
candy, which is the most successful, and it seems to me that 
although I could certainly argue, I think, with a certain 
amount of reason for the elevation of the director to cabinet 
staff level, it seems to me that we're getting the cart before 
the horse here, that maybe we better clean up everything and 
get everything in order as perhaps suggested by Mr. Ehlers' 
bill, and then have an Agency that is fulfilling a mission. I 
would hate to think of what we would have done with the 
Secretary of State had we had problems all over the world, 
ineffective Secretary of State, and then all of a sudden 
decided, well, let's put him up to cabinet level, that will 
make everything OK.
    I do not want to share a misguiding opinion or idea with 
the American people that because we've taken it up to cabinet 
level, which is not an easy thing to do, by the way, that 
everything is going to be all right. You think we need to 
continue to share that we've got 283 million people that need 
to worry about polluted waters, and polluted air, and collected 
solid waste disposal and that it cannot just be one person or 
Agency. It's got to be all 50 States; in Idaho, all 44 
counties, all 202 cities. I'm a little concerned, not only from 
your testimony but also from the suggestions from 
Representative Ehlers that everything is not right, and I think 
we've pretty well established that here this morning.
    Defend for me taking an inadequate organization that is 
missioned with a very important part of our Nation's health to 
cabinet level staff and still be inefficient.
    Ms. Tinsley. If you were to compare what EPA is doing from 
the standpoint of having a results-oriented culture with other 
organizations that I'm aware of through interacting with IGs, 
EPA is actually ahead and is a leader in many of these areas.
    Mr. Otter. Cabinet level position?
    Ms. Tinsley. Yes.
    Mr. Otter. Well, maybe we should remove those from the 
cabinet level.
    Ms. Tinsley. So if we're going to have a level playing 
field, then we might need to think about that, but as far as 
accomplishing its environmental mission, it is going to have to 
interact a lot with those other Federal agencies that are 
cabinet level position--you know, have cabinet level status as 
well as, of course, as I've said, with the States. I think that 
being an equal player at the table could give the Agency more 
influence in that area, because right now it really has to deal 
through personality and, not through having an equal seat at 
the table, and that's a difficult thing to do, given that it's 
really only 20 percent, even at the Federal budget.
    Mr. Otter. Only 20 percent.
    Ms. Tinsley. I know ``only'' sounds like a lot, but when 
your goal is all about clean water, clean air, removing 
hazardous waste, they're taking that 20 and trying to leverage 
the other 80.
    Mr. Otter. But you understand there's a lot more than 20 
percent of this Nation's budget that's spent in pursuit of a 
clean environment. I was the lieutenant Governor of Idaho for 
14 years, and we busted our backs many times trying to match 
and trying to also advance the cause of the clean water, air, 
and solid waste disposal in Idaho. And we had to come up with 
an awful lot of money. If not the exact same amount, in many 
cases, it was a 40/60 split, and in some cases, although we 
were promised money, we got none. So there's an awful lot more 
money being spent than 20 percent of this Nation's budget, and 
it is an important position. But also when we come back on the 
next round, perhaps you can square up for me that if the States 
need to take a much larger role in this, is that going to 
diminish the actual role of the EPA as we see it on the 
enforcement level here and then become the counseling and 
become the activities adviser and that sort of thing for 
States.
    Thank you, Mr. Chairman.
    Mr. Ose. I thank the gentleman. I want to go to something, 
and I would appreciate both of your input on this. I look at 
the way EPA is structured today, and the analogy that was drawn 
for me was of a pin cushion. You have the Administrator; and 
then you have Region 9, and Region 3, and Region 6, and Region 
5; and in each of those regions, you have air, water, land, 
stovepipe type of regulatory enforcement agencies; but you do 
not have any level between the regions and the Administrator 
that would take all of this information and sort through it for 
the purpose of setting priorities within the Agency itself.
    Coming back to your point for instance, if I recall 
correctly, Tennessee being a polluted river on one side, but 
Arkansas it's not. How do you reconcile those? It's the same 
river. All it does is move 3 feet.
    Now, Congressman Horn has within his bill a suggestion for 
a Bureau of Environmental Statistics, where this information 
that would allow the compilation and the analysis of these 
statistics would take place. Is this a good idea?
    Mr. Stephenson. I think both of us would agree that any 
bureau or organization that would do a better job of 
integrating environmental data and providing meaningful data to 
measure progress and assess priorities across programs would be 
a good thing. EPA is organized--now as you have observed is 
partially media, water, and air and so forth and partially 
function, enforcement, compliance. So it's a mixed bag. It's a 
very strange organizational construct.
    Mr. Ose. From an organizational construct position or 
perspective, are there other Federal agencies that are 
similarly structured?
    Mr. Stephenson. I do not know.
    Mr. Ose. OK. Ms. Tinsley, in your testimony, you talk about 
how these environmental problems we just talked about transcend 
media boundaries. You have some interaction between air, and 
water, and land, and what have you, and solutions frankly 
require some innovative approaches rather than, if you will, a 
point source kind of analysis. Just to rephrase the question I 
asked Mr. Stephenson, does the current organizational structure 
lend itself to solving these cross-media problems?
    Ms. Tinsley. It does not lend itself to solving those kinds 
of problems, but it also doesn't preclude the Agency addressing 
problems across media. One of the things that recently the 
Agency has begun doing is looking at environmental protection 
from a watershed standpoint, and using that strategy. It's 
going to try and mix all of the different media things together 
so that you look at how the air pollution in fact impacts the 
water and things like that. So it's not impossible to get there 
with this structure. And I think any structure that you have 
will have some challenges to it. I think most important is the 
ability and the desire of the people who are working on the 
problem to work together to solve it.
    Mr. Ose. Well, are we presently doing a good job of 
handling these cross-media issues?
    Ms. Tinsley. I think that if you were to ask people in the 
Agency, they would say no, not as good as they could be.
    Mr. Ose. I want to examine this watershed issue. There's a 
situation down in South Carolina over the Tar River field that 
feeds into the Pamlico Sound. Going to your safe legal harbor 
issue that you mentioned in your testimony, the approach that 
was taken changed to measure an outcome rather than a specific 
effluent discharge, for instance. In other words, the agencies 
all got together. The stakeholders signed off on some safe 
harbor provisions, and they went and they measured what's the 
impact at the mouth of the river where it spills into the 
sound, because that's basically what they wanted to monitor. It 
changed the approach.
    Now, I want to come back--I know my time is about up. In 
fact, it is up. I want to come back to this safe legal harbor 
issue in particular in this next round, Mr. Stephenson. It's 
your suggestion, I think, in your testimony that we need to 
address that. So Mr. Otter, 5 minutes.
    Mr. Otter. Thank you, Mr. Chairman. I want to go back to 
the question I left you with, and that is how do we square up--
if we're going to ask the States to take a much larger role in 
enforcement, it would seem to me if the EPA is going to carry 
on the enforcement activities but sort of the advice and 
setting standards and that sort of thing, which is needed 
across State lines, and I think we've pretty well accomplished 
a mindset on that, but if we do have this transfer, if you 
will, to the States, do you think the elevation of the 
Administrator to a cabinet level position would be more 
effective for the States as a result of that? You know, I'm 
just concerned that if we do that, how does the Governors 
Association feel about it now? Do they want to see it elevated? 
Do they think it's an important thing to do? It seems to me 
that if they're going to be partners in this program, that they 
need to buy into the idea that we've got a cabinet level 
position here.
    Mr. Stephenson. I do not know. I think that would be a 
great question for the second panel. You've got a lot of the 
State witnesses here. I think more importantly, EPA's role is 
changing from direct enforcement to assistance to the States 
and I do not know what that means in terms of staffing levels. 
But assistance is certainly a very important function--it's 
trust by verifying. They're still going to have to perform some 
oversight functions to make sure that environmental laws are 
consistently applied across the States. So they haven't 
analyzed their staffing levels and their skill levels to 
determine if they're in a good position to do that yet.
    Mr. Otter. Ms. Tinsley.
    Ms. Tinsley. I've heard the Administrator testify on the 
funding that the Agency is asking for to give additional grants 
to States, that those grants are going to be competitive, and 
would probably be awarded to the States that are doing the best 
job in enforcement, which would have to make you wonder what's 
going to happen in those States that aren't doing a good job of 
enforcement because they're not going to get any more money. So 
the oversight and the involvement of EPA that John talks about 
is going to be very important. EPA is going to have to continue 
its enforcement role in addition to the compliance assistance.
    Mr. Otter. Well, I would agree, and perhaps the EPA's role 
of enforcement has not been as effective, and maybe that's 
because it isn't a cabinet level position. You know, I'm very 
much aware since 1994 without a permit, the Army Corps of 
Engineers has been dumping 200,000 tons of sludge into the 
Potomac River. In fact, into the habitat of the snub nose 
sturgeon, and yet without a permit, violating the law.
    If the State did that, I would think that the EPA--are they 
just without power to make another agency obey the laws of this 
land?
    Ms. Tinsley. They don't seem to be real engaged in making 
that happen. Our audit says neither EPA nor the States do 
enforcement the way the regulations would anticipate it should 
happen.
    Mr. Otter. Which brings me back, I guess, to the question 
that I had earlier. Maybe we need to clean this mess up before 
we advance this mess in the very important and necessary role 
that it has.
    In your supportive data that I read last night, Ms. 
Tinsley, I'm going to read for you a part of a paragraph: ``our 
reviews and investigations have disclosed a particularly 
disturbing trend in the number of environmental laboratories 
that are providing misleading and fraudulent data to the States 
for monitoring the Nation's public water supplies. Several 
current lab fraud investigations involve severe manipulations 
of lab tests used to evaluate the compliance of public water 
supplies with Federal drinking water standards. Some of these 
manipulations have masked potential violations of drinking 
water regulations.''
    If we elevated the Director to the Cabinet level, would 
this help improve this, the qualification of labs, the 
verifications of labs, the veracity of labs? How is this going 
to help an inherent problem?
    Ms. Tinsley. I don't think that whether EPA is a Cabinet 
level office or not has any impact on that issue.
    Mr. Otter. So we will just make bigger mistakes at a higher 
level?
    Ms. Tinsley. Just not one way or another. That's a 
different issue.
    Mr. Otter. Thank you, Mr. Chairman.
    Mr. Ose. I thank the gentleman. I want to come back to this 
safe harbor issue with Mr. Stephenson. This really boils down 
to the EPA relationship with the States in terms of what kind 
of insulation you can give them if they are going to do 
innovative things. Now you recently released a report on 
obstacles to State environmental innovation. What did you find 
were the chief obstacles that the States faced?
    Mr. Stephenson. One of the chief obstacles is the 
rulemaking that EPA does based on the regulations. The 
rulemaking is very prescriptive and it is done that way to be 
legally defensible. But the impact that has is that it stymies 
innovation within environmental programs. And the safe harbor--
--
    Mr. Ose. Before we leave that, I want to make sure I 
understand you correctly. When you say it is prescriptive, the 
regulations mandate that it will be done A, B, C?
    Mr. Stephenson. In a specific way.
    Mr. Ose. Rather than L, R, Q? It is A, B, C, or no way at 
all?
    Mr. Stephenson. Right. In a lot of cases that is true. And 
what we're suggesting is that maybe there is more room for some 
flexibility in environmental programs. Just like I described, 
measuring pollution at the mouth of the river, rather than 
regulating everything that's put into the water along the way. 
It's an outcome-based indicator and that's what we advocate.
    Mr. Ose. What sort of things do you recommend to help 
change that prescriptive culture that exists at EPA?
    Mr. Stephenson. I think recognition in some of the 
legislation that employing some innovative practices may be 
acceptable would be the safe legal harbor that we are talking 
about. Right now, the legislation doesn't really allow for 
that, in our view. I believe there was a House bill last year 
that in some way addressed this, but I'm not that familiar with 
it.
    Mr. Ose. I want to make sure I understand. Between rules 
and regulations and legislation, you think the prescriptive 
issue is legislative in nature, not regulatory in nature?
    Mr. Stephenson. I think that because there is no provision 
for this in the legislation, then the rules are not written in 
such a way that would allow innovative practices to be 
employed.
    Mr. Ose. Is there a provision in the legislation that 
prevents the innovation?
    Mr. Stephenson. No.
    Mr. Ose. It's just that the safe legal harbor issue----
    Mr. Stephenson. And EPA chooses to implement the rules the 
way it does in large part so they will be defensible against, 
for example, the Clean Air Act or the Clean Water Act. That is 
the approach they think they have to take.
    Mr. Ose. So your suggestion is that in order to allow that 
culture to evolve into something a little more innovative, we 
need more flexibility in the legislation?
    Mr. Stephenson. Exactly. Exactly.
    Mr. Ose. All right. Then, Ms. Tinsley, you indicate in your 
testimony that relations between the EPA and the States have 
been strained in some occasions. Is this the principal reason 
for that? Is it that the States think we can accomplish 
something by doing a little more innovative approach versus the 
EPA's prescriptive pattern of operation? What are the principal 
causes of this difficult relationship between the States and 
EPA?
    Ms. Tinsley. In the past, EPA has monitored the States 
through requiring States to do certain activities, as you said. 
And States want to do other activities. It seems that it is 
difficult for EPA to give up the old way of doing business in 
favor of a new way. And EPA has also tried, as it has gone 
through a transition to try to work with States, to hold States 
accountable for showing changes in environmental results and 
States have not wanted to be held accountable to that level. So 
you have two different things going on.
    Mr. Ose. Well----
    Ms. Tinsley. And they sort of work against each other.
    Mr. Ose. Let me ask the question to the extent that I can. 
It would seem to me that somebody who lives in New Mexico, 
working at the State of New Mexico's Department of 
Environmental Regulation or whatever, is far closer to a 
problem than somebody at a desk at EPA here in Washington, in 
terms of what needs to be done. Are we just kind of saying, you 
know, we are the big dog, you are the little dog, you have to 
do what we say? Is that what is going on here?
    Ms. Tinsley. At least in some of the regions where we have 
looked at how the regions are interacting with the State, it is 
something like that. And part of this is even a training issue 
where, while the headquarters office at EPA said it was going 
to do business differently with States, the regional people 
said that they had not bought into it. And that's what they 
actually told us when we did our work, was that maybe 
headquarters wanted to do that, but that's not what they were 
doing. Because EPA doesn't have a good handle on what its work 
force is doing all the time, it did not even realize that was a 
problem.
    It resulted in regional people who worked with the States 
actually asking the States to measure hundreds of things, all 
the old activities that they used to monitor, plus the new 
agreements with the States. And if you step back and looked at 
what was happening, it looked like the States would spend all 
of their time counting things and not much time protecting the 
environment.
    Mr. Ose. Mr. Otter.
    Mr. Otter. Ms. Tinsley, in your capacity as the Inspector 
General of the Environmental Protection Agency, how many people 
do you have reporting to you?
    Ms. Tinsley. We have about 350.
    Mr. Otter. No, I mean to you.
    Ms. Tinsley. To me personally?
    Mr. Otter. Yes.
    Ms. Tinsley. I have eight.
    Mr. Otter. And, Mr. Stephenson, in your capacity as the 
Director of Natural Resources and Environment, how many do you 
have reporting to you?
    Mr. Stephenson. Directly reporting about seven or eight.
    Mr. Ose. Do you know that the President now has 14 on the 
Cabinet reporting directly--I mean in the chain of command, 14 
different people reporting to him. I come out of the private 
sector, and generally we thought five to eight was about the 
max that you could really do a good job with. And part of my 
concern about this has always been if we did not fold into 
another agency and have that agency representing the 
Environmental Protection Agency on the Cabinet level, were we 
going to diminish those that were already there or were we not 
going to do as good a job as we would with a little more 
independence? I think that's one of the things that we really 
have to concern ourselves with.
    The other that I am concerned about is as recently as 2 
weeks ago, the environmental community, along with many of the 
States, were quite upset when an individual was removed from 
the Department of the Interior because of an apparent 
disagreement with the administration. And as that person was 
removed, it was suggested that, you know, that the 
administration made sure that removal took place. Even though 
the separation just by command would offer a little bit of 
autonomy, I don't know of any of these 14 people that I have 
seen any disagreement with this administration, so they are all 
still sitting around the table.
    One would have to wonder if the closer the Environmental 
Protection Agency got to the administration vis-a-vis the 
Administrator now sitting at the Cabinet table, that perhaps 
part of that autonomy and that creative individual willingness 
and focus on mission might be diminished, in light of what 
happened a couple of weeks ago in the Department of the 
Interior.
    Mr. Stephenson. I don't have any basis for judgment, but--
--
    Mr. Otter. Well, you are the Inspector General. You guys 
should have investigated that. You don't have an opinion on 
that?
    Ms. Tinsley. Well, I do not investigate things that happen 
at the Department of Interior. I'm pretty busy at EPA.
    Mr. Stephenson. I think the management challenges are 
independent of Cabinet level status. Maybe we shouldn't reward 
EPA until it gets its act together, but based on the 
President's management agenda and the OMB report card that it 
just issued, no agency is doing a good job. There were reds 
everywhere on their green, yellow, red checklist. So that is 
not really a criteria.
    To me, it is the importance of the job that EPA is doing 
and the U.S. standing in the international community. If every 
other country says this is Cabinet level status, then why don't 
we? I guess that is kind of where I am.
    Mr. Otter. And I'm sure you are aware that there is a major 
difference in government structure between the U.S. 
Government----
    Mr. Stephenson. Of course.
    Mr. Ose. Does Mexico, for instance, do they have a Cabinet 
level position?
    Mr. Stephenson. To my knowledge, yes.
    Mr. Otter. I will take my environment, and this is no great 
disparagement to our friends south of the border.
    Mr. Stephenson. I am no way suggesting that elevating EPA 
to Cabinet level is going to solve all of its problems and make 
it a better agency. That is not what I am suggesting at all. 
EPA has to address its management concerns regardless of 
whether it is a Cabinet level agency or it remains an 
independent agency.
    Mr. Otter. My expectation would be if we do elevate it, if 
we increase the title--if I took a person in my company, if I 
went from Lieutenant Governor to Governor, I was expected to do 
a much greater role. If I took a person from vice president to 
a chief of a department or to president of a company, I would 
expect them to have a much greater role, a much greater 
influence, and much more focus overall for their particular 
area of discipline. And I would expect it to improve.
    Mr. Stephenson. Yes. Based on testimony from ex-
Administrators in the Senate last year, they contend that they 
don't have an equal footing with other Cabinet level 
departments, they don't have a place at the table. That's 
debatable, I guess.
    Mr. Otter. I think it would be. And perhaps I'd like to get 
a Governor at that Cabinet level table as well. And so if we 
are going to go to 15, we might as well go to 16 and put a 
Governor on there. Thank you, Mr. Chairman.
    Mr. Ose. I thank the gentleman. I keep coming back to this 
structure issue. In terms of the Agency itself, going back to 
the analogy I introduced of a pin cushion where the different 
assistant administrators and the different regional directors 
report directly to the administrator, I think there are 22 
actual direct relationships there. If we are going to elevate 
EPA to a Cabinet level status, aren't we also obliged to look 
at how it will operate after the fact? If we can identify some 
clear organizational issues that are frankly contributing to 
the difficulty we are having in the aggregate of positively 
affecting our environment, aren't we obliged as we elevate to 
fix those structural problems?
    Mr. Stephenson. Yes, I think they need to be fixed, whether 
EPA is elevated or not.
    Mr. Ose. Do you share that, Ms. Tinsley?
    Ms. Tinsley. Yes.
    Mr. Ose. All right. Now one of those that has been 
suggested, and I think Mr. Otter brought this up earlier, had 
to do with an office dedicated to science. Should the EPA have 
an office dedicated to science, separate and apart? A deputy 
administrator dedicated to the scientific function or 
functions?
    Mr. Stephenson. If our policy is going to be based on sound 
science, I would think that such a position would be 
appropriate.
    Mr. Ose. Do you share that opinion Ms. Tinsley?
    Ms. Tinsley. Yes, I do.
    Mr. Ose. Now there has also been the suggestion at previous 
hearings regarding an office to quantify whether or not the 
programs are having an environmental impact, a positive 
environmental impact or a negative environmental impact. And I 
think, Mr. Stephenson, you talked about this previously. Should 
the EPA have an office, a deputy administrator, if you will, 
responsible for basically monitoring these programs to ensure 
that they're achieving their objective? So you would have a 
science guy, then you would have an enforcement office, you 
would have a ``success or failure'' office. I don't know what 
you call it.
    How do you go about quantifying whether or not the money we 
are spending is actually having the effect that we want?
    Ms. Tinsley. If----
    Mr. Stephenson. Go ahead.
    Ms. Tinsley. If you had the information you needed to 
measure what was happening in the environment, then you could 
hold the individual managers accountable. In normal business, 
every manager is accountable for making sure their part of the 
organization works.
    Mr. Ose. So you have to have an office of the data 
administrator, so to speak, into which all data flows and from 
which you can get good periodic reports evaluating the program.
    Ms. Tinsley. That would be one way to do it. One of the 
reasons that EPA doesn't have the data that it needs to manage 
is not because managers would not like to have that, but 
because there has sort of been, at least in the last few years, 
a collective decisionmaking process about what money gets spent 
on, and managers have a tendency to not want to take funds away 
from their individual programs for the greater good, if you 
will, because they are too busy trying to do the things that 
they hope are working to deliver environmental results.
    Mr. Ose. But you both testified that there is little 
scientific data by which to judge those programs being funded.
    Mr. Stephenson. Well, specifically data on environmental 
indicators, I would call them, supported by sound science. But, 
as you know, what does the data show in terms of how much 
cleaner the water is getting, how much cleaner the air is 
getting and so forth? The fact that EPA does not have a good 
set of outcome-based environmental indicators would suggest 
that it has fallen through the cracks in the Agency's current 
organizational structure.
    So I wouldn't want to get hung up on the title of a bureau 
of environmental statistics or whatever. But that's a really 
important function for EPA to determine its priorities. They 
cannot employ risk-based environmental strategies unless they 
have that kind of data. So it is an extremely important 
function.
    Mr. Ose. And we don't have that data now in a usable or 
consistent manner.
    Mr. Stephenson. No, and I think the current Administrator 
would agree. That is why she has initiated the environmental 
indicators study.
    Mr. Ose. My time is up. OK. I am going to get another round 
here. Both of you have testified about the human capital issue 
in the Agency itself, one comment being that the skill set 
within the work force is not necessarily aligned with the 
challenges we face, and the second issue being that we have 
this bulge, if you will, in the employee pool that is moving 
through chronologically and within 5 years we are going to lose 
a lot of senior people.
    How do we deal with that? I mean, if we know they are 
coming, we know these retirements are pending within 5 to 10 
years, we have a need for a change in the skill sets, is this 
an opportunity to frankly evolve the Agency--that is not a 
verb, but I just made it up--evolve the Agency into something a 
little more responsive or reflective of our current challenges?
    Mr. Stephenson. Preparing for the future is part of good 
human capital strategic management in any agency. There are two 
problems. There is the succession planning problem and there is 
the change in the skill mix from a direct enforcement function, 
to more of an assistance to the States, to kind of an oversight 
function. So there are two problems which should be part of 
EPA's strategic human capital plan.
    After we reported on it last year, they were going to 
undertake several initiatives to address these specific 
concerns. GAO has put out a human capital model for all 
agencies to use to help guide them through this process, but, 
we haven't been back in to look at how well they are doing in 
that endeavor.
    Mr. Ose. Ms. Tinsley, would you agree that we have--I mean, 
we could look at it as lemons or lemonade in terms of an 
opportunity here to refocus the skill set, if you will, within 
the Agency. Is this an opportunity or an impediment?
    Ms. Tinsley. Well, we would have to look at it as an 
opportunity. But this is an opportunity that all of Federal 
Government has, which I think in part is why there has been 
legislation introduced to at least give managers more 
flexibility in how to address these problems. If you look at 
all these folks who could leave the Agency in 5 years, the 
Agency doesn't have any idea whether or not that is going to 
happen. So it needs, as John said, to have some strategic way 
of thinking about where it wants to get to and what skills it 
wants to replace, how it wants to do that through hiring versus 
training, so that 5 years from now the Agency is where it wants 
to be.
    Mr. Ose. Now one of you in your written comments referenced 
a number of pending. EPA ordered a contract ``in early calendar 
year 2002 to develop a model work force planning process and a 
system that will meet the Agency's competency-based work force 
planning needs.'' That is Ms. Tinsley's testimony. When will 
this contract be complete? Do you know?
    Ms. Tinsley. I do not know.
    Mr. Ose. Is it an open-ended contract?
    Ms. Tinsley. I don't know the answer to that. I can get 
back to you for the record.
    Mr. Ose. For the record? We may well want that.
    And also there is a second mention in here, your office 
reported the Agency did not have a policy for awarding 
discretionary assistance funds competitively. You did testify a 
little earlier today about some change in the competitive grant 
process.
    Your written testimony says that the Agency agreed with the 
OIG's observations and is drafting a policy which will address 
competition in the award of discretionary assistance funds. 
When will this be completed?
    Ms. Tinsley. I don't know when that is going to be 
completed, but I have heard discussions among the Agency 
managers, particularly the Assistant Administrator for the 
office that handles that. I think that draft will be out soon 
for our comment.
    Mr. Ose. See, this is the kind of thing that makes it very 
difficult for us on this side, if you will, to evaluate what 
we're doing. I have heard nothing in terms of specific 
empirical objectives as they relate to the environment and I 
did not read anything in your testimony relative to EPA's 
mission in addressing those objectives, specific, empirical 
objectives. We have a contract on a work force planning 
process, for which I don't know the due date. In other words, 
when is that contract supposed to be finished?
    And on the competitive grant process, I get the same 
question that we don't know when that will be finished. It 
almost seems like we have a culture here that does not set 
priorities with due dates. I mean, am I accurate here?
    Ms. Tinsley. Yes. And you have a culture from an 
environmental standpoint that doesn't have the information to 
work with others to make those decisions.
    Mr. Ose. To make those decisions.
    Ms. Tinsley. That is right.
    Mr. Ose. Or a central collection point into which that data 
could come so priorities could be set and based on those 
priorities we could allocate resources accordingly.
    Mr. Otter for 5 minutes.
    Mr. Otter. Mr. Chairman, I have no more questions for this 
panel, but I would like to draw your attention to and make a 
unanimous consent request that a letter received by you on 
December 20, 2001, relative to this very subject, the elevation 
of the Administrator to Cabinet level, signed by myself and 
five of my colleagues, be made a part of this permanent record.
    Mr. Ose. Without objection.
    [The information referred to follows:]
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    Mr. Otter. Thank you, Mr. Chairman.
    Mr. Ose. I do appreciate you taking the time to come and 
visit with us today. I know it is not easy to constructively 
criticize, but I do appreciate the input. It is helpful to me 
to have you come and tell us what you found. I am interested in 
whether or not to elevate EPA. But I'm also cognizant that we 
are not going to repeat the problems we faced in the past. We 
are going to try to fix them.
    So your testimony has been very helpful in that regard, and 
I want to thank you for coming. You are relieved of duty, so to 
speak, and we will call the second panel forward. We will take 
a 5-minute recess here, too.
    [Recess.]
    Mr. Ose. Our second panel today, we are joined by 
Commissioner Karen Studders from the Minnesota Pollution 
Control Agency. Thank you for coming. And also by Jane Nishida, 
the secretary of the Maryland Department of Environment. 
Ladies, as you know, we swear in our witnesses on this 
committee. Rise and raise your right hands.
    [Witnesses sworn.]
    Mr. Ose. Let the record show that the witnesses answered in 
the affirmative. We provide our witnesses with 5 minutes to 
summarize their testimony, which we have received in advance 
and we are grateful for that. So, Ms. Studders, you are going 
to be first. Thank you for coming.

   STATEMENTS OF KAREN A. STUDDERS, COMMISSIONER, MINNESOTA 
   POLLUTION CONTROL AGENCY; AND JANE T. NISHIDA, SECRETARY, 
             MARYLAND DEPARTMENT OF THE ENVIRONMENT

    Ms. Studders. Thank you, Mr. Chairman and members of the 
subcommittee, for giving me this opportunity to appear before 
you today. I welcome the chance to provide Minnesota's 
perspective on elevating the EPA to Cabinet status.
    Minnesota has consistently supported a Cabinet level 
department of the environment. I continue in this tradition 
today. It is more important than ever before that environmental 
protection is factored into decisions made at the highest 
councils of our land.
    There are three reasons to justify this change. First, 
elevating EPA to a Cabinet level status would improve the 
department's ability to work laterally with other Cabinet 
members on what I call second wave environmental issues 
involving agriculture, transportation, and energy. I will 
explain those issues in a moment.
    Second, pollution crosses State, regional, national, and 
international boundaries, thus requiring a Department of the 
Environment with access to policy discussions at the Cabinet 
level.
    Third, a Cabinet level Department of the Environment 
provides leadership to States so that we can better do our 
jobs.
    On my first point regarding the second wave of 
environmental problems, after more than 3 years as Minnesota's 
environmental commissioner, it is clear to me that the State 
regulatory agencies are facing very different problems today 
than we faced in the 1970's, 1980's, and the 1990's when 
Congress passed laws to deal with end-of-pipe emissions, which 
I call environmental protection's first wave.
    This was met with hard-won success. However, today the 
greatest threats to our environment are not from our regulated 
factories and facilities, but they are from widely disseminated 
pollution arriving from transportation, energy consumption, 
agriculture and urban sprawl. In Minnesota we realized a few 
years ago that these complex problems could not be regulated 
out of existence; we needed new strategies, what I call the 
``second wave of environmental protection.''
    This relies on enforceable goals, partnerships, innovation, 
public stewardship, and is performance-based. In Minnesota, 
Governor Ventura has afforded me the latitude to work directly 
with my fellow commissioners in the State Department of 
Transportation, Agriculture, Commerce, Health and Natural 
Resources. By sitting at the table with the top managers of 
other agencies, Minnesota has achieved some remarkable success. 
And I won't go into a great deal of detail, but I would 
encourage to you read it in my written testimony, but I would 
like to cite two examples.
    First, the environmental agency participated in writing the 
State Transportation Department's 5-year strategic plan so that 
when we design roads, we ensure we aren't increasing the 
congestion unnecessarily and causing us to have air quality 
problems.
    Second, Minnesota just completed its first energy plan. It 
is a 10-year energy plan written by our State Department of 
Commerce. The entire appendix, more than half of the document, 
talks about the environmental consequences of the energy 
choices we make. And it literally costs that analysis down so 
we can look at what is the cost to the ratepayer if we add this 
piece of pollution control equipment to this plant in this 
area. That is a first for Minnesota. I am very proud to say 
that we have been able to do such work.
    I do believe that EPA could forge more productive 
relationships and strategies with other Cabinet members if the 
department had a permanent place at table, as do I in the State 
of Minnesota.
    My second point, a Department of the Environment provides 
clout for solving pollution problems crossing State, national 
and international boundaries. Just as today's pollution 
problems require national strategies, they also require 
stronger cooperative relationships. As a commissioner that 
shares a border with Canada, I know how important authority and 
credibility are to developing and maintaining such 
relationships.
    My final point is that States need environmental leadership 
that provides flexibility in approaching environmental problems 
in the 21st century.
    And now I'm going to differ a little from my written 
testimony and try to touch on some of the issues that you 
raised in your questions to the first panel, if I can. I do 
believe that to achieve this leadership goal, EPA needs to do 
three things.
    First, we need a statute that--we need Congress' help in 
writing to allow EPA to operate effectively among the media 
programs. We need a safe harbor, and I will talk a little bit 
about that.
    Second, we need to change the structure so that it helps us 
address cross media issues. However, I would not suggest 
changing structure until we do some things legislatively.
    Third, we need to focus on environmental results. I, too, 
come from the private sector and am very interested in results.
    First, in 1996, Minnesota passed a statute called the 
Environmental Regulatory Innovations Act to give my agency the 
ability to try new ways of working on environmental problems. 
This law leaves in place our existing laws related to air, 
water, and land, by allowing us to try approaches that are 
different, promoting reduction in pollution levels overall and 
reducing unnecessary administrative burdens. And it is allowed 
under State policy.
    A similar overarching Federal law could help EPA deal with 
such innovations, one that leaves in place all of the major 
environmental acts but also gives EPA the flexibility it needs 
to do things differently and depart from statute when needed 
through variances like Minnesota's law, or another mechanism. 
This is the legal safe harbor I refer to.
    Next, EPA needs a clear message from Congress that it wants 
EPA to be flexible. That is where a legal safe harbor sends 
such a message to EPA. In the meantime, a new overarching 
environmental law can be and needs to be written, eventually 
replacing the media laws that are currently on the books.
    Then we need to address EPA's structure. Minnesota has 
experience in designing a structure responding to emerging 
environmental problems, such as smart growth, that cut across 
the media programs. In our experience, the EPA innovations 
staff tries very hard to do things differently, but they run 
into obstacles with the media program staff. Perhaps using a 
congressional task force with the administrator, congressional 
staff, State environmental staff, and environmental 
commissioners to design a new structure will give EPA the 
flexibility to do their job once a national environmental act 
is written.
    Consider a functional organization with reporting similar 
to the corporate model, such as permitting and enforcement and 
research. But I will tell you I think we need a tight timeframe 
to do this. We do not need to get caught up in analysis 
paralysis. We need a flexible statute written. I think it could 
be done in a month.
    Second, we need to write a national environmental 
protection act with a task force doing that work and getting 
stakeholder buy-in. That could be done in about 6 months. And 
then subsequently we need to redesign EPA. That, too, I think 
would take about 6 months.
    Once the above are done, Congress could then reduce the 
number of committees that oversee EPA. I believe at present in 
excess of 15 congressional committees oversee EPA. There are 
not many other departments that have such a reporting 
relationship with Congress.
    Then EPA and Congress could move further in reporting on as 
opposed to counting numbers of permits issued and numbers of 
enforcement actions taken to measuring how the results actually 
improved our environmental state. This is something that 
Governor Christie Whitman has made a priority in her 
administration, and a new statute allowing greater flexibility 
and structure designed to allow the department to work across 
media issues would give EPA the tools it needs to focus on 
environmental outcomes, which I believe are clean air, water, 
and land.
    Finally, I'd like to share with you that I'm going to ask 
you this question as I close: How should we measure the quality 
of our air? One, should we focus on the number of permits that 
are issued to major facilities; or, second, on the number of 
days when air has no negative health impacts? In Minnesota, we 
measure the latter.
    Thank you for inviting me to provide Minnesota's 
perspective, and I apologize in advance, because I know I took 
more than 5 minutes.
    [The prepared statement of Ms. Studders follows:]
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    Mr. Ose. Ms. Studders, we are glad you are here. Your stuff 
is so good we decided to let you run. We figured it was 
productive. So, Ms. Nishida, if your stuff is as good we're 
going to let you run a little long, too.
    Ms. Nishida. Thank you, Mr. Chairman and members of the 
committee. My name is Secretary Jane Nishida. I represent the 
Maryland Department of the Environment and I am privileged to 
be here today to testify about Maryland's position with regards 
to the elevation of EPA. You have my written testimony, and 
what I would like to do in light of the number of questions 
that you asked the panel one witnesses, is to forgo reading or 
summarizing my written testimony but instead try to answer some 
of your questions in the context of three questions that were 
posed to me originally.
    The first question is whether or not the original charter 
of EPA is still valid today, 30 years later. The second, 
whether improvements should be made in elevating EPA. The third 
is whether EPA should in fact be elevated.
    With regards to the first question, that is whether or not 
the original charter of EPA is valid today, I want to answer 
that in the context of an experience that we have in Maryland, 
and that is our restoration of the Chesapeake Bay.
    The earlier panel testified that they had run into 
experiences where States may be treating a water body 
differently from across State lines. I am happy to tell you 
that with regards to the Chesapeake Bay, it is an unprecedented 
level of cooperation that we have with regards to the 
protection of the Chesapeake Bay between the States of 
Maryland, Pennsylvania, Virginia, and the District of Columbia. 
As well, we have included other States who are not technically 
a part of the Chesapeake Bay restoration efforts but who do 
play a role in terms of contributing to the water quality.
    As a result of that and such things as trying to designate 
a TMDL for one of the tributaries of the Chesapeake Bay, the 
Potomac River, we are working jointly with those States that 
share the Potomac River. So we believe that as a result of the 
cooperation fostered by the Chesapeake Bay program, we will not 
see the inconsistencies that are occurring in the other parts 
of the country with regards to different standards and perhaps 
different protections for a water resource.
    Likewise, with regards to the question of whether the EPA 
charter is flexible in addressing the Chesapeake Bay concerns, 
as you have pointed out, there has been evolution of 
environmental problems over the years from the command and 
control approach of point sources. What we're finding in the 
restoration of the Chesapeake Bay is that many of the sources 
of pollution are not from our factories, they are from 
agricultural runoff and sediment erosion from land use and from 
air deposition. Twenty-five percent of the NOx that 
enters the Chesapeake Bay comes from the air.
    The EPA is one of our partners in this Chesapeake Bay 
restoration, one of our strongest partners, and they have 
worked with us in terms of flexible interpretation of their 
standards and approaches. They are able to apply to the States 
the flexibility that we need collectively to protect the 
Chesapeake Bay.
    The second question that I would like to address is what 
other improvements should be made with regards to EPA. I will 
acknowledge that all the points that were raised by 
Commissioner Studders and the other panelists are very valid. 
We need to look at pollution and environmental protection in 
the future from a multipollutant strategy, from a cross media 
strategy. We need to look at an entire facility, not just a 
single media within a facility. We need to look more closely at 
incentive-based approaches. We need to look more at compliance 
assistance.
    One of the difficulties that we have had with EPA in the 
past, when they look at our enforcement record, they only look 
at the number of NOVs and enforcement actions taken and not 
what compliance assistance we have rendered.
    You have raised a question with regards to data management. 
Yes, more integration needs to occur in data management. One of 
the difficulties that we have at the State level, as an 
example, is that because everything is media-driven, my agency 
data base cannot communicate with each other and this prevents 
us from doing community-based profiles in addressing such 
things as environmental justice.
    We also need to look at outcome performance indicators, as 
you indicated. In the State of Maryland, we have been working 
with our regional office, Region 3, to develop a performance 
partnership agreement that establishes environmental indicators 
in exchange for more flexibility with regards to funding that 
comes to the States. And these environmental indicators look at 
number of wetlands that we restore, the number of lead-elevated 
children that we reduced, the reduction of ozone days within 
the State. So they are, again, environmental performance 
indicators.
    Which leads me to the final question, and that is whether 
or not to elevate EPA. As you have indicated, there are several 
proposals before you. One, H.R. 2438, which is the clean bill 
in terms of elevating EPA; H.R. 2694, which has more in terms 
of reforming EPA.
    While we support aspects of the reform bill in terms of EJ, 
IT, and public access, we would urge this committee to pass out 
the clean bill, 2438, because we believe that the structural 
problems are complex, require further evaluation, and further 
dialog with important stakeholders like the States is needed.
    I would add that when my agency was elevated to an 
environmental agency in the mid 1980's, it was not a perfect 
solution. Over the last 15 years I have been before the General 
Assembly where there have been reforms in my agency, where 
certain programs have been shifted and certain organizational 
structures have been made.
    I think the important thing is that we need to send a 
message to our public, we need to send a message to the world 
that we believe that environmental protection is on equal 
footing with the other Cabinet level responsibilities. I think 
the public deserves no less and the time is long overdue. Thank 
you.
    [The prepared statement of Ms. Nishida follows:]
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    Mr. Ose. Thank you, Madam Secretary. We appreciate you 
coming today.
    We are going to go to questions now. Ms. Studders, is it an 
agency or commission you run? I just need to be clear in my own 
head.
    Ms. Studders. My agency's name is the Minnesota Pollution 
Control Agency.
    Mr. Ose. OK. Now, that agency, it is my understanding that 
your agency was reorganized here several years ago and that the 
manner in which you approach the issues before you changed. How 
was the agency organized before and how is it organized now?
    Ms. Studders. Mr. Chairman, the agency was actually created 
3 years before EPA was created. And it was arranged exactly 
like EPA is today arranged, which was by media: air, water, 
land, a separate financial office, an administrative separate 
office.
    The agency was reorganized in 1998, destroying those media 
organizations for all of the reasons that each of the panelists 
have spoken about today with the second wave environmental 
issues, and it was set up to deliver services geographically. 
Minnesota is a northern State and we broke the State down 
geographically and we dealt with the large communities 
differently. So if you were a large community greater than 
about 100,000 in population, services were rendered differently 
to you than in the smaller communities.
    What we did originally was try to put every single program 
out into that service delivery system, if you will. We also 
centralized a planning function, which I think is very critical 
for planning and analysis before new rules are promulgated, 
before a new standard is set, to have independent staff look at 
that rule of standard and see if it was indeed warranted. And 
we set up another division that had to do with environmental 
results. We call it the environmental outcomes division. And 
that group created the Minnesota Environment 2000 report which 
I brought before this committee last year, and is looking at 
our indicators quarterly, and produces a report quarterly 
looking at what progress has been done.
    But I will tell you that it is very difficult to measure 
environmental progress in a quarter. It very often takes years.
    Mr. Ose. Before we leave that, how do you measure it in 
this report? Do you have specific quantifiers in the report? Or 
is it subjective? Tell us how you measure it.
    Ms. Studders. Mr. Chairman, that answer honestly depends on 
the breadth or wealth of the information we may have in the 
media. We have much better data on air in Minnesota than we do 
on water. I think that is true of most States, but not all. The 
number of parameters we have monitored air for in this country 
has been a finite amount and it is less than a dozen and it is 
manageable. In the water arena, it is thousands and it is less 
than manageable. The criteria pollutants are measured. And what 
we have seen is a movement of the criteria pollutants coming 
out of the Twin Cities, our primary metropolitan area, and 
extending north into our area north where our resort areas are. 
We are seeing deposition issues in those lakes. But we are 
measuring the pollutants, I believe, on a monthly basis and 
then looking at that data cumulatively over years and adding 
each subsequent month to that information.
    Mr. Ose. Do you correlate the measurements with changes in 
the regulatory regimes? In other words, at such and such a date 
we had a measurement of X and we changed our regulation at that 
time to address something else? Is there any way to correlate 
your regulatory evolution with the empirical data that you are 
monitoring out in the field?
    Ms. Studders. Mr. Chairman, we started doing that last 
November. We made a structural change to our organization last 
November, which I think is important I share with this 
committee. The district service delivery system was a little 
flawed in that--I'll give you an example. In our main office we 
have 500 people. In a smaller regional office we may have 50. 
And to expect 50 people to operate over 50 environmental 
programs was really, I think, a laudable goal, but an 
impossible one. We pulled some of those programs back into our 
central Saint Paul office primarily for what we call our major 
facilities, those big emitters that have been regulated under 
the Clean Air Act, Clean Water Act, RCRA, for 20, 30 years, and 
have consolidated the major facilities in one division now and 
what we call our minor facilities in a second division.
    We still have those regional offices but what we learned in 
the course of the last 3 years was that our staff needed 
different skills to go out and inspect and enforce a major 
facility versus providing some assistance and perhaps actually 
teaching an entity, like a farmer that had not been regulated 
before about the impact his or her phosphorous and nitrogen was 
having on that waterway down the block. And so now our service 
delivery system is looking at that skill issue and we actually 
have different skills in the two divisions that we ask our 
staffs to have.
    Mr. Ose. I want to come back to this, but my time has 
expired. Mr. Otter.
    Mr. Otter. Ms. Studders, in your testimony, you provide us 
that you had worked for many years for the private sector and 
that is Reliant Energy.
    Ms. Studders. Yes, that is true, Mr. Otter.
    Mr. Otter. Tell me a little bit about Reliant Energy.
    Ms. Studders. I can tell you that--I think it is important 
I tell you this, I worked in the natural gas business 
originally and went through a series of seven acquisitions and 
mergers in my 17-year career in the energy business and wound 
up at Reliant Energy. As that ended, we were doing 
environmental regulatory work in 13 States and I was primarily 
involved in negotiations with the different regions of the 
Environmental Protection Agency, establishing standards and 
negotiating cleanup scenarios for very large sites that needed 
remediation, and then working on air quality agreements as 
well.
    Mr. Otter. And coming from that sector when you were 
working with the EPA, did you find them pretty easy to work 
with, relative to your position now as the head of the 
Environmental Protection Agency of Minnesota?
    Ms. Studders. I think what I would comment on is that I 
found working with each region unique. Region 5 is different, 
different than Region 7. The expectations in Region 8 are very 
different than those in Region 2, and I found that troubling in 
that to me what was good in New York should also be good in 
Texas. But the different regions would interpret the laws 
differently, and I fortunately worked for a company that said 
let's hold ourselves to the highest standard that one region of 
the EPA holds us to. So it made my job easier as I worked with 
fellow managers to teach them what standard they needed to 
comply with. But EPA themselves don't hold themselves to that 
same standard.
    Mr. Otter. Was Reliant generally under the auspices of the 
public utilities commissions of these relative states?
    Ms. Studders. Yes, it was.
    Mr. Otter. And so if you had an environmental problem that 
required a solution within a certain period of time, you needed 
to, as you stated in your testimony, you could cost-basis 
whatever it was going to cost for another 1,000 cubic feet of 
gas, what that abatement process was going to cost you in your 
product?
    Ms. Studders. Yes.
    Mr. Otter. And then with that knowledge, you could go to 
the PUC and say we need an increase from $1.80 up to $1.85 or 
$1.82?
    Ms. Studders. We could, but I will be honest, the people I 
worked for asked that I do a more thorough analysis of that, 
meaning look at different alternatives to grapple with an 
environmental scenario and cost that out, and then go to the 
public utility commission and ask them what they thought. So we 
did not necessarily always go in with one solution, we went in 
with several so that they could help determine if they wanted 
that issue addressed or not because there are different costs.
    Mr. Otter. In that capacity, was Reliant ever fined by the 
EPA?
    Ms. Studders. Reliant has been fined by EPA, yes.
    Mr. Otter. Did you believe that those were justifiable?
    Ms. Studders. I will be honest, Mr. Chairman, the fines I'm 
referring to actually happened to Reliant before I came to work 
with Reliant, because I only worked with them the last 4 years 
of my career. During the time I was there they did not have any 
fines that I'm aware of.
    Mr. Otter. Very good. I operated a plant in northern 
Minnesota, a little town called Claxton. I also operated plants 
in Idaho, Maine, California, and several other States, and 
several other countries. And I have to tell you that we were 
just as frustrated with the different rules and different--
about the time we thought we had it figured out in one State or 
in one country and made those accommodations, then we found out 
because of the inconsistencies between regions that we no 
longer were doing the proper job.
    And quite frankly, selling French fries is not the same as 
selling 1,000 cubic feet of gas. There is no PUC to go to. You 
have to go to McDonalds and Burger King and say we have to 
raise the price of your product. We have a problem here. It is 
not as easily accomplished in the private sector as it is in 
the quasi public sector that you talk of. There is no PUC. 
There is only the consumer. And if you happen to have been 
fortunate to have located your plant in a region which was more 
flexible, you could cost your product much cheaper. And if you 
did not, and your competition did, well, then actually it was 
the regulation by your own government that put you in a 
noncompetitive position because you happened to locate your 
plant in a different State and subsequently in a different 
region.
    And so you can imagine what the private sector is faced 
with constantly when they have a multiplacement of plants or 
when some competition was a little more far-sighted and located 
in one of the regions that were more flexible. I will come back 
to this later in my second round. My time is up, Mr. Chairman, 
but flexibility is one thing that if we are going to establish 
flexibility, and I appreciate the fact that both of you have 
spoken to that, we need to make it consistently flexible. 
Otherwise, we disenfranchise in the marketplace and we 
disenfranchise States, to some extent one State is required to 
do something that other States are not. Thank you, Mr. 
Chairman.
    Mr. Ose. I thank the gentleman. Ms. Studders, Ms. Nishida, 
I have a bunch of questions for you also. Just be patient with 
me.
    Ms. Studders, you talked about how you have reorganized or 
Minnesota has reorganized to effectively go away from the air, 
water, land, to basically--these are my words, not yours--the 
stationary known air emitters that require major oversight, and 
then the smaller ones. You centralized the oversight of the 
major guys in an office that had staffing. Now the smaller 
offices, the satellite offices, if you will, retained 
jurisdiction on what emerging types of industries? I mean, how 
did you structure this? When you got the big emitters 
identified and centralized, how did you handle the ones that 
were less than big?
    Ms. Studders. Mr. Chairman, the large emitters are 
primarily identified by EPA, and the regulatory 
prescriptiveness to which we are held to show that we are 
complying with Federal law as we regulate them determined who 
was a major facility. And that's a finite group that we could 
put in that one division.
    The second division is everything else. So it is much less 
tangible and it will have facilities in it that one could argue 
will have to operate under the same prescriptiveness. As an 
example, a smaller sized wastewater treatment facility still 
has to comply with the Clean Water Act.
    But the volume of the discharge and the number of 
pollutants they need to test for is much smaller than a major 
facility is. That same staff will have to work with a farmer to 
implement Minnesota's new feedlot regulations, which also have 
two sets of rules. One set of rules is much more prescriptive 
for a small farmer, to tell them exactly what to do. And the 
second set of rules is performance-based, because the large 
operators with confinement animal feeding operations [CAFO's] 
told us they didn't want the prescriptiveness, they just wanted 
the goals they needed to meet. So we wrote our regulations that 
way.
    Mr. Ose. Has that worked?
    Ms. Studders. I would say yes, Mr. Chairman. We've had the 
regulations on the books since last October, and when I came on 
board in February 1999, there was much contention in Minnesota 
about our lack of regulation of farmers and if you were even 
being too tough on farmers or too weak on them. And I can tell 
you the calls and the letters have dropped immensely since 
we've gotten those regulations in place.
    Mr. Ose. Well, let me examine the CAFO thing that you've 
obviously dealt with, because I know that--I'm more familiar 
with the hog production in Iowa and cattle production in 
California than I am with what's in Minnesota, but the concept 
is the same, in the sense that the discharge--I mean, you point 
out that the critical piece to the puzzle is what are you 
discharging at the end of the day, so to speak? Now, you 
apparently have taken it toward that end as opposed to the 
prescriptive end. Is that correct?
    Ms. Studders. With regard to the CAFOs, that is true, Mr. 
Chairman, yes.
    Mr. Ose. And then you've taken that particular approach and 
expanded it in the satellite offices beyond just the CAFO/AFO 
situation, but perhaps to some more industrial uses?
    Ms. Studders. We are in the midst of doing that, Mr. 
Chairman. We are in the midst--we are now issuing permits that 
are multimedia in Minnesota, and from our perspective in 1996 
when Minnesota passed that law giving our agency the 
flexibility, we were allowed to start doing those things.
    Mr. Ose. Does the stovepiping of EPA, the air, land, water 
issue, is that one of our impediments here?
    Ms. Studders. Mr. Chairman, it's a double-edged sword. It 
is both an impediment and something that is very valuable, if 
that makes any sense.
    Mr. Ose. It does.
    Ms. Studders. When we made changes to our organization last 
fall, we reinstituted what are called media leads. For us to 
interact with the Environmental Protection Agency [EPA].
    Mr. Ose. Media leaks?
    Ms. Studders. Media leads.
    Mr. Ose. I'm familiar with those.
    Ms. Studders. Not leaks; a lead. We did that because it was 
very difficult for EPA to talk to us. They didn't know who to 
talk to, who was in charge of water in Minnesota, because we 
had perhaps a dozen people handling water in Minnesota. And so 
we have both a hierarchical relationship in our State now as 
well as a lateral relationship.
    And to simplify it, I'll tell you that if we have seven 
offices, each of the offices work on water, but there is one 
person now in charge of water, so that they have an indirect 
relationship reporting in to that individual as they operate 
their water programs. But they don't all report to that person, 
because as they are out there working in the field--as my 
fellow commissioner said--air deposition is very often 
impacting water; my staff need to be looking at the impacts of 
air and water together. And if I kept them organized by air and 
water, they just weren't able to do that. It was too difficult 
culturally for them to have that interaction. Now they are much 
more amenable to having such an interaction.
    Mr. Ose. All right. My time is expired. Mr. Otter.
    Mr. Otter. Thank you, Mr. Chairman.
    Ms. Nishida, in your testimony you indicated that you lack 
certain aspects of Mr. Horn's legislation which called for the 
establishment of a statistics bureau and creates an independent 
bureau within the EPA dedicated to environmental statistics. Is 
this something that you support, even though you indicated that 
you prefer the clean bill? But if in the restructuring of the 
EPA we were to establish that kind of a department, would you 
have a little more belief in the information that you get from 
EPA?
    Ms. Nishida. I think as you have heard this morning, 
managing data is one of the challenges that EPA has, along with 
the States. And so I think by creating a bureau of statistics 
or however we name that bureau, we would assist States in being 
able to assure more complete and accurate data. So to that 
extent, yes, I think that this would be an improvement with 
regards to looking at the structure at EPA.
    The question that I was pointing out was that some of the 
other provisions in the reform bill are more complex and may 
require more careful evaluation before proceeding and therefore 
might delay the elevation of EPA.
    Mr. Otter. Do you think it would be more advantageous for a 
Cabinet-level EPA Director to make those kind of important 
structural changes? Is the EPA director stopped from doing that 
now because she doesn't have Cabinet-level position to make 
those changes?
    Ms. Nishida. No. I think it would be hard for me to say 
that the EPA Administrator is prohibited now from doing that 
because she doesn't have the Cabinet-level status. I think what 
is important to point out that in her ability to interact with 
other Cabinet-level agencies, she needs to have the same level 
playing field.
    And I'll just give you one example. In the area of air 
quality regulations, she has to interact very closely with the 
Department of Energy and the Department of Transportation. What 
we have found at the State level, that some of the changes that 
are now being considered in air quality protection and 
statutes, EPA doesn't necessarily have the same level playing 
field and the same access to the information and to the 
decisions that we think that a Cabinet-level status might 
afford her. And as I mentioned, most of the States in the 
country have Cabinet-level environment departments. Certainly 
Minnesota and Maryland are two of them.
    Most recently, at the last ECOS meeting, which is the 
environmental commissioners across the country, they supported 
a resolution where the State commissioners recommended to 
Congress to elevate EPA. So this is something that is 
important, I think, at the State level to give the 
Administrator that equal footing.
    Mr. Otter. The term ``interaction,'' I'm a little confused 
by that. One of the other committees that I serve on is the 
Transportation Committee, and the subcommittee that I serve on, 
that has to do with water and also with pollutants, air 
pollutants. We've got a turnpike in New Jersey that is 6 years 
yet to be built because the EPA has not permitted it. We've got 
a bridge in Tennessee that's about the equal number of time. 
I've got a stretch of highway in my State that kills 34 people 
a year that we've not been able to go forward with on 
construction because we haven't gotten the EPA permit.
    What kind of interaction are you talking about? I mean, 
they can deny the permit. We can't go forward with the 
construction in transportation.
    Ms. Nishida. Well, again, certainly I'm not suggesting that 
there isn't communication between a Cabinet-level agency and an 
agency like EPA. What I'm suggesting, though, that on some of 
the important policy issues that are before this Congress in 
terms of what new steps that this country needs to move toward 
in terms of air quality initiatives that you have heard about 
recently like the President's Clean Skies Initiative--that 
those are the types of issues that we believe from a State 
perspective, that EPA should be on a level playing field, on 
equal footing with the other Cabinet agencies, because the 
environmental aspects of those policy decisions are critical 
and need to be considered in that equal footing.
    Mr. Otter. I understand that, but I'm also, I guess, 
concerned and maybe perhaps a little confused when you overlay 
the Clean Skies with the Jobs Initiative and you see that we've 
got over $14 billion in highway projects that are being held up 
that could put over 400,000 high-paying jobs to work in this 
country, and they're being held up because of one of the three 
environmental considerations.
    And the question is, are they dealing with true science? 
There's a conflict between the two that is greater--and not 
necessarily that the two goals can't be achieved, but right now 
it appears that they can't be achieved. And so whether it's 
agreements or whether it's ability to sit at the same table and 
make these kind of decisions, I would hate to arrive at a 
structure, whether it's at the Cabinet level or what, that 
makes it worse.
    Ms. Nishida. Well, I think you raise the issue of the 
dichotomy between economic development and environmental 
protection. And like you, I know that we can achieve both 
goals. They don't need to be mutually exclusive. They don't 
need to be necessarily adversarial in terms of their outcomes. 
And Congress has passed a law that requires that any 
transportation project, whether it's a highway project or a 
transit project, be able to conform with the Clean Air Act that 
you have also passed. And as a part of the responsibilities 
that EPA has to assure transportation and clean air conformity, 
they have had to take a close look at some of these 
transportation projects. I'm not familiar with the one, 
obviously, you're referring to. I can tell you that with 
regards to the transportation projects in the State of 
Maryland, we work very closely with our transportation 
counterparts. We work very closely with EPA in trying to 
resolve the conformity issue, because it is a very complicated 
and difficult issue to resolve. But I think that the fact that 
I'm a Cabinet-level agency gives me the greater ability in 
terms of dealing with my transportation colleagues. That's not 
to say that I want to put an obstacle to any transportation 
projects. We just have to understand what the environmental 
impacts are so that when we submit our State implementation 
plans to EPA to meet the Clean Air requirements, there is 
conformity.
    Mr. Otter. I understand that. Mr. Chairman, in the second 
round, I will come back and I will wonder out loud why the EPA 
took Maryland's Clean Air standards back and is now operating 
your Clean Air.
    Ms. Nishida. I can answer that.
    Mr. Ose. I thank the gentleman. Ms. Studders, it's clear 
that you and the Governor of Minnesota are certainly trying to 
innovate in how you address these challenges we face, and I 
admit to significant admiration for your efforts. How 
frequently do you seek to innovate? I mean, is it an ongoing 
process?
    Ms. Studders. Mr. Chairman, innovation is a tool that we're 
trying to foster within our staff, just like enforcement is a 
tool, just like writing a permit is a tool. I think what is 
interesting is that--I really do believe Minnesota has been an 
environmental leader in this country, and I think part of it is 
the pristine lakes we have in the Boundary Waters Canoe Area, 
and just the value that Americans place on that sort of real 
estate.
    The innovations start at the States, and Minnesota was one 
of the prime States that pushed for the Environmental Council 
of States to negotiate the agreement that the GAO talked about 
in their report that I read last night, between the States and 
ECOS. That was Project Excel, one of the agreements that we 
were trying to help fix that had been passed.
    I can tell you, Minnesota has similarly been very 
disappointed with the amount of hours we have put of staff time 
into innovations and for the lack of a result that's better.
    Mr. Ose. What kind of obstacles have you run into?
    Ms. Studders. When we sit down and work with companies that 
want to innovate and sit down with regional EPA, it's not 
uncommon to put 1,000 hours of staff time into talking about 
doing something; yet the permit is not even issued.
    Mr. Ose. Is it a conflict between a culture that relies on 
a prescriptive mandate versus a culture that looks at an 
outcome?
    Ms. Studders. Mr. Chairman, very much so. If you look at 
the Clean Air Act as an example, it's very prescriptive of how 
to protect the environment. It's not prescriptive as to what 
the goal is.
    Mr. Ose. But those standards of how to protect the 
environment were written in 1971 or 1972. Is that one of the 
problems we have here?
    Ms. Studders. Mr. Chairman, I believe the Clean Air Act was 
actually amended a couple of times.
    Mr. Ose. Well, the amendments that--we've had some 
amendments in the early nineties, for instance.
    Ms. Studders. Yes, I believe so; and that's why Minnesota 
wrote the Innovations Act that allowed us to not follow that 
prescriptiveness, so long as we were meeting the same CAA goals 
and allowed that to happen. I can tell you that we could not 
even have experimented with Project XCel if our State 
legislature had not passed that statute.
    Mr. Ose. Now, I'm told that in the past year or so, you 
haven't sought any EPA approval of innovative programs at 
Minnesota. Is that accurate?
    Ms. Studders. What I would believe is accurate--it's yes 
and no. We have two that we have further pursued, one with the 
Anderson facility and another with--I apologize. I believe it's 
an IBM facility. I may have the wrong name, but we have not 
tried anything else. That is correct.
    Mr. Ose. Why not?
    Ms. Studders. Because the amount of stakeholder time and 
the amount of staff time, in my mind, it's not cost-effective. 
And I'm probably the first MN commissioner that's saying, how 
cost-effective is this?
    Mr. Ose. So someone at the State may vet a program, or a 
proposal, more accurately, that gives a better environmental 
outcome in terms of level of emissions or pollutants that are 
put into the environment than the current prescriptive mandate.
    Ms. Studders. Yes.
    Mr. Ose. And the State of Minnesota has elected not to 
pursue that because the culture, if you will, at EPA doesn't 
seem to be very receptive to that?
    Ms. Studders. Mr. Chairman, I wouldn't be quite that broad. 
Minnesota still has its innovation statute on the books, and I 
have not asked that the legislature remove that by any means. 
We are operating under that statute with respect to several 
permits that we did successfully get through, where the State 
was able to make those decisions with delegated authority. But 
to the extent where we have to involve EPA, our success record 
has not been very good.
    Mr. Ose. So once you get into an area where there's no 
clear delegation of authority, that's when you tend to bog 
down; when there's a prescriptive element to any consideration 
you're making, there's little flexibility provided?
    Ms. Studders. Mr. Chairman, that is correct. And in 
fairness, we very often can get the flexibility at the region, 
and then we get stuck at headquarters.
    Mr. Ose. So the region might sign off on it, but then when 
it goes up the chain you get resistance?
    Ms. Studders. The closer you get to headquarters, the more 
you're involved with media management and very much the silos.
    Mr. Ose. The stovepipe issue?
    Ms. Studders. Yes.
    Mr. Ose. One of the things that occurs to me in listening 
to your earlier testimony is that you reengineered--these are 
my words, not yours--you reengineered your stovepipes in an 
effort to expedite this innovative process that you've created 
in Minnesota. It almost seems as if you reengineered to, 
frankly, more effectively deal with stovepipe challenges you 
face not the regional level but the national level. Am I 
accurate?
    Ms. Studders. I would say with our recent change, that is 
accurate.
    Mr. Ose. OK.
    Ms. Studders. For point of information, I think it's 
important to understand--if I could, Mr. Chairman--if we can't 
interact with EPA well at the State level, we stand to lose a 
significant amount of Federal funding.
    Mr. Ose. I understand.
    Ms. Studders. And in fairness to EPA, if we aren't 
organized in a way that can somehow interact with their 
existing structure, it does get to be problematic.
    Mr. Ose. The situation I'm most familiar with--and this may 
be the case up around Minneapolis, St. Paul--is that there is a 
mandate in terms of what can go into automobile fuel, even 
though industry tells us now that they can accomplish a more 
efficient outcome if they're allowed to use a different 
chemical or manufacturing process. And it's this kind of 
innovation that I want to find a way to encourage, as opposed 
to frustrate. It's outcome-based rather than legislatively 
mandated, and that's the thing I keep driving at with 
Minnesota's success.
    I'm trying to figure out how to, frankly, push that up the 
chain rather than have things sent down the chain. So I 
appreciate you coming.
    Ms. Nishida, I want to go to Maryland's experience. I've 
particularly followed the Chesapeake Bay program, and I'm 
highly complimentary of that. I do want to enter into the 
record the short synopsis that I have here about the agreement 
between the States and EPA. I do want to note publicly that the 
signatories to this document dated December 9, 1983 are the 
Commonwealth of Virginia, the State of Maryland, the 
Commonwealth of Pennsylvania, the District of Columbia, United 
States of America, and the Chesapeake Bay Commission. So we've 
had for roughly 20 years some evidence of an ability to 
interact successfully in a manner that leaves EPA, as I read 
this document, leaves EPA as the Chair of the Chesapeake Bay 
Council. Is that accurate?
    Ms. Nishida. No. What happens is--Mr. Chairman, the Chair 
rotates every year. And so this year it is Mayor Williams of 
the District of Columbia who was nominated by his peers to be 
the Chair of the Chesapeake Bay program.
    Mr. Ose. The balance is accurate, though?
    Ms. Nishida. Yes. The bay agreement that you're referring 
to is the one in 1983. Most recently, there was an agreement 
last year that set even higher goals with regard to our 
commitments, and actually set very ambitious goals that we are 
working now to achieve.
    Mr. Ose. Briefly, if you would, summarize those goals. Are 
they empirical in nature, or are they----
    Ms. Nishida. They are empirical in nature. One goal is in 
terms of wetlands. The Chesapeake Bay States have agreed to 
restore 25,000 acres of wetlands in the Chesapeake Bay area. 
Another goal is that we are going to reduce the negative impact 
of sprawl by 30 percent, I believe. I might have that exact 
percentage in error, but as you can tell from those two 
examples, they are empirical goals that the public can hold us 
accountable to.
    Mr. Ose. All right. Is that a dynamic program? In other 
words, you say this was adopted last year.
    Ms. Nishida. Yes.
    Mr. Ose. Do you periodically review it and update it?
    Ms. Nishida. Yes. It is a very dynamic program in which new 
goals are set. For instance, one of the goals that was 
originally set was that we were going to reduce the amount of 
nutrient pollution into the bay by 40 percent. That was to 
occur in the year 2000. We are now reevaluating that 
commitment, trying to understand whether we need to set new 
goals with regard to nutrient reduction and, as I alluded to, 
set new and different goals with regards to resource protection 
or land use.
    Mr. Ose. How do you get the science to determine what the 
goal should be?
    Ms. Nishida. We have a scientific advisory committee that 
is chaired by some of the eminent scientists within the region, 
and they essentially advise what we call the principal staff 
committee, which includes the Cabinet secretaries from amongst 
the region. They will make recommendations with regards to some 
of the scientific background and goals that the States should 
then set, and then we--it's our obligation to develop 
strategies to meet those goals. So there's a science and 
technical advisory committee that's created by the Chesapeake 
Bay program.
    Mr. Ose. So the science and technical advisory committee 
will look at the bay as a whole and say, all right, our 
analysis indicated that we've got a problem here, here, here 
and here, and those may be different media, obviously different 
geographic areas. Does the science and technical advisory panel 
also make a recommendation as to the priority with which the 
Chesapeake Bay program should proceed?
    Ms. Nishida. They do make recommendations with regards to 
priority areas that need to be addressed. One of the things 
that we have found over the years is that the Chesapeake Bay 
program is very comprehensive. It started out originally as a 
water pollution problem and had a water pollution focus. But in 
the last agreement I just referred to, there are goals on air 
pollution, there are goals on transportation, there are goals 
on brownfields.
    And so we have now, since the evolution of--since 1983, 
gone to the other media, and it is truly a much more 
comprehensive approach. It's not just a watershed-based 
approach, though it is primarily water-based focused.
    Mr. Ose. And EPA signed off on this?
    Ms. Nishida. Yes, and EPA has signed off.
    Mr. Ose. How is it that--I don't know how to put this 
delicately so I'm not going to try. How is it that you've been 
able to succeed in achieving, if you will, some cooperation on 
this, frankly, comprehensive approach, and yet Ms. Studders has 
some difficulty in creating the same kind of innovative 
approach in Minnesota?
    Ms. Nishida. Well, not knowing enough about, obviously----
    Mr. Ose. I mean, we may very well compare you to Minnesota, 
but I don't want to jeopardize Ms. Studders' job.
    Ms. Nishida. Right. Well, let me, I guess, describe what we 
think are the features that created the success with regards to 
the Chesapeake Bay program. One, we had the commitment from the 
highest levels of government, as you can see, and that 
document--it is the Governors who signed the agreement.
    Second, when the agreement was signed, all of the measures 
were voluntary, so that some of the goals that were to be 
achieved were going to be achieved through voluntary measures. 
What has evolved is we've realized it has to include a mix of 
regulatory measures.
    The third thing is that even though we set an overall goal 
for restoration of the Chesapeake Bay, each individual State 
can adopt their own individual strategies, so it's not 
prescriptive to the States in that sense. Maryland and Virginia 
take very different approaches to land use. We have a land use 
goal, but each State can meet it according to its own 
approaches.
    And then the fourth thing I would say is the very active 
involvement we have with our stakeholders. I mentioned the 
scientific community. We have also actively gone out to the 
regulated community--to the industry. We have businesses for 
the bay, which includes our chemical manufacturers. We have 
farmers for the bay. We have even, most recently, a 
homebuilders signed agreement to address the commitments in the 
Chesapeake Bay program.
    And so I think that, again, unprecedented level of 
cooperation, both at the government as well as the private 
sector, has contributed to our success.
    Mr. Ose. My time is expired. Mr. Otter.
    Mr. Otter. Ms. Nishida, when we left last, I had said that 
I would come back to you with a thought out loud about the EPA 
having to take over Maryland's air program. Why did that 
happen? Was Maryland not meeting these standards?
    Ms. Nishida. No. I'm glad you raised that. That's the title 
V program. What happened was EPA determined there was a 
deficiency in our title V program. The deficiency did not have 
anything to do with the air quality and protections of our 
regulations. Rather, it had to do with a legal issue of citizen 
standing. The Maryland citizen standing law is much more 
restrictive than the Federal Constitutional protections for 
citizens in terms of access to court. So EPA advised us that we 
had to correct that deficiency.
    We actually went into our legislature a number of times to 
correct environmental standing. Unfortunately, we were met with 
a lot of opposition from the business community, who were 
afraid of increased lawsuits as a result of having the broader 
standing. And, frankly, we were actually glad that EPA took the 
program back, because now as a result of that, the business 
community for the first time testified this January in our 
legislature in support of expanded standing, because they did 
not want to have to go to Philadelphia to get their permits.
    Mr. Otter. I understand that. We, I guess, had something 
like that happen to us similarly in Boise, and it is 
unfortunate, but you know when the question comes between the 
individual's Constitutional right, I don't think that ought to 
be diminished in any way. And having been a businessman, you 
know, I know how tough that can be.
    So perhaps with some of the tort reform that we have 
engaged in and what we've already passed in the House--and Lord 
knows what's going to happen to it in the other body--but 
perhaps we can correct some of that, while not diminishing the 
Constitutional standing of the individual in favor of anybody 
else, including the government. Hopefully we'll be able to go 
forward with that.
    Has the EPA ever taken over any other program, solid waste 
or water?
    Ms. Nishida. In terms of the State of Maryland, no. That 
was the first program that we lost delegation for, and 
unfortunately we had the dubious distinction of also being the 
first State in the country of losing title V delegation. But 
our hope is, because the legislation has now passed, though it 
hasn't come to the Governor's desk for signature yet, that we 
can get the program yet. We have not lost anything else.
    Mr. Otter. So because of the legalism rather than the 
presence of any problem that was going to endanger the 
environment, you lost the title V; is that fair?
    Ms. Nishida. That is fair.
    Mr. Otter. So that is not something that you would correct 
or try to find some sort of arbitration method for establishing 
a program where that didn't happen again?
    Ms. Nishida. No. We have found, at least in our region, 
where we have had difficulties with regards to program 
delegation, that we have been able to work it out with the 
region satisfactorily, so that we've been able to retain the 
programs.
    Mr. Otter. During your testimony, you spoke of the 
Chesapeake Bay, and I have to tell you when I first came to 
Congress--and I've only been here a few months, I guess 14 now, 
15.
    Mr. Ose. Seems like yesterday.
    Mr. Otter. Seems like yesterday. That one of the first 
gentlemen I met was a fellow by the name of Wayne Gilchrest. 
And Wayne had made a statement in the Transportation Committee 
that I was really concerned about. And I talked to him about 
it, and I said, I want to make you a deal, Wayne. I won't make 
any decision that adversely affects Maryland without talking to 
you. It doesn't mean I'm going to vote your way necessarily. 
And you won't make a decision that adversely affects Idaho 
without talking to me first. And you don't have to vote my way; 
just listen to my argument.
    I ended up voting for the Chesapeake Bay, I think it was 
$350 million for the Chesapeake Bay cleanup, simply because of 
that agreement with Wayne.
    And, you know, I hope that's the kind of cooperation that I 
hope will continue for me in this Congress, because so many 
times we try to do things in our own States and within our own 
little world that can adversely affect anybody else. And this 
inconsistency that we have coming from the EPA, Wayne and I 
have since had many, many opportunities to talk about things 
that are happening in Idaho.
    For instance, 3 years ago, we burned 880,000 acres of 
forest, and that's all on the watershed, and all of that 
water--and ostensibly we weren't allowed to go in and harvest 
or thin that forest on a sustainable yield, sustainable cut 
basis, because we would have degraded the watershed.
    I have since asked the EPA if they will make an 
environmental assessment of whether we do more damage to the 
watershed by burning it or do more damage to the watershed by 
going in and selectively harvesting it. And, by the way, Wayne 
is not fully my way yet, but he's coming my way.
    It is fortunate that States like Maryland have been able to 
work out a cooperative agreement on an important water body 
like the Chesapeake Bay, because it truly is a national 
treasure and something that we all ought to be concerned about. 
But I would have to tell you, if I hadn't had the opportunity 
to talk to Mr. Gilchrest, I probably would not have voted for 
that bill.
    Ms. Nishida. Well, we are obviously very proud of 
Congressman Gilchrest. He is our strongest advocate in the 
State of Maryland and obviously here on Capitol Hill, and so I 
will certainly pass on your comments to the Congressman.
    Mr. Otter. It doesn't change the fact that he can be a pain 
in the tree stump sometimes, but he's a great guy.
    Ms. Nishida. Me, too.
    Mr. Otter. Thank you. Thank you, Mr. Chairman.
    Mr. Ose. Wayne did that to you, too? I have to give 
Congressman Gilchrest credit. He is quite an operator up here. 
He did that same little dance with me, too. And I do enjoy 
working with Wayne.
    On the screen over here--you probably can't see it very 
well--but that is a chart of the organizational structure in 
the executive portion of the EPA under this and past 
Administrators. There are 22 direct reporters to the 
Administrator. The reason I put that up there is that I keep 
coming back to this issue of why is it that we can make 
something happen in the Chesapeake Bay that has been so clearly 
beneficial to the environment and the surrounding States, and 
we have such difficulty in a different region in making the 
same kind of thing happen.
    I've asked questions earlier, to the other panel in 
particular, about the various bills before us and whether an 
office of science, or office of implementation, or an office of 
enforcement are appropriate levels of management to basically 
collect and reconcile these decisions.
    Now, Ms. Studders, you said earlier, in response to a 
question on innovation, that it's very frustrating from your 
perspective in terms of staff and the like to pursue these 
things.
    Ms. Nishida, you indicate that last year the Chesapeake Bay 
program was updated to reflect a significant evolution in what 
its objectives were and that EPA signed off on it. Those are 
two diametrically different messages I'm getting here. And I'm 
trying to figure out structurally, is the problem in the 
structure where you have different regions who take different 
approaches? I mean, what is the impediment here? Ms. Studders.
    Ms. Studders. If I can, Mr. Chairman----
    Mr. Ose. You need to turn on your microphone.
    Ms. Studders. I'm chomping at the bit here to tell you 
something, and I would draw this parallel: I think that 
Secretary Nishida's example is a good one of a success. I don't 
want to leave you with the impression that Region 5 or 
Minnesota is not capable of similar success. Please. I believe 
the Great Lakes are being handled exceptionally well. We have 
eight States involved. I think there are five States in 
Chesapeake Bay--four.
    When you get multiple States involved, there's power in 
numbers at the State level. And when there's multiple States 
involved, I really do think EPA has come to the table a little 
differently, and I think part of that is because you have to go 
pretty high up at EPA when you're dealing with multiple States. 
I think we're managing the Great Lakes exceptionally well, 
considering they too are a treasure, and we're sharing them 
with an international partner, and I believe we have eight 
States around the Great Lakes.
    A similar successful example I would cite is down in the 
Gulf of Mexico where we were dealing with the hypoxia down 
there. I'm honored to serve on the congressional task force, 
but I can tell you it's a very different relationship when 
there's multiple States at that table.
    Mr. Ose. For what purpose, though? Why should that be 
different?
    Ms. Studders. I think it's pretty simple. I think when 
you're dealing with a permit with one State, you're dealing 
with an individual at EPA and that individual's supervisor or 
manager, and they're typically in a media-led program, and 
there's a right or wrong answer, primarily because they're 
concerned about litigation and having something upheld in 
court.
    I think when you're dealing with a much more policy-
orientation about how are we going to manage this resource and 
what sort of goals we should set to improve the quality of this 
resource, you're doing it much more methodically, much--very 
differently than the Clean Air Act or the Clean Water Act, and 
you're applying normal management skills to a problem.
    The issuance of permits and enforcements aren't normal 
management skills. They're very prescriptive output-measured 
ways of doing things.
    Mr. Ose. Ms. Nishida, do you want to add anything to that?
    Ms. Nishida. Well, I guess I would agree with my 
commissioner with regards to the two different aspects to 
interacting with the States and the structure that's before 
you. When you are dealing with a specific industry or a 
specific permit or enforcement issue and there are 
disagreements amongst the States, it's much harder to resolve. 
That is, even though we are obviously very successful with 
regards to our commitment to restore the Chesapeake Bay as a 
resource, as I mentioned, we were all left to our own devices 
in terms of how we protect that resource.
    What it comes down to, I guess, is sometimes in individual 
permit issues, Maryland may take a very different approach than 
Virginia EPA has to come in and then negotiate this, and that 
is not always easy with regards to resolving a very specific 
permit issue or enforcement issue.
    Mr. Ose. But you've proven that it can work?
    Ms. Nishida. Well, we have proven that it can work, as I 
mentioned, in terms of broad goals that we are trying to 
address. As I mentioned--take, for example, the wetlands goal 
in terms of restoring----
    Mr. Ose. 25,000 acres.
    Ms. Nishida. The 25,000-acre goal. We may, in Maryland 
approach that from a regulatory standpoint. In other words, we 
may choose to impose more prescriptive regulations to get the 
25,000 acres. Virginia may take a more incentive-based approach 
to do that.
    What I guess the strength of the Chesapeake Bay program has 
been is, you have outcome goals that you prescribe for each 
individual State, but you let the individual States prescribe 
how you're going to perform those outcomes. And I think the 
more that EPA tries to prescribe outcomes on States, that's 
when you run into more of the difficulty.
    Mr. Ose. You said that far more eloquently than I have been 
able to say that yet this morning.
    Mr. Otter.
    Mr. Otter. Ms. Studders, in your answering a question to 
the chairman during this last go-round of questioning, you 
indicated how much easier it was for five States to get 
together, or, I should say, how much easier it was to get 
something, some reaction from the Environmental Protection 
Agency; because several States get together, and that's 
precisely the reason when we write a memo to the chairman, we 
get as many other of our colleagues to sign that as we possibly 
can, to say that this is not just one individual.
    Now, let's take that from there to the private landowner or 
the private citizen, the private farmer, that you mentioned 
earlier. You know, for Archer Daniels Midland, or for some 
company like that to file for an environmental permit because 
they want to do something on 40 acres is much, much different 
than for the mom and pop that own that 40 acres and that's 
their equity, that's their livelihood, that's everything.
    And I don't know if you've ever filled out a--is it a 404 
national permit? Have you ever seen those 404 national--on 
wetlands? But to ask mom and pop to sit down at the breakfast 
table and to fill that thing out is absolutely impossible. And 
what's even more frustrating is when they call you and they 
say, Congressman, we went down to the local EPA and we went 
down to the local Army Corps of Engineers folks and asked them 
to do it, and they said we had to go hire somebody for $182 an 
hour. We had to go hire an environmental engineer to do that.
    If we're truly the servants of the people, why is it that 
we don't engage in the EPA, folks like we do in the IRS, and 
some now in the IRS; because if you walk in and you've got a 
major tax problem, they assign somebody to sit down, and they 
don't charge you, and they guide you through the process so 
that you can fill out something as important every year as your 
tax return.
    Why can't we do that for folks with a 404 national permit 
so that they can dig an irrigation ditch on their property or 
so that they can build something on their property? Why don't 
you get those five States together and go to the EPA folks and 
say, why don't you simplify the permit so that it's a one-page 
thing and mom and pop can sit down at the breakfast table over 
a cup of coffee and have some sort of control over their life 
and their property?
    Ms. Studders. Mr. Chairman and Mr. Otter, I will see if I 
can do justice to that very well-worded question. I'm going to 
try to simplify it, because I think that's part of the core of 
what we're all grappling with in how we improve environmental 
protection in this country with limited resources.
    The world of pollution has changed in America. And I can 
quote you the Minnesota statistics, not the national, so I'll 
keep it to my home turf that I'm much more familiar with. I 
won't use the 404 form per se, but I'll say when the 
regulations were written to create such a document, most of the 
air pollution and the water pollution was coming from large big 
sources, corporations, factories with many employees and very 
complicated equipment, and it was appropriate to start 
ratcheting down the emissions coming from that equipment.
    In Minnesota, to give you an example, it was primarily our 
air pollution and our water pollution. Those complicated forms, 
they probably had an environmental engineer on staff who 
understood and actually operated that equipment and could fill 
it out. That's what the laws were written for.
    Thirty years later in Minnesota, we have a very different 
story. Air is almost 50-50. It's 43 percent coming from our 
regulated businesses and 57 percent coming from things I can't 
even regulate, that the Clean Air Act doesn't touch--
automobiles and energy. That's where our air pollution is 
coming from. It's not coming from the points that I regulate.
    Water, it's much more disparate. Only 14 percent of our 
water pollution in our State is coming from the factories where 
we regulate their discharge from the pipes, from the wastewater 
treatment facilities, and from the businesses that are treating 
their water before it's discharged. We're the land of 10,000 
lakes and we do not have an ability to get our arms around 85 
percent of the water pollution in our State with the existing 
Clean Water Act!
    The way we have chosen to start remedying this in Minnesota 
was, we took the feedlot issue first. We are primarily an 
agricultural State. Our main source of revenue is agriculture, 
and we're very proud of our farmers. And we started 
inventorying our farms. We estimated that we had 80,000 farms 
in Minnesota. January of this year, we received applications 
for feedlots numbering 40,000, and we know we have not had the 
entire regulated community--we probably come in about 50 
percent. We created a general permit, which the Clean Water Act 
does allow us to do and the Minnesota comparable law does, and 
we're issuing general permits to small farmers, a very simple 
form. He or she can sit down at the breakfast table and fill 
that form out with their spouse.
    If you're a large CAFO in Minnesota, you're filling out a 
much more detailed form as prescriptively regulated by the 
Clean Water Act, but we feel you're capable of doing that. If 
you're Archer Daniels Midland, you have people on board that 
understand the ramifications of a facility of that size and 
understand how to operate a facility of that size responsibly 
and can fill that out. So we've handled it very differently.
    Mr. Otter. Thank you, Mr. Chairman. Thank you.
    Mr. Ose. I have nothing further.
    I want to thank our witnesses today. We're going to leave 
this record open for 7 days. We have some questions that may 
arise here as we think about this over the next 24 hours. We'd 
like your cooperation if we send them to you, to have a 
response in writing.
    We stand adjourned. Thank you both for coming.
    [Whereupon, at 12:12 p.m., the subcommittee was adjourned.]


          EPA CABINET ELEVATION: AGENCY AND STAKEHOLDER VIEWS

                              ----------                              


                         TUESDAY, JULY 16, 2002

                  House of Representatives,
  Subcommittee on Energy Policy, Natural Resources 
                            and Regulatory Affairs,
                            Committee on Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 3:05 p.m., in 
room 2154, Rayburn House Office Building, Hon. Doug Ose 
(chairman of the subcommittee) presiding.
    Present: Representatives Ose, Duncan, Otter, Cannon, 
Tierney, Waxman, and Kucinich.
    Staff present: Dan Skopec, staff director; Jonathan Tolman, 
professional staff member; Yier Shi, press secretary; Allison 
Freeman, clerk; Greg Dotson, Elizabeth Mundinger, and Alexandra 
Teitz, minority counsels; and Jean Gosa, minority assistant 
clerk.
    Mr. Ose. Good afternoon and welcome to today's hearing of 
the Subcommittee on Energy Policy, Natural Resources and 
Regulatory Affairs. The subject today will be EPA Cabinet 
Elevation: Agency and Stakeholder Views.
    Mr. Waxman has come in and Mr. Tierney will be back 
shortly.
    The issue of elevating EPA to Cabinet level status has been 
around since the day after the Agency was created in 1970. In 
the years since its inception, Congress has passed numerous 
environmental statutes expanding the jurisdiction of the EPA. 
As its jurisdiction has expanded, the Agency has grown as well. 
Today with more than 18,000 employees at work, EPA has an 
annual budget of $7.5 billion.
    It is important to note that elevating the EPA to a Cabinet 
level department will not in and of itself change the Agency's 
size, jurisdiction, or effectiveness. The act of creating a new 
Cabinet level department is largely symbolic. The important 
thing is how and why Congress elevates the EPA, as it may 
fundamentally affect not only how the EPA operates, but also 
perceptions of the agency and the importance of environmental 
issues.
    Two bills have been referred to this subcommittee to 
elevate EPA to a Cabinet level department. The first, by 
Representative Sherry Boehlert, is H.R. 2438 and the other is 
by Representative Steve Horn, H.R. 2694. The bills take 
radically different approaches. One offers no reforms to the 
Agency and the other offers a multitude of reforms. The 
principal question facing our subcommittee at this hearing is 
what, if any, reform should Congress explore in the process of 
elevating EPA to a Cabinet level department?
    At our first hearing in September, we heard from the 
sponsors of the elevation bills. In addition to them, a number 
of policymakers from the academic community testified about 
whether elevation should proceed with or without certain 
legislative reforms. At the second hearing last March, we heard 
from EPA's IG and the General Accounting Office. Both 
identified numerous organization and management challenges 
faced by the Agency. In addition, we heard from State 
Environmental Protection Agency heads. Most of our major 
environmental laws are delegated in some fashion or the other 
to the States. State agencies are not only the work horses when 
it comes to environmental protection, but are also innovative 
leaders. This as yet unchallenged assertion begs any number of 
questions, some of which I hope to get to today.
    When EPA was created in 1970, this country faced widespread 
and daunting environmental challenges. We have made great 
progress in the cleanup of large industrial pollution that 
plagued our Nation 30 years ago. Many of the pollution problems 
we face today come not from large industrial sources but from 
the actions of every day citizens, from our cars, our yards, 
our homes, our cities, and our farms. These are more complex 
and intractable concerns that seem to defy the simple solutions 
mandated by the first wave of environmental laws.
    While elevating EPA to a Cabinet level department is an 
important gesture, it is clear that more flexible and 
innovative approaches are needed to find solutions to the 
second wave or second generation of environmental problems, not 
just for the problems we face today, but for the environmental 
problems that we will undoubtedly face in the future.
    By 2025, the population of the United States is expected to 
reach more than 335 million people. That means we will have 50 
million more people than we have now. Think about the amount of 
food, water, housing, and energy consumed by an additional 50 
million people. It understates the case that this could put a 
strain on our environment. If we are to prepare for these 
changes, we must begin to think about different approaches to 
environmental regulation. The old command and control approach 
won't get us where we need to go. It is largely inflexible and 
some of the compliance costs are excessive. The time has come 
for us to look at innovative ways to manage our environment. 
High standards of environmental protection are a must, but 
individuals must have the flexibility to meet those standards 
in new ways. Government bureaucrats should not be environmental 
bean counters but instead, environmental managers. The goal 
should not be the number of permits issued or the amount of 
money spent, but rather, the ultimate result which is a cleaner 
environment.
    While we do face some daunting problems, there are some 
reasons to be hopeful, areas where environmental innovation and 
experimentation have worked. For example, the 1990 Clean Air 
Act amendments, in which many of my colleagues on this panel 
participated, introduced the novel concept for controlling 
sulfur emissions from powerplants. Instead of requiring 
specific clean technology at every plant, sulfur emissions were 
capped as a whole for the whole country. Powerplants were 
forced to either reduce their own emissions or buy credits from 
other plants that were in fact reducing emissions even further 
than they were required. At the time, environmental economists 
predicted this would be a more efficient way to reduce 
pollution and in fact, the program was even more successful 
than had been predicted, with powerplants reducing sulfur 
pollution even more effectively than anyone had thought.
    To its credit, this administration has seen the success of 
such emissions trading programs and is seeking to expand them. 
The administration's Clear Skies Initiative seeks to expand air 
emissions trading beyond merely sulfur emissions. In addition, 
EPA recently proposed a water quality trading policy that 
promotes the use of pollution reduction credits for trading in 
watersheds.
    As our committee looks at elevating EPA, we want to ensure 
that the Agency has an organizational and management structure 
that allows such successful, innovative environmental policies 
to be the rule, not the exception. Today's witnesses include 
the Administrator of EPA, Governor Christine Todd Whitman; the 
chairman of the Council on Environmental Quality, Mr. James 
Connaughton; the president of Environmental Law Institute, Mr. 
J. William Futrell; vice president for Environment and 
Regulatory Affairs, U.S. Chamber of Commerce, Mr. William 
Kovacs; and a senior fellow for environmental economics, 
Natural Resources Defense Council, Mr. Wesley Warren.
    [The prepared statement of Hon. Doug Ose follows:]
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    Mr. Ose. I would now like to yield to my friend from 
Massachusetts for the purpose of an opening statement.
    Mr. Tierney. Thank you, Mr. Chairman.
    I am going to submit my statement for the record and allow 
the witnesses to testify.
    I would simply say I hope we can move the EPA up and 
elevate it to the status I think it deserves and warrants. I 
would note the Congressional Research Service found that of 198 
governments worldwide, all but 9 include their environmental 
agency at the administerial level. I am hoping we will be able 
to do that with a clean bill and not get bogged down on the 
internal machinations of how the Environmental Protection 
Agency works.
    With that, I yield the balance of my time and submit my 
statement for the record.
    [The prepared statement of Hon. John F. Tierney follows:]
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    Mr. Ose. The gentleman's statement is accepted for the 
record without objection.
    The vice chairman of the subcommittee, Mr. Otter.
    Mr. Otter. No.
    Mr. Ose. My good friend from Los Angeles and Beverly Hills, 
Mr. Waxman.
    Mr. Waxman. Thank you very much, Mr. Chairman. As a result 
of redistricting, it is Los Angeles, Beverly Hills, and many 
other cities.
    I am pleased to see Administrator Whitman here today.
    I have long supported the elevation of EPA to a Cabinet 
level department because of the great importance of its job and 
the respect I have for the EPA staff. The American people 
should take pride in the performance of this Agency over the 
last decade. Most of the staff at the EPA are professionals who 
care deeply about their work. These government employees have 
chosen their careers because they want to protect public health 
and the environment. Over the past decade, they have had a long 
list of successes.
    In the 1990's, EPA worked with industry, the States, and 
environmental groups on initiatives such as updating health-
based air pollution standards, attacking powerplant emissions, 
cleaning up automobiles and diesel engines, and finally, 
working to clean up the Nation's rivers and streams, and 
starting to address one of the most serious environmental 
challenges we face, global warming.
    EPA vigorously enforced the law. They caught diesel engine 
manufacturers redhanded. EPA found that the Caterpillar Corp. 
and some other companies had sold diesel engines that illegally 
emitted millions of tons of air pollution. EPA investigations 
revealed that electric utilities were flagrantly violating the 
Clean Air Act, spewing some 5 million tons of illegal air 
pollution each and every year.
    Yet with grave disappointment, I have to note the sea of 
change that has occurred in the last year and a half. Under 
strong pressure from the White House, EPA appears to be in 
active retreat from the central purpose of the Agency. Indeed, 
the progress of the last decade is quickly being undone by the 
Bush administration. For this reason, I question whether this 
is the right time to be discussing elevating EPA to a Cabinet 
department.
    Last month, Administrator Whitman announced that she would 
weaken the Clean Air Act's New Source Review provisions, 
placing EPA's pending enforcement actions in jeopardy. Then EPA 
joined the White House Office on Management and Budget in 
announcing it would consider weakening the recently upheld 
rules to clean up diesel engines. These actions, if carried 
through, will be a major rollback of our clean air program and 
could well leave children throughout the country exposed to 
unacceptable levels of air pollution.
    It seems every day we learn of a new rollback being pushed 
by the Bush administration. Just this weekend, we learned that 
EPA is considering a plan to jettison efforts to clean up 
polluted runoff and yesterday the trade press reported that 
Administrator Whitman may backpedal on penalties for not 
complying with diesel engine emission standards. Without 
sufficient penalties, companies won't bother to clean up their 
engines and the health of the American people will suffer as a 
result.
    Today I have learned that EPA is considering requiring the 
States to weaken their air pollution laws. I would like to 
introduce a letter into the record from the State Air 
Administrators on this issue.
    It is a terrible thing for the Federal Government to ignore 
its duties to protect public health and the environment, but at 
least you would expect EPA to let the States do the job if EPA 
won't. News that EPA would consider preventing the States from 
more aggressively targeting air pollution is truly an outrage.
    With regard to environmental policy, this administration 
has acted abysmally and EPA's interactions with Congress have 
been no better. Over the last year and a half, EPA has resisted 
necessary congressional oversight, apparently at the direction 
of the White House. In fact, EPA has been stonewalling 
information requests I have made for months. This is not a 
partisan issue. The Constitution provides Congress with 
oversight authority, yet both Republicans and Democrats alike 
have been critical of EPA's responsiveness to the congressional 
oversight requests.
    Good government requires responsiveness without resorting 
to subpoenas. EPA must address congressional concerns in a 
prompt, non-partisan manner, and I am looking forward to 
hearing from Administrator Whitman on what changes she will 
make at the Agency to ensure that EPA's poor record in 
communicating with Congress is immediately improved.
    Mr. Chairman, for more than 10 years, I have supported 
elevating EPA to a Cabinet level position and I still support 
this goal but I don't think it would do much good under this 
administration. The whole purpose of elevating EPA is to 
enhance environmental protection, but this administration seems 
bent on undermining, not strengthening, our environmental laws.
    Mr. Ose. Does the gentleman have a letter he wishes to 
enter into the record?
    Mr. Waxman. I have a letter I would like to submit for the 
record.
    Mr. Ose. Without objection.
    [The prepared statement of Hon. Henry A. Waxman and the 
information referred to follow:]
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[GRAPHIC] [TIFF OMITTED] 82666.131

    Mr. Ose. The gentleman from Tennessee.
    Mr. Duncan. Thank you, Mr. Chairman.
    Thank you for calling this hearing.
    After spending my 6 year limit chairing the Aviation 
Subcommittee, I now chair the Water Resources and Environment 
Subcommittee. In that role, we have many contacts with the EPA. 
I can tell you the EPA has been very responsive to that 
subcommittee, both to the majority and the minority. There is 
just no way they could have been more responsive.
    My dad told me many years ago that everything looks easy 
from a distance. The longer I live, the more truth I see in 
that statement. It is easy to criticize but I said at one of 
the hearings of my subcommittee that I thought Administrator 
Whitman had perhaps the most difficult, if not the most 
difficult, one of the most difficult jobs in entire Federal 
Government because it is extremely difficult to reach that 
delicate balance that we need to make sure we don't hurt the 
poor, the lower income, and the working people in this country 
because if we go overboard on anything, you can take any good 
thing to extremes. If we go overboard in things that may sound 
good on the surface, you destroy jobs, drive up prices, and 
hurt the poor, and lower income, and the working people most of 
all.
    I think Administrator Whitman has been doing a really 
outstanding job. I think we do have some serious questions we 
need to look at in regard to whether to elevate the EPA. The 
big question would be, what could the EPA do then that they 
could not do now. That is sort of the threshold question.
    We got a Congressional Budget Office report last week that 
said it is going to cost us at least $3 billion to create the 
Homeland Security Department, just to implement it. I assume 
there would not be any similar type cost here, but we have to 
look into all of these things.
    I just want to thank you and Chairman Connaughton for being 
here. He is also in a difficult position. I want to thank you. 
You didn't come to my district but you did come close, to the 
First District of Tennessee, a few days ago with Sandra Friez 
attempting to work with the Congress. I hope you had a nice 
visit to the Smokies. I represent about half of the Smokies. I 
have the Second District. I appreciate your being here with us 
today and I look forward to hearing your testimony.
    Thank you very much, Mr. Chairman.
    Mr. Ose. Thank the gentleman.
    As our witnesses have come to know, in this committee we 
swear in everybody, it doesn't matter who you are. So if you 
would both please rise.
    [Witnesses sworn.]
    Mr. Ose. Let me again welcome you both to our humble 
committee.
    We will first have the Administrator of the EPA offer her 
testimony and then we will have the chairman of the Council on 
Environmental Quality offer his. We have received your written 
testimony and it has been entered in the record. We would like 
you to summarize your testimonies within 5 minutes each, so we 
can go to the member questions.
    Welcome, Administrator Whitman.

     STATEMENTS OF CHRISTINE TODD WHITMAN, ADMINISTRATOR, 
    ENVIRONMENTAL PROTECTION AGENCY; AND JAMES CONNAUGHTON, 
           CHAIRMAN, COUNCIL ON ENVIRONMENTAL QUALITY

    Administrator Whitman. I want to thank you and the members 
of the committee for the opportunity to be here this afternoon 
to talk about something I think is of great importance, 
particularly to the environment and to the American people, the 
elevation of the Environmental Protection Agency to the level 
of department.
    It was over 30 years ago that President Nixon affirmed 
America's commitment to the environment by creating the 
Environmental Protection Agency. Since that time, the EPA has 
worked to fulfill its mission, protecting human health and 
safeguarding the natural environment. We have witnessed this 
mission take on a whole new meaning since the attacks of 
September 11th of this past year. As we have seen, EPA plays a 
critical role in protecting our homeland with responsibilities 
that range from responding to chemical or biological attacks to 
protecting our Nation's water supply. These responsibilities 
underscore the significance of the Environmental Protection 
Agency.
    However, despite the crucial nature of these new 
responsibilities, the importance of the EPA is not a new 
phenomenon. Since its creation in 1970, the EPA has worked to 
preserve the quality and safety of some of our most basic 
needs--the water we drink and the air we breathe. The EPA has 
helped develop a national appreciation for our natural 
resources and an understanding of the integral role that they 
play, not just in our economic prosperity but also in our 
everyday life.
    Economic prosperity and protecting the environment are two 
of the paramount goals of American life. EPA is charged with 
finding that balance between those two issues to ensure that 
America remains both economically strong, but as importantly, 
environmentally safe and healthy for the public that we serve.
    Fortunately, over the years EPA has enjoyed the support of 
Congress and the White House. Establishing EPA as a Cabinet 
level department is not a new idea. The first bill to elevate 
the EPA was introduced in the Senate in 1988 and since that 
time, a dozen similar proposals have been introduced.
    Similarly, former President Bush showed his support by 
becoming the first President to support elevating EPA to 
Cabinet level and involving then Administrator Riley in the 
Cabinet meetings and according him Cabinet level status. 
President Clinton and President George W. Bush have followed 
suit, both supporting legislation and including the EPA 
Administrator in the Cabinet. These actions emphasize the 
importance that past administrations and our current 
administration put on the environment.
    Environmental protection is critical to our public health's 
security and economic vitality as are the responsibilities that 
are under the jurisdiction of other Federal level departments. 
Indeed, EPA works closely with many of those departments with 
areas of responsibility often overlapping. As an example, EPA 
is currently working with other Cabinet level departments, 
emergency response teams, and independent experts to address 
bioterrorism threats and to develop effective remediation tools 
for protecting our Nation's critical infrastructures and the 
health and safety of the American public.
    Elevating EPA to Cabinet status will ensure that this type 
of cooperation and integral working relationship will continue 
into the future. The environment is not just a domestic issue. 
It continues to play a central role in international relations 
as well. This legislation will bring the United States on a par 
with other G8 countries and more than 60 others by establishing 
a Secretary for the Environment. The time has come to establish 
EPA as a full member of the Cabinet. Doing so would be 
consistent with over 30 years of environmental work and 
accomplishments and with the status of our international 
partners.
    I am pleased that many in Congress support this crucial 
step. The bill Congressmen Boehlert and Borski have introduced 
would elevate EPA to Cabinet level status and provide the 
Agency with the flexibility that it needs in that transition. I 
would like to urge the committee to avoid any extraneous 
amendments to the bill and to strictly limit any changes to 
those that would improve organizational efficiency and 
streamline management. I am requesting your support in 
achieving this goal.
    Making sure all Americans have clean air to breathe, pure 
water to drink, and unspoiled landscapes to enjoy, and 
contributing to the safety and the security of our homeland, 
this encompasses the mission of the Environmental Protection 
Agency and it is a mission that deserves our full support, the 
full support of Congress, that Cabinet level status will bestow 
on the Agency. Creating the Department of Environmental 
Protection will ensure that our environmental and public safety 
mission will continue to be a high priority both today and in 
the future.
    Thank you very much for your time and attention. I will be 
happy to answer questions once the chairman has finished his 
testimony.
    [The prepared statement of Administrator Whitman follows:]
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    Mr. Ose. We thank you for your testimony, Administrator 
Whitman.
    Now, we welcome the chairman of the Council on 
Environmental Quality, Mr. James Connaughton, for 5 minutes.
    Mr. Connaughton. Good afternoon.
    Thirty years ago, it fell to my predecessor, Russ Train, 
the chairman of the first Council on Environmental Quality, the 
task of helping advance the creation and the establishment of 
the Environmental Protection Agency. It is my pleasure to sit 
here today, as the current chairman of the Council on 
Environmental Quality, and take part in advancing the next 
critical step in this agency's evolution; that of a Cabinet 
level agency.
    I am pleased to share this panel with my colleague, 
Administrator Whitman, with whom I have enjoyed a wonderful 
year of close collaboration and significant environmental 
progress.
    In EPA's short history, its work has helped transform the 
way Americans view the environment. It has planted in the 
American consciousness a clear sense of environmental 
stewardship. Over this period, EPA has taken on the qualities 
we would expect and taken on the mission that we would expect 
of a Cabinet department. First, EPA carries out the work of a 
Cabinet department. EPA started out by overseeing four major 
environmental statutes. Today, EPA implements 15 major statutes 
and numerous others, as well as a full complement of grant 
programs, voluntary initiatives, technical assistance and 
educational programs, and citizen outreach throughout the 
Nation.
    EPA advances the mission of a Cabinet department. EPA is 
reaching out to develop new approaches that promote 
stewardship, spur innovation, instill sound science in its 
decisions, advancing federalism through greater involvement of 
State and local government, and ensuring compliance.
    EPA also plays the vital role of a Cabinet level department 
in defense of our homeland security. Their expertise is 
essential for a Federal response to an act of terrorism that 
involves a release of biological, chemical, or radioactive 
material.
    EPA produces initiatives of national significance that one 
would expect of a Cabinet department. EPA designed and is 
advancing the President's Clear Skies Initiative, which would 
cut the Nation's powerplant emissions of sulfur dioxide, 
nitrogen oxide, and mercury by 70 percent. This initiative will 
enable hundreds of counties across the Nation to meet national 
air quality goals.
    EPA possesses the international standing of a Cabinet 
department. Our laws, regulations and standards have been 
adopted by nations across the globe. EPA's scientific and 
technical expertise is respected worldwide and is increasingly 
being deployed worldwide.
    Finally, EPA's Administrator fulfills the role of a Cabinet 
Secretary. When President Bush took office, he welcomed 
Governor Whitman to his Cabinet. As EPA Administrator, Governor 
Whitman serves the Nation as a core member of the President's 
leadership team.
    In sum, in the Bush administration EPA carries out the work 
and advances the mission of a Cabinet department. In the Bush 
administration, the EPA Administrator has the stature, the 
standing, and the authority of a Cabinet Secretary. The Bush 
administration therefore looks forward to working with the 
committee to advance EPA Cabinet status legislation, and to 
make official what in this administration is already a reality.
    Thank you.
    [The prepared statement of Chairman Connaughton follows:]
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    Mr. Ose. Thank you, Mr. Chairman.
    We will now go to questions from Members. Each Member will 
be given 5 minutes. If a second round of questions is 
necessary, we will have one. I am going to claim time first.
    My first question is for the Administrator. Governor 
Whitman, in the past you have talked about moving EPA toward a 
results oriented environment. I actually had the liberty of 
going back and reading some of your recent speeches, which I 
found enlightening because embedded in all your remarks is a 
real focus on making this results oriented policy approach 
stick.
    The biggest problem is how do you change a large ship's 
direction in a short period of time? I guess the question we 
would have is how do we ensure that the agency will keep moving 
in the direction you are trying to lead, which is a results 
oriented approach? Is this legislation, whether Congressman 
Boehlert's, or Congressman Horn's, or some mix of that, is 
there something we can use to assist you in this task?
    Administrator Whitman. Mr. Chairman, the legislation in and 
of itself is not going to change the focus or the purpose of 
how we administer the agency. The focus on the results oriented 
approach is one that we are integrating into all our planning 
now of budget and all of our prioritization.
    As Congressman Waxman pointed out, we have an 
extraordinarily dedicated staff of professionals, people who 
are committed to making environmental progress. They have 
welcomed the idea of measuring environmental progress by real 
positive changes to the environment. I believe as we continue 
to move forward in this way, we are going to institutionalize 
this approach. As we develop our environmental report card, 
which we are in the process of developing and hope to have 
ready before the end of the year to show where we are today and 
the status of the environment and where we hope to go, that 
will also help determine that approach to the environment for 
the Environmental Protection Agency is one that is going to 
continue long after this Administration.
    Mr. Ose. I do appreciate your touching on the future 
because I scribbled in a little note here that none of us lasts 
forever, so it is a concern that we find a way to get this 
results oriented, empirically measured policy approach in 
place.
    Chairman Connaughton, the Government Performance Results 
Act has created a general framework for agencies to establish a 
mission, set goals and objectives to achieve that mission, and 
then measure empirically the outcome of these policies and 
projects to see if they achieve that. Would it make sense for 
Congress to more proactively establish a statutory mission 
statement for EPA?
    Mr. Connaughton. I think right now we have a well 
established framework for EPA's mission, which began with the 
National Environmental Policy Act, in terms of its overall 
goals and then the kind of statement you just heard 
Administrator Whitman articulate, I think they have one at hand 
that could be looked at.
    I think a goals statement is important but it is also 
important to leave the future Cabinet Secretary the flexibility 
to have that mission statement evolve as circumstances evolve. 
Certainly in your comments you reflected, Mr. Chairman, the 
fact that we have had a long and quite rewarding history of the 
regulatory apparatus in place in terms of the benefits it has 
delivered, but we are at a stage where we need new tools and 
new focus to make even greater progress with greater innovation 
and less cost. Certainly I wouldn't want to lock us into a 
particular construct, so I would want to be flexible on the 
goals side.
    Specifically, in terms of advancing the metrics and the 
mission of the Government Performance and Results Act, we are 
dedicated to making that happen. EPA has actually made 
substantial strides in making real progress in articulating the 
kinds of metrics you just discussed. Certainly the Office of 
Management and Budget is a key supporter of that and certainly 
in the President's budget submission this year, we made it a 
first and critical step in beginning to identify some key 
indicators on which we will measure agency performance. Those 
indicators were worked out in close collaboration with the 
agencies themselves.
    Mr. Ose. Are those indicators, the metrics you speak of, 
available for congressional review or input or are they 
guidance documents?
    Mr. Connaughton. The initial steps are actually articulated 
in the President's budget submission to Congress, so we are 
actually looking forward, as we get into the rest of the budget 
season, to quite an extensive conversation about those.
    Mr. Ose. Thank you, gentleman.
    The gentleman from Massachusetts.
    Mr. Tierney. Thank you, Mr. Chairman.
    I thank the witnesses for being here today.
    During the course of your time in this office, there has 
been a great deal of criticism about what some perceive as an 
attempt to weaken the broad range of environmental protections, 
whether carbon dioxide, or the New Source Rule, the Clean Skies 
Initiative, things of that nature. Over the weekend, the 
Washington Post reported that you might be planning to reverse 
the previous administration's watershed protection rule that 
requires the EPA approval of State plans for cleaning up lakes 
and rivers. Is that an accurate report? Are you, in fact, 
planning to change those rules?
    Administrator Whitman. We are looking and our mission is to 
see how we can best implement all the rules we have before us. 
We are looking at how we provide the States the kind of 
flexibility they need to deliver on a watershed-based approach. 
We are not talking about backing away from any of our water 
regulations, we are not talking about rolling back any of our 
Clean Water regulations or Drinking Water regulations. In fact, 
I spent the morning talking with all the regional 
administrators and assistant administrators on the budget, and 
water was one of the first areas that came up for discussion 
and a recommitment or an insurance that we are going to advance 
the goals of Clean Water in this country.
    Mr. Tierney. How is it that you say that moving away from 
the current regulation put in by the last administration, how 
is that going to specifically move us forward in that 
direction?
    Administrator Whitman. We are not moving away from any 
regulation that the Agency has developed. What we are looking 
at is a watershed-based approach as a more comprehensive way to 
get at the kinds of challenges we face today. As the chairman 
mentioned, one of the biggest issues we face is nonpoint source 
pollution, particularly to our watersheds. It comes from 
behavior of individuals in places far from where the waters 
drain along our coastal waters.
    What we need to do is encourage a watershed-based approach, 
and we are looking at how do we help the States with that kind 
of planning and identifying their most vulnerable watersheds, 
what do we do to educate the public? But we are not in the 
process of rolling back any regulations that would ensure that 
we continue to comply with the Clean Water Act.
    In fact, as you know, we have new standards that were put 
in place in 1998. What we are looking at is how do we enable 
the States to form a partnership that will leverage the 
enormous number of dollars that are going to be required to 
meet the new standards.
    Mr. Tierney. So States will still need EPA approval before 
moving ahead with their plans?
    Administrator Whitman. Excuse me?
    Mr. Tierney. States will still need the EPA's approval 
before moving forward with any plans they have with respect to 
cleanup?
    Administrator Whitman. At this point in time, we are 
anticipating continuing to work very closely with States and 
tribal governments as our partners. We will look and make sure 
that plans they put forward are going to achieve the goals of 
the Clean Water Act.
    Mr. Tierney. Right now it needs EPA's approval before any 
plan goes forward? Are you still going to retain that aspect?
    Administrator Whitman. At this point in time, we are still 
retaining everything, but we are looking at what is the best 
relationship to have and how do we ensure that we leverage all 
our resources.
    Mr. Tierney. If you are going to attempt any action that 
would do away with the EPA's approval of those plans, would you 
do it through a public rulemaking process?
    Administrator Whitman. Yes. If we did anything, it would be 
through a public rulemaking process. What you are talking 
about, I believe, is the Total Daily Maximum Load regulation?
    Mr. Tierney. Yes.
    Administrator Whitman. That article, that was put on hold 
by the Congress by the Clinton administration, so that 
regulation has been on hold. We have continued that hold as we 
have worked. It is an enormously challenging rule. It requires 
setting a standard for every single pollutant, of which there 
are literally hundreds in some States. Each State has to do 
that and we are trying to work with the States to see how do we 
best do that, what is the smartest way to do it, how do we 
enable them to do it, do we identify those that are most 
troublesome from a pollutant perspective first. At this point 
in time, we are not talking about rolling back; we are just 
trying to make it more effective.
    Mr. Tierney. Thank you.
    Mr. Ose. The gentleman yields back.
    The gentleman from Idaho for 5 minutes.
    Mr. Otter. Thank you, Mr. Chairman.
    Administrator and Mr. Chairman, thank you for being here 
today. I was particularly interested in the questions being 
framed by my colleague from Massachusetts in terms of watershed 
protection.
    Madam Administrator, do you feel that elevating the 
position of the Administrator of the EPA to Cabinet level post 
would also probably provide you the opportunity to provide 
greater national focus on certain issues that may be facing the 
Environmental Protection Agency and watershed protection? Do 
you agree with that?
    Administrator Whitman. Congressman, at this point we enjoy 
a very good relationship with the States, a very good 
relationship with our other Federal partners, and I am not sure 
the elevation would necessarily change that particularly. The 
issues that we face are of such national significance that they 
get a lot of attention, as we have seen recently, but 
certainly, having the Agency become a department can only help 
in our ability to implement some of the solutions, to get the 
attention of some that we may need to get in order to work in a 
collaborative way. It is only going to help us in that effort.
    Mr. Otter. Let me ask this in a bit of a different way. 
Part of watershed protection, it seems to me, would be to have 
healthy watersheds.
    Administrator Whitman. Absolutely.
    Mr. Otter. Part of the Clean Water Act would be to have 
healthy watersheds. Healthy watersheds mean healthy forests, at 
least for us out west. Right now, we have overgrown forests, 
forests that are burning up, forests that are in a poor state 
of health to resist themselves from disease and bug 
infestation, all kinds of noxious and invasive weeds that are 
all degrading to the watershed.
    My question goes to a position on the Cabinet, would that 
give you a position perhaps over the objection of say, the ESA, 
where you say we are going in to thin out these forests, have 
prescribed burns, create a healthy watershed so we have a 
healthy water supply?
    Administrator Whitman. Again, right now I enjoy the kind of 
relationship with my colleagues that wouldn't be impacted by 
the elevation. The importance of the elevation is to ensure 
that continues no matter which administration it is. It might 
help in the future. The short answer is no.
    Mr. Otter. Let us stop right here then. Why don't we? If 
you agree with me that healthy watersheds are part of a healthy 
supply and healthy forests, which certainly clean up the air, 
they make their contribution to nature's cycle in cleaning up 
the air, why haven't we focused on resisting this effort to 
keep everybody out of the forests, everybody off the watershed, 
and gone in and thinned the forests, had the prescribed burns, 
created a healthy forest and therefore a healthy watershed?
    Administrator Whitman. Congressman, as you know, the 
decisions on forests, on burns and such policy, rests with both 
the Department of Interior and the Department of Agriculture. 
The watershed initiatives you talk about--in fact, in this 
budget the President has requested an additional $21 million to 
enable us to focus on 20 of the Nation's most threatened 
watersheds and to work on a variety of watershed policies we 
believe could be used to start to draw attention to watersheds. 
The average person hasn't a clue what a watershed is. We need 
to do an enormous education job, work with the States to help 
them identify their watersheds, identify what is happening to 
them, but the actual policy to which you are referring on 
forest management rests with those two other departments.
    Mr. Otter. I am not going to get into a major disagreement 
with you, but it seems it is not out of character and not out 
of the purview of the Environmental Protection Agency to 
regulate the Department of Agriculture on what kinds of 
chemicals it might use on noxious and invasive weeds in order 
to eradicate those. It would seem to me that if the overall 
purpose of a watershed is to create healthy water, it would be 
within the purview of the Environmental Protection Agency to 
order the Department of Agriculture and the Department of 
Interior, like it can on the application of chemicals, to clean 
up the watershed and to manage it so we have a healthy 
environment.
    Administrator Whitman. As we move forward with this new 
watershed initiative, it may turn up something such as that, 
but we are just beginning that process now. That has not been a 
focus of the Agency to date.
    Mr. Otter. I am sure we will come back to this on a second 
round of questions, but Chairman Connaughton, the Council on 
Environmental Quality was created prior to the EPA. The purpose 
of the Council on Environmental Quality was to advise the 
Government, including the President and the Cabinet, on 
questions of the environment. If we were to elevate the 
Administrator to Cabinet level position, do we get rid of the 
Council on Environmental Quality or do we have a collateral 
responsibility, a dual responsibility, for both you and now the 
new elevated Secretary on the Cabinet level?
    Mr. Connaughton. I think the roles would continue. As 
Administrator and member of the Cabinet, Governor Whitman, just 
as the Secretary of Agriculture, the Secretary of the Interior, 
the Secretary of Commerce, reflecting on issues under the 
purview of NOAA, enjoy the direct role as Cabinet members and 
advisors to the President.
    I would expect the Council on Environmental Quality would 
continue its key role as a policy coordinating body and as an 
interagency convening body to deal with the kinds of issues you 
describe, related to forest health and watershed health where 
not only is there a role for the Environmental Protection 
Agency but the Department of Agriculture, the Department of 
Interior, the Department of Defense, and the Army Corps of 
Engineers. They each have something quite substantial to 
contribute to a coordinated national response. That is where 
assuring continued Cabinet status for EPA comes in, because EPA 
can provide the kind of expertise you have described, the 
technical expertise to understand the health of water systems.
    Just to give you an example in addressing the forest health 
issue, primary implementation would occur with the Department 
of Agriculture and the Department of Interior, and then in 
watersheds, we have a huge initiative, up to $47 billion, in 
the farm bill conservation title, a significant portion of 
which we need to tap and harness in an incentive-based way to 
promote stewardship among our farmers and ranchers to help 
clean up some of these watersheds, help preserve some of our 
forest habitat as well, but do it in an incentivized way. That 
is where EPA brings forward the technical expertise, the 
agencies bring the outreach, the implementation, and the 
incentives to achieve our goals.
    Mr. Ose. The gentleman's time is up.
    Mr. Otter. I would argue that the conservation title of the 
Agriculture bill does not speak to the watersheds that I am 
talking about. The managed watersheds is what the conservation 
and that $48 billion is directed to. It is the impact we have 
on the environment, not the impact we refuse to have on the 
environment.
    Mr. Connaughton. I was just using that as an example. 
Certainly there are some affirmative programs specifically 
related to forest health that we are pursuing quite vigorously.
    Mr. Ose. The gentleman from California.
    Mr. Waxman. Administrator Whitman, as you know, I have been 
deeply disappointed by EPA's recent unresponsiveness to 
congressional inquiries and particularly I can't understand why 
you fail to provide information that I have requested. For 
example, 2\1/2\ months ago, the Assistant Administrator for 
Air, Mr. Jeffrey Holmsted, was quoted in the press as saying, 
``EPA rejected its own more stringent proposal for powerplant 
regulation based on information EPA received from the power 
sector and unions.'' In April, I asked you for the information 
referenced by Mr. Holmsted but have received no response. Is 
there any reason Mr. Holmsted can discuss this information with 
the press but EPA cannot provide it to the Congress?
    Administrator Whitman. Congressman, we are doing our best 
to respond to all your requests. As you know, I think you have 
sent a dozen letters in the course of this year and received 
responses to nine of those. We have three outstanding. One of 
those is the one to which you refer.
    We have an open process for reviewing our decisions and 
responding to your requests. We hope to get that request to you 
in very short order, but I will tell you that in order to 
ensure that the answers are complete and thorough, we do spend 
a great deal of time, and to date in response to the requests 
that just you have sent to us, we have spent about 800 hours of 
time to do it, so we don't take this lightly.
    Mr. Waxman. I know you don't take it lightly, but it is 
hard to understand whether it is being taken seriously because 
we had a Subcommittee On Energy and Air Quality of Energy and 
Commerce meeting on May 1. I sent EPA a set of followup 
questions for the hearing record and I understand EPA answered 
followup questions from other subcommittee members but I 
haven't received a response to my questions. The record for 
that hearing has now been closed and EPA never responded to my 
questions, so EPA's lack of timeliness has resulted in an 
incomplete congressional record.
    Do you believe EPA has a responsibility to respond to 
congressional inquiries in a timely manner and is there some 
reason I haven't received a response?
    Administrator Whitman. Congressman, we absolutely do our 
best to provide answers in a timely fashion. I believe that 
letter included a 12 page list of questions on the Clean Air 
Act. As you may know, our decision was only recently made on 
the New Source Review program to which most of that letter 
referred. So we are doing our best to get a comprehensive 
response for you because as you know, when we do send partial 
responses, it is not satisfactory, nor should it be. We take 
this responsibility very seriously.
    Mr. Waxman. When do you expect that I will get these 
replies?
    Administrator Whitman. Again, I would hope we would have it 
very soon.
    Mr. Waxman. Are any of those responses currently undergoing 
White House review?
    Administrator Whitman. I don't know whether any of those 
are. I believe they all rest with the Agency, those three 
letters at this point in time.
    Mr. Waxman. So you don't know if there is White House 
review of those answers?
    Administrator Whitman. I don't know where they are now.
    Mr. Waxman. You don't know that there is any delay because 
the White House is reviewing EPA's response?
    Administrator Whitman. No.
    Mr. Waxman. Do you know that the EPA response is not being 
held up because the White House is reviewing the letters?
    Administrator Whitman. I am saying I don't know exactly 
where in the process of our Agency it is at this point in time, 
but we can get back to you with that as quickly as possible.
    Mr. Waxman. I would like to have that.
    Can you tell us today any changes you will make at EPA to 
ensure that congressional inquiries are answered on a timely 
basis from now on? Can you tell us if you have any 
recommendations for CEQ, whether the White House is speeding 
the review of congressional inquiries?
    Administrator Whitman. Again, we believe we respond as 
quickly as we possibly can, understanding the nature of the 
questions, as I indicated the one letter of yours was about 12 
pages worth of very detailed questions. As you know, most of 
our work is very detailed and scientific, so we try to ensure 
we give you the most accurate answers possible. There are 
numerous documents that you have asked for, and we would have 
to go through and make sure we are in a position to provide 
everything you want. So we do try. As I say, we have 3 
outstanding of the 12 you sent since the beginning of the year. 
I suspect we are not the only agency that has difficulty with 
this.
    Mr. Waxman. I look forward to getting your response on 
those.
    In the very brief time I have left, I want to ask you about 
the diesel engines. In 1998, there was an agreement to settle 
the largest ever Clean Air Act enforcement to make sure the 
diesel engines were going to meet the standards. Now 
Caterpillar is trying to back out of the deal. It wants EPA to 
cut a break on the penalties it will apply.
    If the penalties are too low, it is going to be more 
profitable for them to pay the penalties than comply with the 
law and it will increase the amount of pollution, wouldn't it? 
The other part of it is, if Cummins is doing its job, aren't 
they put at a competitive disadvantage if Caterpillar can just 
pay a low penalty and they have gone ahead and done what they 
should have done, which is comply with the law?
    Administrator Whitman. We are planning to move forward with 
the enhanced penalties. In fact, that is part of the Clean Air 
Act, a requirement that we continue to review penalties and 
there is a formula on how we do it. We have put forward a new 
set of penalties that would be sufficient, we hope, to ensure 
that we get those clean engines quickly, as fast as we need to 
get them.
    There will always be some companies that, for their own 
financial and business decisions, decide they would rather 
produce the old engines and pay the penalties, but we are doing 
everything that we can at this point in time to ensure that we 
have the desired impact on the environment and that we move to 
the cleaner burning engines as quickly as we can.
    Mr. Waxman. Will you commit to finalize the penalty rule 
before October and keep the penalty levels you have proposed?
    Administrator Whitman. We are moving forward with that 
process. We will finalize by October. They are in the process 
now, the new recommendations at the new levels.
    Mr. Waxman. At your proposed levels?
    Administrator Whitman. Yes.
    Mr. Waxman. Thank you.
    Mr. Ose. The gentleman from Utah?
    Mr. Cannon. I would like to apologize to you and to our 
distinguished panel for the fact I was a bit late but we get 
caught up sometimes, and this is an important hearing.
    I would like to thank our panelists. The job you have is 
very difficult, often thankless, and very, very important. It 
is a matter of balancing our quality of life and the prosperity 
of Americans, especially those who are poorest who tend to be 
affected.
    Without lecturing, let me point out in the last recession 
from March to March, we lost about 1.8 million jobs net but of 
those 1.8 million jobs, we had an offset of about 400,000 jobs 
of people who had college degrees or more and those 1.8 million 
jobs that were lost were people who had less than a college 
degree. So the decisions you make have a profound affect, 
especially on the poorest among us.
    Good science seems to me to be the key to solving the 
problem of how we deal with these awful tradeoffs and if we can 
deal with science and agree to context for science instead of 
dogmatic beliefs that somehow creep into our society as 
absolutes, I think we will do much better.
    To followup on Mr. Otter's questions, the mountain behind 
my house has just burned. It would have been national news 
except we had so many other huge fires all over the West. In 
fact, I have a canyon in the mountain to the south that burned 
3 years ago and was national news, the mountain to the north 
burned and hardly got a moment's notice, although I will tell 
you the problem from that to our watershed and the loss of top 
soil and the floods we will have next spring is really 
daunting. I have several neighbors to the south whose houses 
were wiped out by the mud flows subsequent to spring rains.
    It seems to me, Mr. Chairman, that you are in a 
particularly important position to be asked to do something 
aggressive about what I think has been a decade of neglect to 
our forests. Are you doing something actively and aggressively 
to turn this around? This is an area where we have good 
science, we have good understanding. If you look at Utah, we 
have had two or three major forests that have been destroyed by 
pine bark beetles, which could have been saved if we had just 
gone in and eliminated those areas that were affected instead 
of destroying literally a third of all the trees in the State 
of Utah, which is devastating for top soil and for watershed.
    Now that we have this crisis of fires, which I think lends 
itself to terrorism in a serious way, are we doing something 
radical to say we need to cut fire breaks, we need to take each 
forest in the country, and under your direction guiding the 
Forest Service and to some degree the BLM into taking steps 
that will preserve or optimize our environment?
    Mr. Connaughton. The short answer is yes and with 
Congress's support, we need to do more. I had the privilege of 
being in Idaho in Boise City to sign with the Governors--
including Governor Kempthorne, a very good friend of mine and I 
enjoy working with him--to sign the 10-year fire plan, which 
has some key immediate implementation steps that will be taken 
this summer to at least get better control over the devastating 
situation you describe so eloquently.
    Then we have key implementation steps that will be 
occurring as we prepare for next year's fire season and beyond. 
We have to get into these forests. The science has caught up 
with us, we have had decades of mistaken policy, decades, not 
just one decade, but decades of mistaken policy. I think there 
is a much broader consensus that we can sensibly go in and 
produce a healthier forest as a result of some effective 
management actions and we now need to mobilize the resources 
and mobilize the local commitment and we have that now. It is a 
bipartisan local commitment toward more effective management.
    We have some significant work internal to the government, 
the Forest Service, and BLM to preserve the environmental 
reviews that need to occur, but to do it in a more streamlined 
way so we can get these projects moving. We need to reduce the 
litigation holding up some of these projects. We know what we 
need to do, we can do it sensibly environmentally--so we are 
working on all those different levels.
    Mr. Cannon. Tell me please that we are doing something 
radical. Because we have a radical problem, and we also have 
pretty good science, and the President has a great deal of 
power, and you are sort of the key to that power. Are we going 
to do something like cut fire breaks in areas that are 
significant?
    Mr. Connaughton. The answer to that is yes. I would prefer 
the words ``aggressive'' and ``environmentally responsible.''
    Mr. Cannon. I appreciate that but let me tell you, if I 
were a radical Islamic terrorist--I don't think I am giving 
away any secrets here--you could drop little firebombs around 
the western United States and have a huge effect on our 
economy, our livelihood, our water, our water reservoirs, and 
every other aspect of our life. Therefore, I think while you 
may need to speak in terms you have described, some radical 
action is probably justified.
    Thank you.
    Mr. Ose. The gentleman from Ohio?
    Mr. Kucinich. Thank you, Mr. Chairman.
    Administrator Whitman, welcome. Welcome, to the chairman.
    If it was up to me today, I would address you as Secretary. 
I believe the EPA deserves to be Cabinet level status. The 
priorities of environmental protection and public health are 
equally important and if not more important in some 
consideration as energy, commerce, and others, dedicated 
Federal departments.
    Some opponents have criticized efforts to raise the EPA to 
Cabinet level status on the argument that such a move would be 
largely symbolic and wouldn't have any tangible meaning. I 
think the best way to counteract that argument is for the EPA 
to make a claim to Congress and the public that this would not 
be the case. I use that as a prologue to concerns I had when I 
read last Saturday's Washington Post that the EPA will ``no 
longer exercise its duty over Total Maximum Daily Load, a 
significant Clean Water Act antipollution program.'' The Total 
Maximum Daily Load [TMDL] is the post child for a program where 
Federal oversight is essential because the States have refused 
to implement it.
    As you know, I represent Cleveland. A few years ago, you 
and I were with Senator Voinovich touring Cleveland. We know 
years ago when the Cuyahoga River caught on fire, that was part 
of what spurred passage of the Clean Water Act. I represent the 
people of Ohio who petitioned the Federal EPA to help protect 
Ohio's environment when the Ohio EPA failed to do so. Ohio's 
EPA has undergone the deepest and widest evaluation of any 
State EPA ever.
    It is with disappointment that after my constituents have 
experienced such precedent setting levels of pollution and have 
rallied and fought against it, that now the Federal EPA, in my 
opinion, is turning its back on the problem by weakening, by 
reopening the TMDL rules. It will simply result in a lowering 
of standards in order to meet such standards.
    Proposed changes such as planning for entire watersheds 
instead of individual water bodies, in my view, are merely a 
tactic to lower standards to achieve compliance. As the 
proposed changes to TMDL say, ``EPA will not review, approve, 
or back stop,'' State plans to comply with water quality 
standards. It seems EPA is not doing the job it has the duty to 
do, and not doing the job citizens are asking it to do.
    My first question is how would the EPA improve water 
quality by removing itself from an oversight and enforcement 
role?
    Administrator Whitman. I know it will come as a surprise, 
but the article isn't correct. Unfortunately, the newspapers, 
particularly of late--there have been a couple on major issues 
which have been very troubling for the Agency, because they 
simply have been filled with inaccuracy.
    As you know, the Congress put the implementation of the 
TMDL rule on hold during the previous administration. We are 
continuing to work with that. Our object is to see how we best 
implement those TMDL standards, understanding that they are 
enormously burdensome and complicated in that they require 
individual standards to be set for every single type of 
pollutant that is found in the water bodies.
    We are exploring a number of different ways to leverage the 
States' abilities with the Agency's abilities to ensure that we 
reach the result that is the object of the TMDL rule, which is 
cleaner, healthier waters. We are committed to that; we are not 
backing away from it. The article unfortunately made some 
assumptions that were just inaccurate. I know all of you have 
been exposed to that kind of thing from time to time and know 
it can happen.
    It becomes very troublesome, though, when it is talking 
about issues that are of such importance, and this one is of 
critical importance.
    Mr. Kucinich. I think it is important to go over this for 
the record. I have the article from the Washington Post, one of 
their environmental writers. Essentially, it characterizes the 
Administrator's position on this. If the Administrator is 
saying this is not true, then we will take her at her word.
    Another disconcerting example, the EPA recently decided to 
relax the New Source Review program rules. Just as 
environmental advocates feared, EPA's decision has created a 
chilling effect on court cases brought by the Department of 
Justice and EPA to enforce New Source Review. While EPA claims 
the new rule would not weaken ongoing litigation, we have proof 
it has already done so.
    On June 26, U.S. District Court Judge William M. Screteny, 
presiding over a case brought by the New York Attorney General 
for Clean Air violations instructed the Attorney General and 
the utilities to submit new briefs describing how the rule 
change would impact the issues brought by the case, and EPA's 
decision to roll back the Clean Air Act is harmful enough 
without the added impact of crippling governmental efforts to 
enforce the law. If you could answer the question, why does the 
EPA deserve to be a Cabinet level position if it rolls back air 
and water quality standards?
    If we in Congress want to promote the EPA, how can we do 
that if it appears that the EPA is not realizing the authority 
it has now?
    Administrator Whitman. As you may not know, in a hearing 
earlier today, the Justice Department testified to the fact 
that prospective regulations should not impact those cases. In 
fact, Attorney General Spitzer's spokesperson indicated they 
did not feel any prospective action by the Agency would impact 
those cases. We continue to vigorously enforce them.
    The proposals that we have made on New Source Review, there 
are two different sets of proposals. One, there were regulatory 
changes that were first proposed during the Clinton 
administration in 1996 and have been subject to the full and 
open public process. Those really do not impact utilities at 
all.
    Prospective regulations that have not even begun the 
rulemaking process but are contemplating, of those there are 
three and one is the critical one, as far as utilities are 
concerned, routine maintenance repair and replacement. That 
rulemaking process has not begun. It will be subject to the 
full public disclosure and it is responsive to a number of 
concerns that have been raised about ensuring that New Source 
Review is as effective and efficient as possible.
    The real answer here, we all believe, whatever happens with 
New Source Review, that we enact the President's Clear Skies 
Initiatives, which include a very rigorous reduction in the 
emissions of SO2 nitrogen oxide and mercury by 70 
percent over the next 10 years--make it clear, make it 
mandatory, provide the flexibility for utilities to achieve 
those standards within what makes sense for them economically, 
work with the acid rain program, and work extremely 
effectively.
    We are continuing to ensure that we enhance the quality of 
our air. I would say to your last point that the elevation of 
the Environmental Protection Agency to department status should 
really be a reflection of the importance this country puts on 
the environment and not a reward, or not withheld as a 
punishment or given as a reward for particular behavior. This 
is broader than that. It is about where do we place the 
environment in our scope of government and how important it is.
    As you indicated at the beginning, environment is something 
that is of enormous importance to the health and well being of 
this Nation. That is how the elevation ought to be looked at. 
It is not a reward for this administration or a previous 
administration. It is about how we value the environment.
    Mr. Kucinich. Thank you.
    Mr. Ose. We will have a second round if the members so 
choose.
    Chairman Connaughton, in terms of the Agency being 
elevated, should Congress statutorily require the Agency 
measure the environment to ensure that the policies and 
regulations are achieving those goals that are otherwise laid 
out? The question is a bit broader than it may appear, in that 
it is my understanding that the collection of information at 
the agency, because of the scope of the problem, leaves 
something to be improved. Would you care to comment on that?
    Mr. Connaughton. I would first agree with you that data 
collection information and tying measures of performance and 
outcome to the specific actions and different things, 
regulatory programs, incentive programs, State oversight, is a 
very, very critical and near term, pressing priority. Certainly 
that has been recognized by the National Academy of Public 
Administration, some thoughtful analysis by the EPA Inspector 
General, and recognized first and foremost by Governor Whitman 
when she took the helm of the Agency.
    Whether there is a specific legislative mandate is 
something I think we should discuss. I have seen lots of 
different proposals for that and at this time wouldn't be able 
to commit to one or another of those. Certainly the Bush 
administration supports linking programs to results. The best 
way to achieve that is something we would like to talk to you 
about.
    Mr. Ose. Administrator Whitman, do you have any 
observations you might wish to share with us regarding 
collection of the information together with its correlation to 
programs and results?
    Administrator Whitman. We are instituting a results 
oriented policy. That is how we are approaching our mission, 
that is how we are approaching the various programs we 
undertake, and any new regulatory process. We are strengthening 
our accountability based on performance information, and we are 
enhancing our performance information by elevating science at 
the Agency and ensuring that is at the very beginning of any 
kind of regulatory process, improving management decisionmaking 
based on information on the best way of doing business to 
accomplish our goals.
    As I have said repeatedly, the measure of environmental 
success should not be on the amount of penalties we collect in 
a year or the number of enforcement actions we bring. It should 
be on is the air clean, the water pure, the land better 
protected. That is the measurement of whether or not we are 
doing our job. We are moving now to institutionalize that kind 
of results oriented policy.
    One of the gaps--I will say there is a gap--is the quality 
of the State level data. We cannot collect all the data. It is 
virtually impossible to do it all ourselves. What we are doing 
now is working closely with the States and tribes as partners 
to try to develop better ways to get data, to see how we 
leverage the dollars we give to make sure that we have some 
national standards on data, and we make it easier for them to 
collect and provide us with that kind of data, and we are not 
overburdening them, because it is a huge burden to collect the 
information required to make good decisions. That is something 
we have focused on a great deal and will continue to as we move 
forward.
    Mr. Ose. How big an obstacle is the collection of data and 
its correlation to the results?
    Administrator Whitman. Actually, the collection is the 
bigger challenge. Once you have the data, the correlation to 
results is pretty easy to do. Even the TMDL, as we have been 
talking earlier--Oklahoma is one State that has spent a lot of 
focus and time on the collection of data. They have been able 
to implement TMDLs without a great deal of effort and long 
maintained that data collection and good data has to be the 
basis for moving forward. Wherever we find those challenges, 
that is where we will be directing our resources to try to help 
the States do a better job of that and understand the 
importance of good data collection and making their overall job 
easier.
    Mr. Ose. The reason I focused on data collection versus the 
empirical metrics that Chairman Connaughton mentions is at the 
end of my tenure here, I want to know that the environment is 
better than when I got here. How do we help either the Council 
or EPA find a way to measure these outcomes? I understand the 
stovepipe approach with the Clean Water Act, Clean Air Act, and 
what have you. Tell me how we in Congress can help you do that, 
to get to the information collection that leads to better 
results, less environmental damage?
    Administrator Whitman. As you will see, we have requested 
in this budget proposal some additional dollars for science. 
That is going to be very helpful to us. We are trying to 
breakdown those stovepipes. That is something I believe has 
been an obstacle to our doing good planning for the 
environment. No one told Mother Nature that what is in the air 
can't come down on the water or the land, or what is in the 
water can't migrate into the land and vice versa.
    We need to do a better job in the way we collect and manage 
environmental information and move away from that historic 
media specific approach into a wider, broader, more enterprise-
wide management system. That is what we are in the process of 
doing. The dollars and the emphasis that we have put on 
enhanced science are going to help us with that and on 
information technology. We have put some additional dollars and 
will be requesting additional dollars in this budget on our 
information technology so that we can enhance that and do a 
better job in the way we collect that data and make it easier 
to share it and understand it.
    Mr. Ose. Chairman Connaughton.
    Mr. Connaughton. I would amplify on that from the 
perspective at a macro level: is the air cleaner, is the water 
cleaner? We can collect that information, the broad 
information, but we are missing this link, and the data flows 
and the science Governor Whitman talked about is critical, is 
the link to performance-based budgeting.
    I think the Congress is critical, the House in particular, 
in supporting the President's management agenda approach that 
is actually trying to link these core indicators of 
environmental quality and health with the most effective 
programs so that we can begin to create a good old-fashioned, 
good Government competition for budget dollars, tied to the 
most effective programs.
    Certainly we would want to see Congress support something 
like the Clear Skies Initiative that would result in no 
litigation and the most cost effective way of getting air 
pollution reductions. It is finding the data that allows you to 
link the program with the outcome that is critical, so you can 
compare a command and control program to a market-based program 
to an incentive-based program and say which is delivering more 
environmental protection for the taxpayer dollar? Congress 
getting behind that and actually giving us oversight, the 
importance of oversight with a performance oriented budget 
approach is really where I think we can advance this next 
generation of more effective environmental management.
    Mr. Ose. I do want to tell you we are interested in you 
doing all the oversight you want. We are not going to give up 
our oversight, so we welcome you to that party.
    The gentleman from Utah?
    Mr. Cannon. You have raised the bar for what is thoughtful 
responses and I appreciate it. I have been an admirer from afar 
and it is nice to see you actually dealing with these issues 
and both of you have done so eloquently and well.
    Ms. Whitman, you talked earlier about a report card and 
answered a number of questions by the chairman. Are you 
developing a report card that will have transparent data behind 
it so people can understand where we are going? Is that the 
same concept you are dealing with here?
    Administrator Whitman. That is the whole point of it, to 
make it something the public can understand, something we would 
release on an annual basis. The importance here, and where we 
could use congressional support when we do come out with that 
report card, is an understanding that we are not going to meet 
our goals every year and we are not always going to be able to 
show the kind of advance we would like to see.
    That doesn't mean we are not progressing. It doesn't mean 
we should give up what we are trying. We should just improve 
it. We shouldn't be afraid of self criticism but we are going 
to make it very public, a transparent process, and ensure the 
public can understand what we are saying.
    Mr. Cannon. Among other things, we have made vast progress, 
not because of Federal rules and the administration, but 
because science has done some remarkable things for us that 
cannot be predicted, controlled, or managed. If we have goals, 
that will help direct resources, so I congratulate you on that 
and look forward to following how that works.
    Let me talk about the role of the States. When EPA started, 
you had no State involvement. Now you have States with 
significant State law and in many cases, delegation of Federal 
authority to oversee laws. What do you see the role of the 
States being? I realize you are going to have to work with 
States and develop data, but how do you see the role of States 
evolving after you have developed the kind of transparency you 
are talking about of goals and information behind goals? Can 
they pick up more of the slack? Can we delegate more and more 
and the Federal Government become a more distant guide and let 
the States take more responsibility?
    Administrator Whitman. I share the President's perspective 
that not all wisdom resides in Washington. Having come as a 
Governor, I also appreciate the work and innovation that is 
occurring at the State level.
    We need to be able to provide the States the flexibility to 
meet the generally agreed upon standards that are protective of 
human health and the environment, standards we will work on in 
a transparent way based on sound science, but we will work with 
the States to allow them some flexibility in the implementation 
without backing away from our responsibility to ensure we are 
in fact protective.
    We have a very good relationship with the States now. Some 
of our most effective programs are State partnership programs. 
We are looking for ways to expand those. The area of 
enforcement, which I know is of great interest to many members 
on the Hill, States do 90 percent of the enforcement now; they 
do 95 percent of the inspections. We are trying to see how we 
can help them do that better.
    States right now are facing severe budget cuts and 
concerns. We need to be sensitive to that. We need to see where 
we can in fact help them do that job, understanding the 
stresses they find themselves in at the moment.
    At all times, we are working with States and tribes as our 
full partners. We intend to continue that effort and look for 
other ways we can do that while being protective of the 
environment and human health.
    Mr. Cannon. I agree with that. I tell my constituents the 
average IQ in Washington is still only 100 and while we have 
more power and maybe some more general view which is helpful to 
us, I agree with you about States and their ideas.
    It is nice for me to see this administration with people 
who are articulate spokesmen. There is nothing we have to fear 
from science, and from peer review, and from the kind of 
processes that get people involved and are transparent. It is 
the other side who are dogmatic and religious in their beliefs, 
who plant links where they shouldn't be because they want that 
to be protected. That is where the problem existed.
    If I could encourage good science, peer review, 
transparency, I think America will make great leaps forward, 
and I encourage you in that activity.
    I yield back.
    Mr. Ose. I have two more questions and we will wrap up this 
panel, because I know you both have busier days than I could 
ever imagine.
    Mr. Chairman, would an Office of Science that integrates 
and coordinates all the science at EPA be helpful? First, is 
the science collection and corroboration a fractured effort in 
your opinion, at EPA? Could it stand improvement?
    Mr. Connaughton. I will answer that in the affirmative. It 
can be improved and we are working to improve it throughout the 
government, the role of science, bringing it forward in the 
line Congressman Cannon suggested.
    I would note EPA has taken the critical step of actually 
creating a science advisor post which I think was a very, very 
strong move. It also brings somebody with responsibility to 
look at science across the Agency, and also provides a key 
person to participate interagency in many of the processes that 
I am involved in and also spearheaded by the Office of Science 
and Technology Policy. So the role of a strong individual or 
group overlooking the science as well as the economics at the 
Agency is very important and consistent with where we want to 
take things, whether it is the Department of Interior or EPA.
    Exactly how that would be structured, again, remains 
something we should discuss and I think with Governor Whitman's 
experience now and as she looks at the future, we would want to 
defer to the leader of the Agency to see how it is structured. 
Each Agency, the Department of Energy deals with it differently 
than the Department of Interior, than does NOAA. Each have 
structured science oversight in different ways. Before we pick 
one, I think we should look at those models to see how they 
were developed and how they were tailored and the particular 
organizational needs of the institution. A strong central 
scientific role is important.
    Mr. Ose. Do you share that view?
    Administrator Whitman. I certainly share the view. We can 
do a better job, and we have been focusing on enhancing the 
role of science in the decisionmaking at the Agency. My concern 
with establishing a Deputy Administrator for Science or a 
specific other position such as that is that science should be 
incorporated throughout the Agency. It should be part of every 
one of the Assistant Administrators job. I don't want anyone 
thinking the Deputy Administrator for Science will take care of 
that. It should be integral and form the basis for all of the 
work we do. That is why I have established the office and role 
of science advisor as someone who can take a more comprehensive 
look but is not seen as being the science person. But in fact 
we are continuing to integrate science in all the decisions we 
make.
    We have enhanced the use of external peer review as we move 
forward with regulations. I think that is an important part to 
corroborate the science we have used. We are doing everything 
to ensure the level of our science is at the top of the range, 
the best we can come up with. And we have some fine scientists.
    We have an innovation strategy that we are in the process 
of developing that will look for other ways to ensure that 
science is integrated into the entire and throughout the entire 
agency. So my only concern about isolating science to one 
particular part of the Agency is that I don't want any kind of 
isolation, I don't want any misunderstanding that there is one 
person that talks science. That should be part of every single 
one of the program areas. They have to have good science and 
good reliance on science.
    We are now doing it through the science advisor and also 
through the innovation strategy that is a place where every 
regulation will go and get looked at to see whether it needs 
science, more science at the beginning than not. So we are 
trying to integrate that but are willing to talk and work with 
the Congress on how best to ensure that continues to happen.
    Mr. Ose. I have nothing else. Mr. Cannon.
    Mr. Cannon. I have nothing else but one comment. We have a 
huge number of people in the private sector who thought a lot 
about these things. I hope you would consider integrating them 
either through contracting or your peer review process or other 
means into the system because good ideas can catch on very 
quickly and move mountains.
    Mr. Ose. We will leave this record open for 10 days. Given 
the time constraints, we will dismiss this panel. We do have 
some questions we did not get to that we will submit in writing 
and we ask for a timely response. We are grateful for you.
    Administrator Whitman. We will get you a timely response.
    Mr. Ose. Governor, you have always been responsive, so I do 
appreciate it.
    Again, the record will be open for 10 days, we will get you 
the questions. We appreciate your taking the time to come down 
and visit with us. We look forward to the next time. Thank you 
both.
    We will take a 5-minute recess.
    [Recess.]
    Mr. Ose. We will reconvene this hearing.
    We welcome our guests for this panel. As you saw in the 
previous panel, we swear in all our witnesses. Our witnesses in 
the second panel will be the president of the Environmental Law 
Institute, J. William Futrell; vice president for Environment 
and Regulatory Affairs, U.S. Chamber of Commerce, William 
Kovacs; and a senior fellow for environmental economics, 
Natural Resources Defense Council, Wesley Warren. Gentlemen, if 
you would rise.
    [Witnesses sworn.]
    Mr. Ose. Let the record show the witnesses answered in the 
affirmative.
    It would appear we have a vote scheduled here. We will 
proceed, Mr. Futrell, with your testimony. We do have your 
statement in writing. I read it and it is comprehensive and 
universal. I do appreciate if you could summarize in 5 minutes.

STATEMENTS OF J. WILLIAM FUTRELL, PRESIDENT, ENVIRONMENTAL LAW 
  INSTITUTE; WILLIAM KOVACS, VICE PRESIDENT, ENVIRONMENT AND 
   REGULATORY AFFAIRS, U.S. CHAMBER OF COMMERCE; AND WESLEY 
  WARREN, SENIOR FELLOW FOR ENVIRONMENTAL ECONOMICS, NATURAL 
                   RESOURCES DEFENSE COUNCIL

    Mr. Futrell. Thank you for the opportunity to join this 
dialog on elevation of EPA to Cabinet status. We have two 
members of the House on our board of directors, Congressman Tom 
Udall of New Mexico and Sherry Boehlert of New York. Therefore, 
reviewing the testimony of the earlier hearings, I was 
interested to read Sherry's judgment which I join in saying 
keep it simple and a clean a bill to elevate EPA to Cabinet 
status.
    The invitation to the hearing asked me to comment about 
what next after Cabinet elevation. I was fascinated to read the 
comments by the other stakeholders in the hearing.
    Mr. Ose. Mr. Futrell, I need to interrupt for a minute. I 
am advised I have three votes which is likely to be a 40 minute 
exercise. We can get each of your statements on records in 
abbreviated form and leave the record open for 10 days, or when 
the point comes where I have to bolt for the floor, we can be 
in recess, I can come back and we can be here a bit longer.
    Mr. Futrell. Whatever your wishes are, Mr. Chairman.
    Mr. Ose. I do not like to treat my witnesses this way. I 
feel as if I am being rude, but I do think in the interest of 
time, yours and mine, it might be best to get your statements 
in the record in an abbreviated form for each of you and let me 
leave here when there are about 2 minutes left. We will adjourn 
the hearing and send the questions in writing to each of you. 
Is that agreeable?
    Mr. Futrell. Sure.
    Mr. Ose. You have 2 minutes.
    Mr. Futrell. I read the statements and many of the 
recommendations you are hearing from the National Academy of 
Public Administration, from Terry Davis, Unified Act, are 
prescriptions which will not cure the problem. My friend Bill 
Kovacs is going to have the same sort of difficulties for his 
companies as he has now because in our system of laws, we have 
a checkerboard of black squares and red squares. If you are on 
a black square, you are regulated beyond belief. That is Mr. 
Kovacs' company, the Dupont Corp., General Electric. If you are 
on the red square, you get away with environmental murder. That 
is the American mining industry. The American mining industry 
causes more damage to the waters of the United States than all 
of manufacturing industry combined.
    The focus in our environmental statutes is on the middle 
process of turning raw materials into products. First, we cut 
down the tree, that is resource extraction. Then it is 
processed, that is manufacturing. Then it is thrown away and 
used. That is resource recovery.
    The Congress' environmental statutes are focused on 
resource processing. If we were to rethink our laws and return 
to what I call sustainable development law, you would be able 
to ease much of the tension on the manufacturing sector. That 
really means taking on the agricultural sector, the mining 
sector, and others, and Congress has avoided that.
    I note with approval your call, Mr. Chairman, for going to 
pollution reduction credits for trading. ELI believes in 
trading. The Clean Skies Initiative, Jim Connaughton's press 
release on that quotes the ELI research work. Here is our book, 
``The Clean Water Act TMDL Program.'' Unless you have a strong 
TMDL program, you cannot have a water trading permit system.
    It is a real challenge. Congratulations on these hearings. 
I think my statement hangs together in written form.
    [The prepared statement of Mr. Futrell follows:]
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    Mr. Ose. Thank you for your brevity.
    Mr. Kovacs.
    Mr. Kovacs. We have been discussing how to better organize 
EPA for 30 years. Since the beginning, there has been a 
fundamental shift and that shift is that 90 percent of all 
enforcement and management activities are by the States. 
Business has spent $2 trillion on environmental protection over 
the last 30 years. It now spends $200 billion annually on 
environmental protection.
    We expect EPA to do the impossible, we expect it to have a 
vast knowledge of law, science, technology, computer modeling, 
the acquisition, development, and analysis of data, federalism 
and the relationship of all these moving parts, and yet we 
straightjacket them into a budget which says it must spend on a 
specific program.
    For example, EPA spends 64 percent of the budget on waste 
management and water and 6 percent of the budget on science and 
data information. The Chamber has some challenging 
recommendations in our testimony. One is EPA needs overarching 
statutory language, if it is going to be elevated, that allows 
it to move forward in a flexible system to do performance based 
standards and to remove the command and controls structure so 
it can address problems in a timely manner.
    Second, we believe there can't be any second guessing of 
States. When the EPA authorizes the States to take over a 
program, they are doing 90 percent of it now anyway, EPA 
shouldn't be able to second guess it. If it doesn't like what 
the States are doing, EPA ought to remove the program 
authority.
    EPA needs to be more focused on standard setting and 
technical assistance and it needs to expend more of its money 
in the realm of science. In particular, I refer you to a 1990 
EPA report, ``Reducing Risk,'' where the agency admits there is 
little correlation between relevant risk and their budget 
priorities. This is a key.
    We need to address sound science and data quality. We now 
have the ``Data Quality Act.'' We can't have good science, we 
can't have environmental protection unless you spend the money 
to get the good science. Without spending the money on data 
quality and science, we are not going to be able to reach the 
goal of flexibility within the program as well as the ability 
to address priority risks. It is a partnership between 
business, the States and the Federal Government. We all need to 
understand our roles and there are ways in which EPA can be 
efficient, give the goals to the States, set the sound science, 
while recognizing that business will continue to spend the 
money to implement environmental programs.
    [The prepared statement of Mr. Kovacs follows:]
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    Mr. Ose. Thank you, Mr. Kovacs.
    Mr. Warren.
    Mr. Warren. The Natural Resources Defense Council supports 
elevation of EPA to a Cabinet level agency. We think it will 
improve attention and priority of the environment within the 
Federal Government, but we do not support it so strongly that 
we would accept substantive changes to their ability to protect 
the environment as part of that legislation. Therefore, we ask 
you to pass a clean bill, free of such extraneous provisions.
    We have endorsed H.R. 2438, Congressman Boehlert's bill, 
but accordingly, we have opposed H.R. 2694, Congressman Horn's 
bill. We believe that it would be a mistake to hold this 
elevation of EPA hostage to addressing other issues, other than 
the elevation. In fact, just those kinds of controversies 
killed this legislation in 1994, which was the last serious 
time it was moving through the House of Representatives. We 
would not like to see that happen again.
    I know the subcommittee has considered many so-called 
second generation proposals as part of its consideration of 
EPA's elevation bill and I have to assure you that they are 
quite controversial. In some cases, they would amount to a 
legislative wipeout of the underlying statute. The fact of the 
matter is the underlying statutes for the most part work quite 
well. They have brought us a generation of environmental 
improvement. As Congress takes them up one by one, we can 
suggest ways they can be improved further but to add them to 
this bill would be a very grave mistake.
    The two most important things that should be done to 
improve environmental protection in this country is to use the 
current statutes better, more enforcement of the laws on the 
books and more funding for the provisions that exist in those 
statutes would make great progress in this area.
    The budget this year for EPA would actually cut enforcement 
by 200 enforcement personnel or about 13 percent, and cut water 
quality investments by over $500 million. Many proposals in 
Congressman Horn's bill we consider controversial but two I 
would point out specifically, Section 120, which would have 
burdensome cost benefit and risk assessment requirements which 
would almost certainly lead to litigation and could be 
construed by some as a super mandate which would be laid on top 
of all existing environmental decisional criteria and some of 
the information provisions which would consist of extensive 
micromanagement of how the Agency does that work including a 
Bureau of Environmental Statistics which could conflict with 
and be duplicative of other parts of the Agency.
    Finally, if it does become a legislative free for all, as 
the EPA Cabinet bill moves through the process, we would come 
forward with proposals we think would substantially improve 
environmental protection. The details are in our testimony.
    They include improving sound science at the Agency by 
eliminating dependence, overdependence, on industry data and 
making sure peer review is free of conflicts of interest; 
second, reform, how regulatory impact analyses and cost-benefit 
work is done at the Agency so that costs are not overstated and 
benefits undervalued; third, improve the way in which 
children's health is protected in this country across the board 
in all environmental statutes; fourth, improve transparency in 
terms of how the agency makes its decisions, especially since 
OMB seems increasingly involved in early decisionmaking at the 
Agency; fifth, ban reliance on human testing data that comes 
from the industry, and finally, make sure industry discloses 
data it has in its possession that shows adverse environmental 
impacts.
    We would only recommend these if the legislation is thrown 
wide open and we strongly urge the subcommittee to move EPA 
Cabinet legislation free of such extraneous provisions that 
might undermine its ability to protect the environment.
    [The prepared statement of Mr. Warren follows:]
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    Mr. Ose. Gentlemen, I do thank you for your brevity. I 
apologize for the circumstances we find ourselves in. I feel 
badly. You came down, testified, and it will not go unnoted.
    We will leave the record open for 10 days. We will send you 
the questions we otherwise would have posed in person to you, 
and hope for a timely response.
    Again, thank you for taking time to come. This hearing is 
adjourned.
    [Whereupon, at 4:40 p.m., the subcommittee was adjourned, 
to reconvene at the call of the Chair.]
    [The prepared statement of Hon. John Sullivan and 
additional information submitted for the hearing record 
follow:]
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